Guest Column
Indian cities shed labels as office space trends diversify
The last twenty-one months (January 2012-September 2013) have differed notably from what was generally observed in the seven years up to December 2011. 217 million sq ft of office space was leased between 2004 and 2011, and in the twenty-one months since then another 46 million sq ft was taken up by occupiers. Of this, the share of IT-ITeS companies in total space leased across India up to December 2011 was 43% – this has now fallen to 36%.
Mumbai, Pune, Kolkata, and the Delhi National Capital Region (NCR) strengthened their share of IT-ITeS leased space from 38% to 52%, whereas Bangalore’s share fell to 18% from 34%. Since January 2012, manufacturing companies have accounted for 28% of the total leased space across India – 7% more than their take-up up to December 2011. Bangalore turned out to be the dark horse, leasing 41% of its space to this sector and relegating the IT-ITeS sector to second spot with 35% of the city’s take-up. Prior to January 2012, the share was IT-ITeS 44% and manufacturing 26%.
Hyderabad has emerged as the city of first choice for healthcare, biotech, telecom, and construction companies, which together have taken up 28% of the total space leased in the city (up from 12% up to December 2011). This improved Hyderabad’s share to 16% (up from 8%) of total space leased across India for these sectors. Meanwhile, more consultancy companies have moved to NCR and the Banking, Finance and Insurance sectors (BFSI) has evidently re-assessed its hitherto singular focus on Mumbai and added Pune to its preferred destinations.
It will be interesting to observe how commercial space developers across cities respond to this new diversity trend. — (The author is Head, Research & Reis, JLL)
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