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A 60% Surge In Office Leasing Deals In Top Eight Indian Cities In The Past Five Years: JLL



Top Eight Indian Cities In office leasing

JLL India data shows that close to 1,300 lease transactions were recorded in 2017, compared to 820 transactions in grade A buildings during 2013.

Mumbai: Over the last five years, top eight cities in India have seen a 60% rise in the total number of office leasing transactions, exhibiting the strong drive of commercial real estate absorption.

Data from JLL India reports that up to 1,300 office leasing deals took place in 2017, a much better number compared to around 820 lease deals recorded in grade A buildings in 2013. However, the average size of transactions has shrunk. The size per transaction has shifted from an average of 31,000 sq.ft. in 2013 to 27,000 sq.ft. in 2017. This development is significant as it defines the way how office space is being consumed.

Though it is a fact that IT and ITeS continue to make deals, the drop in the average size of transactions indicates a trend of rationalization of space uptake through consolidation and workspace strategy implementations.

“Indian office transaction is at an interesting cusp. We have been experiencing a growth in overall leasing activities. While net absorption has remained stable for the past few years, we expect it to be at around 32 million sq. ft. by end of 2018 and be close to 35 million sq. ft. in the subsequent two years till the end of 2020,” said Ramesh Nair, CEO and Country Head, JLL India.

In the previous year, net leasing increased to 29 million sq.ft. and the total number of deals was up to 60% higher than in 2013, and about 7% year-on-year over 2016. But, the big leap was witnessed in the periods of 2014 and 2015, which was widely due to the stability ushered by the then newly elected government that had risen to power with a clear majority.

Nair strongly anticipates that the share for co-working and flexible office space will grow over the next few years, with IT/ITeS will continue to be the largest leasing group.

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