With a strong start across markets in 2019, leasing activity this year is expected to gain momentum with the already high demand for quality office spaces.
The total gross co-working leasing volume in India touched almost 13 msf during the first quarter of 2019, which is 1.45 times higher than the corresponding quarter, as per a report by Cushman & Wakefield India. The growth was largely contributed by IT – BPM sector, supported by the expansionary activity of occupiers and with pre-commitments made towards quality office space supply especially in cities like Bengaluru, Hyderabad and Pune.
The emergence of space take-up in co-working/flex affirms that corporates are aligned to the mixed portfolio strategy of fixed and flex space going forward. Flex operators shall likely grow at an even faster pace compared to 2018 with Hyderabad, Pune and Chennai as the next cities of growth, especially among the large players who have grown tremendously in Bengaluru, NCR and Mumbai over the past couple of years, the report said.
During the first quarter of 2019, almost 1.8 msf of space was pre-committed. Nearly two-thirds of new supply for the first quarter in Bengaluru was pre-leased. About 50 percent of the upcoming supply over the next three quarters is also either pre-leased, or in advanced stages of negotiations, suggesting a continuation of ultra-tight vacancies and steep rental growth scenario. Nearly 1.0 msf of upcoming supply in Hyderabad was pre-leased during the first quarter of 2019. Money Control