Office space absorption tanks 36% to 16.7 million sq ft in first half of 2020
New Delhi: Gross office space absorption tanked 36 percent to just 16.7 million square feet in the top seven cities of the country in the first half (H1) of the current calendar year.
The corona virus pandemic led to the downfall in the space absorption. Most of the deals that were to be finalised in the second quarter (Q2) of the current calendar year have been postponed to the next few quarters as the occupiers are currently focussing on their business continuity plans.
Some of the deals are being reconsidered for cancellation also. Occupiers are busy in maters like workforce preparation, readiness and safety. As the occupiers are slowly planning to reopen their offices, they will carfully reassess their requirements of office space.
However, on the supply side, there has been an increase of 2 percent in H1 of 2020. There was supply of about 24.1 million square feet of office space. The project completions were significant in Delhi-NCR, Bengaluru and Hyderabad, according to a report by the Colliers India.
The drop in the office space absorption is significant also because of the fact that commercial real estate was doing very well in the country in the recent past and the developers were lining up huge plans for office spaces and other commercial offerings.