Existing office space stock of 284 mn sq ft can be securitised for Rs 262,800 cr: JLL
New Delhi: The existing office markets potentially have space of 284 million square feet in the top seven cities of the country that can be securitised to the tune of Rs 262,800 crore.
The city of Bengaluru is identified as the country’s biggest hub for assets available for securitization that will account for about 31 percent or 88 million square feet of REIT worthy asset, valued at Rs 81,468 crore, according to a report by JLL.
The direct office transactions in the top seven touched Rs 22,000 crore mark in 2020. There has been larger domestic institutional investor (DII) participation in the recent listings. There has also been emergence of public-private arbitrage play which has been welcomed by all the investors.
“The continued success of listed REITs in India can be attributed to sponsor quality, track record and ability to stay transparent and deliver predicable returns. JLL believes that India’s current office markets across seven major cities have potential space of 284 million square feet that could be securitised with an estimated value of Rs 262,800 crore. This estimate was based on buildings that meet two important criteria - single ownership and large floor space with high occupancy rate.The office space led the pack among asset classes in India, with direct office transactions reaching Rs 22,000 crore in 2020, underscoring its importance to future REIT listings in India.” Dr, Samantak Das, Chief Economist and Head Research & REIS, JLL.