Nowadays we are seeing an extraordinary growth in the office vacancy rate. According to a research made by a property consultant, Office space leasing has increased by 11% in the year 2014. This covers up to 30 million square feet in 7 major cities of India. The seven cities are Mumbai, Delhi, Chennai, Bangalore, Kolkata, Hyderabad and Pune.
The research report also says that, approximately around 30 million square feet of the office space has got absorbed in the year 2014 which is a jump of almost 3 million square feet when compared to the previous year. 2014 was the second best year for Indian market in terms of office space absorption (other than 2011).
Bengaluru showed the major office absorption:
Bengaluru is the city which had major office absorption of about 9.39 million square feet. This is followed by Mumbai with 5.46 million square feet and Delhi with 5.38 million square feet. Bengaluru witnessed a significant absorption of office space (72%) in the previous year. Bengaluru is followed by Delhi having 48% of absorption, Hyderabad with 41% and Pune with 13%.
Fall in leasing activities:
But Kolkata, Chennai and Mumbai saw a major fall in leasing activities in the year 2014, having a fall of about 55%, 43% and 21% respectively. According to the property consultants, the main reason for this fall was the lack of ideal office space availability in the preferred markets. Coming to the sectors, the sectors which contributed a lot were, IT-ITes absorbing 35% of the office space, BFSI’s with the absorption of 13%, manufacturing companies with 13% and consultant businesses with 6%.
Global and domestic share:
According to the reports, the companies from US continued to retain the major share of office space leasing in India though its share is decreased by 4% when compared to the previous year. But the domestic companies have increased their share from 31% to 33% in the previous year.
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