Even as the Indian real estate sector continues to experience a downturn, cities such as Bengaluru and Mumbai are expected to attract healthy office rentals in 2020, mainly backed by rapid IT industry growth, a study said.
Beating not only Delhi and Mumbai but also Singapore and Hong Kong, according to a survey, the rental office market in Bengaluru is now the highest performing one in the Asia Pacific. While rentals in Bengaluru are now lower than BKC from Mumbai and Connaught Place from Delhi, Bengaluru posted the highest 17.6 per cent rental rise.
Due to the availability of the right talent pool and new office assets at comparatively low rents, multinationals continued to expand robustly, especially in Bengaluru. When demand for office space is expected to increase in 2020, we expect the trend to continue for these markets.
In the first half of 2019, the IT industry accounted for 35% of the total volume of transactions across the top eight cities, most evident in Bengaluru, which recorded a 14% rental increase in January-June (H1) 2019.
Grade-A office rents across the Asia-Pacific region are expected to fall by as much as 3 per cent in 2020, compared to a 0.6 per cent increase in the first nine months of 2019, as occupier demand continues to weaken.
Bengaluru’s central business district (CBD) was the best-performing Asia Pacific sector in July-September (Q3) 2019 with 17.6 per cent rental growth, the report said.
Connaught Place’s CBDs in NCR and Bandra Kurla Complex in Mumbai were the 7th and 11th fastest-growing prime office markets in the Asia-Pacific region, with 4.4% and 2% year-on-year rental growth respectively, it said in Q3 2019.
Myrsa is an online platform where you can find commercial spaces for rent on a temporary basis.