Hyderabad Sees 48 Percent Rise in Office Space Absorption

Bangalore: Hyderabad is likely to witness a 48 percent rise in office space absorption that is about 2million square feet till the end of 2012. It further indicates an optimistic demand trend, according to a report published by Cushman & Wakefield, a global real estate consultancy firm, reports Sobia Khan of Economic Times.

Sanjay Dutt, executive managing director, South Asia, Cushman & Wakefield stated that "The demand for commercial office space in the city is expected to increase moderately from the next year onwards as the economic conditions improve. Most of the demand is still expected to be driven by the existing corporate within the city through consolidation and relocations,” reports Economic Times.

Over the last eight months of 2012, the city observed about 2.38 million square feet of office space absorption and is likely to touch 3.5 million by the end of 2012. The city’s most sought after commercial office space locations are the suburban areas of Madhapur and Gachibowli, which continues to remain the same, as mainly due to the growth of Grade A property launches, said Cushman & Wakefield.  

"The fresh supply has been in the form of larger contiguous floor plates to accommodate growing trend of consolidation and expansions of corporate in the city," said the report.

Last year, the city’s overall vacancy rate had dropped to 13.6 percent from 15 percent. In the suburban areas, the rate of vacant Grade A properties were lesser than city’s average at 7.4 percent, since these areas continued to remain on high demand.

Dutt also added that "The rentals are expected to remain stable in most of the micro markets in the short term due to the moderate demand and substantial new supply entering the market," reports Economic Times.