In Q2 2022 the India office market moved confidently on the track to recovery. It has seen a demand strengthening further with return to work gaining significant momentum and capacity expansions by occupiers. Pent-up demand coupled with large deals and pre-leases making a comeback is adding fuel to the robust growth that we are seeing across cities.
Despite numerous uncertainties around geopolitical risks, tightening monetary policies across the world, and concerns over the recession in the US in Q2 2022, supply-build up across cities is continuing to offer a cost-plus value addition for global firms.
In this report, we take an in-depth look into how the Indian Office Market is taking strides on the path to recovery and the trends that are shaping its future.
Key Highlights Q2 2022:
- Gross Leasing Volume (GLV) rose sharply in Q2 and stood at 23.2 msf cumulatively across top-8 cities, a 63% growth on a q-o-q basis and a 138% jump as compared to Q2 2021 with major cities witnessing a healthy pickup in fresh leasing and closure of large deals, indicating strong occupier sentiments
- While office space demand was strong in most of the top tier cities, Bengaluru, Hyderabad, and Delhi NCR stood out with the highest GLV and cumulatively accounted for around 60% in quarterly leasing; Bengaluru alone contributed nearly 30% of pan India leasing in the quarter
- IT-BPM accounted for the highest share (30%) in quarterly leasing followed by Engineering & Manufacturing (19%); BFSI and Flexible Workspaces followed with 12% and 11% shares respectively.
- 13.1 msf of new completions were recorded in Q2 2022, a 14% decline on a q-o-q basis but 63% growth as compared to the same period last year; Hyderabad, Bengaluru and Pune together accounted for ~70% of the new supply in the quarter
- The net absorption stood at 10.3 msf, a 66% expansion on a q-o-q basis and a 123% jump as compared to Q2 2021