Hyderabad tops office space leasing among Indian cities

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MUMBAI: The Covid19 crisis and the following national lockdown in phases across all major cities have impacted the commercial real estate gross leasing activity adversely in the quarter ended June.

Net absorption of commercial real estate across top 8 cities declined over 73% from a year ago and 49.5% on-quarter to 3.72 million sq ft during the quarter as fresh transaction activity remained muted, showed data from Cushman & Wakefield.

 

 

 

Hyderabad, Mumbai and Chennai have contributed significantly towards net absorption with share of 47%, 44% and 14% respectively, mainly due to projects with significant pre-commitments becoming operational during the quarter which resulted in improved overall net absorption.

Cities like Delhi-NCR and Bengaluru have seen negative absorption pushing the overall net absorption downwards.

“As the world got more engaged to deal with the impact of coronavirus, the resilience of commercial real estate in India was tested. This is reflected in the dwindling demand and supply numbers in the first half of 2020. However, key markets in the southern cities show the highest level of activity during Q2, with Bengaluru leading the pack,” said Anshul Jain, Managing Director, South East Asia and India, Cushman & Wakefield.

According to him, in an ever-evolving situation, it may be difficult to predict the timeline within which Indian commercial real estate might be able to restore its pre-Covid growth momentum. But, a certain level of normalcy could be expected in the second half as companies gradually resume their operations.

 

In terms of leasing activity, the information technology- business process management (IT-BPM) sector continued to witness maximum share with 43% share in overall leasing. Healthcare & pharmaceuticals accounted for 18.6% share followed by Captive centres (GCCs) with a 10.1% share.

 

[Anta Assamey]

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