Total Absorption of Office Space in India Crosses 14 Million Sq Ft in April June 2023 as Per Colliers Report

The total absorption of office space in India in the top six cities increased by 2 percent to 14.6 million square feet during the second quarter of 2023, compared to 14.3 msf during the same period in 2022, indicating a rebound from the cautious first quarter.

According to a new report, Bengaluru and Chennai dominated global leasing growth with 23 percent each.

The technology, engineering, and manufacturing sectors accounted for 47 percent of the total office leasing activity.

Together, the technology and engineering and manufacturing industries dominated office leasing activity during the second quarter of 2023, accounting for 47 percent of the quarter's total leasing. These companies' leasing increased threefold year-over-year as tenants continued to occupy larger spaces in leading markets.

According to a report by the real estate consulting firm Colliers, Bengaluru and Chennai were the most popular locations for engineering and manufacturing firms to expand their offices.

The leasing of flex spaces increased by 58 percent year-over-year during the third quarter, as occupiers continued to incorporate licencing of mixed-use spaces into their long-term strategies, according to the report.

Flex or flexible space is a form of real estate that offers adaptable office space on a monthly or annual basis to enterprises. It refers to shared physical space between individuals and large organisations.

Tenants can select from large office formats or smaller spaces with shared areas, such as conference rooms, etc. It provides tenants with the flexibility to increase or decrease capacity requirements without incurring the financial risk of fitting out their own office spaces.

The six most important office markets were Bengaluru, Delhi-NCR, Mumbai, Chennai, and Hyderabad.