A research produced by
The 2013 cumulative take-up of A-Grade offices across India’s seven largest cities declined marginally to 27 million sq ft down from 27.3 million sq ft in 2012, while in Q4 it grew marginally by 2.6% q-o-q to 7 million sq ft , in the wake of tepid domestic economic growth and global worries. The year’s take-up varied greatly, with Bengaluru spearheading the charge with 10.8 million sq ft take-up, which is a 66% y-o-y growth while there was a decline of 14% in Mumbai.
Project completions also dropped across most cities as developers continued to realign supply to changing demand trends. The year’s new supply dropped marginally by 4% to 22 million sq ft across the seven largest cities in 2013, while in Q4 it dropped by 3.3% q-o-q to 5.5 million sq ft, as the cautious economic outlook adversely impacted the delivery timeline.
With total take-up during 2013 exceeding the new supply during the year, the cumulative vacancy across the seven key markets declined marginally from 20.5% in 2012 to 20.3% in 2013.
Persistent economic sluggishness kept the rentals in most of the cities unchanged. Bengaluru was the only city which saw an upward movement of rentals – and that too in the last quarter of the year – on the back of strong demand and inflationary pressures. On the other hand, Mumbai was the only city which saw rents declining progressively over the 4 quarters of 2013 as tenants shifted their preferences to cheaper micro-markets to offset the tough economic conditions in which they operate.
Although the number of transactions in the three largest cities of India - Delhi NCR, Mumbai and Bengaluru - dipped from 557 in 2012 to 438 in 2013, total take-up increased to 19.2 million sq ft in 2013 from 18.3 million sq ft in 2012. Accordingly, there has been an increased demand for larger ticket size deals exhibited by occupiers.
Source : DTZ (Groupe UGL)
