Grade A office spaces, SCOs, high-streets –  Rise of Commercial RE post-pandemic

By: Shubham Sardana, Director, ElitePRO The pace at which the commercial real estate sector in NCR has risen from the rippling effects of the pandemic shows its resilience and market strength. The increase in private equity investments and its overall performance, despite phased lockdowns at sporadic instances, has left a positive impression on the minds of consumers and investors alike. The last six months of the commercial real estate sector were the most critical in which it has reported an increase in rental leasing, retail loans, the advent of international brands on Indian soil, and a rapid spurt in office space sales, solidifying its pre-pandemic market hold.

The term which has recently gained prime relevance is Grade A office spaces. The return-to-work from-office model has had a concomitant positive impact on office space deals. Most companies, extricated from the fears of Covid-19 spread, have gone back to the physical mode of working and abjured the remote work or work-from-anywhere concept. The mushrooming emphasis on developing well-designed office spaces is also a new-age commercial real estate trend. The dispensation of all-rounder infrastructural facilities and amenities is one of the top-rated qualities of Grade A office spaces. Fire security management, high-end surveillance systems, and earthquake-resistant structure are the highlight features of such establishments. Secondly, after the pandemic, companies are also making subsequent efforts and investing in Grade A office spaces to provide a contemporary equipped office environment and ensure the safety of all office occupiers. The net office absorption data also shows an increase in demand for the Grade A office space category.

Simultaneously, land under SCO development has also seen a cumulative upsurge. Majorly, Shop-cum-Offices are concentrated mainly in Gurugram, especially in close proximity to Dwarka Expressway and Golf Course Road. SCO plots are evenly distributed across several sectors of Gurugram. The profitability of SCOs exceeds its cost dividends, which is acting as a significant initialising factor for developers to launch and develop SCO projects. The maximised growth in SCOs is also leading to its spill-over in other real estate hemispheres like New Gurugram. The impetus for SCO projects has become much more prominent in the last decade. Gurugram has become a hot investment destination, and New Gurugram will become the new hotspot target.

High-street commercials have gained immense popularity in recent times. High visibility, individualistic presence, and low maintenance modules have attracted investors to pool their money in high-street commercials. They are usually located in corporate zones, commercial arcades, and business district zones and close to essential metro lines and hubs to draw visitors. They also provide a larger catchment area, open parking spaces, higher accessibility, and greater view and functionality, which has attracted consumers on a huge level.

The commercial real estate classes have projected strong growth on various performance assessment levels. The increasing footfalls and sales are conspicuous signs of its growth. Gauging by the performance so far in 2022, the next year also seems to be pretty promising for the commercial real estate sector.

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