Bengaluru sees absorption of .50 mn sq mtr of commercial realty in H12020, emerging star city in Asia Pac region
New Delhi: The IT capital of the country Bengaluru is emerging as an important commercial real estate market not just in India but in the hole of Asia Pacific region. The city a net absorption of commercial real estate of 0.50 million square meters in the first half (H1) of the current calendar year, according to a report by Colliers International.
The city also emerged as the Asia Pacific region’s second-largest Grade A office market by stock. It was only after Tokyo in the region in H1 2020. Bengaluru saw new supply of 641,000 square metres in H1 2020.
Bengaluru remains not only a top occupier location (notably for technology companies), but also Asia Pacific’s second largest Grade A office market by stock after Tokyo.Over H1 2020 as a whole, the biggest drivers of new supply in APAC were the Indian cities. Bengaluru led the way with new supply of 641,000 square metres, followed by Delhi-NCR on 445,000 square metres. While the bulk of this new supply represented projects in the final stage of completion that had been held back from 2019, a lot of activity was reported in India despite a national lockdown. Other major drivers of supply included Melbourne CBD, where 218,000 square metresof new office stock (all grades) were delivered over H1.
“We expect most of the South Indian markets to witness sharp recoveries and even growth in the next calendar year as compared to 2020 ”, said Arpit Mehrotra, Managing Director, Office Services (South India) at Colliers International India.
In Bengaluru, Colliers predicts that the new supply in 2020 will be of 1.90 million square metres, registering a growth of 24 percent year on year. It also expects Bengaluru and Delhi NCR to go down a bit from the high levels of 2020 but remain above 1 million square metres mark annually till 2024.
Colliers expects the rents in 2021 to increase marginally from the lows seen in the current year in the whole of the Asia Pacific region. The rents in Singapore, Bangkok and Bengaluru should increase at 3 percent or more in the next five years. Delhi NCR, Auckland, Melbourne and Taipei should witness rent increase of 2 percent or more in the coming five years.