Indian office market is on the path to become "Office to the World": JLL report

New Delhi : India is on the path to become "Office to the world" in terms of providing commercial spaces, highlights a report by JLL, a real estate company.

The report stated that the country stands at an inflection point where India's office markets are expected to move ahead given the tailwinds in the global and domestic economy conditions and India's standing as the "office to the world".

It also added that India's real estate growth momentum will continue to be driven by GCCs (Global Capability Centres) in the second half (July-December) of the year.

The report highlights that both existing GCCs are expanding their footprint and new ones entering the country across varied segments.

Global capability centres are offshore units of multinational corporations that operate across the globe. These centres are responsible for providing various support services, such as IT, finance, human resources, and analytics, to their parent organizations.

The report noted that during the Q2(April-June) of 2024, the top Indian cities recorded gross leasing volumes of at least 1 million sq. ft.

"Q2 (April-May-June) was the first time when all top seven cities (Mumbai, Delhi NCR, Bengaluru, Chennai, Kolkata, Pune, and Hyderabad) recorded gross leasing volumes of at least 1 million sq. ft." said the report.

It also highlighted that the second quarter gross leasing surged by 21.3 per cent Q-o-Q and was recorded at 18.38 million sq. ft. The last four consecutive (Q22024, Q12024, Q42023 and Q32023) quarters have now exceeded the 15 million sq. ft mark in gross leasing volumes, underpinning the strong momentum in the office market.

The report also paints a positive outlook in India's office market and states that the year can establish new peaks in leasing activity, surpassing the historic highs seen in 2023.

According to the report, the first half of 2024 (January to June) marked the best-ever first half, with leasing volumes at 33.5 million sq. ft, surpassing the previous highest first-half performance seen in 2019.

In terms of cities, Bengaluru led the charge, accounting for a 33 per cent share of the quarterly gross leasing, followed by Delhi NCR with a 20.7 per cent share. These two cities have been interchanging their positions in the top two for some time but remain the markets with maximum occupier activity.

The tech sector saw its strongest performance in two years, with its share of Q2 gross leasing at 31.5 per cent. BFSI (Banking, Financial Services, and Insurance) also had a strong showing, accounted for a 20.3 per cent share, followed by the manufacturing/engineering segment with a 17.3 per cent share.

The report noted that the net absorption figures across the top seven cities stood at 10.58 million sq. ft, a significant improvement of 27.5 per cent Q-o-Q.

The year 2024 is projected to mark record-breaking gross leasing of 65-70 million sq. ft, setting the stage for a historic milestone in the country's commercial real estate market. (