Bengaluru tops leasing among Asia Pacific cities in first quarter
BENGALURU: The IT capital of India saw the highest leasing in Asia Pacific Cities during the first quarter of the year. The rise in demand was driven by the IT-ITeS occupiers who executed their expansion strategies and increased their real estate footprint in Bengaluru. Ecommerce firms and corporate offices of manufacturing firms are also actively leasing in the city.
JLL’s Global Market Perspective 2Q16 mentions that Bengaluru and Delhi outperformed bigger global markets on the back of big-ticket office leasing transactions in 1Q16 across Asia Pacific.
“These two Indian cities together saw gross leasing of more than 0.4 million square metres (net leasable area) in 1Q16, out of which Bengaluru saw more than 0.2 million square metres and Delhi-NCR saw more than 0.1 million square metres,” said the report.
“Leasing volumes in the Americas fell by a 10 per cent (y-o-y), Europe and Asia Pacific increased by 14 per cent and 7 per cent respectively (y-o-y),” said Anuj Puri, Chairman & Country Head, JLL India.
The IT capital of India was followed by Tokyo that saw good pre-commitments on upcoming supply. Delhi came third due to healthy leasing activity as also pre-committed space became operational.
“Absorption has been very healthy and there is a huge appetite among investors to buy office space too,” said Nanda Kumar OP, head of leasing at Prestige Constructions. Some of the large firms who set up or expanded their footprints in Bengaluru include Microsoft, Apple, Google, IBM and Accenture.
The first quarter did not see a Chinese city figure in the top-3 as new leasing was down in Beijing and Shanghai -partly due to the timing of new supply and less available space.
Otherwise, demand for office space in China’s tier-I markets was largely sustained despite slowing growth in the country’s economy.
Sustained demand for office space has consistently driven commercial real estate growth in Bengaluru that crossed a milestone in mid-2013 by becoming the first Indian office hub to join the global club for 100-million-sq ft office markets.
Currently, the city has around 40 million sq ft of space is in different stages of planning and construction.