The total leasing of office space, which comprises demand for all grades of buildings, rose 93% year-on-year in January to 3.2 million square feet across seven major cities, according to property consultant JLL India.
However, the leasing fell 56 %, compared to December 2022, which had seen 7.4 million square feet office space absorption.
In January 2022, the aggregate leasing activities stood at 1.7 million square feet.
In January 2023, the top three cities in that order were Delhi NCR, Chennai, and Mumbai, accounting for 77 % of monthly leasing activity.
“IT sector is presently facing slower employment and sluggish corporate growth expectations. As a result, space take-up may be more benign as part of a course correction,” news agency PTI quoted Samantak Das, chief economist and head of research, India, JLL as saying.
The aggregate office market leasing activities refer to transactions for all grades or types of buildings in the top seven cities (Delhi-NCR, Mumbai, Bengaluru, Chennai, Hyderabad, Pune and Kolkata).
The data includes confirmed pre-commitments and term renewals. Deals in the discussion stage are not included.
JLL India said that fresh leasing, which included expansion and relocation-driven space take-up accounted for 87 % of all recorded transactions during the last month.
As per the data, the IT/ITeS category still remained the largest driver of overall market activity in January, accounting for 28 % of total market activity.
According to the JLL data, India’s office Grade A (premium) stock stood at 732 million square feet at the end of March 2022.
The office stocks of other grades were 370 million square feet, taking the total stock to around 1.1 billion square feet.
Meanwhile, according to a report by real estate consultancy firm CBRE, investments in the Indian real estate sector grew 32 % y-o-y to an all-time high of $7.8 billion in 2022. On a quarterly basis, investments in Indian real estate stood at $2.3 billion in the October-December 2022 quarter, growing 64 % q-o-q and 115 % y-o-y.
(With PTI inputs)
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