According to industry research studies, the National Capital Region (NCR) would dominate the office real estate trends over the next five years owing to various factors.
NCR which has consistently outperformed a lot many real estate markets and has ranked the second largest real estate market with 20 per cent share of the nation-wide leasing volume of office spaces over the past five years will continue its dominance over the next five as well, as per a report by Colliers Research.
The report mentions that owing to Grade A supply, expansion in economic activities and large infrastructure outlay, there will be a high demand of commercial office spaces over the next coming years.
Keeping India office property market overview 2018 in mind, we bring you the most important pointers while analysing the current office real estate trends dominating the NCR market.
As per industry studies, most of the business districts in Delhi are connected on the metro rail network. Over the next three years, with the completion of the Phase 4 of Delhi Metro Rail Network, all the office spaces in Noida and Gurgaon will have metro access within 1.8 miles or within three kilometers. Accessibility by occupiers of office spaces has become an important aspect of Corporate Real Estate (CRE) considering that Walk-to-Work is increasingly preferred.
Grade A office real estate supply in the years to follow
When it comes to the India office market overview 2018, there is a trend where large occupiers are more strategic in their pre-committed space for future requirements, strategic in real estate requirements and optimise their real estate portfolios.
For instance, large occupiers such as Bank of America, Gartner, Google and Boston Consulting Group have pre-committed to office space when it comes to Grade A commercial properties. The trend is likely to continue in preferred micro-markets considering the demand for the Grade A properties in the coming years.
In Vogue: Flexible workspaces with aggressive growth
When it comes to office spaces in NCR, the flexible workspaces have been witnessing a proliferation in growth since 2015. Currently, they manage about one million square feet of office spaces in the NCR area. Rather than being considered as disruptors, flexible workspaces are now being considered as an integral part of modern day CRE. Owing to the lack of Grade A office spaces, flexible workspaces started to appear in Delhi Central Business District (CBD) around 2015-16 for smaller occupiers.
But since 2017, Noida property rates have been the focus of operators along with Gurgaon’s considering the tilt towards larger markets with players such as Cowrks, Wework and Goworks which are leasing large floor plates at strategic locations.
Technology matters: SEZs-specific
With nine million square feet of supply being planned to develop over the next five years, more of the upcoming supply is concentrated in Gurgaon in micromarkets such as Sohna Road and Gold Course Extension Road. The Noida real estate market report predicts that Noida only accounts for 30 per cent of the upcoming supply being concentrated along the Noida Expressway.
According to estimates, only six million square feet is likely to be completed by 2020. So, in order to gain advantage against the existing facilities, technology companies are looking to consolidate, relocate and expand in Gurgaon considering strategic locations along the Special Economic Zone (SEZ)-enabled Golf Course Extension Road.
However, beyond the conventional figures recorded, Noida property rates 2018 point out that MNCs are soon going to dominate this space.