Commercial Real Estate Growing By 8% in Q1 2016, Propstack Reports


India’s commercial real estate is an emerging lucrative investment option due to increasing corporate leasing, and purchasing deals. Propstack (commercial data information and analytics firm for commercial real estate) in a report reassures growth in commercial real estate segment.

Propstack has reported that commercial real estate has expanded up to 5.8 million square feet in the Q1 2016, which is a rise of 8 percent from a year ago. The Q1 2016 witnessed real estate transactions going up by 23 percent with demands led by BFSI (banking, financial service and insurance), e-commerce, and IT-ITeS sectors.

RERA (real estate regulatory authority), growing economic signals, increasing investments in India, and boom in startup ecosystem in India, all have boosted sentiments, and demand for real estate. From the last year, commercial real estate segment is witnessing rise, which is set to grow further throughout the year.

According to the Propstack report, rent levels across cities were stable in the Q1 2016 expect Kolkata. Pune with 6.8 percent rise in rents was the highest, meanwhile, Bengaluru with 5.7 percent came second and, Delhi NCR and Mumbai had marginal rise 2.8 and 2.6 percent respectively.

Moreover, office vacancy rates has declined from 26 percent year ago to 14 percent in top seven markets – Delhi NCR, Mumbai, Bengaluru, Pune, Chennai, Hyderabad, and Kolkata. If momentum continues for the rest of the year, then it could be the biggest year for commercial real estate in India.

In Delhi NCR, South Delhi, Gurgaon and Noida are the known for commercial real estate, and many property dealers, builders and developers are expecting uptick in the monsoon season. High office space absorption in the NCR region credited to NRI investments, MNCs and startups.

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