PRLog - Feb. 28, 2014 - GURGAON, India -- With the absorption of prime office space in the National Capital Region, which grew around 14% in Oct-Dec 2013 as compared to the previous quarter, touching the 1.7 million sq fts mark. The retail space is also set to grow by more than double in 2014; 11.7 million square feet, and is likely to take the total to around 87.7 million sq fts in top seven cities of the country compared to 2013.
Trends in Commercial Space in Delhi NCR
In the Oct- Dec 2013 quarter approximately 1 million sq fts of new office space was added, taking the total to 3.5 million sq fts in the Delhi NCR market. Compared to 2012 during the same quarter, 2013 saw a 200% increase in office space. While Gurgaon got a fresh supply of office space of around 0.25 million sq fts most of which is on the Golf Course Road, Noida saw no addition to its premier office space portfolio.
Gurgaon absorbed most of the transactional activity in NCR, which saw about 1.3 million sq fts of office space getting leased during the quarter. Noida saw a decline in the demand for commercial spaces, and only absorbed around 0.3 million sq fts, mostly concentrated along the Noida Expressway area.
Trends in Retail Space in India
These seven cities - Delhi NCR, Bangalore, Pune, Mumbai, Chennai, Hyderabad and Kolkata, during 2013 saw an addition of 5.2 million sq fts, which made the total shopping mall stock to 76 million sq fts. In 2013, among these cities, Chennai led with 1.95 million sq fts of retail space supply, followed by Mumbai and Pune.
As most of these retail projects were launched in 2009-10, and it takes around 4-5 years to complete them, thus 2014 is going to witness an increased supply of mall space. The size of these malls is also likely to increase, as highlighted by the growing trend in retail real estate with developers focusing on project sizes that allow to cater to a broader consumer base in terms of offering various formats and categories under one roof. The average size is going to grow with each passing year.
Retailers too have shown the highest interest in upcoming retail projects that not only offer a good location, but that have been optimized in terms of design, trade and tenant mix.
Another budding trend among developers is to take a structured approach in planning, execution and launch of projects, which will also help retailers to judge and take calculated decisions about making investments.
With the stabilizing global and national economy, and settled ground post general election, developers and investors are expecting a much needed revival in the realty industry in the second half of 2014. With several indications of an already recovering real estate business, as seen in the last quarter of 2013; this year will witness a stable/miniscule appreciation in rentals, and a whole lot of fresh and new supply of a second generation of retail and commercial spaces.