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BENGALURU : The commercial office sector in India is seeing early signs of revival with leasing picking up momentum. However, the overall recovery may still be a few quarters away.

Despite investor interest in the real estate investment trust floated by an entity of Canada’s Brookfield Asset Management, and significant investments in office space, fresh leases for commercial real estate are slow.

DLF Ltd, India’s largest real estate firm, saw vacancy levels inch up at Cyber City in Gurugram after smaller tenants, including co-working and hospitality firms, moved out, the company’s management said during a recent analyst call.

DLF said enquiries increased in December-January. It also leased out 200,000 sq. ft of commercial space.

“We are witnessing green shoots in fresh leasing. This momentum will pick up over the next few quarters with substantial progress in the vaccination programme and openness to travel," Sriram Khattar, MD, rental business, DLF, said in an interview.

Despite IT and ITeS firms, the largest occupiers of office space in India, adopting either work-from-home or hybrid working models, top developers said they will continue to dominate leasing.

“Availability of skilled STEM manpower and attractive rentals will continue to make India a preferred spot to set up global capability and innovation centres for MNCs. We expect another couple of quarters to pick up momentum in leasing. Many tenants are bringing forward their date of starting workplaces," said Mike Holland, chief executive officer, Embassy Reit.

The commercial office sector witnessed a blip last year following the covid outbreak after a seven-year bull run. In 2019, a record 46 million sq. ft of office space was leased.

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