Mumbai recorded a total office space absorption of 2.1 million. sq. ft. and supply of 1.7 million. sq. ft in the Q2 2022 according to a report by CBRE South Asia Private Ltd.
The report findings also highlighted the strong demand for office space in India across major Indian cities in Q2 2022, as leasing activity grew by 61% Q-o-Q to touch the highest-ever quarterly office space absorption of 18.2 million sq. ft.
The BFSI sector led leasing activity with a share of about 40%, followed by infrastructure, real estate & logistics (13%), and flexible space operator (11%). Small-sized deals dominated the transaction activity, with 58% of absorption recorded in the IT spaces, 35% in non-IT spaces, and 7% in SEZs, as per the report.
On the supply side, project completions were dominated by non-IT spaces with a share of 73%, followed by IT spaces at 27%.
The Q2 rentals in Mumbai remained constant over Q1 2022, with a few major transactions such as IDFC leasing 0.12 million sq. ft., The Square, XPO Logistics leasing 72,200 sq. ft. in Kensington and Redbrick Offices leasing 60,000 sq. ft. in Rupa Renaissance.
Among the major cities, on an H1 basis, office absorption stood at 29.5 million sq. ft., recording a growth of 157%(Y-o-Y).
In H1 2022, about 26.1 million sq. ft. of new completions were witnessed – increasing by 26% Y-o-Y.
Bengaluru, Delhi-NCR, and Hyderabad dominated absorption during the quarter, accounting for almost two-thirds of the transaction activity, as per the report.
Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE, said, “The office sector in India reflected a strong recovery in H1 2022 as occupier sentiments were uplifted due to the relatively reduced severity of the Omicron wave, the subsequent relaxation of restrictions, and improved economic activity.”
“It is evident from the leasing activity that employees are resuming office with a flexible approach,” he said.
He said June 2022 recorded a significant surge in leasing sentiments across most APAC markets, with the highest rise witnessed in India.
“This also signifies that the outlook for annual space absorption for 2022 is likely to be higher than 2021,” he added.
