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The supply of corporate grade office space in India will cross 100 million square feet by 2006, a study by Los Angeles-based real estate consultancy firm CB Richard Ellis has said.
Based on the trends of the commercial real estate market over the last few years, this supply will cater to the demand created by the sunrise sectors of information technology, IT enabled services and business process outsourcing. These three sectors together are expected to absorb up to 80 per cent of the supply.
"Over the last few years, the real estate sector in India has undergone a significant change. From being a very disorganised and a localised sector, it has metamorphosed into an industry that is dynamic, quality oriented, and national in character, catering to multinationals (in the commercial and retail arena) on one hand, and the increasing upwardly mobile domestic population (in the residential sector) on the other," says CBRE Managing Director, South Asia, Anshuman Magazine.
The year 2003 saw a total stock of approximately 36 million sq ft that then grew up to 58.1 million sq ft in 2004.
The total stock is expected to add over 23 million sq ft in 2005 to reach about 82.3 million sq ft. The year 2006 is expected to add 24 million sq ft, thereby making the supply cross the 100 million sq ft mark.
"The office sector in India was minuscule compared to the population and the geographic expanse of the country. Due to a substantial increase in the supply in the last two years, it is reaching a respectable level. In the next two years we will surpass some of the other Asian markets," says Magazine.
