Bangalore Second In Top 30 Cities For Office Space Expansion In Asia

The report says that, the office space absorption in Mumbai, the economic capital of India,  is likely to see a 93 percent rise this year. The vacancy levels will still be high at 25 percent with the addition of 1.5 million sq ft office space. "Given the scenario, the rental values of these locations are expected to remain stable with a downwards bias," said Dutt.

There is low demand but high leasing activity in companies located in the other key suburbs such as Gurgoan in Delhi-National Capital Region, Malad and Goregaon in Mumbai.

By the end of 2013, the total office space absorption is expected to be 22 million sq ft, down 11 per cent from the previous year. About 25-30 percent of the office space absorption in 2013 mostly consisted of relocations and/or consolidations where the companies relocated to the suburbs as the infrastructure there was better, more efficient and cheaper. As there was very less activity in the commercial office space last year, the new demand may fillip the absorption of office space in the later part of 2014.

 The total office space supply in 2014 is expected to be 37 million sq ft, which is an increase of over 12 percent over 2013, while an additional 32 million sq ft is to be added up by 2015. Bengaluru, Delhi NCR and Hyderabad will be the leaders for this new demand. The report states that, the net absorption will see an increase of 3 percent in 2014 over 2013 and that nearly 11,854 crore is about to be deployed in the real estate sector this year.