Office space demand may improve in 2010: CBRE

The demand for office space in the country is expected to be improve in the current year although rentals are likely to be flat, according to real estate consultancy CB Richard Ellis (CBRE).

"We expect demand (for office space) to improve this year although rentals are expected to remain flat in the medium term. This will primarily be due to the forecasted large supply of office space coming into the market" CBRE Chairman and Managing Director (South Asia) Anshuman Magazine said in a recent report.

In India the office segment saw some movement in the third and fourth quarters of 2009 with corporates slowly returning to take up space in most cities, he added.

In New Delhi, rental values in the Central Business District (CBD) area remained largely unchanged in the last few months of 2009. Mumbai saw a number of fresh inquiries for medium and large sized units, while the Bangalore office market remained quiet with a few medium and small-size leasing transactions reported across the major business districts, the report said.

On the whole, during the fourth quarter of 2009 the Asian office market saw slowing of the decline in office rentals as multinationals and financial institutions in selected Asian cities display a renewed willingness to expand, the report added.