Medilytix Bureau : Office space absorption across India’s six major cities stood at an 30.4 mn sqft registering a 130% year on year growth as of June 2022, according to International real estate advisory firm Savills India.

The first half of 2022 also witnessed 76% increase in new supply infusion at 32.4 mn sqft. With this, the total Grade A office market stock in the country stands at 676.9 mn sqft.

“The year started with rising optimism on the back of growth in the 2021 calendar. Despite the impact of the third wave and Russia-Ukraine conflict which overshadowed the first quarter economically, occupier confidence stayed strong,” said Arvind Nandan, Managing Director – Research and Consulting, Savills India.

Top 3 cities Bengaluru, Delhi NCR and Pune, contributed to 66% of leasing activity in H1 2022. Bengaluru continued to remain the frontrunner with 10.7 mn sqft of leasing activity, registering a 110% increase from H1 2021.
Meanwhile, overall absorption in cities of Pune, Chennai, Hyderabad and Mumbai remain similar in magnitude between 3.3 to 3.7 mn sqft.

“Most businesses took advantage of the available inventory to upgrade their real estate portfolios, which resulted in strong leasing activity across top 6 cities. Supply grew as well, making it an end users’ market. 2022 is expected to reach pre-pandemic levels as technology and IT-BPM sectors are once again driving demand for the office spaces,” saif Nandan.
Technology sector led the demand for office space with around 42% while pharma & healthcare occupiers increased their space take up by 2.8x when compared to H1 2021. The share of engineering and manufacturing as well as the flexible workspace segment increased by 3.3x and 4.8x respectively.
Large deals of more than 100,000 sq ft in size accounted for 41% of overall transaction activity as compared to 44% in H1 2021. On the other hand, mid-size deals had close to 39% share in H1 2022 when compared to 34% in the previous year.

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