CBRE India Office Figures Q3 2023: In the third quarter of 2023, India witnessed a remarkable surge in office leasing activity, showcasing a 33 per cent year-on-year increase, reaching 15.8 million square feet across nine major cities. The Banking, Financial Services, and Insurance (BFSI) sector took a prominent role, constituting 29 per cent of the total leasing activity during this period. Notably, Mumbai, Bangalore, and Hyderabad were the dominant contributors, accounting for about 60 per cent of the leasing transactions.
According to the CBRE India Office Figures Q3 2023 released today, the BFSI sector’s contribution saw a significant rise from 16 per cent in the previous quarter to 29 per cent, fueled by major deals closed by global capability centres and expanding footprints of Indian banks and insurance firms. Technology companies followed closely, comprising a 23 per cent share, with engineering, manufacturing, and life sciences sectors also actively participating.
In terms of office space supply, the nine cities experienced a substantial uptick, recording a 94 per cent year-on-year increase, totalling 19.3 million square feet in Q3 2023. Bangalore, Hyderabad, and Pune were at the forefront of new completions during this period.
Flexible office spaces gain popularity
Furthermore, a major trend highlighted the rise of flexible office spaces’ popularity and a strong focus on sustainability. Over half (53 per cent) of the completed projects in Q3 2023 were green-compliant, reflecting the growing demand for eco-friendly office spaces.
According to the CBRE report, despite global economic challenges, India’s office sector showcased resilience, attracting global corporations to establish their global capability centres in the country.
Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “India’s office sector has outperformed expectations this year with sustained absorption, driven by optimistic occupier sentiment and a surge in inquiries. While the office sector in 2023 is likely to perform better than predicted at the beginning of the year, India has demonstrated resilience in the face of global economic challenges and remains one of the most attractive destinations for global corporations establishing their global capability centres (GCCs). Simultaneously, domestic companies, particularly in sectors such as BFSI (Banking, Financial Services, and Insurance) and engineering & manufacturing, are displaying an increasing appetite for office spaces in major cities”.
Hybrid working model continues to be the norm
The report suggests that the outlook for 2023 will remain optimistic, with Bangalore, Delhi-NCR, Chennai, and Hyderabad expected to drive absorption. Additionally, the hybrid working model continues to be the norm, underlining collaboration, amenities promoting employee wellness, and the ‘office-first’ approach.
Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said, “This year, we observe occupiers adopting a multifaceted approach that encompasses optimum strategies. Return-to-office plans are gaining traction, characterised by a concerted effort to craft experiential workplaces that cater to all generations of employees. This year, we anticipate a surge in investments in workplace technology, improved coordination across functions, and a heightened emphasis on transforming workspaces.”
The report suggests that the Indian office sector is poised for a robust performance in 2023, outperforming earlier predictions and reinforcing its position as an attractive destination for the corporate world.
