More and more employees are returning to the workplace, this is good news for the real estate sector
heyffice are preparing to return their employees living in the space to the workplace, and a large proportion of transactions in the sector in Q3 2021, according to the quarterly newsletter – The Connect Q3 2021 – are up for renovations by commercial real estate services firm was held responsible. Westian.
Analyzing the performance of the office market in seven major cities of the country, namely Bengaluru, Mumbai, Hyderabad, Chennai, Kolkata, NCR and Pune, and showing the market trends along with the future outlook for the industry, it said Bengaluru continued to move forward. With a share of 24% of total absorption during Q3 2021. Hyderabad regained its position as one of the leading contenders for IT/ITES office demand, capturing the second position.
“The fact that companies are planning a steady return of employees will also increase the demand for office space in key markets of the country,” says Vestion CEO-APAC Srinivasa Rao.
The preferred IT/ITES destination of the country, Bengaluru maintained its dominant position in the major office markets.
* Total office space absorption in Bengaluru was recorded at 2.5 million sq ft in Q3 2021, showing a growth of 39% as compared to absorption in Q2 2021. Second wave of the pandemic.
* Transaction activity showed a significant 67% improvement in the amount of office space leased over the same period in 2020.
* Office markets with ORR accounted for the majority of transactions during Q3 2021, recording their share of over 60% of total absorption.
* On the other hand, unlike the previous quarter, new completions saw a decline of around 67%, with many projects awaiting completion certificates. However, substantial fresh supply is expected to start in the coming quarter, which bodes well for the market.
* The weighted average rent value of Grade A properties has remained fairly stable in the Bengaluru office market, registering a modest 1% YoY growth.
south city report card
* Southern cities Bengaluru, Hyderabad and Chennai accounted for 58% of the total office space absorption in Q3 2021, while their share in new completions was recorded at 45%.
* These cities offer quality supplies along with a strong talent pool within the right rental budget for the IT/ITES and other ancillary service sectors to flourish.
* Apart from strong demand, availability of large land parcels, improved infrastructure and attractive building bye-laws have prompted developers to focus on commercial office projects.
* The strategy of reputed developers to strengthen their commercial real estate portfolio in these southern cities has resulted in creation of a conducive and well-built ecosystem, thereby increasing the share of southern markets in the pan-India landscape.
* In the coming months, Southern office markets will continue to dominate, given the envisaged demand.
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