India to add 40 mn sqft of office space: CBRE
India is likely to add upto 40 million sq ft of office space this year, according to Anshuman Magazine, CMD (South Asia), CB Richard Ellis, the global real estate consultancy. This will be higher than most other developed countries but lesser than China.
Magazine further noted that cities like Chennai, Hyderabad, Kolkata and Ahmedabad are likely to witness a considerable increase in office space and the huge supply would lead to a correction in rental values at some locations like Bengaluru. "Prices can fall further in certain pockets depending on how much supply these places can absorb, while in other places prices have almost stagnated,” he added.
He said that though the demand for office space had increased in the first two quarters of this year, it would take some time for ‘actual demand to pick up’."IT companies are responsible for 80% of the total demand for office locations and these were the most impacted firms during the recession,” he said. Adding, “But next year supply will dip by atleast 20%," he added. Of the total anticipated supply this year, Mumbai, Bangalore and the National Capital Region are expected to account for bulk of the supply.