Mumbai and Pune Recorded Office Gross Absorption of 5.9 Million sq ft in H1 2019: Colliers International India
MUMBAI, July 15, 2019 : Mumbai recorded gross absorption of 3.9 million sq ft in H1 2019, an increase of 9.3% compared to same period last year. Banking, financial services and insurance (BFSI) occupiers led the gross leasing activity with a 26.0% share in H1 2019, with an average deal size of 26,000 sq feet (2,400 sq metres).
“On the back of innovative structuring, office market is witnessing robust activity. It is a reflection of the market finding its equilibrium. These are signs of a resilient and mature market,” said Sangram Tanwar, Managing Director, Mid-India at Colliers International.
Mumbai witnessed new supply of 2.4 million sq ft in H1 2019, registering a 51.0% increase compared to same period last year.Amidst new supply and robust leasing activity, the city’s overall vacancy rate declined to 10.3%, a decline of 2.6 pps compared to H1 2018. About 6.2 million sq feet (576,000 sq metres) of average annual new supply over 2019-2023 is expected.
Pune recorded gross absorption of 2.0 million sq ft in H1 2019, registering a decline of 26.0% from H1 2018. In H1 2019, the Information Technology – Business Process Management (IT-BPM) sector accounted for 43.0% of total gross leasing, similar to the sector’s share in H1 2018. This was followed by the flexible workspace operators who garnered about 26.0% of total leasing. During H1 2019, supply declined by 93.0% YoY to 279,400 sq ft as the majority of supply was postponed to subsequent quarters. Between 2019-2023, total supply of 29.4 million square ft is projected in the city, which is almost a three-fold rise from the preceding five-year period.
