Colliers International’s India office property market overview April 2015. Among all the major markets, Bengaluru office market remains in the “sweet spot” in terms of supply-and-demand fundamentals. About 2 million sq ft of office space is expected to witness completion next quarter, out of which about 0.2 million sq ft is already committed. This steady increase in development activity and greater domestic and foreign investor interest in office market should result in additional occupancy and rent growth. Apart from this in Gurgaon many RFPs are floating and I anticipate an increase in office absorption in the near future. The Institutional sectors like Sector 32 and 44 will continue to remain preferred office locations due to location advantages and competitive rentals.
Also micro-markets such as NH-8, DLF Cyber City, Golf Course Road and Sohna Road has witnessed 5 – 10% appreciation in rental values due to high occupancy rates in properties in these micro-markets, and the fact that these are currently the preferred locations of occupiers. Absorption has increased, especially in Special Economic Zones, as a number of large format deals have been concluded in trailing 12 months and many are in the pipe line and expected to be concluded in the coming quarters” says Vikas Kalia, National Director, Office Services.
In response to tenant demand, the strongest markets (namely Bengaluru and Gurgaon) will witness development of new stock. According to the report finding expanding economy, improving businesssentiment and increasing job creations will keep the momentum in demand for office real estate.