Delhi-NCR region is expected to add fresh office supply to the tune of 48 million sq feet in the coming three years. Gurgaon and Noida will contribute as much as 88 per cent of the upcoming office supply, according to a report by Knight and Frank.
In its outlook on the office space market, the report also points out that rental values in locations across central business districts and secondary business districts in Delhi are expected to witness appreciation. This is due to an anticipated rise in office space demand and lack of fresh supply in micro markets.
It also points that NCR is the biggest commercial market in India with as much as 85 million sq feet of office space under operation. The present vacancy level ranged between 20- 25 per cent across various micro markets. Approximately 0.9 million sq feet was transacted in Q4 FY 12, thus showing a 25 per cent fall compared to the same quarter last year.
At least 29 per cent of the absorption was contributed by the IT/ITes industry which accounted for 0.33 million sq feet of office space in Q4 FY 12, on the other hand the manufacturing sector has been losing sheen in the NCR market as its share has gone down steeply in Q4 FY 12 compared to the preceding quarter and contributed to 12 per cent of the overall absorption in Q4 FY 12.
In Q4 FY 12, about 89 per cent of the total office space transacted in the NCR was taken up in Gurgaon and Noida.
The rental values in locations across the central business district (CBD) and south business district (SBD) in Delhi are expected to witness appreciation owing to anticipated office space demand and lack of fresh supply in these micro-markets, the consultant observed.
The average monthly rental in Gurgaon is around Rs 80 per sq ft and Rs 40 per sq ft in Noida. In Delhi, the rental is about Rs 160 per sq ft in CBD and Rs 130 in secondary business districts.