India s office space demand is set to grow, driven by diversification from the technology sector to include engineering & manufacturing (E&M), BFSI, healthcare, consulting, and flex spaces. Over the next three years, E&M and BFSI are projected to lease about 11-12 million sq ft annually, accounting for roughly 40% of total demand. The office market is transitioning from supply-led to occupier-driven, with a focus on meeting occupier preferences. Global Capability Centres (GCC) and domestic-origin occupiers are expected to contribute to demand expansion. The top six cities will continue to shape commercial real estate, while tier II cities are poised for high potential growth. Technology firms space uptake is expected to stabilize at around 15 million sq ft due to hybrid working models. Flex space occupiers are likely to expand into new geographies, accounting for 15-20% of total office leasing. The office market is anticipated to witness an increase in mid-sized deals, with average transaction sizes declining to 35,000-40,000 sq ft in 2024. Bengaluru, Delhi-NCR, and Hyderabad are expected to see significant demand, with smaller cities also experiencing traction. The demand scale-up will be evident at a city level, with Bengaluru potentially witnessing annual leasing activity close to 20 million sq ft. The report highlights the importance of sustainability and quality in commercial real estate, with nearly 80% of the upcoming supply expected to be green certified. India s office space demand is poised for significant growth, driven by initiatives like Vocal for Local, the Sustainable Development Goals (SDGs), and the global China+1 strategy. The focus on ESG-compliant office spaces is expected to drive resilient demand in the long term, despite potential global economic uncertainties.
Source: freepressjournal.inPublished on 2024-09-14
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