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Transcript of The Knowledge Report_India Office Property Market Overview 1Q 2012
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
1/12
OfficePrOPerty Market OverviewiNDia
QUarterLy UPDate | aPriL | 2012
Accelerating success.
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
2/12www.coier.com
MACRO ECONOMIC OVERVIEW
During 4Q 2011 GDP grew at 6.9 percent in
real terms suggesting a mderatin in grwt
in cmparisn t preceding tw quarters. Te
nance minister presented Indias Unin
Budget 2012 -13 tis quarter prjecting a GDP
grwt rate 7.6% r 2012-13.
Te eadline inatin gure mderated rm
8.3 percent in December 2011 t 6.6 and
6.95% in January and February 2012,
respectively. Keeping in view te mderatin
in inatin rate te Reserve Bank India
(RBI) as stened mnetary plicy r te
rst time since ne and a al year . Tis as
been dne by reducing CRR (Cas Reserve
Rati) by 50 basis pints in January and a
urter reductin 75 basis pint in Marc
2012. Te current CRR rate is 4.75%.
Te Budget remained silent n mst te
majr real estate related issues. It did wever
mentined tat erts are n t arrive at a
plitical cnsensus n te issue allwing
51% Freign Direct Investment (FDI) in multi-
brand retailing.
Te Budget aims t prvide impetus t
ardable using by prviding varius
incentives t bt develpers and end users.
Fr eample te eternal CmmercialBrrwings (ECB) is allwed r lw cst
ardable using prjects wic wuld elp
develpers t raise debt at lwer cst.
Frm an end user perspective, te budget
prvides ew incentives including, Service ta
eemptin r cnstructin service related t
residential dwelling and lw cst mass
using up t an area 60 sq mtr under te
sceme ardable using. Te eisting
sceme interest subventin 1% r
using lans up t INRs 15 lak (were te
cst te use des nt eceed INR 25laks), was etended by ne mre year.
ECONOMIC BAROMETER
RETuRN ON AlTERNATIVE INVEsTMENTs
RESEARCh & FoRECAST REPoRTsYDNEY CENTRAl BusINEss DIsTRICT
INDIA oFFICE MARKETREsEARCh & fORECAsT REpORT
Mar-11 Mar-12
REPo RATE 6.50% 8.50%
REVERSE REPo RATE 5.50% 7.50%
CRR 6.00% 4.75%
INFLATIoN 9.68% 6.89%
PRIME
LENDING RATE8.25% - 9.50% 10.00% - 10.75%
DEPoSIT RATE
(>1 YEAR)7.75% - 9.50% 8.50% - 9.25%
FoREIGN ExChANGE
INR - USD45.02 50.39
INR- EURo 59.12 65.89
Mar-11 Mar-12 YoY %
Cange
GoLD 20,730 27,300 31.69%
SILVER 52,450 56,014 6.80%
EQUITY (BSE
SENSEx) 18167.64 17,675.85 -2.71%
REALTY INDEx 2053.69 1821.35 -11.31%
Source: Colliers International India Research
ECONOMIC INDICATORs
4.0%
5.0%
6.0%
7.0%
8.0%9.0%
10.0%
INRCrre
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
April-Jan2012
Jan-Mar09
Apr-Jun09
Jul-Sep09
oct-Dec09
Jan-Mar10
Apr-Jun10
Jul-Sep10
oct-Dec10
Jan-Dec11
Jul-Sep11
Apr-Jun11
Jan-Mar11
Gro Dometic prodct at actor cot
fDI in Rea Etate
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
0.0%
1.0%
2.0%
3.0%
US$
Nte: As 1st August 2011
Eur
1Q 2012 | THE KNOWLEDGE
70
80
90
110
100
150
140
130
120
160
14-Mar-12
7-Feb-12
2-Jan-12
23-Mar-12
16-Feb-12
1-Apr-12
25-Feb-12
11-Jan-12
20-Jan-12
29-Jan-12
5-Mar-12
BsE senex & Reaty Index
Excange Rate
BSE Sense
Nte: As 1st August 2011
Realty Inde* Rebase t 100
* Rebase t 100
75
80
85
95
90
105
100
110
14-Mar-12
7-Feb-12
2-Jan-12
23-Mar-12
16-Feb-12
11-Jan-12
1-Apr-12
20-Jan-12
29-Jan-12
25-Feb-12
5-Mar-12
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
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1Q 2012 GRADE A AND GRADE BRENTAl VAluEs
pRIME OffICE spACE RENTAl TREND
CBD
AnderiEast
BKC
LwerParel
Malad
NaviMumbai
Pwai
Wrli/Prabdevi
Gregan/JVLR
Kalina
Tane/LBS
AnderiEast(IT)
LwerParel(IT)
Malad(IT)
NaviMumbai(IT)
Pwai(IT)
Gregan/JVLR(IT)
Tane/LBS(IT)
INRPerSqtPerMnt
0
50
100
150
200
250
300
2Q2008
1Q2008
INRperSqtperMnt
INRperSqtperMnt
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
4Q2010
1Q2012
4Q2011
3Q2011
2Q2011
1Q2011
3Q2010
70
20
120
170
220
270
320
370
420
CBD
Lwer Parel Navi Mumbai
KalinaGregan
/ JVLR
Anderi East Malad
Pwai
BKC
Wrli /
Prabadevi
Tane / LBS2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
2Q2012F
4Q2012F
1Q2013F
3Q2012F
1Q2012
4Q2009
1Q2008
1Q2010
2Q2010
3Q2010
Grade A Grade B
COllIERs INTERNATIONAl | p. 3
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Altisurce Viswarp IT Park 137,000 Vasi Lease
ANZ Bank Bmerang 6,000 Anderi Lease
Liberty Insurance Peninsula Business Park 30,000 Lwer Parel Lease
Loreal Maratn Future 71,000 Lwer Parel Lease
Naaptl.cm Sigma IT Park 32,000 Navi Mumbai Lease
Star Unin Dai-ici Lie Insurance Viswarp IT Park 67,000 Vasi Lease
MuMBAI
In Mumbai, apprimately 10 millin sq t
grade A fce space was available r lease
in 1Q 2012. out te ttal available supply
arund 64% was IT/ITeS fce space mstly
cncentrated in te Lwer Parel and Tanemicr-markets.
Prject launced during tis quarter was
Equin Business Park-Twer IV by Equin
Realty & Inrastructure Private Limited. Te
prject as a grss leasable area
apprimately 0.5 millin sq t and is lcated
BKC. Anter mied use prject Island
City Centre was als launced by Wadia
Grups real estate venture Bmbay Realty
spreading ver 45 acres land at Dadar.
Fllwing te previus quarter trend
cnstructin activities remained slw, n new
grade A fce space was added t te citys
ttal inventry tis quarter.
occupier demand remained steady in almst
all te micr markets and ew large space
cmmercial leases were signed during te
quarter. Rental values r grade A fce
space remained stable acrss Mumbai baring
Nariman Pint, te CBD Mumbai, as
ccupiers are gradually siting twards newly
develped areas like Lwer Parel, Bandra
Kurla Cmple (BKC) and Anderi due t
better accessibility and state an artinrastructure.
Lking aead demand is likely t be remained
mderate, wever due t limited supply
rentals are epected t remain stable.
As part te State Gvernments plan t
make Wadala a business ub in lines te
BKC; MMRDA as invited cnsultants t
prepare a detailed develpment plan r
apprimately 110 ectares land.
AVAIlABlE supplY IN pRIME AREAs
Anderi East 24%
CBD 1%
Tane / LBS 21%
Navi Mumbai 6%
Gregan / JVLR 8%
Pwai 5%
Wrli / Prabadevi 1%
Malad 5%
Lwer Parel 20%
BKC 8%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | MUMbai
GRADE A AVERAGE RENTAl VAluE
MUMBAI
0
35
70
140
105
210
245
175
Source: Colliers International India Research
Kalina 1%
Frecast
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Grade A Grade B
Neru Place Saket
Netaji Subas
Jasla Cannaugt
place
p. 4 | COllIERs INTERNATIONAl
1Q 2012 GRADE A AND GRADE BRENTAl VAluEs
pRIME OffICE spACE RENTAl TREND
Source: Colliers International India Research
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
hitaci Ers Crprate Twer 3,000 Neru Place Lease
Mizu Bank DLF Capitl Pint 16,000 C.P. Lease
Pragati Equity Advisrs Sutern Park 1,500 Saket Lease
Snap Deal Sutern Park 22,000 okla-III Lease
DElhI
Mre tan 1 millin sq t grade A fce
space was available r lease in Deli in
1Q 2012. Mst tis available supply was
cncentrated in Jasla and Saket.
N new supply was added t te citys grade
A inventry. Similarly, n new grade A fce
prjects was launced during tis quarter.
Absrptin remained relatively subdued as
nly a ew small fce spaces leases were
signed in lcatins suc as Cnnaugt Place,
Saket and Neru Place. Tis can primarily be
attributed t te sit in demand rm te CBD
and SBD t areas in as Gurgan and NoIDA
n accunt better quality fce and lwer
real estate cst.
Rental values witnessed marginal pressure
acrss te micr markets and a decrease in
te range 1 t 4% was bserved r grade
A fce space.
In mid term rentals are epected t remained
under pressure n accunt lesser demand.
T encurage develpment nn pllutingsmall and medium scale industries in tecity Deli State Industrial and InrastructureDevelpment Crpratin (DSIIDC) isplanning t set up a multi level manuacturingub in Rani Kera in nrt west Deli wit anestimated cst INR 3100 crre. Te wrkn anter knwledge based industrial parkin Baprla as already started.
In an anter inrastructure related intiativete Deli Develpment Autrity(DDA) asplanned t develp tree Urban EtensinRads (UERs). Tese link rads will acilitatesmt travelling between tw States Deli and haryana Dwarka-Palam Viar,Najagar-Dansa and Nelsn Mandela Rad-MG Rad.
AVAIlABlE supplY IN pRIME AREAs
Cnnaugt Pl ace 2%
Neru Place 10%
Saket 29%
Jasla 59%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | DeLhi
GRADE A AVERAGE RENTAl VAluE
2Q2008
3Q2008
0
50
100
150
200
250
300
350
400
Cnnaugt
Place
NeruPlace
Jasla
INRperSqFtperMnt
Saket
NetajiSubas
0
50
100
150
200
250
300
350
400
450
1Q2010
INRperSqtperMnt
0
35
70
105
140
175
210
245
280
INRperSqtperMnt
DELhI
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
3Q2012F
4Q2012F
1Q2013F
2Q2012F
1Q2012
4Q2009
1Q2010
2Q2010
3Q2010
1Q2008
4Q2008
2Q2009
3Q2009
2Q2010
1Q2009
4Q2009
3Q2010
4Q2011
1Q2012
3Q2011
2Q2011
4Q2010
Frecast
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1Q 2012 GRADE A AND GRADE BRENTAl VAluEs
MGRad
GlCurseRad
/Ext/SnaRad
Nh8/UdygViar
Manesar
InstitutinalSectrs/
SusantLk
SnaRad
DLFCyberCity
Nh8/UdygViar
Manesar
0
20
40
60
80
100
120
140
Grade A Grade B
MG Rad
Gl Curse Rad/Et /Sna Rad
Nh8/Udyg Viar (IT)
Institutinal Sectrs /Susant Lk
Nh8/Udyg Viar
DLF Cyber City (IT)
Gl Curse Rad/Et /Sna Rad (IT)
Manesar
Manesar (IT)
4Q2011
COllIERs INTERNATIONAl | p. 5
Source: Colliers International India Research
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Bausc & Lmb First India Place 16,000 M.G. Rad Lease
DhR hldings Plt 121 20,700 Udyg Viar Lease
Epedia DLF Building N 5C 50,000 DLF Cyber City Lease
Ggle Signature Twer-II 175,000 Sectr 15 Lease
Ingersll Rand DLF Building N 5A 49,000 DLF Cyber City Lease
Ri Tint DLF Building N 5A 40,600 DLF Cyber City Lease
GuRGAON
Mre tan 7 millin sq t grade `A fce
space supply was available r t-ut in 1Q
2012. Mst tis available supply was
cncentrated in Udyg Viar and alng
Natinal higway 8 up t Manesar.
Several prjects were launced during 1Q
2012 including one hrizn Centre by
hines India at Gl Curse Rad and Atena
by Brama-Bestec at Nh-8. Bt tese
prject are epected t be cmpleted by te
rst al 2015 and will add arund 1.2
millin sq t grade `A fce space t te
citys ttal inventry.
N majr grade `A prject/pase te
prject was cmpleted in tis quarter.
Absrptin remained ptimistic and a number
large rmat leases were signed during
te quarter including a ew pre-cmmitment
leases in under- cnstructin buildings. Te
investr market als remained active during
te quarter and a ew deals were cncluded
suc as te BPTP buyut 49% te Merrill
Lync stake in te grade `A fce prject
`CCrest. M3M bugt a 28-acre land parcel
rm DLF lcated at sectr 70A.
Rental values r grade `A prperties
increased in te range 2 t 6% in almstall te majr micr-markets barring Udyg
Viar / Nh-8 and DLF Cyber City were rental
values remained stable.
In near uture rentals are epected t remain
stable r bt IT/ITES and cmmercial fce
space.
In 1Q 2012 te state gvernment apprved
inrastructure prjects valued at INR1,394
crre r strengtening rads, water supply
and sewage systems in newly develping
sectrs 77 t 114.
AVAIlABlE supplY IN pRIME AREAs
Institutinal Sectrs /Susant Lk
16%
DLF Cyber City 8%
MG Rad 5%
Manesar 35%
Nh8/ UdygViar 36%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | GUrGaON
GRADE A AVERAGE RENTAl VAluE pRIME OffICE spACE RENTAl TREND
INRpersqtpermnt
INRpersqtpermnt
180
20
40
60
80
100
120
140
160
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F
INRperSqtperMnt
0
20
30
10
40
50
70
90
110
60
80
120
100
GURGAoN
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
4Q2010
1Q2011
2Q2011
3Q2011
1Q2012
3Q2010
2Q2008
3Q2008
Frecast
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Grade A Grade B
p. 6 | COllIERs INTERNATIONAl
1Q 2012 GRADE A AND GRADE BRENTAl VAluEs
pRIME OffICE spACE RENTAl TREND
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Barclays sared services Individual Building 25,000 Sectr 62 Lease
halcrw B-1D 52,000 Sectr 10 Lease
hewitt 3Cs Building Twer-A 100,000 Sectr 127 Lease
oracle 3Cs Building Twer-B 170,000 Sectr 127 Lease
NOIDA
Mre tan 5 millin sq t fce space supply
was available r t ut in NoIDA tis quarter.
Mre tan 85% tis available fce space
was in te rm IT/ITeS. Grade A IT/ITeS
fce space was cncentrated in sectr 16A,62 and sectrs 125 t 143 alng te NoIDA
Epress-way, wile IT/ITeS fce space
available in industrial sectrs was primarily
grade B fce space.
Prjects launced during tis quarter were
Jaypee Cambers by Jaypee Grup in
Sectr 129, Wave City Centre by Wave Grup
and Lgi City Centre by Lgi Grup bt
lcated at sectr 32. All tese prjects
tgeter are epected t cntribute arund
2.1 millin sq t grade A fce space t te
citys ttal inventry by te end 2015.
In 1Q 2012 cnstructin activities slwed
dwn due t state electins, tus n prjects/
pases te prject were cmpleted during
te quarter.
A ew large fce space leases were
cncluded during te quarter. Demand was
largely driven by te IT/ITeS sectr.
In ne te private equity eit, Ktak Realty
Fund as sld its stake back t prmters in
3C cmpanys inrmatin tecnlgy parkprject in NoIDA.
Te rental values r nn IT fce space
remained stable because limited supply
wever, rental values r IT/ITeS fce space
witnessed marginal pressure n accunt
large available supply. Similar rental trends
can be anticipated in near uture.
AVAIlABlE supplY IN pRIME AREAs
Cmmercial Sectrs(Sec 18) 2%
Institutinal Sectrs(Sec.16A, 62, 125-142)
86%
Industrial Sectrs (Sec.1-9, 57-60, 63-65)
(Grade B)12%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | NOiDa
1Q2009
INRPerSqFtPerMnt
0
20
40
60
80
100
120
140
0
10
20
30
40
60
70
50
80
100
90
2Q2009
3Q2009
4Q2009
1Q2010
InstitutinalSectrs
(Sec16A,62,125-
142)(IT)
IndustrialSectrs
(Sec1-9,57-60,
63-65)
CmmercialSectrs
(Sec18)I
NRPerSqFtPerMnt
Institutinal
Sectrs(Sec.16A,62,
125-142)
2Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
4Q2010
3Q2010
Institutinal Sectrs (IT)
Institutinal Sectrs (Nn IT)Cmmercial Sectrs
Industrial Sectr
GRADE A AVERAGE RENTAl VAluE
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
1Q2011
2Q2011
3Q2011
4Q2011
3Q2012F
4Q2012F
1Q2012
2Q2012F
4Q2010
3Q2010
INRperSqtperMnt
0
10
20
40
30
50
80
60
70
NoIDA
Source: Colliers International India Research
1Q2013F
Frecast
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1Q 2012 GRADE A IT AND NON ITRENTAl VAluEs
CBD
INRpersqtpermnt
Guindy(SBD)
Ambattur
oMR(ITCrridr)
GSTrad
0
10
20
30
40
50
60
70
80
IT NoN IT
COllIERs INTERNATIONAl | p. 7
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Bank New Yrk Melln DLF IT Park 50,000 Manapakkam Lease
Barclays DLF IT Park 63,000 Manapakkam Lease
Cambridge Tecnlgies Agniti Park 60,000 Kandancavady Lease
Emersn Ascendas 18,000 Taramani Lease
Mindtree Ramanujam IT Park 100,000 Taramani Lease
Sriram Value Servies Individual Building 18,000 Mylapre Sale
ChENNAI
over 13 millin sq t grade A fce space
supply was available r lease in 1Q 2012.
Mre tan 90% tis stck was IT/ITeS fce
space primarily lcated at oMR and Ambattur
wile nn IT fce space was mstly availablein te CBD area, Vadapalani and Velacery.
N new grade A cmmercial prjects were
cmpleted tis quarter in Cennai.
Prject launced during tis quarter included
ASV Candilya admeasuring apprimately
0.04 millin sq t by ASV Cnstructins.
Te prject is lcated at Traipakkam and
estimates t be cmpleted by 2Q 2013.
Demand was primarily cncentrated in Guindy,
Ambattur and oMR as cmpanies werepreerring tese micr markets r relcatin
and epansin cnsidering accessibility and
state--an-art acilities. Te market seems
t be well segmented suc as KPos and
BPos preerring lking spaces at ceaper
rentals and ready t g at te ar away end
oMR wile ter crprate were ready t pay
iger rentals and preerring initial stretc
oMR, Guindy and Ambattur.
Rental values in 1Q 2012 remained stable
acrss all micr markets. Absrptin was
cmparatively lesser as te ccupiersremained cautius n te backdrp te
current ecnmic scenari. In near uture
rentals are likely t remain stable n accunt
te limited supply sceduled r cmpletin
in 2012.
Under te Mega City prgramme te Cennai
Crpratin as laid ut 360 integrated rads
at an estimated cst INR 800 crre, cvering
an area 176 km. Te state gvernment ad
alltted INR 333 crre last year r te same.
AVAIlABlE supplY IN pRIME AREAs
CBD14%
Guindy (SBD) 5%
Velacery 1%Vadapalini 1%
GST Rd 3%
oMR (IT Crridr) 51%
Ambattur 24%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | cheNNai
pRIME OffICE spACE RENTAl TREND
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
1Q2012
4Q2011
3Q2011
2Q2011
1Q2011
4Q2010
3Q2010
2Q2008
1Q2008
INRpersqtpermnt
90
20
30
40
50
60
70
80
3Q2008
Ambattur GST rad
oMR (IT Crridr)
Guindy (SBD)CBD
GRADE A AVERAGE RENTAl VAluE
2Q2008
1Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2013F
4Q2012F
3Q2012F
2Q2012F
1Q2012
4Q2010
3Q2010
INRperSqtperMnt
0
5
15
25
10
20
30
35
45
55
40
60
50
ChENNAI
Source: Colliers International India Research
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
8/12p. 8 | COllIERs INTERNATIONAl
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
1Q 2012 GRADE A AND GRADE BRENTAl VAluEs
pRIME OffICE spACE RENTAl TREND
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Ats origin India Gpalan Millennium Twer 125,000 Witeeld Lease
Ericssn Umyia Business Bay 22,500 outer Ring Rad Lease
Intersil RMZ Centinnial 17,000 Witeeld Lease
Just dial Embassy Star 10,962 Vasant Nagar Lease
Meru Netwrks Salarpuria Adnis 35,133 old Madras Rad Lease
Tejas Netwrks JP IT Park 90,000 Electrnic City Lease
BENGAluRu (BANGAlORE)
Apprimately 9 millin sq t grade A
supply was available r lease during 1Q
2012. Micr markets suc as te EPIP Zne,
Witeeld, outer Ring Rad and te CBD
accunt r abut 88% tis ttal availablesupply.
New supply cmmercial grade A fce
space r 1Q 2012 accunts r apprimately
0.60 millin sq t. Prjects/ pases te
prjects cntributing t tis new supply were
Mantri Cmmerci develped by Mantri
Grup at outer Ring Rad (oRR) and Equin
Tec Park - Nrt Blck by Essar Grup at
Electrnic City.
During 1Q 2012, a number new prjects
were launced in periperal business area
in Bengaluru, including Prestige Tec ParkIII by Prestige Grup in outer Ring Rad
(oRR), RMZ Galleria and RMZ Latitude
by RMZ Crp at Yelaanka and Bellary Rad,
respectively, Glden Supreme Tec Park
and Maruti Cncrd by lcal develpers in
Electrnic City. Furter, Bagmane Grup als
launced a new twer in its Special Ecnmic
zne (SEZ) Wrld Trade Centre 4 lcated at
oRR. All tese Prjects altgeter will add
apprimately 2.5 millin sq t grade A
fce space t te citys ttal inventry by te
end 2013.
occupier demand was relatively less during
te quarter as cmpared t previus 2-3
quarters, primarily due t cautius ccupiers
sentiments. In terms absrptin micr
markets suc as CBD, Witeeld and EPIP
zne remained active due t lesser availability
grade A fce space in ter preerred
areas suc as outer Ring Rad.
Average rental values r grade A fce space
remain stable quarter n quarter acrss all
te micr markets.
Due t limited supply in te market, rentals are
epected t increase marginally in mid term.
AVAIlABlE supplY IN pRIME AREAs
CBD 8%
outer Ring Rad 15%
Bannergatta Rad 3%
Electrnic City 4%
EPIP Zne/ Witeeld 65% hsur Rd 5%
CITY OffICE BAROMETER
THE KNOWLEDGE | 1Q 2012 | Office | beNGaLUrU
1Q2008
2Q2008IN
RPerSqFtPerMnt
0
10
20
30
40
50
60
70
80
90
100
3Q2008
4Q2008
1Q2009
3Q2009
1Q2010
2Q2009
4Q2009
2Q2010
3Q2010
1Q2011
2Q2011
1Q2012
4Q2011
3Q2011
4Q2010
0
10
20
30
40
50
60
70
80
90
outerRingRad
Grade A Grade B
Electrnic
City(IT)
BannergattaRad
EPIPZne/
Witefeld
hsurRad
INRPerSqFtPerMnt
CBD
CBD
Electrnic City
outer Ring RadEPIP Zne / Witeeld
hsur Rad
Bannergatta Rad
GRADE A AVERAGE RENTAl VAluE
INRperSqtperMnt
15
20
25
30
50
40
45
35
BENGALURU
2Q2008
1Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
1Q2011
2Q2011
3Q2011
4Q2011
3Q2012F
1Q2013F
4Q2012F
2Q2012F
1Q2012
4Q2010
3Q2010
Source: Colliers International India Research
Frecast
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9/12
1Q 2012 GRADE A AND GRADE BRENTAl VAluEs
pRIME OffICE spACE RENTAl TREND
CBD(ParkSt,Camac
St,AJCBseRd)I
NRpersqtpermnt
Sectr-5(IT)
Sectr-5
PBD(New
Twn,Rajarat
Ballygunge
-CircularRD
PBDNewTwn,
Rajarat(IT)
EastKlkata
0
20
40
60
80
100
120
140
Grade A Grade B
COllIERs INTERNATIONAl | p. 9
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Bajaj Allianz Mani Square 9,000 Sectr 5 Lease
Danalami Bank Citrakut building 2,000 AJC Bse Rad Lease
Magma Finance Ec Space 17,000 New Twn Lease
Ra omega Innity Tink Tank 4,500 Sectr 5 Lease
Recn Innity Bencmark 30,000 Sectr 5 Lease
Sarda Grup Crystal Glbsyn 33,000 Sectr 5 Lease
KOlKATA
In 1Q 2012, apprimately 0.08 millin sq t
as been added t grade A fce space supply
in te PBD area. Te prject / pases te
prject wic cntributed t tis new supply
was Risi Tec Park develped by NatvarTracn Pvt. Ltd. lcated at New Twn.
A number cmmercial prjects were
launced during te quarter including Ideal
Unique Centre by Ideal Grup at EM Bypass,
Wdburn Central by Belani Prjects at Elgin
Rad, DN 21 by Midwest hlding Private Ltd
(Catterjee Grup) and Pentagn by Team
Tarus bt at Sectr 5. All tese prjects
will tgeter cntribute apprimately 2
millin sq t grade A fce space t te
citys inventry by te end 2014.
Absrptin remained subdued during te
quarter and nly ew small cmmercial leases
were signed during te quarter. Rental values
r grade A fce space in 1Q 2012 remained
stable acrss all te majr micr markets
due t ample stck availability in majr
cmmercial ubs suc as Rajarat, New Twn
and Sectr 5.
Ging rward rentals are epected t be
under pressure due t prevailing uncertainties
in land plicies and lesser demand.
In a majr decisin te state gvernment
West Bengal as ruled ut SEZ status r
Insys. Te decisin was taken t prtect
te rigts armers and arm land by nt
relaing te urban ceiling laws r Special
Ecnmic Znes (SEZs).
Te Airprts Autrity India (AAI) is
planning t develp cmmercial space in te
vicinity Klkata airprt. Te autrity as
identied apprimately 45 acres land r
cmmercial develpment. Te prject wuld
be develped by ating a public tender andunded trug public-private partnersip.
NEW supplY IN pRIME AREAs
PBD (New Twn,Rajarat)
100%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | kOLkata
1Q2008
1Q2009
2Q2008
2Q2009
3Q2008
3Q2009
4Q2008
4Q2009
1Q2010
2Q2010
4Q2010
3Q2011
1Q2012
4Q2011
2Q2011
1Q2011
3Q2010
INRpersqtpermnt
20
40
60
80
100
120
140
160
Sectr 5
East Klkatta
Ballygunge Circular Rd
PBD (New Twn, Rajarat
CBD (Park St,Camac St,AJC Bse Rd)
GRADE A AVERAGE RENTAl VAluE
INRperSqtperMnt 40
50
70
90
60
80
0
10
20
30
KoLKATA
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
2Q2010
1Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F
4Q2010
3Q2010
Source: Colliers International India Research
Frecast
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
10/12p. 10 | COllIERs INTERNATIONAl
1Q 2012 GRADE A IT AND NON ITRENTAl VAluEs
MARKET TRANsACTIONs
CLIENT BUILDING NAME AREA(SQ. FT.)
LoCATIoN TRANSACTIoN TYPE
Amdcs Magarpatta SEZ 88,000 hadapsar Lease
Bekaert Amar Paradigm 40,000 Baner Lease
CCRT Pride Kumar Senate 1,700 S B Rad Lease
DVS Tara Icn 1,700 Wakdewadi Lease
ExL Magapatta SEZ 88,000 hadapsar Lease
hCL Maragatta SEZ 44,000 hadapsar Lease
puNE
In 1Q 2012 mre tan 9.7 millin sq t
grade A fce space was available r t-
ut in Pune. Mst tis supply was lcated
in hinjewadi, Karadi, hadapsar, Fursungi and
Nagar Rad.
Apprimately 1 millin SEZ space was
added in te eisting SEZ prjects in Pune.
mre tan 60% tis space was switly
absrbed as spaces were pre-cmmitted
by te eisting tenants. In additin t Pune
cmmercial grade A fce space witnessed
an inusin apprimately 0.12 millin sq
t new supply during te quarter. Prject/
pases prject cntributing t tis new
supply was Blue Cip develped by K Raeja
at hinjewadi.
Rental values r grade A fce space
increased in te range 2 t 5% specically
in SEZs in almst all te micr markets.
A ew markets suc as Viman Nagar and
Karadi als witnessed demand r utrigt
purcases.
Ging rward rentals are epected t remain
stable n accunt large available supply,
baring eastern crridr were te rental may
witnessed an increase 7 t 10% in net 2-3
quarters.
Tis quarter te ready reckner rate as been
increased in te range 10 t 30% acrss
Pune. Tis will elp in te imprvement
transparency in real estate transactin in te
lng term.
An veread bridge cnnecting Wakdewadi
(central Crridr) t Nagar Rad/Yerwada
(Eastern crridr), rad cnnecting Cakan,
Bsari and Digii anter rad cnnecting
between Baner Rad and Pimple Nilka t
Pimple Saudagar became peratinal. Tis
will give an impetus t te real estate activitiesin te nearby areas.
supplY IN pRIME AREAs
Kalyani Nagar 4%
Nagar Rad 12%
Aund 3%
Bund Garden 2%
Airprt rad/pune statin 6%
Bavdan 4%
Baner 5%
Karadi 23%
hinjewadi 28%
hadapsar/Fursungi 12%
Senapati Bapat Rad 1%
CITY OffICE BAROMETER
4Q 2011 1Q 2012
VACANCY
ABsORpTION
CONsTRuCTION
RENTAl VAluE
THE KNOWLEDGE | 1Q 2012 | Office | PUNe
1Q2008
2Q2008
INRPerSqFtPerMnt
20
30
40
50
60
70
80
90
100
110
120
130
3Q2008
4Q2008
1Q2009
3Q2009
1Q2010
2Q2009
4Q2009
2Q2010
4Q2010
2Q2011
1Q2012
4Q2011
3Q2011
1Q2011
3Q2010
pRIME OffICE spACE RENTAl TREND
0
10
20
30
40
50
60
70
90
80
Karadi
KalyaniNagar
NagarRad
Bavdan
hadapsar/Fursungi
hinjewadi
SenapatiBapatRad
Aund
Airprtrad/
punestatin
BundGarden
INRPerSqFtPerMnt
Baner
Bavdan Airprt rad/pune statin
Baner
Kardi
Nagar Rad
hinjewadi / hadapsar/Fursungi
Kalyani Nagar
Bund Garden
Aund
Senapati Bapat Rd
GRADE A AVERAGE RENTAl VAluE
INRperSqtperMnt
0
10
30
20
40
70
60
50
PUNE
2Q2008
1Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
3Q2012F
2Q2012F
4Q2012F
1Q2013F
4Q2010
3Q2010
IT Nn IT
Source: Colliers International India Research
Frecast
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
11/12
Mumbai
Te majr business lcatins in Mumbai are te CBD (Nariman Pint, Frt and Bal lard Estate), Central Mumbai (Wrli, Lwer Parel and Parel), Bandra
Kurla Cmple (BKC) and Anderi Kurla stretc. Pwai, Malad and Vasi are te preerred IT/ITES destinatins, wile Airli at Navi Mumbai and Lal
Baadur Sastri Marg are emerging as new fce and IT/ITES submarkets.
Delhi
Te cmmercial areas in New Deli metrplitan area can be bradly classied int te CBD (Cnnaugt Place), SBD Neru Place, Bikaji Cama
Place, Netaji Subas Place, Jasla and Saket .
Gurgaon
Te prime business lcatins in Gurgan are MG Rad, Gl Curse Rad, Cyber City and Udyg Viar. Manesar n te utskirts Gurgan is als
emerging as te citys new fce destinatin.
NOIDA
NoIDA market is cmprised sectrs bradly classied as institutinal, industrial and cmmercial sectrs. Institutinal sectrs include sec 16A, 62
and 125-142, industrial sectrs include sec 1-9, 57-60 and 63- 65 wile sectr 18 is te mst develped cmmercial sectr.
ChennaiPrime fce prperties in Cennai are lcated in ur principal sub-markets: te CBD, te IT Crridr, te SBD and te PBD. Te SBD cmprises
Guindy, Manapakkam, Velacery and ter areas. Te PBD primarily includes Ambattur and GST Rad, wile te IT Crridr is te old Maaballipuram
Rad (oMR) in sut Cennai.
Bengaluru (Bangalore)
Prime fce prperties in Bengaluru can be divided int tree principal sub-market CBD, te SBD cnsisting Banergatta Rad & outer Ring
Rad (oRR) and PBD including hsur Rad, EPIP Zne, Electrnic City and Wileeld.
Pune
Te prime fce sub-markets Pune include Deccan Gymkana, Senapati Bapat Rad & Camp (SBD), wile te PBD includes Aund, Bund Garden,
Airprt Rad and Kalyani Nagar, amng ter lcatins. Te eastern crridr, alng wit Nagar Rad and Karadi, ave emerged as a preerred
lcatin r nancial and IT/ITES cmpanies.
Kolkata
Te majr business lcatins in Klkata are CBD (Park Street, Camac Street, Cwrangee Rd), SBD (AJC Bse Rd, Ballygunge circular Rd, East
Klkata), East Klkata and PBD (New Twn & Rajarat). Te area arund Park Street, Camac Street and AJC Bse rad uses number ig-rises
cmmercial buildings suc as Catterjee Internatinal Centre, Tata Centre, Everest huse and Industry huse amng ters.
OffICE suBMARKETs
COllIERs INTERNATIONAl | p. 11
THE KNOWLEDGE | 1Q 2012 | Office | sUbMarkets
CITY BAROMETER
Increasing as cmpared t previus quarter
Decreasing as cmpared t previus quarter
Remained stable rm previus quarter
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8/2/2019 The Knowledge Report_India Office Property Market Overview 1Q 2012
12/12
Accelerating success.
Clliers Internatinal (India) prvides prperty services t prperty Investrs and occupiers. We
deliver custmised service slutins utilising lcal and glbal knwledge in partnersip wit ur
clients via ur prperty Investment and occupier service lines. Tese service lines include - ofce
Services, Facility Management, Prject Management, Residential Services, Investment Services
and Valuatin & Advisry Services.
www.clliers.cm/india
Fr natinal fces services related queries please cntact:
Gerge Mckay, Sut Asia Directr Vikas Kalia, Natinal Directr
ofce & Integrated Services ofce Services
[email protected] [email protected]
Tel: +91 22 4050 4553 Tel: +91 124 456 7531
Mumbai : Prabu Ragavendra, ofce Directr
31/A, 3rd r, Film Center, 68, Tarde Rad, Mumbai, India - 400 034.
Tel : +91 22 4050 4500, a : +91 22 2351 4272
Delhi NCR : Ajay Rakeja, ofce Directr
New Deli :Statesman huse, 4t Flr, Barakamba Rad, Cnnaugt Place,
New Deli, India - 110001
Tel : +91 11 4360 7500 - 23, a : +91 11 2335 6624
Gurgan : Tecnplis Building, 1st r, DLF Gl Curse Main Rad, Sectr 54, Gurgan,
India - 122002
Tel : +91 124 437 5807, a : +91 124 437 5806
Bengaluru : Gutam Cakrabrty, ofce Directr
Prestige Garnet, Level 2, Unit N.201/202, 36 Ulsr Rad, Bengaluru,
India - 560 042
Tel : +91 80 4079 5500, a : +91 80 4112 3131
Pune : Sures Castellin, ofce Directr
htel Le Meridian, 101, R.B.M. Rad, Pune, India - 411 001
Tel : +91 20 4120 6438, a : +91 20 4120 6434
Chennai : Kausik Reddy, ofce Directr
heavitree Cmple, Unit 1C, 1st r, 23,Spurtank Rad, Cetpet, Cennai,
India - 600 031
Tel : +91 44 2836 1064, a: +91 44 2836 1377
Kolkata : Sumya Mukerjee , ofce Directr
Innity Business Centre, Innity Bencmark, Rm N 13, Level 18, Plt G - 1,
Blck EP & GP, Salt Lake Sectr V, Klkata - 700 091 West Bengal, India
Tel : +91 33 2357 6501 Etn : 206 , a +91 33 2357 6502
Recent Reports :
This book is printed on 100% Recyclable paper
THE KNOWLEDGE | 1Q 2012
Accelerating success.
AUTHORS
Amit Oberoi MRICS
Natinal Directr, Valuatin & Advisry; ResearcEmail: [email protected]
Surabhi Arora MRICS
Assciate Directr, ResearcEmail: [email protected]
Sachin Sharma
Assistant Manager, ResearcEmail: [email protected]
Heliana Mano
Assistant Manager,Valuatin & AdvisryEmail: [email protected]
Fr general queries and eedback :
[email protected]: +91 124 456 7580
Tis reprt and ter researc materials may be und nur website at www.clliers.cm/India. Questins relatedt inrmatin erein suld be directed t te ResearcDepartment at te number indicated abve. Tis dcumentas been prepared by Clliers Internatinal r advertisingand general inrmatin nly. Clliers Internatinal makesn guarantees, representatins r warranties any kind,epressed r implied, regarding te inrmatin including,but nt limited t, warranties cntent, accuracy andreliability. Any interested party suld undertake teirwn inquiries as t te accuracy te inrmatin.
Clliers Internatinal ecludes unequivcally all inerredr implied terms, cnditins and warranties arising ut tis dcument and ecludes all liability r lss anddamages arising tere rm.
Cpyrigt 2012 - 2013 All Rigts Reserved.
522 fces in 62 cuntries n 6 cntinents
United States: 147Canada: 37Latin America: 19Asia Pacic: 201EMEA: 118
$1.8 billin in annual revenue2.55billin square eet under management
over 12,300 + pressinals
Acceleratingsuccess.
Residential PropertyMarket OverviewINDIA
QUARTERLY UPDATE | FEBRUARY | 2012
ASIA PACIFIC
INDUSTRIAL MARKET OVERVIEW
Acceleratingsuccess.
December2011
HIGHLIGHTS
GLOBAL INDUSTRIAL
WWW.COLLIERS.COM
SECONDHALF2011| INDUSTRIAL
JAMESCOOKDirectorof Research |USA
GlobalIndustrialTrendForecastGrowingglobaltradewillsteadydemandforqualitywarehousespaceinmanyregions.
Industrialvacancyrateswillfurtherdropinmostmarkets.
Somemarkets,U.S.andAustraliaamongthem,willexperiencealackofnewsupplyinthefaceofgrowingdemand.
PrimewarehouserentswillclimbinmostAsiaPacicmarkets,remainstableinEMEAandLATAM,andcontinuetostrengtheninNorthAmericanmarkets.
Citingdeterioratingnancialconditionsanddimminggrowthprospect,the InternationalMonetaryFunds(IMF)reviseditsSeptember2011WorldEconomicOutlookgrowth projectionsdownwardinJanuary2012.However,theIMFstillforecaststhatglobaltradevolumewillriseby3.8percentin2012and5.4percentin2013;asglobaltraderises,sotoowill demandforwarehousespace.
WhilewarehouserentshavestabilizedinmostEMEAand LatinAmericanmarkets, primewarehouserentsquotedin localcurrenciesincreasedinthemajorityofAsiaPacicandNorthAmericanmarketsin2011overthepreviousyear.Weexpectthistrendtocontinue,withprimewarehouserentsclimbinginmostAsiaPacicandNorthAmericanmarketsinthenextyear.
LatinAmericanRentsPoisedtoStabilizeInLatinAmerica,primewarehouserentalratestookafall.In71.4percentofthemarketswetrack,year-endrentsdecreasedin2011fromayearearlier. However,weexpectwarehouserentsinLatinAmericatostabilizeinthecomingyear.
SoPaulosawa12.4percentdropinwarehouserentsinlocalcurrency,duetoincreasedsupply.However,withabsorptionsettooutpacesupply,
weexpectoverallwarehouserentsintheSoPauloregiontorisebyasmuchasfourpercentinthecomingyear.
MexicoCitysawathreepercentdecreaseinitsindustrialvacancyrateinthesecondhalfof2011,downto4.8percent.MexicowasmorenegativelyaectedbytherecessionthanmostcountriesinNorthAmerica,anditseconomicfutureislargelytiedtothatofitskeytradingpartner,theUnitedStates.ButwithU.S. growthontheupswing,Mexicotooispoisedtogrowatamodestrateandweexpectthatvacanciescouldmakefurtherdropsinthecountry.
SteadyDemandinNorthAmericaSincepeakingin2010,growthinthemanufacturinganddistributionindustryhaskepttheU.S.vacancyratedroppinginamostlyregularfashion.Vacancydroppedto9.72percentin Q42011. Withconstructionproceedingatlowlevels,weexpectvacanciestocontinuetodropatameasuredrateinto2013.
Toronto,Canadasbiggestindustrialmarket,saw13.7millions quarefeetofindustrial spaceabsorbedin2011,andthecitysprimewarehouserentsgrewby7.1percentinthesecondhalfof2011.
DroppingVacanciesinMostAsianMarketsAsiaPacicsawdroppingvacanciesinnearlyeverymarket. Primewarehouserentsgrewinmorethanhalfofthemarkets,andobserversinmorethanhalfofthose marketsexpectthatwarehouserentswillcontinuetoclimboverthenextsixmonths.
Australianindustrialhasbeenespeciallystronginmostmajormarkets.Retailpurchases,mademoreattractivebytherelativelystrongAustraliandollar,havepushedupdemandforlargewarehousespaceinseveralportmarkets. Whilethereisgrowingdemandforlargemodernwarehouse
GlobalWarehouseDemandShows
Consistent Growth
GLOBALINDUSTRIALCAPITALIZATION RATES(PrimeYield/Percent)
MARKET(SelectMarkets) REGION
DEC2011
DEC2010
HongKong Asia Pacic . . S i ng ap o re A s i a Pa c i c . . L o n do n (H e at h r ow ) E M E A . . T ok y o A s i a P a ci c . . LosAngelesInland Empire,CA
N A . .
C hi ca go ,I L N A . . Paris E ME A . . M un ic h E ME A . . V an co uv er , BC N A . . M ar se il le s E ME A . . Ne w J er se y No r t he r n NA . . Dallas-Ft.Worth,TX NA . . Shanghai Asi a Pac i c . . S eo ul A s ia P ac i c . . M ad ri d E ME A . . Sydney Asi a Pac i c . . Mexico C ity L A TA M . . P ra gu e E ME A . . A th en s E ME A . . B u ch a re s t E M EA . .
GLOBALTOPTE N INDUSTRIALWAREHOUSE RENTS
M AR K ET R EG I ON
RENT(USD/
PSF/Year)6-MONTHCHANGE*
T ok y o A s ia P ac i c . - . %L o n do n (H e a th r o w) E M E A . . %H on g Ko n g A s ia P a c i c . . %S i n ga p o re Asi a Pa c i c . . %Z ur ic h E ME A . . %O sl o E ME A . . %M os co w E ME A . . %G en ev a E ME A . - . %S oP a ul o L A TA M . - . %H el si nk i E ME A . . %M ar se il le s E ME A . . %P ar is E ME A . . %
*Local currency
Continuedonpage8
HIGHLIGHTSGLOBAL OFFICE
WWW.COLLIERS.COM
SECONDHALF2011| OFFICE
JAMESCOOK Directorof Research |USA
GlobalOfceTrendForecast
Globalocevacancieswillcontinuetheirdecline,duetosteadydemandandlowlevelsofnewconstructioninNorthAmericaandEurope.
Theighttoqualitytrendwillcontinueinmanymajormarkets,withoccupierstradinguptohigher-qualityspaceorabetterlocationastheirleasesexpire.
TheEuropeansovereigndebtcrisiswilllikelypushtheEurozoneintoamildrecessioninearly2012.Thiscontractionwillbefeltmostprofoundlyinahandfulofcommercialpropertymarketswithinthemosttroublednations.
EconomicprospectsintheEurozonehaveslightlyreducedoverallposit iveglobalexpectationsformarketperformancein2012.Weexpectcontinuingmodestdemandforocespace,withmostcit iesseeingadropinvacancyrates.Butglobalaveragesdonotspeaktothenuancesofindividualmarkets,andwhileweexpectposit iveabsorptionduetobusinessgrowthandexpansionintheUnitedStates,ChinaandAustraliasomeEurozonecountriesmayseenegativeabsorptionandincreasedvacancyastheregionentersamildrecession.
GlobalOfceDemandGrowthSlowandSteady
GLOBALCAPITALIZATION RATES/PRIME YIELDS:10 LOWESTCITIES
MARKET(Ranked byDec 2011)
DEC2011
JUNE2011
DEC2010
T ai pe i . . .
H on g Ko n g . . .
Vienna . . .
L o n do n We st E n d . . .
Zurich . . .
S i ng ap o re . . .
G e ne va . . .
B ei ji ng . . .
P ar is . . .
M un ic h . . .
T ok yo . . .
GLOBALOFFICE OCCUPANCY COSTS:TOP10 CITIES
MARKET(Ranked byDec 2011)
DEC2011
JUNE2011
DEC2010
H o ng K o n g . . .
London WestEnd. . .
P ar i s . . .
R i o d e Ja n e ir o . . .
M os c ow . . .
L o n do n C i ty . . .
Perth . . .
S i n ga p o re . . .
G e ne va . . .
S o Pau l o . . .
CBD CAPRATE (%)
LatinAmericaBoaststheTightestOfceMarketsSomeoftheworldslowestocevacancyratesarefoundinLatinAmericancit ies.Santiago,Chile;RiodeJaneiro,Brazil;SoPaulo,Brazil;andLima,Peruallhavevacancyratesbelowthreepercent,result inginamarketthatstronglyfavorslandlords,promptsnewconstructionandmightsqueezesometenantsthatdesiretoexpand.Forthemostpart,weexpectthestrengthofthesemarketstopersist.WhiledecreasesinEuropeandemandforitscommoditieswilllikelyhurtLatinAmerica,thiswill betemperedbycontinueddemandfromChina.InSoPaolo,heighteneddemandhasspurredthehighestratesofnewdevelopmentintheregion,whichwill eventuallyputdownwardpressureonaskingrents.
SelectAsiaPacicMarketsSeeBigVacancyDropsTheglobaltrendindroppingvacancyratesshouldbeevi-dentinAsiaandcontinuethrough2012.Marketsthatsawadropinvacancyinthesecondhalfof2011outnumberedbyatwo-to-onemarginthosewherevacancyincreased.
Oftheworldsmostpopulousmarkets,thosewiththemostsignicantdeclinesinsix-monthvacancyrateswerenearlyallintheAsiaPacicregion. Chengdu,propelledbyitsstrongmanufacturingsector,sawitsvacancyratedropby7.8percentintheperiod,andShanghaisawa3.2percentdropinvacancy.
TwootherlargeAsianmarketssawvacancyratesdropby1.5percentormore: Jakarta,whichhasalso seensustainedgrowthinCBDrentalratesandrenewedglobalinvestorinterest;andSingapore,whereoccupanciesareexpectedtostabilize.
MarqueeMarketsSeeRentDeclineWhileHongKong,LondonsWestEndandPariscommandthetopthreehighestaskingrentsforClassAocespace,
eachhasshownapparentdeclineinrentsbetweenJuneandDecemberof2011,whenquotedin U.S.dollars.Substantialdeclines,infact:ledbya$10.87USD dropinParisianClassArents.
Buthowsignicantarethesegures?ThechangeinLondonandParisrentsisduetothestrengtheningdollarrelativetotheeuroandpoundsterling.Inlocalcurrency,primerentsinthesemarketsareholdingground.Althoughsmaller,thedeclineinHongKongof$7.56USD($5.10HKD)persquarefootmaybeamoreimportantindicatorofthingstocome,asdemandfromthebankingandnancialsectorcontinuetoweaken.
EMEAandAsiaPacicLeadGlobalConstructionAsignicantpercentageofthe ocespaceunderconstructionisinEurope,theMiddleEastand Africa(EMEA),andmuchofthatisoccurringinMoscowandDubai.Whilebothofthesemarketsshouldexpectstrongeconomicgrowthin2012,thefactthatDubaiwithavacancyrateof50percentisconstructingatsuchapaceleadsustoexpectthatsupplywillcontinuetooutpacedemandinthatmarket.
TheothertwotopmarketsforoceconstructionareintheAsiaPacic region. GuangzhouChinasleadingcommercialportcityandTokyohave19.6and15.6millionsquarefeetunderconstructionrespectively.Asianeconomicgrowthrateswillremainstronginthecomingmonths,withChinaandIndialeadingthepack. Rentsareontheriseinmostcit iesintheregion.However,droppingrentsinSeoulandHongKongareapotentialindicatorofglobaleconomicuncertainty.InTokyo,wherenewsupplyhasbeenincreasingforthepastthreeyears,weexpectconstructiontopeakandbegintodeclineinthecomingyear.
CLASSA / NETRENT(USD/SQFT)
www.colliers.com/india
BudgetHighlights|Real Estate
FinanceMinisterPran abMukherjeestarted hisbudgetspeech 2012-13in the
backdropof challengingmacroeconomic scenario.Thenancemini sterprojects
theeconomyto growby7.6% in thenextscal upfrom6.9% in 2011-12.Hementioned thatduetoadverse global economic sentimentsthereh asbeen a
slowdown in theIndian Economybutthefact isIndia still remainsamongthe
frontrunners in theeconomic growth in anycrosscountrycomparison. The
budgetaimsat faster,sustainablean d moreinclusive growth acrosssectors
emphasizingon vefocusar easincluding revival of domestic consumption,
rapid revival of high growth in privateinvestment,removal of supplybottlenecks,
addressingmalnutrition in 200high burden districtsand expediteimprovementin deliverysystem,governanceand transparency.
Froma real estateperspective,thebudgetremained silenton mostof themajorissuesincluding statusof STPIs(SoftwareTechnology Parksof India),RealEstateRegulatoryBill, Land Bill etc.however,itmention ed thateortsareon toarriveat a political consensuson theissueof allowing51% Foreign DirectInvestment(FDI) in multi-brand retail.
THE KEY HIGHLIGHTSOFTHE BUDGETWHICHMAY IMPACTREALESTATE
SECTORARE ASFOLLOWS:
- External Commercial Borrowings(ECB) forlowcostaordablehousingprojects. Impact:Realestate companiesdeveloping large aordable housing
projectswith large fundrequirementswillbenetthe mostfrom the ea sing ofexternalcommercialborrowing (ECB)normsasinterestrate chargedislowerin
case of externalborrowingsin comparison to rateschargedby domestic
institutions.
- Increasein provision underRural HousingFund toINR4,000crore fromtheexistingINR3,000crore. Impact:Itwillprovide housing nance to targeted
groupsinruralareasatcompetitiverates.
-Extension of theexistingschemeo f interestsubvention of 1% on housing
loansupto INR15lakh wherethecostof thehousedoesnotexceed INR25
lakh foranotheryear. Impact:Thiswillboostthe aordable housing segment
by providing cheaperloan to the endusers.
MARKETREACTION TOBUDGET
Q1 2012 | RESEARCH
Source:www.bseindia.com|Mar16,2012
C o mp a ny C h an g e (% )
BSESENSEX -1.19
RealtyIndex -1.26
AnantRaj Inds -6.04
D BRealty -2.02
DLF 0.15
Godrej Properties -2.82
HDIL -5.21
Hubtown Ltd. -4.13
IndiabullsReal Estate -1.95
Mahindra Lifespaces -0.72
OrbitCorp. -3.37
Parsvnath Developers -4.04
Peninsula Land -3.18
Phoenix Mills -2.65
S o bh a D e v e lo p er s 3 . 04
SunteckRealty -1.13
Unitech -1.68
UNION BUDGET 2012 -13
A SNEAK PREVIEW
P.1 |COLLIERSINTERNATIONAL
OFFICE
PROPERTY MARKET OVERVIEWINDIA
QUARTERLY UPDATE | JANUARY | 2012
Acceleratingsuccess.