We have studied the pattern of leasing activity over past few years and identified key industry verticals, which were acting as the fundamental drivers of office space demand in India. The IT & ITES sector – which saw a sharp decline in its share, falling from 48% in 2005 to 23% in 2009 – has improved its share to 39% this year.
With immediate effect, the minimum built-up area requirements to be met by SEZ developers will be 100,000 square meters for the seven major cities, 50,000 square meters for Category B cities and only 25,000 square meters for the remaining cities.
Given the typical time-lag between an upturn in economic fortunes and leasing market activity, a full-fledged recovery in the leasing volumes of Mumbai’s office property market in early 2013 seems unlikely. Heading into 2013, doubts over future economic conditions may continue to dampen corporate demand.
Bangalore is all set to reach a new milestone in its growth story – the office real estate stock (Grade A occupied and vacant office space) is expected to reach 100 million square feet by 2016 – 17.
It is estimated that in 2011, the service sector accounted for about 70% of the demand for commercial office space in the seven major Indian cities – Mumbai, NCR-Delhi, Bangalore, Chennai, Hyderabad, Pune and Kolkata – with the remaining 30% coming from manufacturing and other industries.