Gross office leasing dips 1pc in Apr-Jun amid supply constraints: C&W

New Delhi, Jul 4 (PTI) India’s top-eight property markets saw a 1 per cent dip in gross leasing of office spaces during April-June due to constrained supply of prime workspaces, according to Cushman & Wakefield.

Net leasing of office spaces too declined 14.5 per cent annually.

While the gross number reflects the overall leasing activities in the market, the net leasing is the change in occupied workspaces.

Real estate consultant Cushman & Wakefield on Saturday released its office market report for the eight major cities — Mumbai, Delhi-NCR, Bengaluru, Pune, Hyderabad, Chennai, Ahmedabad, and Kolkata.

During the latest April-June period, the net leasing of office spaces declined 14.5 per cent annually to 11.6 million sq ft. The gross leasing of office spaces decreased

1 per cent to about 21 million sq ft.

The consultant attributed the fall in net leasing to lower availability of prime office spaces in the market.

Net absorption refers to the net change in occupied space. It is a difference between occupied stock at the end of the current period and the previous period.

The gross leasing factors in all leasing activity in the market, including fresh take-up, open market renewals by occupiers as well as pre-leasing. It is an indication of overall market activity.

Anshul Jain, Chief Executive – India, SEA, MEA & APAC Office and Retail, Cushman & Wakefield, said, “While global macroeconomic and geopolitical uncertainties have led occupiers to adopt a more measured approach to decision-making, the underlying demand story remains firmly intact.” Global organisations continue to make long-term commitments to India, reflecting confidence in the country’s talent ecosystem, business environment and long-term growth potential, he added.

“Global capability centres continue to be at the heart of this momentum, with their expansion increasingly shaping demand across multiple office markets,” Jain said.

On the office space supply, he pointed out that over the past couple of years, many developers prioritised residential development amid strong housing demand.

“However, with office vacancy tightening to post-pandemic lows, rental growth strengthening and demand remaining resilient, we expect commercial development activity to regain greater attention,” Jain said.

He felt a healthier supply pipeline will be critical in supporting the next phase of growth in India’s office sector. PTI MJH TRB