New Delhi: Improving economic sentiment and rising confidence of the corporate sector led to a 65% jump in demand for office space in the April-June quarter at 5.66 million sq ft compared to the previous quarter.
However, the gap between demand and supply also grew wider during the quarter with supply outstripping demand by over 50% and increasing the average vacancy across major cities in India to over 13-18%, according to real estate consultancy Cushman and Wakefield.
Rental corrections during the quarter ranged from 3-10% across most micro markets in key cities of India. The highest correction was recorded in Thane, which saw rentals declining by 25% on account of low demand.
Bangalore’s suburban locations recorded a correction of 12% while Nagar Road in Pune registered a drop of 14% in rental values over previous quarter, the consultancy said in a report.
Mumbai continued to remain volatile in terms of rental values. Bandra-Kurla Complex (BKC) corrected by another 20% over the previous quarter. The central business district (CBD) saw a correction of 14% largely due to low demand from corporate sector.