India’s office market surges in first half of year with record 33.5 mn sq. ft. leasing activity: JLL

Mumbai, July 4 (FN Bureau) Driven by strong leasing activity, Q2 (April-May-June) was the first time when all top seven cities (Mumbai, Delhi NCR, Bengaluru, Chennai, Kolkata, Pune and Hyderabad) recorded gross leasing volumes of at least 1 million sq. ft, a JLL research report said on Thursday. The second quarter gross leasing was up 21.3 percent Q-o-Q and was recorded at 18.38 million sq. ft. The last four consecutive (Q22024, Q12024, Q42023, and Q32023) quarters have now exceeded the 15 million sq. ft mark in gross leasing volumes, underpinning the strong momentum in the office market. This quarter is a testament to the inherent strengths of the Indian office market, with the strong fundamentals clearly indicating the potential for this year to establish new peaks.

Surpassing the historic highs seen in 2023, report said. Furthermore, H1 2024 (January to June) marked the best-ever first half, with leasing volumes at 33.5 million sq. ft, surpassing the previous highest H1 performance seen in 2019. Bengaluru accounts for a 33 percent share of the quarterly gross leasing, followed by Delhi NCR with a 20.7 percent share. Hyderabad and Mumbai also recorded strong leasing activity, with respective shares of 13.1 pc and 12.2 pc. This was the first quarter when all seven cities under review recorded gross leasing levels exceeding 1 million sq. ft. This was on account of the strong performance recorded by Kolkata in the quarter.

“As global economic and business conditions stabilise, global occupiers are now more certain of their real estate plans, with India at the top of their list for footprint expansion and growth. In Q2, global occupiers accounted for a significant 59.3% share of gross leasing volumes. Nevertheless, domestic occupiers continue to show strong momentum, representing a 48.4% share of India’s gross leasing activity since 2022. This is a notable increase from the Rs35% average share in the three-year period from 2017 to 2019. While global occupiers remain bullish on expanding and growing their operations in India, a strong domestic economy is creating resilience in the office market,” Dr. Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.