BFSI sector leasing projected to be over 11 mn square feet in 2024: JLL

The banking, financial services, and insurance (BFSI) leasing in 2024 is projected to surpass the last year’s figure of about 11 million square feet (msf), according to real estate advisory firm JLL.

 

Between January and September this year, office leasing in the BFSI sector stood at approximately 8.8 msf with a share of 16.4 per cent in the total gross leasing in India (53.4 msf), with a nearly flat outlook for the rest of the year.

 

“The overall BFSI segment leased over 11 msf in 2023, the highest ever, and is on track to surpass that number in 2024. We are already seeing that the tech cities of Bengaluru, Hyderabad, Chennai, and Pune account for over 80 per cent of all BFSI GCCs’ demand, while domestic BFSI demand is driven by Mumbai and Delhi NCR, which together account for a ~65 per cent share,” Samantak Das, chief economist and head of research and REIS, India, JLL, said.

 

As per JLL, BFSI sector is emerging as the second-largest office space occupier in India, following the information technology (IT) and IT-enabled services (ITeS).

 

Overall, the BFSI sector’s share in India's gross office leasing has increased from an average of approximately 11 per cent during the 2017-2019 period to 17-18 per cent over the last few years, across the country's top seven cities- Mumbai, Delhi-national capital region (NCR), Kolkata, Bengaluru, Chennai, Hyderabad, and Pune.

 

Global players are involved in about 65 per cent of the BFSI leasing activity in India. As per JLL, on an average, these international entities have accounted for two-thirds of all office space leased by the sector over the past six years. Meanwhile, Mumbai accounts for approximately 44 per cent of the total space occupied by domestic BFSI organisations.

 

“India's BFSI sector is experiencing remarkable growth, with significant opportunities for the office real estate market. The country's fintech market, currently valued at $584 billion, is projected to reach approximately $1.5 trillion by 2025. This expansion is reflected in the increasing presence of global capability centres (GCCs) across India. The BFSI industry already accounts for a substantial 20 per cent share of these GCCs. With over 1,900 GCCs offering end-to-end services, India is poised for further growth in this sector, driving continued demand for office spaces,” said Rahul Arora, head of office leasing and retail services, senior managing director (Karnataka, Kerala), India, JLL.