Commercial reality market touching skyline

Reality Market at its Peak

The commercial real estate of most of the Indian cities is booming after the prolonged abeyance. The rentals will remain under control for sometime considering the plethora in the market. The report by one of the popular property consultants ‘Knight Frank’ says that, office absorption in January-March 2012 rose up by 23 percent as in comparison with 2011.

1.04 million sq ft have been total transaction of office space, both sale and lease, in Mumbai from January to March this year as compared to corresponding year which was 0.88 million sq ft. Rentals and capital prices have dropped over the last one year even when the number of transaction are increasing. Commercial space leased at the approximate monthly rentals in Mumbai in the first three months of this year was Rs 111 per sq ft as compared to Rs 120 per sq ft in the first three months of 2011. In the same way the average property price fell between January to March of 2011 and 2012. The report pinpointed that , the growing numbers are yet to take over the present supply, causing a wider gap between demand-supply over the past year causing rent and vacancy levels to remain under burden.

The primary driver of office-space market in most of the Indian cities has been the Banking, Financial Services and Insurance (BFSI) sector, transactions in office-space in IT/ ITES sector has been abridge by half due to the interminable debt crisis. The additional report by Jones Lang LaSalle reveals that, a marginal growth is expected in the rentals of Grade A offices in Mumbai by the second quarter of this year.

An expert alleges that, with a view to boost transactions at a time when the vacancy rates are high, the developers will refrain from rising rentals. He also stated that, the cue of Indian economy is not very encouraging, office occupier continue to block the widening plans across all the major cities of India.  Significant office supply is expected in Delhi and Mumbai over next few months.

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Tags : Commercial real estate, Commercial projects in NCR, Commercial real estate, Cosmic Group, Cosmic Projects.