Welcome to Noida reality! Contrary to the dynamics of property market where lesser transactions lead to skyrocketing of rental values, in Noida this conventional wisdom of market does not hold true. Noida, as a matter of fact, is a classic case in contrast where the supply is huge, transactions are less and the rental values are the lowest. Reason: imbalance of demand & supply in the same catchment area.
Track2Realty Exclusive: The commercial property is looking forward to sunny days with the forecast of capital values across the commercial segment expected to rise in the next few quarters. The rental market has already started showing the renewed interest level of the occupiers. The widespread economic recovery and the stable government at centre with some of the positive announcements has revived the sentiments across the property market and the commercial property is the first to pick up in the Indian market before other segments also join the rally.
Track2Realty-Agencies: After some neglect in the past several years, the realty industry in India finally saw some reforms that had a direct and indirect impact on its fortunes and which led to the some development of the sector in 2012. The prospect of a revival looks brighter once the central bank keeps it promise of cutting interest rates to spur overall growth.
The economy is facing difficulties on several fronts, including declining GDP growth, high inflation, high fiscal and current account deficits and depreciation of the rupee. The poor performance of the stock market has attracted a lot of negative press in recent months and this was reflected in the commercial real estate market which remained tepid in Q2 2012, says a DTZ research.
With global corporates increasingly seeking to optimize resources, maximize savings, and drive growth, India offers a compelling proposition. During Q1 2024, India continued to witness traction in GCC leasing activity. A significant 5 million square feet (msf) of leasing activity by GCCs, represented 37% of total office leasing across the top six cities. Looking ahead, GCCs are projected to lease between 45-50 msf of office space in the next two years, constituting around 40% of total demand.
Global Capability Centres (GCCs) accounted for a share of one-third in the overall India office leasing in Jan- Mar ’24. Within the GCCs space take-up, E&M companies contributed to over one-fourth share, followed by automobile firms. Bangalore led the chart for GCC leasing, boasting a 60% share, followed by Hyderabad with 26% and Delhi-NCR with 9%. Notably, 38% of the large-sized deals (exceeding 100,000 sq. ft.) were secured by GCCs during this period, underscoring their significant impact on the office leasing landscape.
India office holds upside potential to scale up to 60 msf in 2024. Domestic enterprises to account for over half of the office demand during 2024. GCCs to gain further ground accounting for over 40% of the total demand. BFSI and Engg & Mfg. to drive demand for Grade A office spaces. Flex spaces are likely to drive about 15-20% of the overall leasing in 2024. Large-sized deals of 100,000 sq ft or more, projected to account for 50-55% of 2024 leasing activity. About 30-35% of Grade A office demand is likely to come from PBDs in 2024.
Real estate in general and its future growth in particular is defined by its demand drivers. It is relatively easier to forecast the demand drivers in the residential sector. Reason being that the economic activities indicate the migration of the workforce and hence inherent need for housing. However, to forecast the emerging economic activity, both sector wise and region wise, is more often than not guesstimate, finds Track2Realty.
Apart from the top cities, Tier 2 & 3 cities are also on the radar of many PE funds which see these cities actively driving retail going forward. At least 36% (nearly USD 1 bn) retail-focused funds went to cities like Ahmedabad, Amritsar, Bhubaneshwar, Chandigarh, Nagpur and Mohali. In 2019, ANAROCK Capital was instrumental in Virtuous Retail South Asia (a JV between Singapore’s PE firm Xander Group and Dutch institutional investor APG) concluding a USD 100 mn deal with TRIL for two retail malls – one each in Nagpur and Amritsar.
OYO Workspaces, India’s fastest growing, multi-brand managed workspaces solutions provider is expanding its footprint in India and has forayed into the Hyderabad market with its new Innov8 centre. This new centre named as Innov8 Sreshta Marvel Hyderabad, is situated in Gachibowli, in the vicinity of Hitec City and has a capacity of over 700 seats. It is a beautifully crafted workspace with an industrial design language and is the latest addition to the company’s 22+ coworking centres.