Commercial Real Estate – On The Cusp Of A Rebound: ICICI Securities

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Along expected lines, the Indian commercial real estate office market has seen a 15% YoY decline in nine-months CY21 (January-September 2021) net absorption at 11.5 million square feet.

However, with a 21% QoQ pick up in Q3 CY21 net absorption to 4.3 msf, green shoots have re-emerged with the improved pace of vaccinations across India, select corporates recalling employees to offices (footfalls at 20-25% of pre-Covid-19 levels as of October 2021) and gradual pick up in international travel.

With India continuing to offer competitive rentals of ~$1 per square feet/month in IT/IT enabled services driven markets of South India and national capital region/Pune and robust hiring plans of domestic/multi national companies IT/ITeS companies, we expect this to result in pickup in office absorption from January 2022 onwards.

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ICICI Securities Real Estate India Commercial Update.pdf

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