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The total absorption for Grade A properties in office spaces was recorded at 8.5 million sq-ft,higher by 20% on a year-on-year basis, with regions such as Bengaluru, Chennai, Kolkata, Mumbai and Pune showing the most notable increases, said the first quarter 2015 report by Cushman & Wakefield. The office market saw the strongest growth in Bengaluru with a whopping 500% increase in absorption rate.
The recent case in point is ecommerce and tech giant Amazon leasing out 1.2 million sq-ft of office space in Bengaluru. Other than Amazon, during the quarter Oracle inked 400,000 sq-ft of space in the JP Nagar submarket.
"The first quarter has seen a trend setting start to the year and the momentum is expected to remain steady. Also, with the change in the global outlook towards India, we can look at hitherto, stalled or delayed plans of global companies coming to India materialising. There is visibly increased leasing activity and appreciation of rent along with commercial terms. This is likely to continue as demand seems robust," said Sanjay Dutt, executive MD, Cushman & Wakefield, South Asia.
Among the total share of absorption, IT/ITeS continues to remain the main driver with a share of 69% of total lease space. Bengaluru formed 44% of the total share of absorption.
This was followed by service and industrial sectors like BFSI, consulting, engineering & manufacturing which contributes a 15% share. Sectors such as FMCG, trading, education, logistics, shipping, travel and tourism contributed 13% share in the office space leasing.
