The second wave of Corona virus has impacted the leasing of the office space in Hyderabad to an extent. Compared to the second quarter of 2020, the vacant space available for lease for offices in the city is up by 14 per cent during the corresponding period this year. Last year, the availability of office space for lease during the corresponding period was only 6.5 per cent. The office space is going to remain tenant-friendly for the next 12 or 18 months as the land lords are willing to cut down on the rents.
In the second quarter of 2021, several firms took 28 lakh sft on lease, which is two times more than the total office space leased out in the first quarter. Reputed firms like Legato Ltd and Qualcomm took 20 lakh sft on lease, while the rest of the 8 lakh sft was leased out to various firms to meet their office needs.
As the vaccination programme has been progressing, several business establishments have been changing their strategies on taking the office space on lease. In fact, many of the business houses took the office space on lease in Madhapur. Several smaller business establishments took the opportunity that came their way with the both hands as the furnished office space is on the offer. Several business houses engaged in IT and BPO, engineering and health care sectors took the office space on lease.
More availability of office space
In the second quarter of this year, first 18 lakh sft of office space was on the offer for those who want to set up their offices in the city. Of which, 72 per cent of the area was leased out through pre-lease. In spite of the some organisations are leaving the market, the demand for office space has increased by 14 per cent. During the past 12 months, the vacant office space has almost doubled in the city. As more and more office space is on the offer, some of the business establishments have changed their strategies. In the second quarter of this year, another 40 lakh sft is going to be made available for offices to lease. But, the lion’s share of the space has been leased out through pre-leasing activity.
Did the office lease go down?
In spite of various firms vacating their office space in Madhapur and Gachchibowli, the office lease remained more or less stable for the past three months. Because of this phenomenon, the land lords are coming forward to reduce the lease amount. For the next 18 months, the office space market would remain favourable to prospective lease holders.
