Office space vacancy rate fell to 15 oper cent in 2016, the lowest in eight years, on better leasing in IT cities such as Bengaluru and fall in supply of quality commercial space, according to a report.
"The pan-India office vacancy in 2016, at 15 per cent, was the lowest in eight years," property consultant JLL India said in a report.
The year witnessed a record low vacancy, largely driven by IT cities such as Bengaluru, Pune and Hyderabad - each of which saw vacancy in single digits, it added.
Office space vacancy in Bengaluru fell from 14.5 per cent in 2010 to 3.8 per cent in 2016. The vacancy in Chennai fell to 11 per cent from 32 per cent.
Hyderabad has also seen vacancy reduce from 15.5 per cent in 2009 to 9 per cent in 2016.
Similarly, in Pune, vacancy has reduced from 17 per cent in 2009 to 5.5 per cent today.
"The pan-India vacancy is forecasted to increase marginally this year and remain range bound until the year 2019," JLL said.
Supply of quality commercial space declined to 35 million sq ft in 2016, from 38.5 million square feet in 2015, the report said.
The availability of right space at right location remains a challenge for many occupiers looking for grade-A offices, especially the ones looking for superior grade-A office space.
"As vacancy reduces across key cities, the supply of good quality assets continues to diminish," it said, adding that vacancy in higher quality assets is far lower than the average city-level vacancies.
Assets poorer in quality or at inferior locations have much higher vacancy, except in cities like Bengaluru, Pune, Hyderabad and Chennai.
Disclaimer: No Business Standard Journalist was involved in creation of this content
