Office Gross Absorption Goes Up Marginally By 4% To 12.2 MSF In Q1: Colliers
New Delhi: The Corona virus-hit first quarter (Q1) of 2020 saw office gross absorption go up marginally by 4 percent to 12.2 million square feet across the top seven cities of the country.
The total supply increased by 1 percent to 13.2 million square feet with developers focusing on completing projects, according to Colliers India.
The IT-Business Process Management sector (IT-BPM) dominated the leasing activity in Q1 of 2020. It accounted for 55 percent share in overall leasing. The flexible workspace operators grabbed 15 percent share of the gross leasing activity in Q1 of 2020.
Bengaluru recorded leasing of 3.7 million square feet of office space on account of strong expansion by technology companies. The technology and IT-BPM sector accounted for 58 percent of the leasing. Flexible office operators took away 11 percent of the gross absorptions in the city. The new supply in Bengaluru dropped 5 percent to 4.2 million square feet.
Delhi-NCR saw gross absorption go up by 21 percent in Q1 of 2020 as compared to the same period of 2019. The technology and IT-BPM companies took away 57 percent of the leasings. They were followed by flexible workspace operators with a share of 19 percent. Delhi-NCR saw new supply of 2.6 million square feet.
Pune’s gross office space absorption jumped 90 percent to 2.2 million square feet in Q1 of 2020. The leasing activity was driven by absorption of pre-committed spaces by technology companies taking away 77 percent of the leasings.
“While Indian market is likely to see adverse impact from the ongoing COVID-19 pandemic, India is relatively better placed in terms of economic growth, with GDP expected to grow at 4.4%. Going ahead, demand from resilient sectors such as technology should be stable, with pharmaceuticals, ecommerce and logistics sectors also increasing,” said Sankey Prasad, Managing Director and Chairman, Colliers India.