Key Findings
* Cumulative take-up across India‟s seven largest cities increased by a modest 8% year-on-year (y-o-y) in 2011.
* Demand was primarily driven by a number of significant deal closures in the first half of 2011, with demand slowing considerably during the second half of the year.
* Bengaluru, Delhi, Chennai and Mumbai recorded higher than the average quarterly take-up during Q4 2011, while the other Indian markets reported weaker occupier sentiment.
* Project completions fell in Q4 – by 45% quarter-on-quarter (q-o-q) – to reach one of the lowest levels in recent years. This reflects declining developer confidence in several markets.
* Availability continued to decline in most markets in Q4, as demand for space exceeded new supply. Interest rates in India appear to have peaked in the wake of a drop in inflationary pressure during the final quarter of the year.
* However, occupiers remain cautious regarding the business outlook and expansion plans against a backdrop of global uncertainties. The next few months are likely to be critical in deciding the direction of the economy and hence the office real estate sector in the country.
