One among top 3 cities in office space absorption
Engineering & manufacturing occupiers lead the leasing activity
Hyderabad: Hyderabad stood among the top three cities in India, with office space absorption at 2.6 million sft in Q2 2022, says a report by real estate consulting firm CBRE South Asia Pvt Ltd. The office space leasing in Hyderabad was mainly driven by engineering and manufacturing firms, having a share of about 53 per cent, followed by life sciences (16 per cent) and BFSI (15 per cent) firms.
As per the report, small-sized deals dominated the transaction activity; 69 per cent of the absorption during the quarter was recorded in SEZ spaces, 22 per cent in IT spaces and, 9 per cent in non-IT spaces. On the supply side, project completions were dominated by SEZ spaces having a share of 74 per cent, followed by IT at 17 per cent and non-IT at 9 per cent.
The city also witnessed a few major transactions with Qualcomm leasing 1.1 million sft in CommerZone Wing 1, PwC leasing about 0.35 million sft in My Home Twitza, and Legato leasing about 0.33 million sft in Vance Business Hub (H9). It will continue to drive transaction activity in the coming quarters of this year.
The report's findings also highlighted strong demand for office space in India across major Indian cities in Q2 2022, as leasing activity grew by 61 per cent to touch the highest-ever quarterly office space absorption of 18.2 million sft. Among the major cities, on an H1 basis, office absorption stood at 29.5 million sft, recording a growth of 157 per cent Y-o-Y.
Anshuman Magazine, Chairman and CEO - India, South-East Asia, Middle East & Africa, CBRE, said: "The office sector in India reflected a strong recovery in H1 2022 as occupier sentiments were uplifted due to the relatively reduced severity of the Omicron wave, the subsequent relaxation of restrictions, and improved economic activity."
He adds, "It is evident from the leasing activity that employees are resuming office with a flexible approach. The supply addition in Hyderabad was particularly notable, as the city's stock crossed 100 million sft during the quarter, making it the fourth market in India after Bengaluru, Mumbai, and Delhi-NCR to reach that milestone."