Average city-level office rentals in Delhi-NCR
remain static..!
While
Gurgaon records a slight increase as of 2Q16, Noida sees a decent rise but on a
lower base
By Mr. Santhosh Kumar, JLL India
Gross rentals in the Delhi-NCR market remained static
in 1H16 compared to 1H15. At INR 77 per sq ft per
month (on a stock-weighted basis), the third largest office market in India –
in terms of stock – showed no appreciation in city-level average rents.
Among
micro-markets, Gurgaon and Noida saw a marginal rise in rentals with average
rents increasing to INR 75 in Gurgaon, and INR 43 (as of 2Q16) in Noida,
clocking a y-o-y increase of 1% and 5% respectively.
The relatively affordable rents in both Noida and
Gurgaon micro-markets make them maintain their attractiveness for IT/ ITeS
players. The profile of tenants has changed in recent years, however, in
certain precincts of these micro-markets such as Cyber City, where rents are
inching closer to triple digits.
From being back offices with strict dependence
on cost arbitrage, the tenant profile now includes consulting, high-tech
engineering and design firms. Presence of non-IT companies in such traditional
IT holdouts has also increased.
Overall, the prominent office occupiers in the city
and suburbs belong to sectors like technology, banking, pharmaceutical, real
estate & construction, transport, consumer goods and professional services.
The concentration of banking and financial institutions is higher in the
central business district (CBD) and secondary business district (SBD) whereas
many new age sectors and corporate occupiers prefer younger office buildings in
Gurgaon and Noida.
 |
| Santhosh Kumar, JLL India |
Market dynamics
In terms of having the most grade-A office stock,
Gurgaon micro-market leads the way followed by Noida and SBD. Delhi city has limited
grade-A supply. The emergence of Gurgaon and Noida as
key office corridors was largely due to lack of adequate land limiting the
development potential in Delhi city.
Also, the main city of Delhi has often
seen developers employ the strata sale model while lease model is more
prevalent in the suburban locations, which makes the latter more attractive to
large occupiers.
About the author
Mr. Santhosh
Kumar,
CEO – Operations & International Director,
JLL India
For media contact
Arun Chitnis
Head – Corporate
Communications & Media Relations
JLL India
Level 6, Amar Avinash
Corporate Plaza
Bund Garden Road,
Pune 411001.
Tel: (020) 30930441 Fax:
(020) 40196101
Mob: +91 9657129999
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