Office space absorption during January-March quarter has increased by 11 per cent to 8.8 million sqft across nine major cities, a survey has revealed.
A report by Colliers International said the higher absorption was primarily derived by the traditional demand driver, the technology sector.
The growth is mainly backed by positive economic sentiment, business confidence index which increased by 5 per cent in January and the GDP forecast of about 7.5 per cent, said Senior Associate Director (Research) Surabhi Arora.
Bengaluru remained the top contributor of the demand with 33 per cent share, followed by National Capital Region (Delhi, Gurgaon and Noida), Hyderabad, Pune and Mumbai.
Arora further said positive economic growth coupled with increasing business confidence index due to government’s proactive policy initiatives will be the factors influencing the demand for office space in the coming quarters.
IT-ITeS, which also comprise technology startups and e-commerce companies, continued to remain the leading sector driving this demand with an 88 per cent share in overall absorption, it said.
NCR clocked an overall absorption of 1.42 million sqft with Gurgaon’s commercial real estate market recording about 700,000 sqft of office space uptake in the first quarter of 2016 as compared to 450,000 sqft in the previous quarter, but about 30 per cent less than in Q1 2015.
Delhi and Noida recorded absorption of about 340,000 sqft and 380,000 sqft, respectively.
Hyderabad witnessed robust corporate demand in the first quarter with a gross leasing volume of 12.7 million sqft.