Hyderabad: Southern cities Hyderabad, Chennai and Bengaluru are creating a niche for themselves in office space as they have surpassed Singapore and Hong Kong. During the September quarter, the three Indian cities recorded over 23 per cent growth in office space, according to Knight Frank India (Asia-Pacific) Q3-2019 Office Rental Index report.
This year witnessed a volume of 46.5 million sq ft office space in eight cities in India. Hyderabad and Bengaluru account for 70 per cent of the total office space deals in the country. Coming to industrial verticals, IT and ITeS segments garnered about 42 per cent. The report made a forecast of 50 million sq ft office space deals in 2020.
Hyderabad has been expanding in terms of office space ever since the formation of Telangana in 2014. The TRS government is implementing TSiPASS, and tax sops and infrastructure development are adding to the growth of the office space. Affordable office space, availability of skilled workforce, etc., are icing on the cake. Hyderabad recorded 10.5 million sq ft office space in 2019 and technology companies accounted for 50 per cent of the total demand. Meanwhile, flexible workplace witnessed a four-fold jump as the area grew 32 per cent. The Knight Frank report expects demand for 13 million sq ft space in 2020.
Bengaluru topped the list in terms of office rent followed by Melbourne and Bangkok during the third quarter. The office rents rose 17.6 per cent in Bengaluru, 15.5 per cent in Melbourne and 9.4 per cent in Bangkok in the quarter. Bengaluru also recorded the highest number of transactions for office space in the country as the City of Gardens witnessed 15 million sq ft office space in 2019.
Hong Kong stood at the top in monthly rentals, recording $206.5 per sq ft rent. The monthly rental was $11.9 in Tokyo and $80.5 in Singapore. Mumbai stood at the top inexpensive office space in India and fifth place in Asia-Pacific region. Monthly rentals in National Capital Region (NCR) were $51.8 per sq ft, $46.2 in Mumbai, and $20.5 in Bengaluru.