Connect with us


Gurgaon dominates office leasing activity in Delhi ncr in Q3, 2017



New Space Addition up by one Million sq.ft. y-o-y in the First Nine Months of 2017

Space Take Up Across Key Cities Crosses 10 Million Q3, 2017

New Delhi, October 9, 2017:  CBRE South Asia Pvt. Ltd, India’s leading real estate consulting firm, today announced the findings of itslatest India Office MarketView Report – Q3, 2017.While Gurgaon dominated leasing activity during the review period, Noida recorded a quarterly increase in absorption. Sustained occupier interest resulted in the micro-markets of NH8, Main Noida and DLF Cybercity driving more than half of the regions leasing activity. Most of the absorption was in non-IT spaces in developments on NH-8 in Gurgaon, Aerocity in Secondary Business District and Main Noida.

On the supply side, quarterly supply addition increased but was limited to Gurgaon. Most of the new supply entering the market was thanks to the receipt of long pending completion certificates which resulted in development completions across several projects. IT/ITeS corporates dominated leasing activity, followed by Engineering and Manufacturing firms. Leasing activity continued to be driven by small to medium-sized transactions, however, the quarter also witnessed a large-sized deal (greater than 100,000 sq. ft.) with the culmination of pre-commitment in a prime development on NH-8.


DLF Cybercity (SEZ)witnessed a rental growth of about 3 – 4 % q-o-q. Rising vacancy levels in select developments resulted in a marginal rental dip of about 2-4% q-o-q in the Secondary Business District of Nehru Place and Jasola in Delhi.

Commenting on the findings of the report, Anshuman Magazine, Chairman – India & South-East Asia, CBRE said, “India’s prime office market is evolving at a rapid pace. Occupier strategies continue to focus on consolidation/expansion as well as cost and greater flexibility of office space. The advent of co-working and shared office space formats are also influencing the market to some extent. While demand for traditional office space will continue to dominate the segment, it will have to make allowance for newer formats that are slowly gaining prominence and absorbing a part of the overall pie.”

Ram Chandnani, Managing Director – Advisory & Transaction Services, CBRE South Asia Pvt. Ltd. added, “Despite availability of quality, ready to move in office space remaining constrained, overall office leasing continued to be high during the quarter. The sustained interest from EMEA and US corporates highlights India’s continued preference as a destination for office space. Going forward, as occupiers continue to future proof their portfolios and hedge against future rental escalations, we can expect to witness a rise in pre-leasing of space across various cities. This shift in occupier strategy, focus on cost, and the growing prominence of alternative options like co-working spaces, could impact the demand for office space in the short-term. 

Delhi Market Indicators – Q3 2017



Q-o-Q Highlights

Demand q-o-q





CBD Small and medium-sized transactions were noted with stability in rental growth
Gurgaon Leasing activity remained broadly steady, occupier focus continued to be on core micro-markets
Noida Leasing activity reported in recently completed developments in Main Noida


Leasing activity for prime office space across key cities in India remained robust during Q3, 2017, crossing 10 million sq.ft. As in earlier quarters, space take up was dominated by the IT/ITeS sector with 36% share of overall space leased across key cities. It is noteworthy to highlight that the share of office leasing by e-commerce firms grew from 3% earlier this year to 10% in Q3, 2017. Other segments that drove the demand included the Engineering and Manufacturing segment (19%), BFSI segment (10%), and Co-working/Business Centers (6%) which is witnessing increased activity in recent months. With European corporates showing an increased interest in India’s office segment, the share of office leasing from these firms was recorded at 14% in Q3, 2017, up from 9% in Q2, 2017.

During Q3, 2017, new supply addition witnessed a marginal, quarter-on-quarter dip to reach 7.2 million sq.ft. during Q3, 2017. Mumbai, Bangalore and Delhi NCR accounted for almost 80% of the supply addition followed by Chennai and Hyderabad. Leasing activity was driven by small and medium-sized transactions (<50,000 sq. ft.) with small sized transactions (<10,000 sq. ft) alone comprising 40% of all transactions reported during the quarter.

Other City Highlights–Q3, 2017


  • Mumbai
    • Office space take-up was largely concentrated in PBD – Navi Mumbai, Thane; accounting for almost half of the city’s leasing activity
    • Supply addition witnessed in PBD – Navi Mumbai and ABD
    • BFSI companies continued to dominate space take-up, followed by IT/ITeS/BPO/KPO companies
    • Rental values remained stable
  • Bangalore
    • Leasing activity fell marginally on a q-o-q basis, largely concentrated in non-SEZ developments
    • Office space demand was mainly driven by engineering and manufacturing, IT/ITeS and e-commerce firms which took up large sized spaces
    • Supply addition remained subdued with only Northern Bangalore witnessing supply addition during the quarter
    • Co-working operators continued to be active
  • Chennai
    • Leasing activity grew on a q-o-q basis; mainly concentrated in OMR Zone I and Mount Poonamallee Road (MPH Road)
    • Rental growth witnessed in OMR Zone I (IT) and GST and MPH Road (SEZ)
    • Office space demand was mainly driven by e-commerce, IT/ITeS /and BFSI firms
    • Supply addition rose in the city on a q-o-q basis
  • Hyderabad
    • Leasing activity fell on a q-o-q basis
    • IT/ ITeS corporates dominated leasing activity, followed by BFSI and research, consulting and analytics corporates
    • Supply addition witnessed in IT and Extended IT Corridor
    • Rental values continued to grow across IT and SEZ developments
  • Pune
    • Leasing activity increased on a quarterly basis
    • Rental values rose on a quarterly basis across most micro-markets
    • Office space demand was mainly driven by IT/ITeS firms while consulting, research and analytics and engineering and manufacturing firms were other prominent occupiers
    • Co-working operators continued to be active in the city
  • Kolkata
    • Leasing activity was mainly concentrated in Salt Lake V and Rajarhat, followed by developments in SBD
    • Electronics corporates followed by media and research, consulting and analytics firmsled demand,
    • Bulk of the demand was concentrated in IT developments
  • Kochi
    • Leasing activity increased on a quarterly basis; mainly concentrated in SBD
    • Rental values remained stable
    • The city witnessed negligible supply addition during the quarter
    • Leasing activity in the city was mainly driven by the research, consulting and analytics sector, followed by IT/ITeS corporates

A review of the data for the first nine months of the year reveals that leasing activity continues to remain robust across the key cities. Key highlights for the segment for the January – September 2017 period are:

  • Absorption touched 29 million sq.ft.; marginally lower compared to same period of 2016
  • Bangalore led leasing activity, followed by Hyderabad; signaling the growing prominence of the city as a preferred destination by corporates
  • NCR records 2.4 million sq.ft. of new supply y-o-y in the first nine months
  • New office space completion down 3% y-o-y

Office leasing activity is expected to sustain in the short-term, backed by companies looking to expand or consolidate their operations. Moving ahead, occupiers will continue to keep space utilization and innovation in workplace strategies at the forefront of their expansion plans. Demand and use of co-working spaces is expected to rise with the concept being adopted by corporates who have fluid expansion/occupation plans. With supply continuing to remain constrained across most cities, the demand-supply gap will lead to rental growth across most peripheral and sub-urban micro-markets. Pre-commitments in projects which are nearing completion are also expected to continue in the coming months, due to the limited availability of ‘ready-to-move-in’ space in the coming quarters.


Latest News

News1 day ago

Central Park’s Bignonia Towers in Sohna Achieves Rs 500cr Sales Bookings 

New Delhi, 14th June 2024: Bignonia Towers by Central Park in in Sohna has recorded sales bookings of Rs 500...

News1 day ago

Author Ashwinder R. Singh Launches His Third Book, “Master Commercial Real Estate”

June 14, 2024: Ashwinder R. Singh, acclaimed for his insightful contributions to real estate, launched his third book, “Master Commercial...

News1 day ago

Grade A Office Spaces Demand Growing at a Brisk pace, 164.3 Mn Sq Ft Added Since 2021

June 14, 2024: India’s office market is undergoing a profound transformation, reflecting the country’s robust economic growth, demographic advantages, and...

News1 day ago

Real Estate Sector Needs to Gear Up for New Housing Challenges Until 2029, With Rain Harvesting as a Core Element for Housing Projects: HUA Additional Secretary

New Delhi, June 14, 2024: Additional Secretary of the Ministry of Housing and Urban Affairs, D Thara, on Friday asked...

News2 days ago

Tier-2 Cities Closing the Gap with Top-8 as Property Prices Surge by 10-15% in Prime Areas: Report

New Delhi, June 13, 2024: has released its inaugural “The Bharat in India” report on Thursday. The report unveils...

News2 days ago

Housing Prices Soar 13% CAGR as Inflation Moderates to 5.4%: ANAROCK Report 

Mumbai, June 13, 2024: Inflation, the gradual increase in the general prices of goods and services, erodes the purchasing power of money...