OFFICE SPACE DEMAND ON RISE

Office space apsorption rose by 17 per cent to 6.6 million sq ft in the seven major cities of the country during January-March quarter, according to global property consultant CBRE. "The prime office space segment across key cities in India are witnessing an improvement in sentiment from last year. Approximately 6.6 million sq ft of space absorbed in Q1, 2013 as compared to 5.6 million in Q1 2012," CBRE said in a statement. According to CBRE's latest report, India Office Market View Q1 2013, the transaction activity during Q1, 2013 was dominated by Mumbai, Bangalore, Chennai and NCR (National Capital Region), representing about 90 per cent of the total volume during the quarter. Hyderabad, Pune and Kolkata are the other three markets. "This is a positive sign for the Indian economy reflecting business expansion along with consolidation. This also indicates that the downward trajectory should be plateauing in the near future," CBRE South Asia Chairman and Managing Director Anshuman Magazine said. However, he said the Indian office market would continue to take cues from the existing economic sentiment globally and within the country. "It is too early in the year to take a position on the market performance". The report said that the occupier focus continued to be on consolidation and more efficient use of existing portfolio. The transactions took much longer to conclude and majority of the demand was for smaller floor plate sizes. "Rental values continued to witness downward pressures across most micro-markets as occupier expansion faced cost pressures and consolidation continued to be the key theme. Rents were stable in suburban office markets such as Gurgaon, Noida, Outer Ring Road, Whitefield, Hitec City and Gachibowli, among others," the report added.