The leasing market in Bengaluru is set to witness a strong revival with absorption by end of 2021 set to touch approximately 10 million sq. ft., according to property consultant JLL.
This is close to 2017-2018 absorption levels for the city, it said in a statement on Monday. In the last two months (September-October) the city has seen closure of approximately three million sq. ft, highest in 2021. Bengaluru continues to dominate with the highest leasing activity in the country with overall absorption of approximately 7.2 million sq. ft.
year to date. A strong supply pipeline, flexible deal structuring, return to work along with strong revival in market sentiment will continue to strengthen momentum of office leasing space in the city.
The city with a total workforce of approximately three million is expected witness a phased return of approximately one million employees to office by first half of 2022, it said. "An increased activity from start-ups in the city has been observed and these businesses are driving the demand for agile workspaces.
Out of the 73 unicorns in India, 33 have been founded in and are headquartered in the city. Most of them have expanded or optimised their real estate footprint in the city as employees return to offices in a phased manner," said Managing Director - Bangalore & Head - Office Leasing Advisory, India, JLL, Rahul Arora.
Outer Ring Road continued to witness the highest absorption in the city of approximately 2.8 million sq. ft. out of the 7.2 million sq. ft. Close to 7,000 seats have been leased out of the 17,000 seats. Managed office players continue to be significant absorbers of space, witnessing an absorption of approximately one million sq. ft.
Peripheral markets like Whitefield, Hosur Road & Electronic City are witnessing renewed interest owing to metro lines nearing completion, improved support infrastructure & lower top line rentals.
Leasing momentum continues to strengthen with several new Request for Proposals (RFPs) at all-time high of 12 million sq. ft. across various micro markets which is expected to put pressure on rentals in the next 3-4 quarters, it was stated.