The first-half ended June 30, 2012, recorded a 35 per cent dip in office space absorption in seven major cities, according to real estate consultancy Jones Lang LaSalle.
Mr Hariharan Ganesan, Senior Manager, Research & REIS, Jones Lang LaSalle in India, in their survey report finds that the supply fell by 52 per cent during the period. However, this trend varied from city to city.
The growing supply of office space in Mumbai and NCR-Delhi continued to outpace absorption, while the other Indian cities mirrored the pan-India trend of demand outstripping supply.
With a 32 per cent share, Mumbai was the top contributor to the total absorption in the pan-India region during the first-half. However, Mumbai recorded 19 per cent of the absorption and placed second compared to NCR-Delhi, which was responsible for 21 per cent.
Backed by relatively healthy leasing activity, Bangalore, Chennai and Pune accounted for nearly 45 per cent of the pan-India absorption, an increase from 42 per cent in the first-half of last year.
Hyderabad and Kolkata together increased their total absorption to 14 per cent from 8 per cent in the first half this year due to the penetration of good quality office buildings with moderate occupancy rates over the past few quarters.
The survey notes that the supply overhang will persist amid moderate pre-commitments in near-term supply. The country’s office market is likely to continue favouring tenants in the near term.