Mumbai: The commercial real estate in Mumbai is expected to witness significant leasing activity in the coming months due to fresh supply and revival in demand. According to international property consultant Vestian, the demand for office space in the city is likely to be driven by banking financial services and insurance (BFSI) and pharmaceutical sectors, as well as co-working space operators.
The office space absorption between October and December 2018 stood at approximately 2.42 million square feet, up 44 per cent from the same period last year. During the quarter, new supply was about 3.3 million square feet.
A number of mid- to large-sized office space deals were inked in Q4 2018; a few prominent ones being Accenture (250,000 square feet) at Vikhroli and Google (100,000 square feet) at Bandra Kurla Complex (BKC). The total office space absorption during the whole year stood at 6.70 million square feet, with substantial demand coming from the co-working space operators.
Co-working is a recent phenomenon where individuals from different industries or sectors work independently or collaboratively in a shared office space.
Across top Indian cities, the property consultant noted that the co-working segment is expected to account for a larger share of the market in 2019, portending a major shift in workspace dynamics with technology, innovative space design and flexibility impacting the preferences of new-age businesses.
“Navi Mumbai, with its strong office supply pipe-line and the upcoming phase one of the international airport, is projected to become an attractive destination for occupiers seeking large contiguous space for their back-office IT operations at relatively lower rentals,” Mr Shrinivas Rao, CEO-APAC, Vestian.