Gross office rent in Gurugram nearly doubled, Noida sees slight increase in 2021
The office market in Delhi-NCR remained active last year despite the COVID-19 pandemic, with Gurugram seeing an almost doubling in gross lettings to 4 million square feet, according to Colliers India.
Gross rental of office space in Gurugram was 2.1 million square feet in 2020.
Noida witnessed a marginal increase in gross office space rental to 2.1 million sq ft in calendar year 2021 from 1.9 million sq ft in the previous year. In Delhi, office space absorption remained stable at 2,00,000 square feet.
According to the Colliers India report, the overall Delhi NCR office market saw a 50% increase in office space gross letting to 6.3 million sq.ft in 2021 from 4.2 million square feet the previous year.
Technology companies accounted for 40% of total rentals.
Driven by growing demand for managed spaces from businesses and start-ups, demand for flexible workspaces has tripled and approached one million square feet in 2021.
Commenting on the report, Bhupindra Singh, Managing Director, Regional Tenant Representation and Office Services, North India, Colliers, said: “The overall absorption figures indicate a strong corporate desire to engage in the office segment. and thus show that the WFH (working from home) is only a temporary option”.
In the Delhi-NCR market, DLF Ltd, Brookfield Group, Bharti Realty and Max Group company MaxVIL are major real estate players that offer office space for rent.
The most prominent coworking companies in the NCR are WeWork, Smartworks, Skootr Global, The Executive Centre, Simpliwork, Awfis and The Office Pass, among others.
Singh noted that office uptake in Noida has increased significantly since the onset of the pandemic as it is a highly profitable location backed by superior infrastructure.
The quality of the buildings is comparable to any other development in the North, he added.
On NCR’s office market, Skootr India Founder and Director, Puneet Chandra said, “Corporate occupiers are looking for portfolio re-optimization and focusing on cost-effective and ‘core + flex’ strategies to instill the work of anywhere.” According to Chandra, businesses are encouraged by flexible leases and low upfront cost in managed office space provided by coworking operators.
With an increase in demand for managed office space, Chandra said the momentum for rental agreements has increased significantly.
According to the Colliers report, new supply of Class A office space in Delhi-NCR fell to 4.1 million square feet in 2021 from 7.5 million square feet the previous year.
At Gurugram, new supply has grown from 4.7 million square feet to 2.8 million square feet. Office supply in Noida fell to 1.3 million square feet from 2.2 million square feet.
In Delhi, there was no new supply of premium office space in 2021. The nation’s capital had seen new supply of 6,00,000 square feet in the previous year.
“Developers remained cautious in bringing in new offerings due to high levels of vacancy in some micro-markets,” Colliers said.
The consultant expects a gradual increase in office rentals this year due to the limited availability of quality stock.
(This story has not been edited by the Devdiscourse team and is auto-generated from a syndicated feed.)