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Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.
Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.
Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.
Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.
Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.
Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.
Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.

Office PrOPerty Market Overview

iNDia

QUarterLy UPDate | aPriL | 2012

Accelerating success.

Office PrOPerty Market Overview iNDia QUarterLy UPDate | aPriL | 2012 Accelerating success.

1Q 2012 | THE KNOWLEDGE

sYDNEY CENTRAl BusINEss DIsTRICT

REsEARCh & fORECAsT REpORT

RESEARCh & FoRECAST REPoRT

INDIA oFFICE MARKET

REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE
REpORT RESEARCh & FoRECAST REPoRT INDIA oFFICE MARKET ECONOMIC BAROMETER   Mar-11 Mar-12 REPo RATE

ECONOMIC BAROMETER

 

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

 

8.25% - 9.50%

10.00% - 10.75%

LENDING RATE

DEPoSIT RATE

 

7.75% - 9.50%

8.50% - 9.25%

(>1 YEAR)

FoREIGN ExChANGE INR - USD

45.02

50.39

INR- EURo

59.12

65.89

RETuRN ON AlTERNATIVE INVEsTMENTs

 

Mar-11

Mar-12

YoY %

 

Change

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%

MACRO ECONOMIC OVERVIEW

During 4Q 2011 GDP grew at 6.9 percent in real terms suggesting a moderation in growth in comparison to preceding two quarters. The finance minister presented India’s Union Budget 2012 -13 this quarter projecting a GDP growth rate of 7.6% for 2012-13.

The headline inflation figure moderated from 8.3 percent in December 2011 to 6.6 and 6.95% in January and February 2012, respectively. Keeping in view the moderation in inflation rate the Reserve Bank of India (RBI) has softened monetary policy for the first time since one and a half year . This has been done by reducing CRR (Cash Reserve Ratio) by 50 basis points in January and a further reduction of 75 basis point in March 2012. The current CRR rate is 4.75%.

The Budget remained silent on most of the major real estate related issues. It did however mentioned that efforts are on to arrive at a political consensus on the issue of allowing 51% Foreign Direct Investment (FDI) in multi- brand retailing.

The Budget aims to provide impetus to affordable housing by providing various incentives to both developers and end users. For example the external Commercial Borrowings (ECB) is allowed for low cost affordable housing projects which would help developers to raise debt at lower cost.

From an end user perspective, the budget provides few incentives including, Service tax exemption for construction service related to residential dwelling and low cost mass housing up to an area of 60 sq mtr under the scheme of affordable housing. The existing scheme of interest subvention of 1% for housing loans up to INRs 15 lakh (where the cost of the house does not exceed INR 25 lakhs), was extended by one more year.

ECONOMIC INDICATORs

Gross Domestic product at factor cost 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0%
Gross Domestic product at factor cost
10.0%
9.0%
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
fDI in Real Estate
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
BsE sensex & Realty Index
160
150
140
130
120
110
100
90
80
70
BSE Sensex
*
Rebase to 100
Realty Index
INR Crore
2-Jan-12
Jan - Mar 09
2005
- 06
11-Jan-12
Apr - Jun 09
20-Jan-12
Jul - Sep 09
2006
- 07
oct - Dec 09
29-Jan-12
2007
- 08
Jan - Mar 10
7-Feb-12
Apr - Jun 10
16-Feb-12
2008
- 09
Jul - Sep 10
25-Feb-12
oct - Dec 10
2009
- 10
5-Mar-12
Jan - Mar 11
2010 - 11
Apr - Jun 11
14-Mar-12
Jul - Sep 11
23-Mar-12
April - Jan 2012
Jan - Dec 11
1-Apr-12

Note: As of 1st August 2011

Exchange Rates

110 105 100 95 90 85 80 75 US$ Euro * Rebase to 100 2-Jan-12
110
105
100
95
90
85
80
75
US$
Euro
* Rebase to 100
2-Jan-12
11-Jan-12
20-Jan-12
29-Jan-12
7-Feb-12
16-Feb-12
25-Feb-12
5-Mar-12
14-Mar-12
23-Mar-12
1-Apr-12

Note: As of 1st August 2011

Source: Colliers International India Research

www.colliers.com

MUMBAI CITY OffICE BAROMETER 4Q 2011 1Q 2012 VACANCY ABsORpTION CONsTRuCTION RENTAl VAluE GRADE ‘A’

MUMBAI

CITY OffICE BAROMETER

4Q 2011

1Q 2012

VACANCY

VACANCY
VACANCY

ABsORpTION

ABsORpTION
ABsORpTION

CONsTRuCTION

CONsTRuCTION
CONsTRuCTION

RENTAl VAluE

RENTAl VAluE
RENTAl VAluE
GRADE ‘A’ AVERAGE RENTAl VAluE 245 Forecast 210 175 140 105 70 35 0 INR
GRADE ‘A’ AVERAGE RENTAl VAluE
245
Forecast
210
175
140
105
70
35
0
INR per Sq ft per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | MUMbai
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | MUMbai
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | MUMbai
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | MUMbai

THE KNOWLEDGE | 1Q 2012 | Office | MUMbai

MuMBAI

In Mumbai, approximately 10 million sq ft of grade ‘A’ office space was available for lease in 1Q 2012. out of the total available supply around 64% was IT/ITeS office space mostly concentrated in the Lower Parel and Thane micro-markets.

Project launched during this quarter was “Equinox Business Park-Tower IV” by Equinox Realty & Infrastructure Private Limited. The project has a gross leasable area of approximately 0.5 million sq ft and is located off BKC. Another mixed use project “Island City Centre” was also launched by Wadia Group’s real estate venture Bombay Realty spreading over 45 acres of land at Dadar.

Following the previous quarter trend construction activities remained slow, no new grade ‘A’ office space was added to the city’s total inventory this quarter.

occupier demand remained steady in almost all of the micro markets and few large space commercial leases were signed during the quarter. Rental values for grade ‘A’ office space remained stable across Mumbai baring Nariman Point, the CBD of Mumbai, as occupiers are gradually shifting towards newly developed areas like Lower Parel, Bandra Kurla Complex (BKC) and Andheri due to better accessibility and state of an art infrastructure.

Looking ahead demand is likely to be remained moderate, however due to limited supply rentals are expected to remain stable.

As part of the State Government’s plan to make Wadala a business hub in lines of the BKC; MMRDA has invited consultants to prepare a detailed development plan for approximately 110 hectares of land.

AVAIlABlE supplY IN pRIME AREAs

Goregoan / JVLR 8%

Kalina 1% Navi Mumbai 6% Powai 5% Worli / Prabhadevi 1% Thane / LBS 21%
Kalina 1%
Navi Mumbai 6%
Powai 5%
Worli / Prabhadevi 1%
Thane / LBS 21%
Malad 5%
CBD 1%
Lower Parel 20%
Andheri East 24%

BKC 8%

1Q 2012 GRADE ‘A’ AND GRADE ’B’ RENTAl VAluEs

300 250 200 150 100 50 0 Grade A Grade B INR Per Sq ft
300
250
200
150
100
50
0
Grade A
Grade B
INR Per Sq ft Per Month
CBD
Andheri East
BKC
Lower Parel
Malad
Navi Mumbai
Powai
Worli/Prabhdevi
Goregaon / JVLR
Kalina
Thane / LBS
Andheri East (IT)
Lower Parel (IT)
Malad (IT)
Navi Mumbai (IT)
Powai (IT)
Goregaon / JVLR (IT)
Thane / LBS (IT)
pRIME OffICE spACE RENTAl TREND 420 370 320 270 220 170 120 70 20 CBD
pRIME OffICE spACE RENTAl TREND
420
370
320
270
220
170
120
70
20
CBD
Andheri East
Malad
BKC
Lower Parel
Navi Mumbai
Powai
Worli /
Prabhadevi
Goregaon
Kalina
Thane / LBS
/ JVLR
INR per Sq ft per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Altisource

Vishwaroop IT Park

137,000

Vashi

Lease

ANZ Bank

Boomerang

6,000

Andheri

Lease

Liberty Insurance

Peninsula Business Park

30,000

Lower Parel

Lease

L’oreal

Marathon Futurex

71,000

Lower Parel

Lease

Naaptol.com

Sigma IT Park

32,000

Navi Mumbai

Lease

Star Union Dai-ichi Life Insurance

Vishwaroop IT Park

67,000

Vashi

Lease

THE KNOWLEDGE | 1Q 2012 | Office | DeLhi DElhI •More than 1 million sq
THE KNOWLEDGE
|
1Q 2012
| Office
| DeLhi
DElhI
•More than 1 million sq ft of grade ‘A’ office
space was available for lease in Delhi in
1Q 2012. Most of this available supply was
concentrated in Jasola and Saket.
•No new supply was added to the city’s grade
‘A’ inventory. Similarly, no new grade ‘A’ office
projects was launched during this quarter.
DELhI
•Absorption remained relatively subdued as
only a few small office spaces leases were
signed in locations such as Connaught Place,
Saket and Nehru Place. This can primarily be
attributed to the shift in demand from the CBD
and SBD to areas in as Gurgaon and NoIDA
on account of better quality office and lower
real estate cost.

CITY OffICE BAROMETER

Rental values witnessed marginal pressure across the micro markets and a decrease in the range of 1 to 4% was observed for grade ‘A’ office space.•

4Q 2011

1Q 2012

VACANCY

for grade ‘A’ office space. 4Q 2011 1Q 2012 VACANCY ABsORpTION • In mid term rentals

ABsORpTION

In mid term rentals are expected to remained In mid term rentals are expected to remained

under pressure on account of lesser demand.

to remained under pressure on account of lesser demand. CONsTRuCTION RENTAl VAluE GRADE ‘A’ AVERAGE RENTAl
CONsTRuCTION RENTAl VAluE GRADE ‘A’ AVERAGE RENTAl VAluE 280 Forecast 245 210 175 140 105
CONsTRuCTION
RENTAl VAluE
GRADE ‘A’ AVERAGE RENTAl VAluE
280
Forecast
245
210
175
140
105
70
35
0
INR per Sq ft per Month
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F

To encourage development of non polluting small and medium scale industries in the city Delhi State Industrial and Infrastructure Development Corporation (DSIIDC) is planning to set up a multi level manufacturing hub in Rani Khera in north west Delhi with an estimated cost of INR 3100 crore. The work on another knowledge based industrial park in Baprola has already started.

In an another infrastructure related intiative the Delhi Development Authority(DDA) has planned to develop three Urban Extension Roads (UERs). These link roads will facilitate smooth travelling between two States — Delhi and haryana — Dwarka-Palam Vihar, Najafgarh-Dhansa and Nelson Mandela Road- MG Road.

AVAIlABlE supplY IN pRIME AREAs

Saket 29%

Connaught Place 2% Nehru Place 10% Jasola 59%
Connaught Place 2%
Nehru Place 10%
Jasola 59%

1Q 2012 GRADE ‘A’ AND GRADE ’B’ RENTAl VAluEs

400 350 300 250 200 150 100 50 0 Grade A Grade B INR per
400
350
300
250
200
150
100
50
0
Grade A
Grade B
INR per Sq Ft per Month
Nehru Place
Connaught
Place
Netaji Subhash
Jasola
Saket
pRIME OffICE spACE RENTAl TREND 450 400 350 300 250 200 150 100 50 0
pRIME OffICE spACE RENTAl TREND
450
400
350
300
250
200
150
100
50
0
Nehru Place
Jasola
Cannaught
Saket
place
Netaji Subhash
INR per Sq ft per Month
2Q2008
3Q2008
4Q2008
1Q2008
2Q2009
3Q2009
4Q2009
1Q2009
2Q2010
3Q2010
4Q2010
1Q2010
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

hitachi

Eros Corporate Tower

3,000

Nehru Place

Lease

Mizuho Bank

DLF Capitol Point

16,000

C.P.

Lease

Pragati Equity Advisors

Southern Park

1,500

Saket

Lease

Snap Deal

Southern Park

22,000

okhla-III

Lease

Snap Deal Southern Park 22,000 okhla-III Lease p. 4 | COllIERs INTERNATIONAl Source: Colliers

per sq ft per month INR per sq ft per monthINR

per sq ft per month INR per sq ft per monthINR THE KNOWLEDGE | 1Q 2012
per sq ft per month INR per sq ft per monthINR THE KNOWLEDGE | 1Q 2012
per sq ft per month INR per sq ft per monthINR THE KNOWLEDGE | 1Q 2012
per sq ft per month INR per sq ft per monthINR THE KNOWLEDGE | 1Q 2012

THE KNOWLEDGE | 1Q 2012 | Office | GUrGaON

ft per monthINR THE KNOWLEDGE | 1Q 2012 | Office | GUrGaON GURGAoN CITY OffICE BAROMETER

GURGAoN

CITY OffICE BAROMETER

GuRGAON

More than 7 million sq ft of grade `A’ office space supply was available for fit-out in 1Q 2012. Most of this available supply was concentrated in Udyog Vihar and along National highway 8 up to Manesar.

Several projects were launched during 1Q 2012 including “one horizon Centre” by hines India at Golf Course Road and “Athena” by Brahma-Bestech at Nh-8. Both of these project are expected to be completed by the first half of 2015 and will add around 1.2 million sq ft of grade `A’ office space to the city’s total inventory.

No major grade `A’ project/phase of the project was completed in this quarter.

Absorption remained optimistic and a number of large format leases were signed during the quarter including a few pre-commitment leases in under- construction buildings. The investor market also remained active during the quarter and a few deals were concluded such as the BPTP buyout of 49% of the Merrill Lynch stake in the grade `A’ office project `C“Crest”. M3M bought a 28-acre land parcel from DLF located at sector 70A.• • • • • • • •

4Q 2011

1Q 2012

VACANCY

ABsORpTION

CONsTRuCTION

RENTAl VAluE

GRADE ‘A’ AVERAGE RENTAl VAluE 120 Forecast 110 100 90 80 70 60 50 40
GRADE ‘A’ AVERAGE RENTAl VAluE
120
Forecast
110
100
90
80
70
60
50
40
30
20
10
0
INR per Sq ft per Month
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F

Rental values for grade `A’ properties increased in the range of 2 to 6% in almost all the major micro-markets barring Udyog Vihar / Nh-8 and DLF Cyber City where rental values remained stable.

In near future rentals are expected to remain stable for both IT/ITES and commercial office space.

In 1Q 2012 the state government approved infrastructure projects valued at INR1,394 crore for strengthening of roads, water supply and sewage systems in newly developing sectors 77 to 114.

AVAIlABlE supplY IN pRIME AREAs Manesar 35% Nh8/ Udyog Vihar 36% Institutional Sectors / Sushant
AVAIlABlE supplY IN pRIME AREAs
Manesar 35%
Nh8/ Udyog
Vihar 36%
Institutional Sectors /
Sushant Lok
16%
MG Road 5%

DLF Cyber City 8%

1Q 2012 GRADE ‘A’ AND GRADE ’B’ RENTAl VAluEs

   
 

Manesar

Institutional Sectors / Sushant Lok

Grade A

DLF Cyber City

Nh8/Udyog Vihar

Manesar

Sohna Road

Grade B

Nh8/Udyog Vihar

MG Road

Golf Course Road /Ext /Sohna Road

pRIME OffICE spACE RENTAl TREND

180 160 140 120 100 80 60 40 20 MG Road DLF Cyber City (IT)
180
160
140
120
100
80
60
40
20
MG Road
DLF Cyber City (IT)
Golf Course Road/Ext /Sohna Road
Golf Course Road/
Ext /Sohna Road (IT)
Institutional Sectors /Sushant Lok
Manesar
Nh8/Udyog Vihar (IT)
Nh8/Udyog Vihar
Manesar (IT)
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Bausch & Lomb

First India Place

16,000

M.G. Road

Lease

DhR holdings

Plot 121

20,700

Udyog Vihar

Lease

Expedia

DLF Building No 5C

50,000

DLF Cyber City

Lease

Google

Signature Tower-II

175,000

Sector 15

Lease

Ingersoll Rand

DLF Building No 5A

49,000

DLF Cyber City

Lease

Rio Tinto

DLF Building No 5A

40,600

DLF Cyber City

Lease

THE KNOWLEDGE | 1Q 2012 | Office | NOiDa

THE KNOWLEDGE | 1Q 2012 | Office | NOiDa NoIDA CITY OffICE BAROMETER NOIDA • More

NoIDA

CITY OffICE BAROMETER

NOIDA

More than 5 million sq ft of office space supply was available for fit out in NoIDA this quarter. More than 85% of this available office space was in the form of IT/ITeS. Grade ‘A’ IT/ITeS office space was concentrated in sector 16A, 62 and sectors 125 to 143 along the NoIDA Express-way, while IT/ITeS office space available in industrial sectors was primarily grade ‘B’ office space.

Projects launched during this quarter were “Jaypee Chambers” by Jaypee Group in Sector 129, “Wave City Centre” by Wave Group and “Logix City Centre” by Logix Group both located at sector 32. All of these projects together are expected to contribute around 2.1 million sq ft of grade ‘A’ office space to the city’s total inventory by the end of 2015.

4Q 2011

In 1Q 2012 construction activities slowed down due to state elections, thus no projects/ phases of the project were completed during the quarter. • • • •

1Q 2012

VACANCY

ABsORpTION

CONsTRuCTION •A few large office space leases were concluded during the quarter. Demand was RENTAl
CONsTRuCTION
•A few large office space leases were
concluded during the quarter. Demand was
RENTAl VAluE
largely driven by the IT/ITeS sector.
GRADE ‘A’ AVERAGE RENTAl VAluE
•In one of the private equity exit, Kotak Realty
Fund has sold its stake back to promoters in
3C company’s information technology park
project in NoIDA.
80
Forecast
70
60
50
40
•The rental values for non IT office space
remained stable because of limited supply
however, rental values for IT/ITeS office space
witnessed marginal pressure on account of
large available supply. Similar rental trends
can be anticipated in near future.
30
20
10
0
INR per Sq ft per Month
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F
AVAIlABlE supplY IN pRIME AREAs Commercial Sectors (Sec 18) 2% Institutional Sectors (Sec.16A, 62, 125-142)
AVAIlABlE supplY IN pRIME AREAs
Commercial Sectors
(Sec 18) 2%
Institutional Sectors
(Sec.16A, 62, 125-142)
86%
Industrial Sectors (Sec.
1-9, 57-60, 63-65)
(Grade B)
12%
Industrial Sectors (Sec. 1-9, 57-60, 63-65) (Grade B) 12% 1Q 2012 GRADE ‘A’ AND GRADE ’B’

1Q 2012 GRADE ‘A’ AND GRADE ’B’ RENTAl VAluEs

100 90 80 70 60 50 40 30 20 10 0 Grade A Grade B
100
90
80
70
60
50
40
30
20
10
0
Grade A
Grade B
INR Per SqFt Per Month
Institutional
Sectors (Sec.16A,62,
125-142 )
Commercial Sectors
(Sec 18)
Industrial Sectors
(Sec 1-9,57 -60,
63 -65)
Institutional Sectors
(Sec 16A,62 ,125-
142) (IT)
pRIME OffICE spACE RENTAl TREND 140 120 100 80 60 40 20 0 Industrial Sector
pRIME OffICE spACE RENTAl TREND
140
120
100
80
60
40
20
0
Industrial Sector
Institutional Sectors (IT)
Commercial Sectors
Institutional Sectors (Non IT)
INR Per SqFt Per Month
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Barclays shared services

Individual Building

25,000

Sector 62

Lease

halcrow

B-1D

52,000

Sector 10

Lease

hewitt

3C’s Building Tower-A

100,000

Sector 127

Lease

oracle

3C’s Building Tower-B

170,000

Sector 127

Lease

3C’s Building Tower-B 170,000 Sector 127 Lease p. 6 | COllIERs INTERNATIONAl Source: Colliers
THE KNOWLEDGE | 1Q 2012 | Office | cheNNai ChENNAI ChENNAI • over 13 million
THE KNOWLEDGE | 1Q 2012 | Office | cheNNai ChENNAI ChENNAI • over 13 million
THE KNOWLEDGE | 1Q 2012 | Office | cheNNai ChENNAI ChENNAI • over 13 million
THE KNOWLEDGE | 1Q 2012 | Office | cheNNai ChENNAI ChENNAI • over 13 million

THE KNOWLEDGE | 1Q 2012 | Office | cheNNai

THE KNOWLEDGE | 1Q 2012 | Office | cheNNai ChENNAI ChENNAI • over 13 million sq

ChENNAI

ChENNAI

over 13 million sq ft of grade ‘A’ office space supply was available for lease in 1Q 2012. More than 90% of this stock was IT/ITeS office space primarily located at oMR and Ambattur while non IT office space was mostly available in the CBD area, Vadapalani and Velachery.

No new grade “A” commercial projects were completed this quarter in Chennai.

Project launched during this quarter included “ASV Chandilya” admeasuring approximately 0.04 million sq ft by ASV Constructions. The project is located at Thoraipakkam and estimates to be completed by 2Q 2013.

CITY OffICE BAROMETER

4Q 2011

1Q 2012

VACANCY

VACANCY

ABsORpTION

ABsORpTION

CONsTRuCTION

CONsTRuCTION

RENTAl VAluE

RENTAl VAluE

Demand was primarily concentrated in Guindy, Ambattur and oMR as companies were preferring these micro markets for relocation and expansion considering accessibility and state-of-an-art facilities. The market seems •

to be well segmented such as KPo’s and

BPo’s preferring looking spaces at cheaper rentals and ready to go at the far away end ofThe market seems to be well segmented such as KPo’s and oMR while other corporate were

oMR while other corporate were ready to pay higher rentals and preferring initial stretch ofat cheaper rentals and ready to go at the far away end of oMR, Guindy and

oMR, Guindy and Ambattur.to pay higher rentals and preferring initial stretch of GRADE ‘A’ AVERAGE RENTAl VAluE 60 Forecast

GRADE ‘A’ AVERAGE RENTAl VAluE 60 Forecast 55 50 45 40 35 30 25 20
GRADE ‘A’ AVERAGE RENTAl VAluE
60
Forecast
55
50
45
40
35
30
25
20
15
10
5
0
INR per Sq ft per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F

Rental values in 1Q 2012 remained stable across all micro markets. Absorption was comparatively lesser as the occupiers remained cautious on the backdrop of the current economic scenario. In near future rentals are likely to remain stable on account of the limited supply scheduled for completion in 2012.

Under the “Mega City” programme the Chennai Corporation has laid out 360 integrated roads at an estimated cost of INR 800 crore, covering an area of 176 km. The state government had allotted INR 333 crore last year for the same.

AVAIlABlE supplY IN pRIME AREAs oMR (IT Corridor) 51% GST Rd 3% Velachery 1% Vadapalini
AVAIlABlE supplY IN pRIME AREAs
oMR (IT Corridor) 51%
GST Rd 3%
Velachery 1%
Vadapalini 1%
CBD
14%
Ambattur 24%
Guindy (SBD) 5%
1% Vadapalini 1% CBD 14% Ambattur 24% Guindy (SBD) 5% 1Q 2012 GRADE ‘A’ IT AND

1Q 2012 GRADE ‘A’ IT AND NON IT RENTAl VAluEs

80 70 60 50 40 30 20 10 0 IT NoN IT INR per sq
80
70
60
50
40
30
20
10
0
IT
NoN IT
INR per sq ft per month
CBD
Guindy (SBD)
Ambattur
oMR (IT Corridor)
GST road
pRIME OffICE spACE RENTAl TREND 90 80 70 60 50 40 30 20 Ambattur GST
pRIME OffICE spACE RENTAl TREND
90
80
70
60
50
40
30
20
Ambattur
GST road
CBD
Guindy (SBD)
oMR (IT Corridor)
INR per sq ft per month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Bank of New York Mellon

DLF IT Park

50,000

Manapakkam

Lease

Barclays

DLF IT Park

63,000

Manapakkam

Lease

Cambridge Technologies

Agnitio Park

60,000

Kandhanchavady

Lease

Emerson

Ascendas

18,000

Taramani

Lease

Mindtree

Ramanujam IT Park

100,000

Taramani

Lease

Shriram Value Servies

Individual Building

18,000

Mylapore

Sale

THE KNOWLEDGE | 1Q 2012 | Office | beNGaLUrU

THE KNOWLEDGE | 1Q 2012 | Office | beNGaLUrU BENGALURU BENGAluRu (BANGAlORE) • Approximately 9 million

BENGALURU

BENGAluRu (BANGAlORE)

Approximately 9 million sq ft of grade ‘A’ supply was available for lease during 1Q

2012. Micro markets such as the EPIP Zone,

Whitefield, outer Ring Road and the CBD account for about 88% of this total available supply.

New supply of commercial grade ‘A’ office

space for 1Q 2012 accounts for approximately

0.60 million sq ft. Projects/ phases of the

projects contributing to this new supply were “Mantri Commercio” developed by Mantri Group at outer Ring Road (oRR) and “Equinox Tech Park - North Block” by Essar Group at Electronic City.

CITY OffICE BAROMETER

VACANCY

ABsORpTION

CONsTRuCTION

RENTAl VAluE

BAROMETER VACANCY ABsORpTION CONsTRuCTION RENTAl VAluE • During 1Q 2012, a number of new projects were
BAROMETER VACANCY ABsORpTION CONsTRuCTION RENTAl VAluE • During 1Q 2012, a number of new projects were
BAROMETER VACANCY ABsORpTION CONsTRuCTION RENTAl VAluE • During 1Q 2012, a number of new projects were
BAROMETER VACANCY ABsORpTION CONsTRuCTION RENTAl VAluE • During 1Q 2012, a number of new projects were

During 1Q 2012, a number of new projects were launched in peripheral business area in Bengaluru, including “Prestige Tech Park III” by Prestige Group in outer Ring Road (oRR), “RMZ Galleria” and “RMZ Latitude” by RMZ Corp at Yelahankha and Bellary Road, respectively, “Golden Supreme Tech Park” and “Maruthi Concord” by local developers in Electronic City. Further, Bagmane Group also launched a new tower in its Special Economic zone (SEZ) “World Trade Centre 4” located at oRR. All these Projects altogether will add approximately 2.5 million sq ft of grade ‘A’ office space to the city’s total inventory by the end of 2013.• • • •

4Q 2011

1Q 2012

GRADE ‘A’ AVERAGE RENTAl VAluE 50 Forecast 45 40 35 30 25 20 15 INR
GRADE ‘A’ AVERAGE RENTAl VAluE
50
Forecast
45
40
35
30
25
20
15
INR per Sq ft per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F

occupier demand was relatively less during the quarter as compared to previous 2-3 quarters, primarily due to cautious occupier’s sentiments. In terms of absorption micro markets such as CBD, Whitefield and EPIP zone remained active due to lesser availability of grade ‘A’ office space in other preferred areas such as outer Ring Road.

Average rental values for grade ‘A’ office space remain stable quarter on quarter across all of the micro markets.

Due to limited supply in the market, rentals are expected to increase marginally in mid term.

AVAIlABlE supplY IN pRIME AREAs

Electronic City 4% Bannerghatta Road 3% outer Ring Road 15% CBD 8% hosur Rd 5%
Electronic City 4%
Bannerghatta Road 3%
outer Ring Road 15%
CBD 8%
hosur Rd 5%
EPIP Zone/ Whitefield 65%

1Q 2012 GRADE ‘A’ AND GRADE ’B’ RENTAl VAluEs

90 80 70 60 50 40 30 20 10 0 Grade A Grade B INR
90
80
70
60
50
40
30
20
10
0
Grade A
Grade B
INR Per SqFt Per Month
CBD
hosur Road
EPIP Zone/
Whitefield
Electronic
City(IT)
Bannerghatta Road
outer Ring Road
pRIME OffICE spACE RENTAl TREND 100 90 80 70 60 50 40 30 20 10
pRIME OffICE spACE RENTAl TREND
100
90
80
70
60
50
40
30
20
10
0
CBD
Bannerghatta Road
hosur Road
Electronic City
EPIP Zone / Whitefield
outer Ring Road
INR Per SqFt Per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Atos origin India

Gopalan Millennium Tower

125,000

Whitefield

Lease

Ericsson

Umyia Business Bay

22,500

outer Ring Road

Lease

Intersil

RMZ Centinnial

17,000

Whitefield

Lease

Just dial

Embassy Star

10,962

Vasanth Nagar

Lease

Meru Networks

Salarpuria Adonis

35,133

old Madras Road

Lease

Tejas Networks

JP IT Park

90,000

Electronic City

Lease

KoLKATA CITY OffICE BAROMETER 4Q 2011 1Q 2012 VACANCY ABsORpTION CONsTRuCTION RENTAl VAluE GRADE ‘A’

KoLKATA

CITY OffICE BAROMETER

4Q 2011

1Q 2012

VACANCY

VACANCY
VACANCY

ABsORpTION

ABsORpTION
ABsORpTION

CONsTRuCTION

CONsTRuCTION
CONsTRuCTION

RENTAl VAluE

RENTAl VAluE
RENTAl VAluE
GRADE ‘A’ AVERAGE RENTAl VAluE 90 Forecast 80 70 60 50 40 30 20 10
GRADE ‘A’ AVERAGE RENTAl VAluE
90
Forecast
80
70
60
50
40
30
20
10
0
INR per Sq ft per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | kOLkata
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | kOLkata
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | kOLkata
3Q2011 4Q2011 1Q2012 2Q2012F 3Q2012F 4Q2012F 1Q2013F THE KNOWLEDGE | 1Q 2012 | Office | kOLkata

THE KNOWLEDGE | 1Q 2012 | Office | kOLkata

KOlKATA

In 1Q 2012, approximately 0.08 million sq ft has been added to grade ‘A’ office space supply in the PBD area. The project / phases of the project which contributed to this new supply was “Rishi Tech Park” developed by Nathvar Tracon Pvt. Ltd. located at New Town.

A number of commercial projects were launched during the quarter including “Ideal Unique Centre” by Ideal Group at EM Bypass, “Woodburn Central” by Belani Projects at Elgin Road, “DN 21” by Midwest holding Private Ltd (Chatterjee Group) and “Pentagon” by Team Tarus both at Sector 5. All of these projects will together contribute approximately 2 million sq ft of grade A office space to the city’s inventory by the end of 2014.

Absorption remained subdued during the quarter and only few small commercial leases were signed during the quarter. Rental values for grade ‘A’ office space in 1Q 2012 remained

stable across all of the major micro markets due to ample stock availability in major

commercial hubs such as Rajarhat, New Town and Sector 5.

Going forward rentals are expected to be under pressure due to prevailing uncertainties in land policies and lesser demand.

In a major decision the state government of West Bengal has ruled out SEZ status for Infosys. The decision was taken to protect the rights of farmers and farm land by not relaxing the urban ceiling laws for Special Economic Zones (SEZs).

The Airports Authority of India (AAI) is planning to develop commercial space in the vicinity of Kolkata airport. The authority has identified approximately 45 acres of land for commercial development. The project would be developed by floating a public tender and funded through public-private partnership.

NEW supplY IN pRIME AREAs PBD (New Town, Rajarhat) 100%
NEW supplY IN pRIME AREAs
PBD (New Town,
Rajarhat)
100%
NEW supplY IN pRIME AREAs PBD (New Town, Rajarhat) 100% 1Q 2012 GRADE ‘A’ AND GRADE

1Q 2012 GRADE ‘A’ AND GRADE ’B’ RENTAl VAluEs

   

East Kolkata

Sector-5

Grade A

PBD (New

Town, Rajarhat

Sector-5

PBD New Town, Rajarhat (IT)

(IT)

Grade B

INR per sq ft per month

Ballygunge

-Circular RD

CBD (Park St, Camac

St,AJC Bose Rd)

pRIME OffICE spACE RENTAl TREND 160 140 120 100 80 60 40 20 CBD (Park
pRIME OffICE spACE RENTAl TREND
160
140
120
100
80
60
40
20
CBD (Park St,Camac St,
East Kolkatta
AJC Bose Rd)
Ballygunge Circular Rd
Sector 5
PBD (New Town, Rajarhat
INR per sq ft per month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Bajaj Allianz

Mani Square

9,000

Sector 5

Lease

Dhanalaxmi Bank

Chitrakut building

2,000

AJC Bose Road

Lease

Magma Finance

Eco Space

17,000

New Town

Lease

Rax omega

Infinity Think Tank

4,500

Sector 5

Lease

Recon

Infinity Benchmark

30,000

Sector 5

Lease

Sardha Group

Crystal Globsyn

33,000

Sector 5

Lease

THE KNOWLEDGE | 1Q 2012 | Office | PUNe puNE •In 1Q 2012 more than
THE KNOWLEDGE
|
1Q 2012
| Office
| PUNe
puNE
•In 1Q 2012 more than 9.7 million sq ft of
grade ‘A’ office space was available for fit-
out in Pune. Most of this supply was located
in
hinjewadi, Kharadi, hadapsar, Fursungi and
Nagar Road.
•Approximately 1 million of SEZ space was
added in the existing SEZ projects in Pune.
more than 60% of this space was swiftly
absorbed as spaces were pre-committed
by
the existing tenants. In addition to Pune
commercial grade ‘A’ office space witnessed
an infusion of approximately 0.12 million sq
ft
new supply during the quarter. Project/

PUNE

CITY OffICE BAROMETER

4Q 2011

1Q 2012

VACANCY

VACANCY
VACANCY

ABsORpTION

ABsORpTION
ABsORpTION

CONsTRuCTION

CONsTRuCTION
CONsTRuCTION

RENTAl VAluE

RENTAl VAluE
RENTAl VAluE
GRADE ‘A’ AVERAGE RENTAl VAluE 70 Forecast 60 50 40 30 20 10 0 INR
GRADE ‘A’ AVERAGE RENTAl VAluE
70
Forecast
60
50
40
30
20
10
0
INR per Sq ft per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012
2Q2012F
3Q2012F
4Q2012F
1Q2013F

phases of project contributing to this new

supply was “Blue Chip” developed by K Raheja

at hinjewadi.

Rental values for grade ‘A’ office space increased in the range of 2 to 5% specifically

in SEZs in almost all of the micro markets.

A few markets such as Viman Nagar and

Kharadi also witnessed demand for outright purchases.

Going forward rentals are expected to remain stable on account of large available supply, baring eastern corridor where the rental may witnessed an increase of 7 to 10% in next 2-3 quarters.

This quarter the ready reckoner rate has been increased in the range of 10 to 30% across Pune. This will help in the improvement of transparency in real estate transaction in the long term.

An overhead bridge connecting Wakdewadi (central Corridor) to Nagar Road/Yerwada (Eastern corridor), road connecting Chakan, Bhosari and Dighii another road connecting between Baner Road and Pimple Nilkah to Pimple Saudagar became operational. This

will give an impetus to the real estate activities

in the nearby areas.

supplY IN pRIME AREAs

Kharadi 23% hadapsar/Fursungi 12% Baner 5% Bund Garden 2% Airport road/ pune station 6% Aundh
Kharadi 23%
hadapsar/Fursungi 12%
Baner 5%
Bund Garden 2%
Airport road/
pune station 6%
Aundh 3%
Senapati Bapat Road 1%
Bavdhan 4%
hinjewadi 28%
Kalyani Nagar 4%

Nagar Road 12%

1Q 2012 GRADE ‘A’ IT AND NON IT RENTAl VAluEs

 

Aundh

Bavdhan

Senapati Bapat Road

IT

Kalyani Nagar

Nagar Road

hinjewadi

hadapsar/Fursungi

Kharadi

Non IT

INR Per SqFt Per Month

Baner

Airport road/

pune station

Bund Garden

pRIME OffICE spACE RENTAl TREND 130 120 110 100 90 80 70 60 50 40
pRIME OffICE spACE RENTAl TREND
130
120
110
100
90
80
70
60
50
40
30
20
Bavdhan
Aundh
Airport road/pune station
Bund Garden
Nagar Road
Baner
Kalyani Nagar
Senapati Bapat Rd
Khardi
hinjewadi / hadapsar/Fursungi
INR Per SqFt Per Month
1Q2008
2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
1Q2012

MARKET TRANsACTIONs

CLIENT

BUILDING NAME

AREA

LoCATIoN

TRANSACTIoN TYPE

 

(SQ. FT.)

Amdocs

Magarpatta SEZ

88,000

hadapsar

Lease

Bekaert

Amar Paradigm

40,000

Baner

Lease

CCRT

Pride Kumar Senate

1,700

S B Road

Lease

DVS

Tara Icon

1,700

Wakdewadi

Lease

ExL

Magapatta SEZ

88,000

hadapsar

Lease

hCL

Maragatta SEZ

44,000

hadapsar

Lease

OffICE suBMARKETs

OffICE suBMARKETs THE KNOWLEDGE | 1 Q 201 2 | Office | sUbMarkets Mumbai The major
OffICE suBMARKETs THE KNOWLEDGE | 1 Q 201 2 | Office | sUbMarkets Mumbai The major
OffICE suBMARKETs THE KNOWLEDGE | 1 Q 201 2 | Office | sUbMarkets Mumbai The major
OffICE suBMARKETs THE KNOWLEDGE | 1 Q 201 2 | Office | sUbMarkets Mumbai The major

THE KNOWLEDGE | 1Q 2012 | Office | sUbMarkets

Mumbai The major business locations in Mumbai are the CBD (Nariman Point, Fort and Ballard Estate), Central Mumbai (Worli, Lower Parel and Parel), Bandra Kurla Complex (BKC) and Andheri Kurla stretch. Powai, Malad and Vashi are the preferred IT/ITES destinations, while Airoli at Navi Mumbai and Lal Bahadur Shastri Marg are emerging as new office and IT/ITES submarkets.

Delhi The commercial areas in New Delhi metropolitan area can be broadly classified into the CBD (Connaught Place), SBD Nehru Place, Bhikaji Cama Place, Netaji Subhash Place, Jasola and Saket .

Gurgaon The prime business locations in Gurgaon are MG Road, Golf Course Road, Cyber City and Udyog Vihar. Manesar on the outskirts of Gurgaon is also emerging as the city’s new office destination.

NOIDA NoIDA market is comprised of sectors broadly classified as institutional, industrial and commercial sectors. Institutional sectors include sec 16A, 62 and 125-142, industrial sectors include sec 1-9, 57-60 and 63- 65 while sector 18 is the most developed commercial sector.

Chennai Prime office properties in Chennai are located in four principal sub-markets: the CBD, the IT Corridor, the SBD and the PBD. The SBD comprises Guindy, Manapakkam, Velachery and other areas. The PBD primarily includes Ambattur and GST Road, while the IT Corridor is the old Mahaballipuram Road (oMR) in south Chennai.

Bengaluru (Bangalore) Prime office properties in Bengaluru can be divided into three principal sub-market— CBD, the SBD consisting of Banerghatta Road & outer Ring Road (oRR) and PBD including hosur Road, EPIP Zone, Electronic City and Whilefield.

Pune The prime office sub-markets of Pune include Deccan Gymkhana, Senapati Bapat Road & Camp (SBD), while the PBD includes Aundh, Bund Garden, Airport Road and Kalyani Nagar, among other locations. The eastern corridor, along with Nagar Road and Kharadi, have emerged as a preferred location for financial and IT/ITES companies.

Kolkata The major business locations in Kolkata are CBD (Park Street, Camac Street, Chowranghee Rd), SBD (AJC Bose Rd, Ballygunge circular Rd, East Kolkata), East Kolkata and PBD (New Town & Rajarhat). The area around Park Street, Camac Street and AJC Bose road houses number of high-rises commercial buildings such as Chatterjee International Centre, Tata Centre, Everest house and Industry house among others.

CITY BAROMETER

Increasing as compared to previous quarterhouse and Industry house among others. CITY BAROMETER Decreasing as compared to previous quarter Remained stable

Decreasing as compared to previous quarterCITY BAROMETER Increasing as compared to previous quarter Remained stable from previous quarter COllIERs INTERNATIONAl

Remained stable from previous quarterIncreasing as compared to previous quarter Decreasing as compared to previous quarter COllIERs INTERNATIONAl | p.

THE KNOWLEDGE | 1Q 2012

Colliers International (India) provides property services to property Investors and occupiers. We deliver customised service solutions utilising local and global knowledge in partnership with our clients via our property Investment and occupier service lines. These service lines include - office Services, Facility Management, Project Management, Residential Services, Investment Services and Valuation & Advisory Services.

www.colliers.com/india

For national offices services related queries please contact:

George Mckay, South Asia Director office & Integrated Services George.mckay@colliers.com Tel: +91 22 4050 4553

Vikas Kalia, National Director office Services Vikas.kalia@colliers.com Tel: +91 124 456 7531

Mumbai

: Prabhu Raghavendra, office Director Prabhu.raghavendra@colliers.com 31/A, 3rd floor, Film Center, 68, Tardeo Road, Mumbai, India - 400 034. Tel : +91 22 4050 4500, fax : +91 22 2351 4272

Delhi NCR : Ajay Rakheja, office Director Ajay.rakheja@colliers.com

New Delhi : Statesman house, 4th Floor, Barakhamba Road, Connaught Place, New Delhi, India - 110001 Tel : +91 11 4360 7500 - 23, fax : +91 11 2335 6624

Gurgaon : Technopolis Building, 1st floor, DLF Golf Course Main Road, Sector 54, Gurgaon, India - 122002 Tel : +91 124 437 5807, fax : +91 124 437 5806

Bengaluru : Goutam Chakraborthy, office Director Goutam.chakraborthy@colliers.com Prestige Garnet, Level 2, Unit No.201/202, 36 Ulsoor Road, Bengaluru, India - 560 042 Tel : +91 80 4079 5500, fax : +91 80 4112 3131

Pune

: Suresh Castellino, office Director Suresh.castellino@colliers.com hotel Le Meridian, 101, R.B.M. Road, Pune, India - 411 001 Tel : +91 20 4120 6438, fax : +91 20 4120 6434

Chennai

: Kaushik Reddy, office Director Kaushik.reddy@colliers.com heavitree Complex, Unit 1C, 1st floor, 23,Spurtank Road, Chetpet, Chennai, India - 600 031 Tel : +91 44 2836 1064, fax: +91 44 2836 1377

Kolkata

: Soumya Mukherjee , office Director Soumya.mukherjee@colliers.com Infinity Business Centre, Infinity Benchmark, Room No 13, Level 18, Plot G - 1, Block EP & GP,Salt Lake Sector V, Kolkata - 700 091 West Bengal, India Tel : +91 33 2357 6501 Extn : 206 , fax +91 33 2357 6502

522 offices in 62 countries on 6 continents United States: 147 Canada: 37 Latin America:
522 offices in 62 countries on 6 continents
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Canada: 37
Latin America: 19
Asia Pacific: 201
EMEA: 118
$1.8 billion in annual revenue
2.55 billion square feet under management
over 12,300 + professionals
AUTHORS
Amit Oberoi MRICS
National Director, Valuation & Advisory; Research
Email: Amit.oberoi@colliers.com
Surabhi Arora MRICS
Associate Director, Research
Email: Surabhi.arora@colliers.com
Sachin Sharma
Assistant Manager, Research
Email: Sachin.sharma@colliers.com
Heliana Mano
Assistant Manager,Valuation & Advisory
Email: heliana.mano@colliers.com
For general queries and feedback :
India.Research@colliers.com
Tel: +91 124 456 7580
This report and other research materials may be found on
our website at www.colliers.com/India. Questions related
to information herein should be directed to the Research
Department at the number indicated above. This document
has been prepared by Colliers International for advertising
and general information only. Colliers International makes
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expressed or implied, regarding the information including,
but not limited to, warranties of content, accuracy and
reliability. Any interested party should undertake their
own inquiries as to the accuracy of the information.
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North America, and its economic future is largely
Singapore
Asia Pacific
�.��
�.��
will experience a lack of new supply in the face
tied to that of its key trading partner, the United
London (Heathrow)
EMEA
�.��
�.��
of growing demand.
Tokyo
Asia Pacific
�.��
�.��
Los Angeles –
NA
�.��
�.��
Inland Empire, CA
Chicago, IL
Paris
Munich
Vancouver, BC
Marseilles
New Jersey – Northern
Dallas-Ft. Worth, TX
Shanghai
Seoul
NA
�.��
�.��
Prime warehouse rents will climb in most Asia
Pacific markets, remain stable in EMEA and
LATAM, and continue to strengthen in North
American markets.
States. But with U.S. growth on the upswing,
Mexico too is poised to grow at a modest rate and
we expect that vacancies could make further
drops in the country.
EMEA
�.��
�.��
EMEA
�.��
�.��
NA
�.��
�.��
EMEA
�.��
�.��
NA
�.��
�.��
NA
�.��
�.��
Asia Pacific
�.��
�.��
Asia Pacific
�.��
�.��
Madrid
EMEA
�.��
�.��
Steady Demand in North America
Since peaking in 2010, growth inthe manufacturing
and distribution industry has kept the U.S. vacancy
rate dropping in a mostly regular fashion. Vacancy
dropped to 9.72 percent in Q4 2011. With
construction proceeding at low levels, we expect
vacancies to continue to drop at a measured rate
into 2013.
Sydney
Asia Pacific
�.��
�.��
Citing deteriorating financial conditions and
dimming growth prospect, the International
Monetary Fund’s (IMF) revised its September 2011
World Economic Outlook growth projections
downward in January 2012. However, the IMF still
forecasts that global trade volume will rise by 3.8
percent in 2012 and 5.4 percent in 2013; as global
trade rises, so too will demand for warehouse
space.
Mexico City
LATAM
�.��
�.��
Toronto, Canada’s biggest industrial market, saw
Prague
EMEA
�.��
�.��
13.7 million square feet of industrial space
Athens
EMEA
�.��
�.��
EMEA
��.��
��.��
While warehouse rents have stabilized in most
EMEA and Latin American markets, prime
warehouse rents quoted in local currencies
increased in the majority of Asia Pacific and North
American markets in 2011 over the previous year.
We expect this trend to continue, with prime
warehouse rents climbing in most Asia Pacific and
North American markets in the next year.
absorbed in 2011, and the city’s prime warehouse
Bucharest
rents grew by 7.1 percent in the second half of
2011.
GLOBAL TOP TEN INDUSTRIAL
WAREHOUSE RENTS
Dropping Vacancies in Most Asian Markets
Asia Pacific saw dropping vacancies in nearly
RENT
(USD/
6-MONTH
MARKET
REGION
PSF/Year)
CHANGE*
Tokyo
Asia Pacific
��.��
-�.�%
London (Heathrow)
EMEA
��.��
�.�%
Hong Kong
Asia Pacific
��.��
�.�%
every market. Prime warehouse rents grew in
more than half of the markets, and observers in
more than half of those markets expect that
warehouse rents will continue to climb over the
next six months.
Singapore
Asia Pacific
��.��
�.�%
Zurich
EMEA
��.��
�.�%
Oslo
EMEA
��.��
�.�%
Latin American Rents Poised to Stabilize
In Latin America, prime warehouse rental rates
took a fall. In 71.4 percent of the markets we track,
year-end rents decreased in 2011 from a year
earlier. However, we expect warehouse rents in
Latin America to stabilize in the coming year.
Moscow
EMEA
��.��
�.�%
Geneva
EMEA
��.��
-�.�%
São Paulo
LATAM
��.��
-��.�%
Helsinki
EMEA
��.��
�.�%
São Paulo saw a 12.4 percent drop in warehouse
rents in local currency, due to increased supply.
However, with absorption set to outpace supply,
Australian industrial has been especially strong in
most major markets. Retail purchases, made more
attractive by the relatively strong Australian dollar,
have pushed up demand for large warehouse
space in several port markets. While there is
growing demand for large modern warehouse
Marseilles
EMEA
��.��
�.�%
Paris
EMEA
��.��
�.�%
Continued on page 8
*Local currency
WWW.COLLIERS.COM

This book is printed on 100% Recyclable paperContinued on page 8 *Local currency WWW.COLLIERS.COM SECOND HALF 2011 | OFFICE GLOBAL OFFICE HIGHLIGHTS Global

SECOND HALF 2011 | OFFICE GLOBAL OFFICE HIGHLIGHTS Global Office Demand Growth Slow and Steady
SECOND HALF 2011 | OFFICE
GLOBAL OFFICE
HIGHLIGHTS
Global Office Demand Growth
Slow and Steady
JAMES COOK Director of Research | USA
Global Office Trend Forecast
Global office vacancies will continue their decline, due to steady demand and low levels of new construction in North
America and Europe.
GLOBAL CAPITALIZATION RATES /
The “flight to quality” trend will continue in many major markets, with occupiers trading up to higher-quality space or a
PRIME YIELDS: 10 LOWEST CITIES
better location as their leases expire.
The European sovereign debt crisis will likely push the Eurozone into a mild recession in early 2012. This contraction
CBD
CAP RATE (%)
will be felt most profoundly in a handful of commercial property markets within the most troubled nations.
MARKET
(Ranked by
DEC
JUNE
DEC
Economic prospects in the Eurozone have slightly reduced overall positive global expectations for market performance in
Dec 2011)
2011
2011
2010
2012. We expect continuing modest demand for office space, with most cities seeing a drop in vacancy rates. But global
averages do not speak to the nuances of individual markets, and—while we expect positive absorption due to business
Taipei
�.��
�.��
�.��
growth and expansion in the United States, China and Australia—some Eurozone countries may see negative absorption
Hong Kong
�.��
�.��
�.��
and increased vacancy as the region enters a mild recession.
Vienna
�.��
�.��
�.��
Latin America Boasts the Tightest Office Markets
each has shown apparent decline in rents between June
London – West End
�.��
�.��
�.��
Some of the world’s lowest office vacancy rates are found
and December of 2011, when quoted in U.S. dollars.
Zurich
�.��
�.��
�.��
in Latin American cities. Santiago, Chile; Rio de Janeiro,
Substantial declines, in fact: led by a $10.87 USD drop in
Brazil; São Paulo, Brazil; and Lima, Peru all have vacancy
Parisian Class A rents.
Singapore
�.��
�.��
�.��
rates below three percent, resulting in a market that
But how significant are these figures? The change in
Geneva
�.��
�.��
�.��
strongly favors landlords, prompts new construction and
London and Paris rents is due to the strengthening dollar
might squeeze some tenants that desire to expand. For the
Beijing
�.��
�.��
�.��
relative to the euro and pound sterling. In local currency,
most part, we expect the strength of these markets to
Paris
�.��
�.��
�.��
prime rents in these markets are holding ground. Although
persist. While decreases in European demand for its
smaller, the decline in Hong Kong of $7.56 USD ($5.10 HKD)
Munich
�.��
�.��
�.��
commodities will likely hurt Latin America, this will be
per square foot may be a more important indicator of things
tempered by continued demand from China. In São Paolo,
Tokyo
�.��
�.��
�.��
to come, as demand from the banking and financial sector
heightened demand has spurred the highest rates of new
continue to weaken.
development in the region, which will eventually put
downward pressure on asking rents.
EMEA and Asia Pacific Lead Global Construction
GLOBAL OFFICE OCCUPANCY COSTS:
A significant percentage of the office space under
Select Asia Pacific Markets See Big Vacancy Drops
TOP 10 CITIES
construction is in Europe, the Middle East and Africa
The global trend in dropping vacancy rates should be evi-
(EMEA), and much of that is occurring in Moscow and
dent in Asia and continue through 2012. Markets that saw
CLASS
A / NET RENT (USD/SQ
FT)
Dubai. While both of these markets should expect strong
a drop in vacancy in the second half of 2011 outnumbered
economic growth in 2012, the fact that Dubai—with a
MARKET
by a two-to-one margin those where vacancy increased.
vacancy rate of 50 percent—is constructing at such a pace
(Ranked by
DEC
JUNE
DEC
Of the world’s most populous markets, those with the most
leads us to expect that supply will continue to outpace
Dec 2011)
2011
2011
2010
significant declines in six-month vacancy rates were nearly
demand in that market.
Hong Kong
���.��
���.��
���.��
all in the Asia Pacific region. Chengdu, propelled by its
The other two top markets for office construction are in the
London – West End
���.��
���.��
���.��
strong manufacturing sector, saw its vacancy rate drop by
Asia Pacific region. Guangzhou—China’s leading
7.8 percent in the period, and Shanghai saw a 3.2 percent
Paris
��.��
���.��
��.��
commercial port city—and Tokyo have 19.6 and 15.6 million
drop in vacancy.
Rio de Janeiro
��.��
��.��
��.��
square feet under construction respectively. Asian economic
Two other large Asian markets saw vacancy rates drop by
growth rates will remain strong in the coming months, with
Moscow
��.��
��.��
��.��
1.5 percent or more: Jakarta, which has also seen
China and India leading the pack. Rents are on the rise in
London – City
��.��
��.��
��.��
sustained growth in CBD rental rates and renewed global
most cities in the region. However, dropping rents in Seoul
investor interest; and Singapore, where occupancies are
and Hong Kong are a potential indicator of global economic
Perth
��.��
��.��
��.��
expected to stabilize.
uncertainty. In Tokyo, where new supply has been increasing
Singapore
��.��
��.��
��.��
for the past three years, we expect construction to peak and
Marquee Markets See Rent Decline
��.��
��.��
��.��
begin to decline in the coming year.
Geneva
While Hong Kong, London’s West End and Paris command
São Paulo
��.��
��.��
��.��
the top three highest asking rents for Class A office space,
WWW.COLLIERS.COM
Q1 2012 | RESEARCH A SNEAK PREVIEW UNION BUDGET 2012 -13 Budget Highlights | Real
Q1 2012 | RESEARCH
A SNEAK PREVIEW
UNION BUDGET 2012 -13
Budget Highlights | Real Estate
MARKET REACTION TO BUDGET
Company
Change (%)
Finance Minister Pranab Mukherjee started his budget speech 2012-13 in the
BSE
SENSEX
-1.19
backdrop of challenging macroeconomic scenario. The finance minister projects
Realty
Index
-1.26
the economy to grow by 7.6% in the next fiscal up from 6.9% in 2011-12. He
Anant
Raj Inds
-6.04
mentioned that due to adverse global economic sentiments there has been a
D
B Realty
-2.02
slowdown in the Indian Economy but the fact is India still remains among the
DLF
0.15
front runners in the economic growth in any cross country comparison. The
Godrej
Properties
-2.82
budget aims at faster, sustainable and more inclusive growth across sectors
HDIL
-5.21
emphasizing on five focus areas including revival of domestic consumption,
Hubtown Ltd.
-4.13
rapid revival of high growth in private investment, removal of supply bottlenecks,
Indiabulls Real Estate
-1.95
addressing malnutrition in 200 high burden districts and expedite improvement
Mahindra Lifespaces
-0.72
in delivery system, governance and transparency.
Orbit
Corp.
-3.37
Parsvnath Developers
-4.04
From a real estate perspective, the budget remained silent on most of the major
issues including status of STPIs (Software Technology Parks of India), Real
Peninsula Land
-3.18
Estate Regulatory Bill, Land Bill etc. however, it mentioned that efforts are on to
Phoenix
Mills
-2.65
arrive at a political consensus on the issue of allowing 51% Foreign Direct
Sobha
Developers
3.04
Investment (FDI) in multi-brand retail.
Sunteck
Realty
-1.13
THE KEY HIGHLIGHTS OF THE BUDGET WHICH MAY IMPACT REAL ESTATE
Unitech
-1.68
SECTOR ARE AS FOLLOWS:
Source: www.bseindia.com | Mar 16, 2012
-
External Commercial Borrowings (ECB) for low cost affordable housing
projects. Impact: Real estate companies developing large affordable housing
projects with large fund requirements will benefit the most from the easing of
external commercial borrowing (ECB) norms as interest rate charged is lower in
case of external borrowings in comparison to rates charged by domestic
institutions.
-
Increase in provision under Rural Housing Fund to INR 4,000 crore from the
existing INR 3,000 crore.Impact: It will provide housing finance to targeted
groups in rural areas at competitive rates.
-
Extension of the existing scheme of interest subvention of 1% on housing
loans up to INR 15 lakh where the cost of the house does not exceed INR 25
lakh for another year. Impact: This will boost the affordable housing segment
by providing cheaper loan to the end users.
P. 1
|
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to the end users. P. 1 | COLLIERS INTERNATIONAL www.colliers.com/india Accelerating success. Accelerating success.
to the end users. P. 1 | COLLIERS INTERNATIONAL www.colliers.com/india Accelerating success. Accelerating success.

Accelerating success. Accelerating success.

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