Indian commercial real estate witnessed a new high in the past eight years in gross leasing activity across the major seven cities. As per another report, the overall rental values have also increased by 2.5 percent year-on-year (YoY) across major cities with Hyderabad and Bengaluru leading the pack.
As per a recent report by Colliers, key office micro-markets in Bengaluru, Hyderabad, Chennai, and Kolkata have made it to the list of top 10 markets. These are the markets that witnessed the maximum YoY rental increase in the range of 7.1-16.3 percent in Q4 2018.
Here are the top 10 office micro-markets that witnessed the highest rental growth YoY in Q4 2018:
- Bengaluru- EPIP Zone/Whitefield:
Availability of large floor plates and Grade A developments in this area along with the increased interest of occupiers enabled a spike in the rental value. The area witnessed a YoY rental increase of 16.3 percent in Q4 2018 and is topping the list. The upcoming Namma Metro project along with robust supply pipeline of 9.8 million sq ft will make sure that this micro-market continue to witness the leasing activity.
“We expect this micro-market to witness a notable increase in rent at 8.3 percent, compounded annually over 2018-2021,” Housing.com quoted Ritesh Sachdev, senior executive director, occupier services at Colliers International India, as saying.
- Hyderabad- CBD:
CBD in Hyderabad witnessed a YoY rental increase of 15.8 per cent in Q4 2018. The increase can be attributed mainly to an increase in demand for Grade A office space in the area.
- Bengaluru- Bannerghatta Road:
Due to low vacancy levels and no visibility on upcoming supply, this market saw YoY rental increase of 13.8 percent in Q4 2018.
- Kolkatta- CBD:
The CBD in Kolkatta saw the rental increase of 10.5 percent in Q4 2018. The increase happened mainly due to the expansion of banking companies in this micro-market along with a lack of new supply and its strategic location.
- Chennai- OMR Post-Toll:
This market witnessed a YoY rental increase of approximately 10 percent.
- Hyderabad- PBD:
This peripheral business district micro-market that caters mainly to new Grade A facilities and IT parks occupiers saw a rental increase of 9.1 percent.
- Hyderabad- SBD:
This area continues to be one of the most preferred micro-market down south. The market saw a rental increase of 8.3 percent, mainly owing to low vacancy levels.
- Bengaluru- Hosur Road:
This emerging IT/ITeS micro-market in Bengaluru saw YoY rental increase of 8.1 per cent.
- Bengaluru- Electronic City:
Owing to the availability of large floor plates and premium quality office spaces, this micro-market witnessed a YoY rental increase of 7.5 per cent in Q4 2018.
- Bengaluru- Outer Ring Road (KR Puram-Hebbal):
One of the most active office destination in Bengaluru saw YoY rental increase of 7.1 per cent.