Office space leasing at historic high, records 46.8 msf in 2018
Mumbai, January 10, 2018: Knight Frank India today launched the 10th edition of its flagship half-yearly report – India Real Estate. The report presents a comprehensive analysis of the residential (across eight cities) and office (across seven cities) market performance for the period July – December 2018 (H2 2018). The report findings establish 2018 as the best performing year historically for the commercial office segment with leasing crossing 46 million square feet (msf). The residential market saw some upward movement in sales velocity, but the year stopped short significant recovery. Total sales of residential units were estimated to be 242,328 registering a 6% increase over full year 2017.
Residential market highlights for top 8 cities1
2018 marks the first time in this decade when annual launch numbers have grown y-o-y.
Launch | Units Sold | |||||
City | %
change (y-o-y) |
%
change (y-o-y) |
||||
2017 | 2018 | 2017 | 2018 | |||
Mumbai | 23,253 | 74,363 | 220% | 62,256 | 63,893 | 3% |
NCR | 11,726 | 15,819 | 35% | 37,653 | 40,643 | 8% |
Bengaluru | 22,410 | 27,382 | 22% | 34,546 | 43,775 | 27% |
Pune | 12,705 | 32,684 | 157% | 33,966 | 33,521 | -1% |
Chennai | 9,235 | 10,373 | 12% | 15,520 | 15,986 | 3% |
Hyderabad | 3,511 | 5,404 | 54% | 14,243 | 15,591 | 9% |
Kolkata | 15,940 | 12,015 | -25% | 14,147 | 12,731 | -10% |
Ahmedabad | 4,790 | 4,167 | -13% | 15,741 | 16,188 | 3% |
All India | 103,570 | 182,207 | 76% | 228,072 | 242,328 | 6% |
Source: Knight Frank Research
Shishir Baijal, Chairman and Managing Director, “The residential market in 2018 recorded a recovery after 7 years, which has been led by the affordable segment. Incentives from government such as lower GST rates and infrastructure status to affordable housing have fuelled the demand for the sector. The supply side has accordingly calibrated itself in this period. Having said that, NBFC crisis created a liquidity crunch in the second half of 2018, which restricted sales, particularly in Mumbai and NCR in H2 2018.”
The markets will remain in a cautious mode due to the upcoming general elections and the after-effects NBFC crisis through most of the first half of 2019. On the positive side, the anticipated downward revision of GST on under construction houses should provide a boost to the buyer sentiment. This, coupled with stable interest rates and inflation remaining largely under control, should lead to increased velocities in the second half of 2019. The focus is expected to continue in the affordable segment,” added Shishir.
Commercial market highlights for top 7 cities2
City |
New Completion (mn sq ft) | ||||||
H1 2017 |
H2 2017 |
Full Year 2017 |
H1 2018 |
H2 2018 |
Full Year 2018 |
% change 2018/ 2017) |
|
Mumbai | 7.6 | 2.8 | 10.4 | 4.4 | 2.2 | 6.5 | -37% |
NCR | 1.8 | 2.3 | 4.1 | 3.6 | 4.0 | 7.6 | 86% |
Bengaluru | 3.7 | 4.4 | 8.1 | 3.7 | 3.9 | 7.6 | -6% |
Pune | 1.7 | 0.4 | 2.1 | 2.7 | 4.2 | 6.9 | 229% |
Ahmedabad | 2.2 | 0.7 | 2.9 | 0.9 | 2.2 | 3.1 | 6% |
Chennai | 1.1 | 0.8 | 1.8 | 1.2 | 0.2 | 1.3 | -28% |
Hyderabad | 2.0 | 1.3 | 3.2 | 1.7 | 2.1 | 3.9 | 19% |
Total 7 cities | 20.1 | 12.5 | 32.7 | 18.2 | 18.7 | 36.9 | 13% |
Source: Knight Frank Research
Leasing Activities | |||||||
City |
H1 2017 |
H2 2017 |
Full Year 2017 |
H1 2018 |
H2 2018 |
Full Year 2018 |
%
Change (Full Year 2017 / Full Year 2019 |
Mumbai | 3.1 | 4.4 | 7.5 | 2.9 | 5.1 | 7.94 | 5% |
NCR | 3.2 | 3.2 | 6.4 | 3.4 | 3.9 | 7.34 | 14% |
Bengaluru | 5.8 | 5.9 | 11.7 | 6.5 | 6.9 | 13.40 | 14% |
Pune | 1.8 | 2.7 | 4.5 | 3.9 | 2.7 | 6.57 | 46% |
Ahmedabad | 1.1 | 0.3 | 1.5 | 0.5 | 0.6 | 1.03 | -29% |
Chennai | 1.9 | 2.6 | 4.5 | 1.8 | 1.7 | 3.47 | -23% |
Hyderabad | 2.3 | 3.3 | 5.7 | 2.7 | 4.3 | 7.03 | 24% |
Total 7 cities | 19.2 | 22.6 | 41.8 | 21.5 | 25.2 | 46.78 | 12% |
Source: Knight Frank Research
Shishir Baijal, Chairman and Managing Director, The commercial market surpassed previous records and registered a new high in 2018. Bengaluru continued to demonstrate its front runner status, by clocking an all-time high transaction volume, Leasing volumes and fresh supply have shown growth trends in 2018 which are reflective of heightened economic activity. 2019 is expected to witness undercurrents of several geo-political events and resultant economic developments that may impact markets and businesses.”
Corporate Comm India(CCI Newswire)
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