As the pandemic-induced work-from-home and remote working practices wane with many top corporates in the country announcing a return to offices, the vacancy rate of such spaces has for the first time in the last two years remained stable at 18.5 per cent for the quarter ended March 2022 (Q12022).
While the vacancy rate across the country had moved upwards every quarter starting from January-March 2020 (Q12020), the rally that started at 10.6 per cent has stabilised at 18.5 per cent of vacancy across the top six cities. The vacancy rate was the same (18.5 per cent) for the quarter ended December 2021 (Q42021), as per data from Colliers, a real estate services provider and investment management firm.
The industry expects occupancy to increase further in the upcoming quarter.
"This strong leasing comes at a time when occupiers in India have started opening their doors to employees after a hiatus of two years. Q2 2022 will be a crucial period as we expect more companies to open up workplaces,” said Ramesh Nair, CEO, India and Managing Director, Market Development, Asia, Colliers.
Along with the stabilisation of the vacancy rate, the gross absorption rate of the office space, too, has gone up almost three times YoY across India to about 13 million square feet in Q12022 from 4.7 million square feet in Q12021. The gross absorption rate is the highest in the last two years.
Besides increasing demand for office spaces, "quality supply across the prominent markets" has ensured that large deals have made a comeback to the drawing tables of the real estate industry after a long gap.
Flex spaces have gained ground by commanding a 15 per cent share in the market with more offices opting for workspace flexibility for their employees. The technology sector, however, remains on top, accounting for 32 per cent of the total absorption.
Check out latest DH videos here