Hyderabad secures second position after Bengaluru for acquiring large-size office spaces
Hyderabad, the capital city of Telangana state has secured the second position for being occupied and reserved with the maximum amount of spaces/ plots for offices. The city of pearls stands second in line after the record was broke by Bengaluru, the capital city of Karnataka state.
The role record of Hyderabad stratifies that the city is in a hike of almost and approximately 3.70 million square fts. coverage continuing to expand more than 12 percent from the previous quarter alone.
Most of the office space is reserved in HITECH-City-Kondapur, Rayadurg, Nanakramguda, Financial District, and Gachibowli witnessing more new completions on different official construction projects. These areas are likely to come under Grade A space where the rent of each sq. ft is Rs 62 but the average rental if all locations are considered it is Rs 45 per sq. ft.
On the other hand, where Bengaluru is considered top most on the list, it witnesses large-sized deals above 100,000 square feet area, and it is expected to form a major portion of the projected leasing by the end of the year 2021.
The city also witnesses a 20-30 per cent increase in absorption where the supply is expected to be incremented by a growth of 20-30 per cent. It is heading to lead with an estimated absorption of 14 million square feet by year-end as confidence among corporate occupiers in the city continues to remain strong.
All credits to the diversified talent pools and robust tech ecosystem built-up in Bengaluru that allows the city to expand confidently ahead of others.
According to the reports of 2018, Hyderabad has seen office absorption of about 70 lakh sqft, which is the highest ever. This is about 24 per cent more than 2017.
Also, the demand for office space will continue to rise and in 2019 it could even breach 85 lakh sqft even as reaching the same 70 lakh sqft is a given thing, he said. This will mean another 85,000 new jobs going by the same 100 sqft metric. Last six months-from July to December, have seen office space leasing of 43 lakh sqft, which is an all-time high leasing volume.
The Indian demographic reports states that the office space absorption across India’s six major cities is expected to touch 41.3 million square feet by the end of 2021, marking a growth of 22 per cent from 2019.
Anurag Mathur, the CEO of Savills India explained how with the help of the government reforms sincerely and positively towards the economic activity may certainly improve the office space absorptions. With the expansion of the office real estate market, these office space absorptions will attract more reliable investors despite the disruption caused by COVID in 2020.
Hyderabad greatly hopes for a successful completion of the 2021 in terms of the office real estate market in Hyderabad. It hopes to see an abrupt growth of 25-30 per cent in this sector so that the IT sector continues to drive its leasing activity in the pearl city.
Hyderabad’s office market has seen net absorption rising by 83 percent, QoQ, to around 2.80 million sq ft in the fourth quarter (Q4) of 2020, according to a report by Jones Lang LaSalle (JLL). The city has seen this metric increase continuously over the previous three quarters, thus exhibiting signs of sustained recovery.
The jump in net absorption was backed by fresh completions becoming operational with full occupancy during the studied period. HITEC City and Gachibowli continued to attract occupiers, constituting a significant portion of the leasing activity.
Net absorption and new completions are forecasted to increase further in the next two quarters as significant projects, which have been entirely pre-committed, are likely to get operational.
Vacancy levels in Hyderabad continued to rise during Q4 2020, as the year saw occupiers resorting to cost and space optimisation strategies. Rentals have mostly remained range-bound across the majority of sub-markets in the city during the said quarter.
Moreover, everything is depended on time. The time can estimate how much of the office space in Hyderabad shall be absorbed by the end of 2021. It may even cause that this year in 2021, there will be excessive supplies to force the developers to reduce the rents for increasing their chances of finding customers. But this kind of situation will allow existing companies to expand more even as new ones come to Hyderabad.
KFortune is a real estate company and we deal in residential plots in and around the city of Hyderabad. With over 20 years of experience, we aim to deliver the best plots at lowest rates. Check out our Current projects and continue to read about procurement of large sized office spaces in the metropolitan cities of India