NEW DELHI :
Beating not just Delhi and Mumbai but also Singapore and Hong Kong, Bengaluru’s office rental market is now the best performing one in the whole of Asia Pacific, according to a report. Although rentals in Bengaluru are now lower than Mumbai’s BKC and Delhi’s Connaught Place, Bengaluru recorded the highest rental growth of 17.6%, property consultant Knight Frank said in a report.
The commercial business districts of Connaught Place in NCR and Bandra Kurla Complex (BKC) in Mumbai were the 7th and 11th fastest-growing prime office markets in the Asia-Pacific region, respectively, with a comparatively modest 4.4% and 2% year-on-year rental growth, respectively, in Q3 2019, it said.
“India’s main office markets continue to enjoy healthy rental growth, despite the weaker economic print in 2019, mainly due to the rapid expansion witnessed in its IT industry,” Knight Frank India Chairman and Managing Director Shishir Baijal said.
The IT industry accounted for 35% of total transaction volume in first half of 2019 across the top eight cities, which was most apparent within Bengaluru, which recorded 14% rental rise in January-June (H1) 2019.
“Multinationals continued to expand robustly because of availability of right talent pool and new office assets at comparatively low rents. In 2020, while more supply is expected over the horizon, demand is expected to remain steady as the IT sector continues to expand,” Baijal said.
In another report, Colliers International India said the southern Indian cities of Bengaluru, Hyderabad and Chennai saw a 23% jump in demand for office space over last year, with gross absorption at 30.6 million sq feet.
“As per our expectations, a sustained leasing momentum, coupled with continued demand from technology and flexible workspace operators once again helped Bengaluru secure the number 1 position in terms of overall leasing in 2019,” Arpit Mehrotra, Senior Director, Office Services (Bengaluru & Hyderabad) at Colliers International India said.
Bengaluru continued to be the market leader with gross absorption of about 15 million sq feet in 2019, an increase of 6% from 2018. Technology and IT-BPM sector accounted for 39% of the total leasing during the year, followed by the engineering and manufacturing segment’s share at 16% and the flexible workspace share at 15%. During the year, Bengaluru saw supply infusion of 10.9 million feet.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.