In India’s top 6 cities, office vacancy rates substantially decline, signaling a strong rebound for commercial real estate.
Based on the report, the Colliers research states that total leasable space has climbed to 50.3 million square feet this year, and occupancy has maintained strong during the subsequent quarters of 2022. However, due to renters’ cautious behavior during the global crisis, market activity was poor in the fourth quarter of 2022. Because of this, gross absorption in Q4 2022 was around 21% lower than it was in Q4 2022, which was lower than the average seen in Q1 and Q3 2022. ” After a two-year pause, it is reassuring to see the office space market recovering this year and declining vacancy rates. It’s interesting to note that BFSI’s business has expanded quickly this year as a result of Indian banks and international financial institutions occupying sizable office spaces.
In Mumbai, BFSI recorded 40%, the highest lease rate when financial institutions started operations, according to Ramesh Nair, CEO & Managing Director of Development India of the Asian market, Colliers. “BFSI’s leasing has virtually doubled over the year,” he adds. Similar Articles With 10.6 million square feet of flexible office space, Bengal leads APAC, according to a report. Offices Transform Space Strategies for Hybrid Work and Portfolios: READ THE REPORT NOW. Rents in Different Industries Flex space operators leased 7 million square feet of space in 2022, the most in years, for around 14% of the total rent, according to the report data. Due to rising demand from big businesses, flexible operators have started renting class-A offices since last year. Similarly, BFSI increased its office space occupied by -14%, consulting businesses by 14%, and engineering firms by 10%.
Since last year, rents in these three industries have risen and now even outpace pre-pandemic levels. With more than 50% of the yearly demand for flex space, Bengaluru and Pune continue to be preferred destinations for flex space providers. The top six cities’ gross sales totaled 50.3 million square feet. Hyderabad recorded a 10% year-over-year growth to 6.5 million square feet while Bengaluru reported 16.2 million square feet. As businesses adopt a cautious approach going forward, Peush Jain, Managing Director, Office Services, ColliersIndia, stated that now is the moment to focus on growing gradually and flexibly with a comprehensive view of ESG.
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