Delhi-NCR has emerged as the sixth costliest office location in the APAC region. The prime office rents in the region averaged at Rs 340 per square foot per month, according to the Asia-Pacific Prime Office Rental Index for Q3 2024, which was released by Knight Frank India. The financial capital also featured on the list but ranked eighth most expensive with its rents averaging at Rs 317 per square foot.
Hong Kong SAR remains the most expensive office market in APAC, however, headwinds to the broader global economy continue. The prime office markets of Delhi-NCR and Mumbai have been extremely resilient and continue to see strong demand with stable rental values.
Stable Rents and Increasing Demand in Delhi NCR and Mumbai
Delhi NCR’s prime office rents remained steady in Q3 2024 at Rs 340 per square feet on par with last four quarters. Corporate occupier demand has been strong. In fact, rentals in Mumbai and Bengaluru have risen recently too. The rentals have grown 5 percent year-on-year in the case of Mumbai, but a rise in Bengaluru was at a more moderate 3 percent as demand was sustained while new office supplies were limited.
Bengaluru is one of the region’s more affordable office locations, though prime rents at Rs 138 per square foot a month helped it slip into 18th place in the APAC region’s most expensive office markets.
India’s Strong Economic Performance Supports the Resilience of the Office Market
Chairman and Managing Director Shishir Baijal of Knight Frank India attributed resilience in Indian economy to sustained demand for office space across major cities of India. “The resilience of the Indian economy continues to attract strong global corporate interest, as reflected in the sustained demand across India’s major office markets,” he observed. Quarterly transaction volumes have touched record high numbers and are likely to exceed annual benchmarks also in 2024.
Baijal further elaborated that although the rental rates remained stable over 2022, the good physical occupancy and soaring demand in 2024 are positive indicators for the Indian office market.
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