BENGALURU: Office space absorption in Bengaluru inched up slightly in the recently concluded quarter compared to the same period last year helped by an increase in leased out space in Whitefield, the hub for IT companies. But it was also a quarter devoid of any big bang leases from major multi-national companies.
Gross absorption increased to 2.7 million square feet for the second quarter ended September 30, from 2.3 million sqft a year earlier, according to independent property consultancy CBRE. Even during the first quarter, the amount of space leased stood at 2.3 million. Gross absorption includes net absorption and property under development, which will be delivered within 4-6 quarters.
A majority of office space acquisitions took place in the micro market of Whitefield, located in the eastern part of the city, due to more vacancies compared to Outer Ring Road (ORR). The Outer Ring Road sub-market is slowly getting saturated and witnessing a vacancy of just 2%, due to good connectivity with surrounding residential areas.
“Overall supply in Bengaluru continues to remain a constraint but at the same time there are vacancies in micro markets such as Whitefield and Electronic City,” Ram Chandnani, managing director, advisory and transaction services, CBRE India, said.
During the reported quarter, the biggest space was taken up by Tata Consultancy Services (TCS), India’s largest software services exporter by revenue. TCS took up 0.55 million sqft space in Whitefield, followed by US financial services company, Broadridge Financial which leased 0.15 million. Home improvement company Lowe’s, which has its Innovation Labs, earlier this year in Bengaluru, took up 0.12 million sqft space in Embassy Manyata Tech Park.