IT/ITeS remains the key driver of commercial real estate in the country, but e-commerce has witnessed a fall in transaction volumes during the July-September quarter.
During the third quarter (Q3) of this calendar (2015), the IT-ITeS sector continued to drive leasing demand in major cities (NCR, Bengaluru, Chennai, Hyderabad, Pune and Mumbai), accounting for nearly 50 per cent of leasing volume by floor space.
Other sectors such as banking / financial services and manufacturing / engineering also witnessed significant transaction velocity, together constituting 28 per cent of the total demand.
On the development and completions front, it surged by around 21 per cent quarter-on-quarter with Bengaluru leading new supply addition.
New supply More than 10 million square feet of fresh investment-grade office space was completed across major cities during Q3, leading to a Q-o-Q rise of around 21 per cent and 44 per cent on a year-on-year basis.
According to CBRE’s India office report, city wise split of new supply is as follows: Bengaluru 38 per cent, NCR 22 per cent, Chennai 17 per cent, Hyderabad 11 per cent, Pune 10 per cent and Mumbai 2 per cent.
Bengaluru led new supply addition of office space during the July–September period. Overall office space supply addition in Q3 2015 was the highest over the previous nine quarters.
Ram Chandnani, Managing Director – Transactions Services, CBRE South Asia, said, “The July–September period saw a strong infusion of new office space coming into the market. At the same time, some of the supply pipeline was pushed forward to the next few quarters. Most of this upcoming supply is concentrated in key micro-markets of the leading cities.”
Small & medium formats Magazine said: “On similar lines, as in the previous few quarters, most office space transactions were focused upon small and medium-sized space requirements. Small-sized transactions (less than 10,000 square feet) constituted a share of approximately 41 per cent; while those ranging between 10,000–30,000 square feet accounted for a share of around 33 per cent of the total transaction closures reported during the quarter.”
The market witnessed a few big ticket transactions finalized across cities by leading organizations such as Concentrix Services, Citrix Systems, Accenture, Panasonic, Seagate Technologies, and Sutherland Global Services, among others.
In addition, Gurgaon, Hyderabad and Chennai witnessed large-sized transaction closures (ranging between 2-5 lakh square feet) from occupiers belonging to the IT/ITeS, banking / financial services and telecommunications sectors.