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Q3 2023 RICS Commercial Prop Monitor Shows Optimistic Outlook for Indian RE 

New Delhi, November 6, 2023The Royal Institution of Chartered Surveyors (RICS) Global Commercial Property Monitor for Q3 2023 shows India displaying significant optimism, maintaining its CPSI at +23, as an exception. Meanwhile, Singapore saw less momentum in Q3, recording a drop in the headline index from +26 to +6. Malaysia remains in the neutral territory with the headline index at -2. Japan and New Zealand both registered marginal improvements with the headline index rising from -16 to -4 and -18 to -5, followed by Sri Lanka and Australia which recorded -9 and -12 in CPSI. On the weaker end, China and Hong Kong are still in deep negative territory, with both CPSI registered at -32.

According to the Q3 2023 RICS Commercial Property Monitor, the office market in India is experiencing robust activity, with a growing number of occupiers opting for flexible or managed offices across the country. This shift towards more flexible workspaces signifies an evolving work culture and indicates a strong demand for adaptable office solutions in India. Bangalore market shows an upswing except in commercial due to mix or work from home and off so the work is increased but not the requirement of off space but potential to growth is visible and in residential segment there has been a good growth in sales and prices across, which is a positive sign. Furthermore, the residential demand in India has reached an all-time high, particularly in Gurgaon, where it has reached its peak. This surge in residential demand demonstrates the buoyancy of the residential real estate market in India and suggests significant growth potential in the sector. Additionally, in Kerala, Trivandrum shows slight improvement on the residential property side whereas in Ernakulam, the market stays gloomy as the region has emerging negative political impact due to scandals, nepotism, fraudulent activities in cooperative banks, near bankrupt status of the state government, and many other negative factors that are beyond comprehension.

The report reveals positive signs of market recovery in Mumbai, with expectations of an upward trend over the next six months. This anticipated market improvement signals positive sentiment and potential opportunities for investors and developers within the commercial property market in Mumbai. The Q3 2023 RICS Commercial Property Monitor also highlights the positive impact of upcoming infrastructure projects in India, including metro lines and the highly anticipated second Navi Mumbai international airport, set to be inaugurated next year. These infrastructure developments are expected to foster economic growth and further enhance the attractiveness of the real estate market in India.  While commercial property rates in Mumbai are projected to remain stable, the overall real estate sector in the National Capital Region (NCR) is witnessing steady growth. The report underscores the positive trajectory of the real estate market in NCR, highlighting rising capital values and rental growth across various sectors.

RICS said, “The Q3 2023 RICS Commercial Property Monitor offers valuable insights into the Indian real estate market. With an active office market, booming residential sector, and positive signs of recovery in Mumbai, the report indicates significant opportunities for investors, developers, and industry professionals.”

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