Office leasing grows over 2.5 times to 14.7 mn sq ft in June quarter across 6 major cities: Report

Gross leasing of office space grew over 2.5 times to 14.7 million square feet in the April-June quarter of this year across six major cities, helped by lower base effect and rise in demand from corporates, according to a report by Colliers India.

In the corresponding three months a year ago, the gross leasing of office space stood at 5.6 million square feet, the real estate consultant said.

The demand for housing as well as office was badly impacted during the April-June quarter of last year because of the strong second wave of the COVID pandemic.

During the June quarter of 2022, Colliers said the gross leasing of office space jumped more than 2.5 times to 27.5 million square feet across six cities, from 10.3 million square feet in the corresponding period of the previous year.

Colliers India CEO Ramesh Nair said: "The quarter saw increased office occupancy after a hiatus, as demand outpaced supply by a significant margin."

The absorption in the first two quarters of the year has already surpassed more than 80 per cent of the total absorption seen in the whole of 2021, Nair said.

"Clearly, office demand is well headed to close at 40-45 million sq feet by the end of this year. Resultantly, rentals are also likely to firm up in next two quarters as the occupancy levels rise," Nair said.

As per the Colliers India data, the gross office leasing in Bengaluru rose to 4.4 million sq ft in April-June 2022 from 2.2 million square feet in the year-ago period. During the first half of the 2022 calendar year, the absorption of office space jumped to 8.4 million square feet from 4.2 million square feet in the corresponding period of the previous year.

In Chennai, the gross leasing increased to 1.1 million square feet in April-June, from 0.4 million square feet in the same period last year.

During January-June, the leasing jumped to 2.6 million square feet from 0.8 million square feet in the year-ago period.

The gross leasing of office space in Delhi-NCR increased to 2.7 million square feet in April-June from 1.2 million square feet in the year-ago period.

During January-June, the leasing increased to 4.5 million square feet from 1.9 million square feet in the corresponding period of the previous year.

Hyderabad market saw gross leasing increase to 2.3 million square feet in April-June from 0.7 million square feet in the year-ago period. In January-June, the gross leasing in the city jumped to 4.5 million square feet from 1.1 million square feet in the corresponding period of the previous year.

In Mumbai, the gross leasing of office space increased to 2.8 million square feet from 0.9 million square feet in the year-ago period. In January-June, the number jumped to 4 million square feet from 1.6 million square feet in the corresponding period of the previous year.