Office space absorption tanks 30% in Q1 of 2020: JLL

New Delhi: There has been 30 percent lower net absorption in the office spaces in the first quarter (Q1) of 2020. There has been a pause in expansion plans of many firms which resulted in office pace absorption of just 8.6 million square feet, according to a report by property consultant JLL.

The pause has also resulted in postponement of many deal and also re-negotiations of contracts as well as delaying of fit-outs in new office premises. 

Now the corporate tenants are asking for waiver of Common Area Maintenance (CAM) charges or at least some discounts on it.   

But fortunately, there is no visible trend of deferment in rents or any discount in rents in the top seven cities of the country.

There is far greater focus f the companies on sanitization and well-being of employees. Now is important for developers or the landlords to maintain and sanitize their properties properly. 

“Institutional investors are expected to assess the progress in each sector and are likely to focus on asset management and support projects for their last mile funding in the short term,” says Samantak Das Chief Economist and Head - Research and REIS, JLL 

The silver lining is that the demand for office space stock is expected to remain strong in the medium to long term. The vacancy levels are low and expect to remain so.