NOIDA: The National Capital Region (NCR), led by Gurugram and Noida, accounted for a major 28% of the 24-million-square-feet office space absorbed across the country in the first half of 2018.
The Office Space Absorption report prepared by real estate researchers Colliers International indicates Gurugram, a real estate hub, recorded the biggest leap among NCR cites by absorbing 3.7million square feet — a 111% rise on a year-on-year basis over the first half of 2017. In fact, the report suggests, Gurugram’s office space absorption for this period was on a par with that of Mumbai.
Similarly, Noida registered a 100% increase in office space absorption in the first half of 2018, as compared to the corresponding period of 2017, owing to an influx of co-working spaces, along with the entry of technology companies. Colliers International’s report puts the figure at 2 million square feet, which is expected to shoot up to 3.5million square feet by the end of the year.
The 2 million square feet has largely been picked up by Landgis (Toshiba) Candor TechSpace (1,00,000 sqft along Noida Expressway), Genpact-Candor TechSpace (90,000 sqft along Noida Expressway), Syscom Solutions (90,000 sqft in commercial sectors), Insta Office (85,000 sqft in commercial sectors) and ACE Global (Arohant IT park, 80,000 sqft along Noida Expressway).
Among major occupiers, the technology sector accounted for 42% of the gross absorption, followed by the engineering and manufacturing sector at 23%, the banking and financial services and insurance sector at 15%. The report shows that there had been a dip of 13% in rental rates on a year-on-year basis in commercial sectors.
In Gurugram, technology companies accounted for 33% of the total leasing volume, followed by banking, finance and insurance companies with 27%, and flexible workspace operators with 20%.
“Gurugram has already overcome negative market perception, if any,
cashing in on its corporate hub tag,” Surabh Arora, senior associate
director (research), Colliers International, said.
“The reason for Noida’s sudden improvement in office space absorption
is the influx of co-working spaces, along with robust road and metro
railway infrastructure, which have now become primary growth drivers in
the city,” Arora explained.
During the same time in 2017, the office absorption in Noida stood at
0.9 million sqft. “The office market space absorption is picking up in
Noida, which is emerging as a favoured corporate and industrial
destination. This is the first time when so much space has been picked
up in Noida, in the past several years,” Arora further said.
“We expect the demand level to remain strong in the coming quarters, taking office-leasing activities in 2018 to the highest level of the past three years. Positive policy initiatives from the government, a robust supply pipeline and major infrastructure development are contributing to the overall performance of the office market,” Saif Lari, assistant manager, Colliers-NCR said.