India Office Market 2021-2026

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    INDIA OFFICE MARKET

    OVERVIEW

    The real estate sector in India is expected to grow in future. In the commercial real estate market, retail, and hospitality are also growing significantly, providing the much-needed infrastructure for India’s growing needs. The commercial real estate sector in India is predicted to be accelerated by large scale investments by institutional investor, in the upcoming years.

     

    infographic: India Office Market, India Office Market size, India Office Market trends, India Office Market forecast, India Office Market risks, India Office Market report, India Office Market share

    Demand for commercial property is being driven by the country’s economic growth. Government initiatives, urban development policies and programs (Smart City, AMRUT) are expected to contribute to the demand for real estate infrastructure. The commercial real estate sector in the country has been greatly boosted by government initiatives such as ‘Make in India’ and other reforms in the realty sector such as the introduction of the Real Estate Regulatory Authority (RERA) and GST. Despite their initial troubles, developers and buyers have now hailed the move due to the resulting transparency and competence of the sector which has attracted increasing amounts of foreign direct investments (FDI) in the commercial estate.

    DURING PANDEMIC

    The office market in India witnessed green shoots of recovery in Q3 2020. The sentiments continued to improve in the fourth quarter of 2020 with news of the development of potential vaccines. The office market witnesses a net absorption of 8.24mn sq. ft. in the last quarter of 2020, an increase of 52% when compared to the third quarter. Except for Bengaluru, net absorption of office spaces improved in all the market under review. While the southern markets of Hyderabad and Bengaluru led the pack accounting for 34% and 17% of the total net absorption in Q4 2020, the maximum increase in net absorption (when compared to Q3 2020) was witnessed in Mumbai, Delhi NCR and Chennai.

    On an annual basis, net absorption in 2020 dipped by 45% when compared to 2019. However, 2019 was a year of historic highs and a comparison to the average annual net absorption levels between 2016 and 2018 elucidates a more realistic picture of resilience. Led by the southern markets of Hyderabad, Chennai and Bengaluru, net absorption levels in 2020 reached 81% of what was observed between 2016 and 2018. The total newly completed malls in 2018 stood at 7.8 million square feet which are expected to see increase further in the upcoming years.

    POST PANDEMIC

    If 2020 was the year that changed everything, 2021 may be the year where change becomes the ‘new normal’ and adapting to this ‘new normal’ will require imagination, innovation and digital transformation. The arrival of 2021 will not shake off all the challenges of a pandemic-riddled economy but the groundwork for a sector-wide recovery has been laid. The year is poised to establish itself as the year where India enters a new phase of real estate growth, innovation and investment. The lifting of lockdown and travel restrictions is expected to revive real estate assets, improve income visibility and attract cross-border investments in 2021.

    INDIA OFFICE MARKET SCOPE

    Currently, retail accounts for a small portion of Indian real estate market. Organized retailers are few and the organized retail space is mostly developed by residential/office space developers. The growth of organized retail is expected to be driven by increasing disposable incomes, changes in shopping habits, the entry of international retailers into the market and the growing number of retail malls.

    The pandemic may, in 2021, affect buyers’ preferences in terms of choice of real estate: larger layouts with higher safety, hygiene, and captive amenities may find their way to more takers. In terms of commercial real estate, satellite offices in non-conventional micro markets, i.e., outside the CBDs (Central Business Districts) will be absorbed faster and more effectively. With the wide adoption of WFH (Work from Home) across the IT sector, ITeS buildings may face medium vacancies through the first quarter of 2021.   

     

    infographic: India Office Market, India Office Market size, India Office Market trends, India Office Market forecast, India Office Market risks, India Office Market report, India Office Market share

     

    Government has initiated with government of respective states to encourage developments in the sector. The Smart City Project, with a plan to build 100 smart cities, is a prime opportunity for real estate companies.

    The Securities and Exchange Board of India (SEBI) has given its approval for the Real Estate Investment Trust (REIT) platform, which allow all kind of investors to invest in Indian real estate market. It would create an opportunity worth Rs. 1.25 trillion (US$ 19.65 billion) in the Indian market in the coming years. The most marked change has been the shift from family-owned businesses to that of professionally managed ones. Real estate developers, in meeting the growing need for managing multiple projects across cities, are also investing in centralised processes to source material and organise manpower and hiring qualified professionals in areas like project management, architecture and engineering.

    COMPETITIVE LANDSCAPE

    Indian commercial real estate has retained a strong position in the market and is becoming a preferred destination for global institutional investors driven by robust office space take-up, falling vacancy levels, and rising rentals.

    The commercial real estate market in India is reaching a moderate consolidation phase as the number of developers offering commercial properties is decreasing and the small-scale developers are also merging with the big real estate developers or exiting the market. Some of the major commercial real estate players in the country include DLF, Godrej Properties, Housing Development and Infrastructure Ltd (HDIL) and Oberoi Realty. 

    TOP PLAYERS IN INDIAN REAL ESTATE MARKET

    Major real estate companies are targeting developable areas and turning them into construction marvels. Here’s a list of the top players in real estate market:

    Sl no Topic
    1 Market Segmentation
    2 Scope of the report
    3 Abbreviations
    4 Research Methodology
    5 Executive Summary
    6 Introduction
    7 Insights from Industry stakeholders
    8 Cost breakdown of Product by sub-components and average profit margin
    9 Disruptive innovation in the Industry
    10 Technology trends in the Industry
    11 Consumer trends in the industry
    12 Recent Production Milestones
    13 Component Manufacturing in US, EU and China
    14 COVID-19 impact on overall market
    15 COVID-19 impact on Production of components
    16 COVID-19 impact on Point of sale
    17 Market Segmentation, Dynamics and Forecast by Geography, 2021-2026
    18 Market Segmentation, Dynamics and Forecast by Product Type, 2021-2026
    19 Market Segmentation, Dynamics and Forecast by Application, 2021-2026
    20 Market Segmentation, Dynamics and Forecast by End use, 2021-2026
    21 Product installation rate by OEM, 2021
    22 Incline/Decline in Average B-2-B selling price in past 5 years
    23 Competition from substitute products
    24 Gross margin and average profitability of suppliers
    25 New product development in past 12 months
    26 M&A in past 12 months
    27 Growth strategy of leading players
    28 Market share of vendors, 2021
    29 Company Profiles
    30 Unmet needs and opportunity for new suppliers
    31 Conclusion
    32 Appendix

     

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