Kolkata's real estate market shows robust growth in 2023: Knight Frank

Kolkata's real estate market witnessed unprecedented growth in both the residential and office segments last year, a real estate report said on Wednesday.

The city experienced a stellar year in office leasing transactions, with a staggering 1.4 million sq ft of office spaces transacted in 2023, marking a healthy 20 per cent growth year-on-year (YoY), Knight Frank India's Residential and Office Market Report (H2 2023) stated. This is also a 9-year high in office leasing transactions.

The report also notes phenomenal growth recorded in new office completions, reaching a remarkable 0.8 million sq ft in 2023, a staggering 332 per cent jump YoY, making it the highest volume recorded in the past five years.

The surge was fueled by robust occupier interest across various sectors, indicating a positive economic outlook.

"The commercial market in Kolkata is now witnessing a consistent rise in transactions exceeding half a million with significant engagement from India-facing business as Kolkata remains the gateway to eastern and north-eastern India. The current 9-year high in office leasing transactions underscores a robust interest from occupiers, signalling potential future growth," Knight Frank India Senior Director (East) Abhijit Das said.

In the residential sector, Kolkata's real estate market witnessed a robust demand throughout 2023, driven by the continuation of the stamp duty rebate. A total of 14,999 residential units were sold, showcasing a significant 16 per cent growth in sales volume over 2022. This represents a notable recovery from a 10 per cent decline observed in 2022 compared to 2021.

The demand for residential units also prompted a substantial increase in new launches, with a notable 28 per cent YoY growth compared to 2022 prompting developers to launch introduced fresh inventory to meet the surge in demand.

In the residential segment, ticket sizes between Rs 5 million and Rs 10 million witnessed an impressive 71 per cent YoY growth, indicating a strong appetite for mid-range properties.

The office leasing rental market in 2023 saw an 11 per cent increase on average, primarily driven by heightened demand. Business districts like Salt Lake City and Rajarhat New Town experienced double-digit YoY rental growth, with limited space availability contributing to the surge in rent prices.