COMMERICAL OFFICE | Staff Reporter, India

Gross office leasing volumes in India down 28.5% to 50.4m sq ft in 2020

Leasing activity was led by Bengalaru.

According to Cushman & Wakefield, gross leasing volumes for 2020 stood at 50.4 msf, a 28.5% decline on a y-o-y basis, largely as a result of the COVID disruption and the ensuing lockdown. After a robust start in Q1, while Q2 was a near washout, H2 showed encouraging signs of recovery. However, in gross leasing terms, H2 2020 was still lower by 29.2% as compared to H2 2019.

For the full year 2020, leasing activity was led by Bengaluru, which accounted for 27.1% of annual gross leasing volumes followed by Mumbai and Delhi-NCR holding identical shares of 16.5% each.

Here’s more from Cushman & Wakefield:

Through 2020, IT-BPM and captive centres (GCCs) continued to remain the dominant occupier sectors accounting for 27% (32% in 2019) and 21% (22% in 2019) respectively, while the share of Engineering & Manufacturing increased from around 8% in 2019 to 11% in 2020 and that of the BFSI segment increased from 5.5% in 2019 to 10% in 2020.

Annual new completions stood at 39.10 msf in 2020, a decline of around 25% y-o-y due to slippages in project completion timelines during Q2-Q4 caused by labour and supply constraints. Bengaluru and Hyderabad accounted for 28.6% and 20% of the new completions in 2020 with higher pre-leased volumes in their newly completed projects.

Net absorption for 2020 added up to 20.9 msf, recording a 54.6% decline from the previous year with occupier exits as part of portfolio optimisation strategies causing an increase in vacancy levels.

Download the full report here.

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