Indian Office Market Rental, Capital Value Momentum Reflects Economic Dichotomy..

by Mr. Anuj Puri, Jones Lang LaSalle India

Indian Commercial Real Estate 2013: A Review..

Indian Office Market Rental & Capital Value Momentum Reflects Economic

Dichotomy..

In 2013, the trend of subdued demand for office space continued from the previous year. Thus, rental

value (RV) growth was slower than that observed in 2012 (with the exception of Mumbai, where

growth was relatively faster).

However, capital value (CV) growth was faster than rental value growth during 2013, resulting in a fall of market yields.

Economy showing signs of picking-up from 2H-2013

(Annualised % growth - 3 month moving average)

Over the last 10 quarters, market yields have fallen in the range of 4-6 basis points. The primary

reason for faster growth of CV is the rising input costs, which forces developers to increase prices

despite less-than-favourable market conditions. This trend was seen in all cities.

About the author

Mr. Anuj Puri is Chairman & Country Head at Jones Lang LaSalle India

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