Global property consultants like DTZ, JLL, Cushman & Wakefield, CBRE, etc. are coming up with contrasting reports regarding the office space demand.
Office space demand rises or falls, experts vary.
BANGALORE: A recent report of CB Richard Ellis, a US based property consultant, stated that the office space absorption in India rose by 37%. The rise is on a year-to year basis. In the opinion of CBRE, January 2013 witnessed higher demand.
Meanwhile another American property consultant stated that the office space demand is down by 37%. This report of Cushman & Wakefield was absolutely on the opposite of what the CBRE report.
The reports of Jones Lang Lasalle and DTZ India are also not complementing each other. While JLL speaks of a moderate demand, DTZ speaks of a fall in the demand.
As per the report of JLL, office space demand is more or same. Compared to the first quarter of 2012 the demand is moderate this year. The report of JLL stated that in most of the cities the demand for office space remained moderate.
As per DTZ India the office space absorption is down by 20%. Anshul Jain, CEO at DTZ India, said that only 4.8 million of office space was absorbed this year. This is 20% lower than the 6 million sq. ft. absorption of 2012. Continue reading →
Oracle India Pvt Ltd will lease large office space in the Bandra Kurla Complex. The IT majorhas already signed the agreement.
Oracle India will lease office space in BKC.
MUMBAI: Oracle has signed a lease agreement for its Indian arm Oracle India Pvt Ltd. The IT major has leased large sized office space in the Bandra Kurla Complex in Mumbai. The group will lease 50,000 sq. ft. of office space.
Oracle India will have to pay Rs.340 per sq. ft. for gaining office in the BKC which is one of the most costly office spaces across India and Asia Pacific Region. The lease agreement will be for a term of nine years.
One floor will be fully leased by Oracle India. The transaction worth Rs.183.6 Cr is the largest lease transaction in FIFC. First International Financial Centre (FIFC) is a Grade-A commercial development in BKC.
Global real estate advisor DTZ reported that this year the demand for office space is likely to increase. Office space demand will be more this year, the report added.
Office space demand to grow this year.
As per the reports of DTZ, nearly 30.5 million sq. ft. of office space will be demanded this year. Comparing to the last year’s office space demand, this year it will be more and far better.
Global economy has started picking up after the downturn. This will boost the office space absorption this year. Additionally other factors such as increase of foreign direct investment (FDI) in the retail sector also will have impact on office space demand of the current year.
Along with the 51% of FDI, the revised repo rates of Reserve Bank of India (RBI) too will boost the demand for office space. The market sentiment has resulted and the economy looks stronger now.
Anshul Jain, DTZ India CEO, said that the fears over the global financial crisis have started fading, resulting in improved market sentiment. Continue reading →
Jones Lang LaSalle India has reported that office space absorption will grow by 68% this year.
Office space absorption in suburbs grows.
Jones Lang LaSalle’s recent survey has reported that in the suburbs the office space absorption will be more this year. The growth of absorption is expected to be by 68%.
In 2012, the office space absorption grew by 60%. This rate is expected to be outperformed. The JLL survey has stated that the companies which plan of expansion will be more concentrating on the suburbs. This will boost office space absorption in the suburbs.
The existing commercial centers are losing its prominence. This will be more visible in the coming five years during which the companies will expand to the suburbs. The expansion is believed to take place within next four to five years.
The survey stated that suburban locations will determine the performance of office market. The companies aim to reduce their cost by shifting to suburban locations. Moreover they will be able to enjoy better facilities and amenities in these areas, however at lower costs. Continue reading →
Data provided by DTZ and Cushman & Wakefield show that there has been a steady decline in the rate of office space absorption by IT firms. This has affected the commercial realty, the report added.
Lowered IT demand affects commercial realty sector.
Commercial realty sector is hit by lowered office space absorption by IT companies. Tracking the office space absorption in top eight cities of India, property consultants C&W and DTZ have reported that the rate of office space absorption has been falling in top cities of India.
Last year, 29.05 million sq. ft. of office space was absorbed. This figure shows a 23% decline in the rate of office space absorption compared to the previous year.
The contribution of the IT sector was a mere 44% last year. On the other hand the information technology sector had contributed over 64% of total office space absorption. This slowdown of IT segment affects commercial realty sector adversely. Continue reading →
The demand for office space will be driven by the foreign retailers who now plan to expand their stores in India.
The expansion plan of the foreign retailers like Starbucks, will boost the demand for office space in India.
Office space will be more demanded in the major cities where the foreign retailers plan to expand their offices. According to the market intelligence report there are many foreign retailers who will drive the demand for office space with their expansion policies.
Gron Stockholm, Hamleys, Hennes and Mauritz (H&M), Lacoste and Starbucks are a few among the many foreign retailers who set to expand and establish their business empire in India.
Compared to 2011, the office space absorption has fallen in Bangalore. Experts opine that the situation was the result of weaker demand from the IT and ITeS sectors.
Office space absorption in Bangalore fell due to the lower demand from IT and ITeS sectors.
Real estate experts said that the office space absorption in Bangalore has been dropped as the IT (Information Technology) and ITeS (IT enabled Services) did not raise much demand. The reports show that the office space absorption has dropped by 24% last year.
Cushman & Wakefield, a global real estate consultancy, reported that in 2012 nearly 7.3 million sq. ft. of office space was absorbed. This rate of absorption is very lower to the 9.59 million sq. ft. of 2011. If the IT and ITeS sectors had shared nearly three fourth of the total supply in 2011, in 2012 their absorption is just above two fourth of total supply. Continue reading →
Real estate witnesses stable office space demand in Pune. Most of the city- areas remained stable while some other areas showed slight rise in office space demand.
Stable office space demand.
Demand for office space remains almost stable in Pune, reports real estate experts of India. Comparatively larger share of office space is demanded by IT and ITES, (information technology and other information technology enabled services ), the real estate experts added further.
Demand for space in commercial real estate sector is reviving after the earlier setbacks in the primary quarters of the year 2012. Seven prominent commercial hubs of India showed a greater pace of growth in the third quarter of 2012. The third quarter which longs from July-to-September quarter, witnessed an A-Grade office space absorption by the major commercial real estate hubs on India. Continue reading →
Commercial Sector Booms with Service Sector Growth
Growing service sector of India drive the demand for commercial real estate. Real estate research firms reported that Service sector of India showed a greater pace of growth rate of 8.5%. This will result in the increased demand for more commercial real estate space. In 2011 service sector occupied 70 % of office space and this is likely to be increased this year. Continue reading →