Despite uncertainty around the performance of India’s office sector due to the second Covid wave, Bengaluru, NCR and Mumbai markets are expected to remain stable in rental values over the next 12-months.

According to the report of Knight Frank Asia-Pacific Prime Office Rental Index Q1 2021, Bandra Kurla Complex (BKC) in Mumbai witnessed a meaningful recovery in office rents to -0.8% QoQ during the January – March 2021 quarter, compared to -5.5% in the previous quarter.

This robust recovery can be attributed to improved transaction activity in the Q1 2021 period.

Knight Frank forecasts that the decline in rents to decelerate this year, with overall rents expected to decline by 3% in the APAC region, compared to the 4.8% decline seen in 2020.

The Central Business District (CBD) of Bengaluru, comprising areas such as MG Road, Infantry Road, and Residency Road, has registered a decline of 3.0% QoQ in Q1 2021 against a decline of 4.0% in Q4 2020.

At the Connaught Place in National Capital Region (NCR), office rents saw a flat 0.0% QoQ price change in Q1 2021 compared to -1.0% in Q4 2020.

Shishir Baijal, Chairman and Managing Director of Knight Frank India in a statement said, “The second wave of pandemic and associated regional lockdowns have temporarily delayed occupiers’ office re-occupancy plans. However, control on infection case count with graded regional lockdowns and progress on vaccination drive will act as a market stabiliser in near future. Given the strong fundamentals of India office market, despite the near-term uncertainty, occupiers will positively react to any improvement in the pandemic scenario in the country.”

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