Delhi­NCR leads APAC in of­fice leas­ing vol­umes

RE­PORT CARD Delhi­NCR and Ben­galuru con­tinue to be the re­gional leader for leas­ing vol­umes in the first half of 2017, ahead of Guangzhou, Manila, Mel­bourne

Hindustan Times (Chandigarh) - Estates - - FRONT PAGE - Ramesh Nair feed­back@livemint.com Ramesh Nair is CEO & Coun­try Head, JLL In­dia

Al­though leas­ing ac­tiv­ity de­clined by 13% year-on-year in Asia Pa­cific in Q2, vol­umes were down only 2% in the first half of the year (H1), in­di­cat­ing sta­ble leas­ing lev­els across the re­gion. Cities like Seoul and Taipei saw slug­gish ten­ant de­mand im­pact­ing leas­ing ac­tiv­ity. Delhi-NCR has con­tin­ued to be the re­gional leader for leas­ing vol­umes while Ben­galuru also came ahead of other ac­tive re­gional mar­kets, in­clud­ing Guangzhou, Manila and Mel­bourne.

Higher lev­els of ac­tiv­ity in Ben­galuru (+11%) and Del­hiNCR (+14%) were, how­ever, off­set by lower lev­els of take-up in Mum­bai (-23%) and Chennai (-53%). While Mum­bai saw lower vol­umes in Q2 as a few big-ticket deals did not crys­tal­lize in time, Chennai suf­fered from lack of qual­ity of­fice spa­ces in a low va­cancy mar­ket. Ag­gre­gate gross leas­ing for four of In­dia tier-I cities reg­is­tered a small 3% de­cline in H1 2017.

The first half of 2017 has seen take-up reach just un­der 10 mil­lion square feet across the four ma­jor cities, which is slightly less than H1 2016 when the take-up ex­ceeded 10 mil­lion square feet.

Tra­di­tional sec­tors re­mained the pri­mary de­mand driv­ers but un­cer­tainty sur­round­ing US off­shoring pol­icy and au­to­ma­tion has seen ITeS’ firms ex­er­cise cau­tion. Co-work­ing op­er­a­tors have started to be ma­jor con­trib­u­tors of space take-up.

What hap­pened in other lead­ing mar­kets?

Leas­ing ac­tiv­ity washigh­eri­nall three China tier-I cities. Do­mes­tic fi­nan­cials, in­sur­ance, real es­tate and tech firms drove leas­ing ac­tiv­ity across th­ese mar­kets. At the same time, Hong Kong has wit­nessed strong de­mand from fi­nan­cial firms from the PRC.

A lack of avail­able space in ex­ist­ing build­ings andup­com­ing sup­ply in Ja­pan’s core ar­eas con­tin­ued to im­pact leas­ing ac­tiv­ity in the Grade A seg­ment in the first half of the year.

Gross leas­ing vol­umes in H1 2017 in Sin­ga­pore were no­tably higher than a year ear­lier, bol- stered by large deals on re­cently com­pleted or up­com­ing build­ings as ten­ants take ad­van­tage of lower rents to lease high-qual­ity space.

Ag­gre­gate gross leas­ing vol­ume sin Aus­tralia dur­ing H 12017 were flat on a year ago. De­mand is strong and broadly-based in Mel­bourne (up 78% in H1), with cen­tral­i­sa­tion a key theme. In Syd­ney, how­ever, gross leas­ing was 33% lower than a year ear­lier due to a high base ef­fect as leas­ing lev­els in H1 2016 were bol­stered by pre-leas­ing in new de­vel­op­ments.

Over­all, Asia Pa­cific leas­ing vol­umes this year are likely to be marginally lower (0% to -5%) than in 2016, with up­side po­ten­tial for im­proved ac­tiv­ity by year-end.

Glob­ally, how­ever, of­fice leas­ing ac­tiv­ity has been re­mark­ably sta­ble dur­ing the first half of 2017, with global vol­umes vir­tu­ally un­changed on the same pe­riod of 2016. For the full year 2017, JLL In­dia ex­pects global leas­ing vol­umes to re­main steady, match­ing the lev­els recorded in 2016. Vol­umes are pro­jected to be some­what higher than in 2016 in the United States, sta­ble in Europe and slightly lower in the Asia Pa­cific re­gion.

GETTY IM­AGES

Tra­di­tional sec­tors re­mained the pri­mary de­mand driv­ers but un­cer­tainty sur­round­ing US off­shoring pol­icy and au­to­ma­tion has seen ITeS’ firms ex­er­cise cau­tion

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.