Office space leasing rises by 23% in March qtr: Report

Office space absorption during the January to March quarter increased by 23 per cent year on year to 11.4 million square feet, driven by demand from technology and finance sectors, said a report.

Bengaluru continued to grab the highest share, accounting for 34 per cent of the total leasing volume, followed by the National Capital Region (NCR) at 26 per cent, Pune at 16 per cent, Mumbai at 10 per cent, Chennai at 9 per cent, Hyderabad at 4 per cent and Kolkata at 1 per cent, Colliers International said in its report.

The technology and finance sectors remained the major contributors to office demand with 36 per cent and 17 per cent share, respectively, of the total office take-up in Q1 2018, according to Ritesh Sachdev, senior executive director, occupier services, Colliers International India.

He further said the demand from flexible workspace operators and the manufacturing sector has started gaining momentum in 2018, accounting for 13 per cent and 12 per cent, respectively, of pan-Indian leasing volume.

"We foresee demand for flexible workspaces further increasing over the coming years," Sachdev added.

The report opined that although more than 30 million sq ft of Grade A supply is scheduled for completion in 2018, real estate developers should adhere to the planned timelines to maximise the benefit of the present supply crunch in technology-driven cities.

Surabhi Arora, senior associate director, research, Colliers International India said developers should gear up to build future-proof buildings with up-to-date amenities and maximum technology intervention to command premium rents.

"We advise large occupiers looking for state-of-the-art buildings with modern amenities and facilities for their employees to pre-commit in advance, especially in low vacancy markets such as Bengaluru, Pune and Hyderabad," she added.