Office Space Supply Falls 4%, Gross Leasing Up 17% In September Quarter: Vestian Report
Real estate consultant Vestian said the fresh supply of office space in Hyderabad declined 25% in the July-September quarter to 4.10 million square feet.
(Representative image. Source: Petr Magera/Unsplash)
New supply of office space across seven major cities fell 4% annually in the July-September quarter to 12.8 million square feet while gross leasing of prime workspace rose 17%, according to Vestian.
In its report released on Tuesday, real estate consultant Vestian said the fresh supply of office space in Hyderabad declined 25% in the July-September quarter to 4.10 million square feet.
Bengaluru saw a 33% increase in new supply of office space to 3.60 million square feet, while Delhi-NCR witnessed a 360% increase to 2.3 million square feet.
In Pune, Vestian data showed that new supply decreased 26% to 1.4 million square feet.
The new supply of office space in Mumbai remained flat at 0.90 million square feet during the July-September period.
In Chennai, the fresh supply declined 58% annually to 0.5 million square feet during the July-September period of 2024.
There was no fresh supply of Grade-A office space in Kolkata during the third quarter of the current calendar year, the Vestian report showed.
On the demand side, Vestian said the gross leasing of office space increased 17% annually to 18.61 million square feet across these seven cities.
In Bengaluru, the leasing of office space surged by 84% to 6.63 million square feet.
Pune saw a 112% growth in demand to 2.33 million square feet, while the leasing activities in Chennai remained flat at 2.01 million square feet.
The leasing activities fell in Hyderabad by 25% to 2.79 million square feet.
Mumbai too saw a 2% dip to 2.25 million square feet.
The absorption or leasing of office space in Delhi-NCR declined 17% to 2.49 million square feet.
Kolkata saw a 45% decline in leasing of office space to 0.11 million square feet during July-September 2024 from a year-ago period, the Vestian data showed.
The consultant noted that the BFSI and flexible spaces operators emerged as key demand drivers for office spaces.
"These sectors account for 39% of the pan-India absorption in Q3 2024, an increase of 20% from the previous quarter. Conversely, the share of the IT-ITeS sector declined from 38% in Q2 2024 to 23% in Q3. This demand shift may alter the demand-supply dynamics across the country," Vestian said.
