India’s office property market recorded the strongest leasing activity in the Asia-Pacific region in the quarter ended September, touching $1 billion for the first time and contributing more than half of Asia’s total gross rentals in this space.
In India, New Delhi was the most active market, while substantial increases were seen in Mumbai and Bengaluru. Office leasing volumes in Asia Pacific in 2015 are predicted to be 25 per cent higher than in 2014, with tier-I cities in China, notably Shanghai, and India likely to continue to see the strongest activity, according to a report by Jones Lang LaSalle.
“The magnitude of office leasing happening in India reflects the renewed confidence international companies have in the India story. India is turning into one of the most happening global markets in terms of quality job creation,” said Anuj Puri, chairman & country head of JLL India. “Every developed country is looking for a share in the pie, existing companies are confidently expanding their presence and commercial real estate investment in the country once again has a very sound long-term rationale.” India’s leasing transaction volumes almost doubled to $1 billion in the third quarter from the previous quarter, with ample interest from equity funds. In India, over a dozen financial services occupiers are seeking over 5 lakh square feet of back/middle office space in key markets such as Mumbai, New Delhi and Bengaluru.
“Demand for office space has been on the rise. Vacancy levels at grade-A complexes have eased. Out of our total 2 million square feet of office space in Mumbai, we have only 1 per cent left to be leased,” said Navin Makhija, MD of Wadhwa Group, a real estate developer.