Hyderabad has taken the lead in India's office space market during the July-September quarter, showing a remarkable surge in leasing and new supply, according to Vestian, a major real estate consultancy.
The city experienced a 270% increase in office space absorption, reaching 3.7 million square feet. Simultaneously, new office space supply soared by 175%, totalling 5.5 million square feet in the same period.
However, while Hyderabad soared, Bengaluru faced a downturn. Bengaluru witnessed a 28% decline in office space absorption, totalling 3.6 million square feet. According to Vestian's report, the new office space supply also dropped by 25%, amounting to 2.7 million square feet during July-September.
The report covering seven major Indian cities unveiled a 21% growth in office leasing and a 26% increase in new supply during the third quarter of the calendar year.
Shrinivas Rao, CEO of Vestian, highlighted heightened activities in the Indian office sector during Q3 2023, marking the highest absorption levels since the pandemic, along with a surge in new completions. Discussing the demand-supply trend, he emphasised, “The key office markets in Southern cities evolved and commanded the highest share of the pan-India absorption and new completions.”
Rao predicted a potential rental rise in Southern cities, particularly in Hyderabad, as several large corporations encourage their employees to return to office spaces, signalling a resurgence in demand.