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Office leasing in Q3 up by 2% in Delhi, Mumbai, four other cities: CBRE

Higher demand from corporates based in Europe, West Asia and Africa triggered a marginal increase in leasing activity, says report

Press Trust of India  |  New Delhi 

Office space
Representative image.

leasing increased marginally during the July-September period in eight major cities at 10.4 million sq ft on higher demand from corporates from Europe, West Asia and Africa, according to consultant

"Leasing activity remained strong during the quarter, with take-up rising marginally by 2 per cent quarter-on-quarter to touch 10.4 million sq ft," said in its report 'Office Q3 2017'.

The eight major cities covered in this report are Delhi- NCR, Mumbai, Kolkata, Chennai, Hyderabad, Bengaluru, and Kochi.

The consultant noted that there was increased interest from Europe, Middle East (West Asia), (EMEA)  corporates for and their share of leasing rose to 14 per cent during the July-September period from 9 per cent in the previous quarter.

"India's prime office market is evolving at a rapid pace. Occupier strategies continue to focus on consolidation/ expansion as well as cost and greater flexibility of office space," said Anshuman Magazine, Chairman and South- East Asia,

The co-working and shared formats are also gaining momentum and influencing the market to some extent, he added.

"While demand for traditional will continue to dominate the segment, it will have to make allowance for newer formats that are slowly gaining prominence and absorbing a part of the overall pie," Magazine said.

As per the report, Bengaluru, and Delhi-NCR led quarterly leasing activity with a share of more than 60 per cent.

"Apart from Bengaluru, and Kolkata, all the other cities witnessed a rise in space take-up on a q-o-q basis," the report said.

IT/ITeS sector continued to drive leasing with about 34 per cent share in the overall space leased during the quarter.

The share of other sectors such as engineering and manufacturing (19 per cent) and banking, financial services and insurance (10 per cent) fell on a quarterly basis.

Co-working operators remained active, with both global and domestic players expanding their operations in Mumbai, Bengaluru, NCR and Pune, the consultant said.

On transaction size, said that the bulk of leasing was for less than 50,000 sq ft during the third quarter of 2017 calendar year.

Small-sized transactions (less than 10,000 sq ft) comprised about 40 per cent of all the transactions reported during the quarter, while half of the deals concluded ranging between 10,00050,000 sq ft.

The share of large-sized deals (greater than one lakh sq ft) remained at 5 per cent, same as the previous quarter.

During the January-September period, leasing, however, declined marginally to 29 million sq ft compared to the year-ago period.

First Published: Sun, October 08 2017. 15:21 IST