The office sector in the country is making strides. According to a report by Cushman & Wakefield, the demand for office space in eight major cities across the country is expected to exceed 80 million square feet this year. While it was 74 million square feet in 2023, an additional 6 million square feet is anticipated this year. In the first six months of 2024, 41.9 million square feet of office space leasing was recorded, and a similar trend is expected in the second half of the year, with another 40 million square feet of office space leasing likely to be registered. The report also noted that several international companies are looking for Grade-A office space from reliable developers.
In reality, leasing of Grade-A office spaces has decreased by 0.40% to 17.7% in the first six months of this year. This is noteworthy as it is the lowest leasing rate observed since the last three months of 2021. During the first half of this year, the IT-BPM sector accounted for the highest share of 26% of the total office space demand. The BFSI sector follows in second place. Experts indicate that India is offering positive, competitive advantages internationally, with a high number of young and tech-savvy professionals in the country, which is attracting international companies.
Factors such as strong economic fundamentals, advanced digital technology, an increase in employees coming to work in offices, and the implementation of expansion plans deferred during the pandemic are all contributing to the increased demand. While domestic demand remains stable, the Indian economy is also attracting international companies. There are expectations that office leasing will set new records this year. Real estate experts say that factors like diverse skill sets, a technology-friendly environment, and the development of infrastructure are facilitating the establishment of Global Capability Centres (GCCs).
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