CBRE - India Office Market View Q12012

7/31/2019 CBRE - India Office Market View Q12012

1/12

2012, CBRE, Inc.

www.cbre.co.in First Quarter 2012

Quick Stats

Rental Movement from last

Quarter

National Capital Region

CBD

Secondary Market

Mumbai

CBD

Alternate Business District

Bangalore

CBD

Peripheral Business District

Chennai

CBD


Hyderabad

CBD

Surburban Areas

Pune

CBD


Kolkata

CBD


India Office

Economic Overview

India's economic growth slowed down

to around 6.1% in the quarter ending

December 2011, registering its slowest

pace in more than three years. This was

largely a consequence of slowing

indus t r ia l growth, s tagnat ing

investment activity and weak global

economic conditions. The Central

Government in its Economic Survey for

the Union Budget 2012-13 estimated

India's economic growth to be around

6.9% for 2011-12, lower than its

previous estimates of 7-7.5%, while

expecting a recovery in 2012-13 to

around 7.6%.

The budget proposals indicated a

strong impetus to affordable housing

and infrastructure. By enabling foreign

funding, supporting flagship schemesand nodal organizat ions, the

Government has aimed at propelling

growth in these two sectors, in order to

stimulate the economy to a higher

growth trajectory. The Reserve Bank of

India (RBI) implemented a reduction in

the Cash Reserve Ratio (CRR) by 125

bps in the present quarter, which is

likely to ease liquidity in the economy

and provide a roadmap for reduction ininterest rates. This is likely to impact

demand and promote construction

activity in real estate and infrastructure

sector. A downside of the budget

proposals has been the proposed

increase in service tax and excise duty

on construction materials, which is

likely to lead to an increase in input

costs for real estate projects.

Demand

Supply

Indicator Trends

Office space demand slowed down

significantly in the first quarter, with

around 4.1 million sq ft of office space

getting absorbed across the leading

cities in the country, compared to

almost 6.5 million sq ft in the previous

quarter. NCR (National Capital

Region), Mumbai, Chennai and

Bangalore were the leading cities;

accounting for more than 70% of the

entire space getting absorbed in the

country.

Supply continued to overtake demand

in the first quarter of 2012, with almost

5.9 million sq ft of office space being

added across the leading cities of the

country. The new supply was largelyconcentrated in NCR, Bangalore,

Mumbai and Chennai, comprising

almost 90% of the entire quantum

added in the present quarter.

Accumulation of stock across most

office micro-markets led to values

coming under some downward

pressure in Q1 2012. Mumbaiwitnessed decline in rental values in few

micro-markets like Nariman Point and

Lower Parel, mainly due to sluggish

demand levels. It is anticipated that

supply dynamics will continue to dictate

rental movement in the coming

quarters, with values in the CBD being

largely stable and those in suburbs

slipping downwards.


2/12

Page 2

2012, CBRE, Inc.

IndiaOffice

FirstQua

rter2012

Outlook

Most leading office destinations are expected to

witness a strong supply pipeline, which might widen

the demand-supply gap, thereby impacting rental

growth negatively. However, prime corporate office

space in the CBDs of most of the major centers is notexpected to be impacted as adversely and values

here should remain stable. The IT SEZ segment

might lose its attractiveness amongst occupiers due

to continuing lack of clarity on tax related incentives.

Growth in the non-SEZ office segment would

depend upon the growth levels in the new economy

verticals like pharmaceuticals, manufacturing,

biotech, telecommunications, along with the

IT/BPO/KPO services. Expansion (as well as

consolidation) plans in these verticals would provide

new opportunities to developers and off-take some

of the surplus stock.

The National Capital Region

The CBD of Connaught Place and its surrounding

areas witnessed some infusion of supply with close to

12,000 sq ft being released in the micro-market. This

new supply is expected to be absorbed by corporates

looking to expand/relocate within the CBD. The CBD is

also expected to witness substantial supply increment

towards end of the year, which is likely to generate

interest amongst prospective occupiers. The otherwise

sparse supply stream indicates that the CBD shall

continue to command a premium over other office

destinations in the region. Absorption gained

momentum as compared to the previous quarter and

stood at approx. 28,400 sq ft. Rental values

maintained stability and vacancy was at a low of 2-3%.

The SBD of Saket, Jasola and Nehru Place did notwitness any fresh supply this quarter. While transaction

activity was limited in Nehru Place, occupier interest

picked up in Jasola and Saket; most occupiers looked

to drive bargains and negotiate favorable terms. The

Saket micro-market observed absorption to the tune of

approx. 55,000 sq ft in DLF South Court and pre-

commitments of 16,000 sq ft in MGF Metropolis.

Jasola on the other hand witnessed absorption of

about 42,000 sq ft of grade A office stock. Most of the

transactions in Jasola were small-mid size in nature

and largely concentrated in a couple of developments

only. Rental values across all micro-markets in the SBD

maintained stability compared to the previous quarter.

Gurgaon continued to be the focus micro-market for

corporate occupiers in the Delhi-NCR region. Close to

0.1 million sq ft of commercial space and 1.56 million

sq ft of IT/SEZ space was added to the micro-market

during the review period. SEZ projects witnessed space

take-up of about 0.13 million sq ft, while almost 0.22

million sq ft of commercial and approx. 0.19 million sq

ft of IT-ITeS space was absorbed in the present quarter.

Compared to the previous quarter, rental values

remained stable.

The Noida micro-market continued to attract tenants

looking for cost effective options compared to the otherprime markets in the region. Approx. 0.1 million sq ft of

SEZ space was absorbed, while another 0.1 million sq

ft was pre-committed in developments along the

Noida - Greater Noida Expressway. The commercial

and IT-ITeS segments also matched pace with an

uptake of about 77, 000 sq ft and 0.15 million sq ft of

space take-up, respectively. Vacancy levels continued

to tread high; rental values were largely stable across

most micro-markets.

Mercer Unitech SEZ Noida 100,000

UHG 3C Oxygen SEZ Noida 100,000

Ingersoll Rand DLF 5A Gurgaon 50,000

Yatra.Com Unitech Cyberpark Gurgaon 25,000

Rei Agro DLF Southcourt Saket 20,000

Major Leasing Transactions

Tenant Building LocationApprox. size

(in sq ft)


3/12

FourthQuarter2008

Page 3

2012, CBRE, Inc.

IndiaOffice

FirstQuarter2012

Rental Value Trends

Capital Value Trends

Outlook

Despite global economic pressures, the office

market in Delhi-NCR is on a stable footing and none

of the prominent micro-markets observed a dip in

rental values. Rentals have consolidated on the back

of consistent occupier activity, primarily in Delhi.

However, an oversupply situation in Gurgaon and

Noida may exert pressures on values as occupiers

look towards striking bargains to leverage the weak

market sentiment. IT occupiers are expected to drive

demand levels across most micro-markets in the

region.

Mumbai

During the review period, the Central Business

District (CBD) of Nariman Point witnessed limited

transaction activity. Only a marginal absorption of

approx. 10,000 sq ft was observed. The micro-market

did not witness the addition of any fresh supply in the

present quarter and vacancy remained stable. In the

coming few quarters, vacancy in this micro-market is

slated to rise from the current estimated 6-7%. Due to

sluggish absorption, rental values witnessed a

marginal decline during this quarter.

Approximately 0.2 million sq ft of Grade-A office space

became available in the Extended Business District

(EBD) of Lower Parel in the present quarter.

Absorption of about 0.18 million sq ft of office space

was witnessed, which led to a decline in vacancy levels.

The micro-markets of Worli and Prabhadevi

witnessed a marginal correction of about 1-3% in

rental values. The decline was largely due to low levels

of transaction activity in the market, with occupiers

focused upon locations like BKC and Lower Parel.There was no new addition of office supply to the

existing stock. Whilst absorption was recorded at a

minimal 20,000 sq ft, vacancy was estimated in the

range of 9-10%.

The Alternate Business District (ABD) of Bandra

Kurla Complex (BKC) continued to remain a

preferred location for corporate occupiers looking for

expansion. The current quarter witnessed space take

CBD (Connaught Place)Grade A

CBD (Connaught Place)Grade B

Secondary market (Nehru Place)Grade A

Secondary market (Jasola)Grade A

Secondary market ( Saket)Grade A

GurgaonGrade A Commercial

Gurgaon

Grade A (IT)

NOIDAGrade A (IT/IT SEZ)

270 270

155 155

190 190

115 115

160 160

88 88

59 59

39 39

Rental Market Indicators

Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)


4/12

Page 4

2012, CBRE, Inc.

IndiaOffice

FirstQua

rter2012


Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)

CBD (Nariman Point, Fort, Cuffe Parade)Grade A

CBD (Nariman Point, Fort, Cuffe Parade)

Grade BEBD ( Lower Parel)Grade A

EBD (Worli, Prabhadevi)Grade A

ABD (Bandra Kurla Complex, Kalina)Grade A

ABD (Bandra Kurla Complex, Kalina)Grade B

SBD (Andheri, Vile Parle, Jogeshwari)Grade A

SBD (Andheri, Vile Parle, Jogeshwari)

Grade BPBD (Malad, Goregaon)Grade A (IT)

PBD (Powai,Vikhroli)Grade A (IT)

PBD (Thane, New Mumbai)Grade A (IT/IT SEZ)

290 300

240 250

150 155

265 270

300 295

250 245

125 125

95 90

95 95

90 90

60 60

Rental Value Trends

up of approximately 35,000 sq ft; vacancy dropped

from 5% in the previous quarter to about 4% in the

present quarter. On account of limited supply, rental

values displayed an upward movement in the range of

1-2% on a q-o-q basis.

Limited leasing activity was witnessed in the

Secondary Business District (SBD) of Andheri, VilleParle and Jogeshwari. Almost 0.6 million sq ft of

fresh Grade A supply was released into this micro-

market; absorption was recorded at around 20,000 sq

ft.

Approximately 45,000 sq ft of IT space was absorbed

in the Peripheral Business District (PBD) of Powai

and Vikhroli during the review period. Navi Mumbai

and Thane witnessed absorption of 0.33 million sq ft of

IT space during this quarter. Vacancy rate dropped

from 10% in the last quarter to approximately 7% in thisquarter. Rental values remained largely stable in the

present quarter.


Tenant Building Micro marketApprox. size

(in sq ft)

Bristol Myers Squibb Indiabulls Finance Centre EBD 40,000

Investec The Capital ABD 8,000

British Petroleum Maker Maxity ABD 7,500


5/12

Page 5

2012, CBRE, Inc.

IndiaOffice

FirstQua

rter2012

Bannerghatta Road witnessed significant number of

transactions in the built-to-suit format for large IT firms

expanding their presence in the city. There were no

significant project completions in this micro-market

during the quarter. Rental values also remained stable

compared to the previous quarter.

The Peripheral Business District (PBD) of

Whitefield continued to be a priority destination for

corporate occupiers, with absorption of around 0.18

million sq ft being reported in the present quarter,

leading to a marginal dip in vacancy rates as

compared to the previous quarter. Whitefield did not

witness any supply during the review period, while

Electronic City witnessed supply of about 0.30 million

sq ft during this quarter. Absorption level remained

unchanged in Electronics City while rental values were

stable over the last quarter.

The Sarjapur Outer Ring Road (ORR) continued to

remain in focus amongst corporate occupiers, as well

as developers, with supply of around 0.80 million sq ft

witnessed in this quarter. Absorption of around 0.18

million sq ft was witnessed, rental values remained

stable compared to the previous quarter.

The North Bangalore micro-market witnessed supply

of around 0.45 million sq ft, while absorption of about

0.10 million sq ft was recorded during the review

period. Rental values increased marginally during the

quarter due to limited availability of grade A office

space in this region. This micro-market is currently

being evaluated by large corporates as a significant

quantum of office space is expected to be added to this

market in the near future.

SunGard Umiya Business Bay Sarjapur ORR 90,000

Indegene Manyata Tech Park North Bangalore 83,000

Redhat IBC Knowledge Park Bannerghatta Road 45,000

Polycom Brigade Summit Whitefield 41,260

SanDisk Bagmane Tech Park CV Raman Nagar 41,000

Times Inc RMZ Nxt Whitefield 35,000

Ixia Umiya Business Bay Sarjapur ORR 30,000



(in sq ft)


Market Outlook

The commercial office demand is expected to

decline in the coming few months, largely due to costconstraints amongst key occupiers. However,

demand for smaller offices in grade A project should

remain buoyant due to the rationalization of rental

values in a few micro-markets.

Bangalore

The Central Business District (CBD) of MG Road,

Richmond Road, Residency Road and Ulsoor Road

witnessed absorption of around 40,500 sq ft of office

space, primarily in the form of mid-sized transactions,

in the first quarter of 2012. Corporates continued to

remain focused on properties in the peripheral and

suburban business districts due to the minimal

availability of grade A space in the CBD. Supply of

around 26,000 sq ft was witnessed in this micro-

market while rental values remained stable when

compared to the previous quarter.

The Extended Business District (EBD) of Indira

Nagar, Koramangala, Inner Ring Road, and CV

Raman Nagar did not observe significant project

completions in this quarter. Absorption of around

43,000 sq ft was witnessed, while rental values

remained largely stable in the present quarter.

Absorption of around 45,000 sq ft was witnessed in the

South Bangalore micro-market of Bannergatta

Road, JP Nagar, Jayanagar and Mysore Road.


6/12

Page 6

2012, CBRE, Inc.

FirstQua

rter2012

IndiaOffice

Market Outlook

Bulk of the new office supply was added to the SEZ

developments located in the city suburbs. However

some prime office developments are also expected

to come on line this year on ORR and in North

Bangalore. Rental values are expected to remainstable or appreciate marginally over the next few

quarters. The city is witnessing a number of

infrastructure developments such as signal free

access from Sarjapur ORR to the Airport, Mass Rapid

Transit System Metro which will enhance

connectivity within the city and elevated expressway

along the Bellary Road, again to the Airport in

Bangalore. These projects would enhance

connectivity from city centre to the peripheral

markets which is expected to augment the demand

for office developments in the North and South-East

locations of the city.


Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)

CBD (MG Road, Residency Road)Grade A

CBD (MG Road, Residency Road)

Grade BEBD (Koramangala, Indiranagar)Grade A

EBD (Koramangala, Indiranagar)Grade B

Outer Ring Road (ORR)Grade A

Outer Ring Road (ORR)Grade B

PBD (Whitefield, Electronic City)Grade A

South Bangalore

Grade ANorth BangaloreGrade A

IndustrialGrade

95 95

70 70

75 75

60 60

47 48

43 43

30 30

44 44

55 54

23 23

Rental Value Trends


Chennai

The Central Business District (CBD) encompassing

areas ofAnna Salai, T Nagar, RK Salai, Alwarpet,

Nungambakkam witnessed a dip in demand for

office space with negligible absorption of around 0.09

million sq ft being reported in the present quarter,

largely in smaller and medium format office spaces.

However, due to negligible supply addition rental

values firmed up by about 2-3% on a q-o-q basis.

The Off / Non CBD micro-market of MRC Nagar,

Guindy and Taramani witnessed stagnation in

market activity when compared to the previous quarter.

Absorption was recorded at around 0.16 million sq ft.

However rental values witnessed a marginal increase

of 4-5% on a q-o-q basis, primarily due to low supply

pressures when compared to the suburban micro-markets. A nominal supply of 0.08 million sq ft was

released; vacancy level was in the range of 3 - 4%.

The Suburban Business District (SBD) including

areas such as Velachery, Perungudi, Mount

Poonamallee Road witnessed maximum activity

during this quarter with an absorption of almost 0.32

million sq ft being reported, compared to around 0.25

million sq ft in the previous quarter. On the supply side,


7/12

Page 7

2012, CBRE, Inc.

FirstQuarter2012

Indi

aOffice


Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)

CBD (Anna Salai, Nungambakkam,RK Salai, T Nagar, Egmore, Alwarpet) 66 64Grade A

CBD (Anna Salai, Nungambakkam,RK Salai, T Nagar, Egmore, Alwarpet) 52 50Grade B

Off CBD ( Guindy, Kiplauk,Taramani, Adyar, Anna Nagar) 48 46Grade A (Non IT / IT)

Suburban Business District (Velachery,Perungudi, Mount Poonamallee Road) 42 40Grade A (Non IT)

Suburban Business District (Velachery,Perungudi, Mount Poonamallee Road) 38 35Grade A (IT)

Suburban Business District (Velachery,Perungudi, Mount Poonamallee Road) 48 48Grade A (IT SEZ)

Peripheral Business District (Perungalathur,Sholinganallur, Siruseri, Ambattur, GST Road) 24 24Grade A (IT)

Peripheral Business District (Perungalathur,Sholinganallur, Siruseri, Ambattur, GST Road) 29 29Grade A (IT SEZ)

no significant additions were witnessed during the

review period. Rental values increased by about 5-8%

on a q-o-q basis; vacancy level was around 7 - 8% in

the present quarter.


Perungalathur, Sholinganallur, Siruseri,

Ambattur and GST Road witnessed minimal activity

with absorption of only around 0.08 million sq ft,

compared to around 0.45 million sq ft in the previous

quarter. The region witnessed an addition of around

0.72 million sq ft of fresh IT space, the only major

supply addition in the city during the review period.

Supply pressures and stagnating demand led to a

downward pressure being created on rental values

and a steep increment in vacancy levels to around 18-

20% in the present quarter.


Building LocationApprox. size

(in sq ft)

Barclays DLF Manappakkam 63,000

BNY DLF Manappakkam 50,000

Amazon SP Infocity Perungudi 180,000

Mitsubishi Prestige Palladium Greams Road 12,000

Tenant

Rental Value Trends


8/12

Page 8

2012, CBRE, Inc.

IndiaOffice

FirstQua

rter2012

Hyderabad

The Central Business District (CBD) comprising of

Begumpet, Somajiguda and parts of Banjara Hills

(Road No 1,2,10, 12) did not witness any significant

increase in absorption levels in Q1, 2012. Rental

values were stable when compared to the previous

quarter. There were no additions to the office stock in

this micro-market and vacancy remained largely

unchanged.

The Secondary Business District (SBD) of

Ameerpet, Himayatnagar, Sarojini Devi Road,

parts of Banjara Hills and Jubilee Hills continued to

experience limited activity levels. There was no

significant supply addition, while absorption of

commercial space was also negligible. Vacancy and

rental values maintained stability when compared to

the previous quarter.

The IT Corridor comprising areas of Madhapur,

HITEC City, Kondapur and Gachibowli remained

the most active micro-market in terms of transaction

activity in the present quarter. On the demand side, the

micro-market witnessed a surge in the number of

inquiries for office space in the Madhapur, Kondapur

and Gachibowli micro-markets. The total absorption

witnessed in this quarter was around 0.33 million sq ft.On the supply front, there has been no fresh addition to

the office stock. Rental values remained largely stable

compared to the previous quarter, primarily due to

availability of significant supply of secondary space in

the micro-market. Vacancy levels witnessed a marginal

decline as compared to the previous quarter.

The Extended IT Corridorcomprising the areas of

Raidurg, Manikonda and Nanakramguda

witnessed absorption of 0.07 million sq ft of office

space in the first quarter of 2012. On the supply sidethere were no new additions to the office stock. Rental

values remained constant as compared to the last

quarter.

Office leasing activity in the Peripheral Business

District (PBD) comprising areas of Uppal, Pocharam

and Shamshabad witnessed interest from office

space occupiers, driven by the availability of ready

supply of grade A commercial space. The Eastern

micro-markets of Uppal and Pocharam witnessed a

significant increase in the demand for office space with

around 0.16 million sq ft of absorption in this quarter

by prominent occupiers. Rentals continued to remain

stable, with a marginal decrease in vacancy rates. The

Southern part of the city witnessed an increase in the

number of inquiries for large scale consolidation/

campus requirements. Rental levels have also

remained largely stable in this region.



(in sq ft)

Infotech NSL Arena Uppal 63,000

Global Data Krishe Sapphire Madhapur, IT corridor 45,000

Quislex DHFLVC Silicon Towers Kondapur, IT Corridor 25,000

Prokarma Divyasree Orion Raidurg 20,000

Market Outlook

Overall market sentiment continues to remain

positive which is expected to translate into healthy

absorption over the coming few quarters. The SEZsegment should continue to witness supply addition,

thereby being a major contributor to the office

market in the city. IT and back-office operations are

expected to continue to remain major contributors to

office demand and transaction activity. Rental values

are expected to remain largely stable across most

micro-markets over the coming few quarters.



9/12

Page 9

2012, CBRE, Inc.

IndiaOffice

FirstQua

rter2012

Pune

Around 0.1 million sq ft of commercial office space was

released in the Central Business District (CBD) of MG

Road, Koregaon Park, Bund Garden, Kalyani

Nagar, Dhole Patil, FC Road and JM Road.

Absorption was recorded at around 0.08 million sq ft,

which included two big ticket transactions by Tata

Teleservices and MWH Global. Rental values for grade

A commercial projects witnessed an increment of

almost 4-5% over the previous quarter, while rental

values for IT space observed an increase of 11-12% on

a q-o-q basis.

Infrastructure growth, proximity to key catchment areas

and attractive rental values ensured that the Off CBD

micro-market of Viman Nagar, Magarpatta,

Aundh, Baner, Shanker Seth Road, S.B Road and

Nagar Road remained a priority office destination for

most occupiers. The micro-market witnessed enhanced

level of enquiries with absorption recorded at around

0.15 million sq ft. About 0.1 million sq ft of office space

came on-line in this micro-market in the present

Rental Value Trends


Market Outlook

Hyderabad is expected to witness a significant

increase in the demand for office space over the next

few months. However, with a substantial volume of

fresh addition to the existing office stock, rental

values are expected to remain stable at the

prevailing levels. The IT Corridor and Extended IT

Corridor are expected to remain the most active

micro-markets for office leasing activity.

CBD (Begumpet/Rajbhavan Road,Banjara Hills (Road No. 1,2,10,12) 46 46Grade A

CBD (Begumpet/Rajbhavan Road,Banjara Hills (Road No. 1,2,10,12) 45 45Grade B

Secondary Business District(Parts of Banjara Hills, Jubilee Hills) 45 45Grade A

Secondary Business District(Parts of Banjara Hills, Jubilee Hills) 44 44Grade B

Secondary Business District (Ameerpet,Himayatnagar, Sarojini Devi Road) 25 25Grade A

Secondary Business District (Ameerpet,Himayatnagar, Sarojini Devi Road) 26 26Grade B

IT Corridor (HITEC City, Madhapur,Kondapur, Gachibowli) 37 37Grade A

IT Corridor (HITEC City, Madhapur,Kondapur, Gachibowli) 27 27Grade B

Extended IT Corridor (Nanakramguda,Raidurg, Manikonda) 34 34

Grade A

Extended IT Corridor (Nanakramguda,Raidurg, Manikonda) 28 28Grade A

PBD (Shamshabad,Pocharam, Uppal) 25 25Grade A


Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)


10/12

Page 10

2012, CBRE, Inc.

IndiaOffice

FirstQua

rter2012

Market OutlookOffice demand is expected to witness an increase in

the coming few months. An increase in demand for

SEZ space coupled with limited supply is likely to

result in rental appreciation along the Eastern

Corridor. However supply pressure is expected to

remain high across most micro-markets, with almost

4 - 5 million sq ft of space lined up for completion by

the end of 2012.

Kolkata

The Central Business District (CBD) of

Chowringhee, B.B.D Bag, Park Street and Camac

Street witnessed limited transaction activity during the

review period. No fresh supply was introduced in the

micro-market and absorption stood at about 22,000

sq ft. Due to many cases consolidation and relocation

to other locations by the occupants of this micro-



(in sq ft)

MWH Brand View CBD 55,000

Icertis Solutions Amar Megaplex Off CBD 23,000

Tata Teleservices Metropole CBD 22,000

Terra Data Magarpatta SEZ Off CBD 22,000

Saba Software Muttha Towers Off CBD 22,000

B&V Commerzone Off CBD 52,000

CBD (Shivaji Nagar, Bund Garden Road,Koregaon Park, MG Road, Dhole Patil) 68 65Grade A

CBD (Shivaji Nagar, Bund Garden Road,Koregaon Park, MG Road, Dhole Patil) 50 50Grade B

Off CBD (Magarpatta, Aundh, Baner,Shankar Seth Road, Viman Nagar, Nagar Road) 46 46Grade A

Off CBD (Magarpatta, Aundh, Baner,Shankar Seth Road, Viman Nagar, Nagar Road) 38 38

Grade B

PBD (Hinjewadi, Kharadi,Hadapsar, Talwade) 35 34Grade A IT/IT SEZ

PBD (Hinjewadi, Kharadi,Hadapsar, Talwade) 27 27Grade B


Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)

Rental Value Trends


quarter. While rental values for commercial stock were

largely stable, those for IT space rose marginally by 4-

5% as compared to the previous quarter.


Hinjewadi, Kharadi, Hadapsar, Talawade and

Kharadi witnessed an addition of 0.3 million sq ft of IT

supply in the present quarter. Absorption remained

muted with close to 18,500 sq ft being transacted.

Consistent occupier interest ensured that rental values

maintained stability during the present quarter.


11/12

Page 11

2012, CBRE, Inc.

Indi

aOffice

FirstQua

rter2012

CBD (Park Street, Camac Street,Theatre Road) 120 120Grade A

Secondary Business DistrictGrade A 80 75

Peripheral Business District(Salt Lake, Rajarhat) (IT) 50 50Grade A

Peripheral Business District(Salt Lake, Rajarhat) (IT SEZ) 37 35Grade A


Sub-market

Average Rent in

Mar 12

(INR/sq ft/month)

Average Rent in

December 11

(INR/sq ft/month)



(in sq ft)

Tata Motors Rene Building SBD 50,000

SFK Bearing Haute Street SBD 8,000

Titagarh Wagon S.B Tower CBD 3,000

market, vacancy levels increased to almost 10-12%.

However, rental values for grade A facilities

maintained stability compared to the previous quarter.

The Secondary Business District (SBD) of EM

Bypass, Kasba-Gariahat, Topsia and Sarat Bose

Road witnessed enhanced activity levels during the

current quarter. New supply in the SBD was to the tune

of approx. 200,000 sq ft, while absorption was

estimated at around 70,000 sq ft. Vacancy levels

increased in Kasba to about 9-10%, on the back of new

projects becoming operational. Rental values in the

SBD have displayed an increment of 6-7% on a q-o-q

basis, with capital values for grade A projects went up

by about 13-14% on a q-o-q basis.

The Peripheral micro-markets of Salt Lake and

Rajarhat did not witness addition of any fresh supplyduring the quarter. However, the micro-market

witnessed increased levels of absorption with almost

around 250,000 sq ft of off-take during the present

quarter. Rental values maintained stability across

commercial and IT segments, with an increase of about

4-5% q-o-q being witnessed in the SEZ segment.

Capital values also remained largely stable in the

commercial and IT segment, with an increment of 9-

10% q-o-q being witnessed in the SEZ segment.


Rental Value Trends


12/12

IndiaOffice

FirstQua

rter2012

Page 12

2012, CBRE, Inc.

HyderabadCBRE South Asia Pvt. Ltd.,211, Maximus 2B,Mindspace Cyberabad,Survey No. : 64 (Part),APIIC Software Layout,Madhapur,Hyderabad - 500 081T (91 40) 40335000F (91 40) 40335050

INDIA OFFICES

New DelhiCBRE South Asia Pvt. Ltd.,Ground Floor, PTI Building4, Parliament Street,New Delhi 110 001T (91 11) 4249 0200 / 4239 0200F (91 11) 2331 7670

ChennaiCBRE South Asia Pvt. Ltd.,2C&D, Gee Gee Emerald151, Village Road,NungambakkamChennai 600 034T (91 44) 2821 4599 / 4571 / 4619F (91 44) 2821 4607

BengaluruCBRE South Asia Pvt. Ltd.,Hulkul Brigade CentreGround Floor, No. 82Lavelle Road,Bengaluru 560 001

T (91 80) 40740000F (91 80 ) 411 21239

PuneCBRE South Asia Pvt. Ltd.,704/705/706, 7th FloorNucleus Church RoadPune - 411001T (91 120) 26055437/367/397/40190100F (91 120) 26055405

We obtained the information above from sources we believe to be reliable. However, we have not

verified its accuracy and make no guarantee, warranty or representation about it. It is submitted

subject to the possibility of errors, omissions, change of price, rental or other conditions, prior sale,

lease or financing, or withdrawal without notice. We include projections, opinions, assumptions or

estimates for example only, and they may not represent current or future performance of the property.

You and your tax and legal advisors should conduct your own investigation of the property and

transaction.

KolkataCBRE South Asia Pvt. Ltd.,Jindal Towers2nd, Floor, Block B

Kolkata - 700017T (91 33) 40190200F (91 33) 40190230

21/1A/3 Darga Road

MumbaiCBRE South Asia Pvt. Ltd.,#202/203, 2nd Floor,Naman Centre, G-block,Bandra-Kurla Complex,Bandra (E),Mumbai 400 051T (91 22) 40690100F (91 22) 26527655

Gurgaon

19th Floor, DLF Square, M Block,Jacaranda Marg,DLF City Phase II, Gurgaon 122002T (91 124) 4659700F (91 124) 4659800

CBRE South Asia Pvt. Ltd.,

About CBRE Group, Inc.

CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered

in Los Angeles, is the world's largest commercial real estate services firm (in terms of

2011 revenue). The Company has approximately 34,000 employees (excluding

affiliates), and serves real estate owners, investors and occupiers through more than

300 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution

for property sales and leasing; corporate services; property, facilities and project

management; mortgage banking; appraisal and valuation; development services;

investment management; and research and consulting. Please visit our Web site at

www.cbre.com.

CBRE South Asia Pvt. Ltd. was the first independent international Real Estate consulting

firm to set up office in the Indian sub continent in 1994. Since then the Indian

operations have grown to a network of offices in all the major metropolitan cities.

Today with over 2500 professionals, CBRE South Asia Pvt. Ltd. is one of the leading Real

Estate consultants in the Indian subcontinent. Please visit our website at

www.cbre.co.in.

Market OutlookThe market has displayed steady activity for the past

2-3 quarters and the trend is likely to continue in the

near future. Absorption activity will be largely driven

by small to mid format transactions. On the supply

front, the SBD is likely to witness supply addition as a

couple of projects are slated to get operational by

mid-2012.

CBRE - India Office Market View Q12012

Documents

Transcript of CBRE - India Office Market View Q12012