Commercial space lease activity increases rentals in Kolkata

KOLKATA: Commercial space rentals are on a gradual rise in Kolkata, thanks to a 20% spurt in transactions in the last two quarters.

The average deal size remained low at 7,500 sq ft in the upcoming business locations and industry experts predict a 5-10% surge in rentals in the next six months at prime locations such as Salt Lake Sector V , Rajarhat and commercial pockets on the flanks of the EM Bypass and Topsia.

According to Surabhi Arora, senior associate director of research at Colliers India, about 3 lakh sq ft of commercial realty space was leased out in Kolkata in the first half of 2016. “Inquiries have picked up. The Kolkata market, unlike other metropolitan cities, is not driven by the IT alone. The growth here is mostly centred on the expansion of homegrown companies,” she said.

“IT-BPM (business process management) companies that have been instrumental in taking bulk of office space on lease in other cities are not as active in Kolkata because of policy bottleneck, despite an abundance of such occupiers,” said Ritesh Sachdev, managing director of tenant advisory group at Cushman & Wakefield.

The Bengal government’s SEZ policy for the IT sector has been the biggest hurdle for software and hardware companies to invest in the state. The matter has been hanging fire since Mamata Banerjee government took over in 2011. Speculation is rife on the government’s decision to tweak the policy to grant the SEZ status to the industry .

It would help proposals from Wipro and Infosys to take off. Wipro has made a fresh application for IT/IT Enabled Services SEZ sprawled over 19.8 hectares at Rajarhat. The key demand drivers for office space in Kolkata have been the banking financial services and insurance (BFSI) companies for their regional offices, telecom companies for their consumer offices, FMCG companies and retail outfits.

Credits ET Realty

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