CHENNAI: Engineering and technology giant GE is setting up shop in Chennai. The Fairfield-Connecticut headquartered company will set up a back office and processing centre across 1.7 lakh square feet at Ramanujam IT Park in Taramani.
“GE signed for space a few weeks ago. They want to set up a back office and processing centre,” sources said. GE could not be reached for comment. According to industry benchmarks, a back office usually allocates 50-60 square feet space per employee and 100 sq ft for software development work. “A 1.7 lakh sqft transaction should be encouraging,” sources said.
Chennai is witnessing shortage of quality office space. Notwithstanding this, office space absorption levels in the city rose to 5.25 million sqft in 2016, from 5 million sqft in 2015. “Despite shortage of supply, the increased volume of absorption is encouraging. It gives the confidence that the supplies in the next 12 to 18 months too will get absorbed. We can expect a positive rub-off of this to retail and residential sectors,” said S Ramaswamy, director, Asset Advise, real estate consultants.
Industry insiders said that 2016 was a year of consolidation and expansion. “Despite political uncertainty due to elections earlier in the year; later the death of chief minister of Jayalalithaa and also cyclone Vardah, the real estate market rallied in Chennai,“ sources said.
Among the top deals in the year, Accenture consolidated its operations adding 2.8 lakh sqft in Divyashree IT park on OMR, Infoview signed up 1.8 lakh sqft in Price Info on OMR, Renault Nissan R&D centre took 1.8 lakh sqft in Ascendas park at Mahindra City near Chengleput.
Guiding to a tepid 2017, Knight Frank’s Krishnan said, “We do not expect big transactions this year as supply side issues still persist. However, we expect these to even out next year when we will see nice properties coming into the market.“
Credits ET Realty