India’s office leasing demand likely to cross 70 million sq. ft in 2024

The demand for Grade A office space leasing in India is set to exceed 70 million sq. ft in 2024, driven by a notable 14% year-on-year surge in the first quarter, as per a CREDAI-CRE Matrix study. Bengaluru, Mumbai Metropolitan Region (MMR), and Delhi-NCR spearheaded this growth, collectively accounting for nearly two-thirds of the total office demand, marking a 23% increase from the previous quarter.

President of CREDAI, Mr. Boman Irani, attributes this growth to robust economic fundamentals and substantial investments, projecting sustained momentum in Grade A office demand. Market rentals for Grade A spaces saw an 8.7% sequential increase in the March quarter, nearing the US$ 1.20 (Rs. 100) per sq. ft mark. CEO & Co-founder of CRE Matrix & IndexTap, Mr. Abhishek Kiran Gupta, anticipates larger deals in cities like Pune, Chennai, Hyderabad, and Noida as rental rates rise in prime markets. The report also highlights a shift towards larger deals, with over 1 lakh sq. ft accounting for 56% of the demand in the first quarter of 2024. Additionally, the IT/ITeS sector dominated the demand for leasing. In contrast, the BFSI sector saw an uptick in demand share, particularly in Mumbai and Chennai. The emergence of co-working spaces as an emerging asset class is also noteworthy, contributing 10% to Grade A office space demand.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.