BENGALURU OFFICE MARCH 2019

MARKETBEATS
5.6% 5.0 msf 4.8 msf
GRADE A VACANCY RATE Y T D L E A S IN G A C T IV IT Y I N C L U D I N G YTD NET ABSORPTION
(Q1 2019) P R E C O MMIT ME N T S

HIGHLIGHTS MARKET INDICATORS 12 month

Q1 18 Q1 19 Forecast
Overall Vacancy 4.8% 5.6%
2019 starts on a positive note with strong demand and rental
Weighted Average Net Asking
growth Rentals (INR/sf/month) 67.27 74.67
2019 is off to a good start with office demand exceeding 5.0 msf during the first quarter,
underlining the strong office fundamentals for the city. Vacancy rates continue to be low across YTD Net Absorption
all submarkets even as the new supply of 4.8 million sf. did not help with nearly 2/3rds of this (sf) 1,290,861 4,775,916
space already being leased. Rental growth continues and was headlined by Suburban East, Source: Cushman and Wakefield Research
CBD and Peripheral East sub-markets. Average rents for older buildings in major office parks
in Suburban East have risen by over 10% during the quarter. Similarly, in the CBD, rentals are GRADE A OVERALL RENT
sharply moving upwards across the board on the back of tightening vacancies amid healthy & VACANCY RATE
demand. Meanwhile, occupiers are actively pre-leasing and exploring upcoming space options 80 15%

Vacancy Rate (%)

in the Peripheral East sub-market driven by higher vacancies and upcoming metro. 60
10%
Sustained momentum in Cow orking 40
5%
Bengaluru’s flexible workspace market has grown at a rapid pace over the past 2 years which 20
strengthened further during the quarter. After leasing nearly 3.0 msf during 2018, Coworking 0 0%
2012 2013 2014 2015 2016 2017 2018 Q1
operators such as WeWork, Indiqube, CoWrks, 91Springboard and TableSpace etc. have 2019
taken up another 1.2 msf over the last 3 months suggesting a robust demand for serviced Net Asking Rental (INR/sf/mo) Vacancy Rate (%)
office space in the city. Besides newly completed projects, coworking players are also Source: Cushman and Wakefield Research

snapping up prominent older buildings across all submarkets as soon as they become GRADE A PRE COMMITMENT AND NET
available post tenant exits. There are indications of another record year for Coworking in the ABSORPTION
city with annual take-up likely to reach nearly 4.0 msf considering the aggressive expansion 15,000
A Cushman & W akefield plans laid out by several flex space operators.
Research Publication 10,000
Market tightening to continue, explore SEZ space options
5,000
About 50% of the upcoming supply over the next three quarters is either pre-leased or in
DATA advanced stages of negotiations suggesting a continuation of ultra-tight vacancies and steep 0
INTO rental growth scenario. Occupiers looking for immediate space options may explore SEZ 2012 2013 2014 2015 2016 2017 2018 YTD
ACTION 2019
options which are completed and available. Nearly 3.0 msf of SEZ space, largely in Peripheral Pre-commitment (000' sf) Net Absorption (000' sf)
North and Peripheral East submarkets is vacant as of Q1 2019, presenting a timely opportunity Source: Cushman and Wakefield Research

www.cushmanwakefield.com for occupiers to avail the tax benefits before the SEZ Sunset Clause.
 BENGALURU OFFICE
MARKETBEAT MARCH 2019
YTD GRADE A WTD. AVG. RENT*
Rohan Sharma INVENTORY VACANCY
YTD LEASING UNDER
CONSTRUCTION
YTD NET
Director
SUBMARKET (SF) RATE
ACTIVITY# CONSTRUCTION
COMPLETIONS
ABSORPTION
INR/SF/MO US$/SF/YR EUR/SF/YR
(SF) (SF)^ (SF)
Research Services, India (SF)
Tel: +91 124 4695555 5,912,788 7.3% 716,837 1,179,519 80,000 678,065
CBD / Off-CBD 133.51* 23.16 20.58
Rohan.Sharma1@cushwake.com
Outer Ring Road 67,059,945 2.6% 1,783,964 12,614,508 2,355,000 2,911,518 88.29 15.32 13.61
Peripheral East 25,854,454 11.2% 1,144,906 6,510,000 2,003,000 665,402 60.21 10.45 9.28
Peripheral North 5,795,654 30.8% 470,000 5,774,215 380,000 556,682 68.35 11.86 10.54
Peripheral South 8,842,839 3.3% 264,000 2,100,000 - 17,000 62.0 10.76 9.56
Suburban East 19,452,232 3.3% 297,122 1,570,400 - (32,273) 83.01** 14.40 12.80
Suburban North West 1,100,000 0.9% 580,000 - (9,600) 150 26.02 23.12
Suburban South 5,209,742 1.4% 356,122 3,946,133 - (10,878) 87.12 15.11 13.43
TOTALS 139,227,654 5.6% 5,032,951 34,274,775 4,818,000 4,775,916 74.67 $12.95 €11.51

The report highlights Grade A details only.

*Certain indicators are historically corrected by addition / deletion of older / refurbished projects as per grade A classification and accounting for changes in built-up / leasable area besides adjusting tenant leases
to reflect accurate market conditions.
#YTD leasing includes pre commitments;
^ Includes planned & under construction projects until 2021
Net absorption refers to the incremental new space take-up; renewals not included in leasing activity statistics
Weighted average asking rental rates for vacant spaces that provide core facility, high-side air conditioning and 100% power back up
*CBD/Off-CBD- Weighted average rents, submarket includes certain outperformers where quoted rentals are above INR 140-150/Sf/Month
**Suburban East - Weighted average rents, submarket includes certain outperformers where quoted rentals are above INR 110-120/Sf/Month
Key to submarkets:
CBD/Off-CBD – M.G. Road, Millers Road, Vittal Mallya Road, Residency Road, etc.; Peripheral South – Electronic City, Hosur Road, Mysore Road; Outer Ring Road – Sarjapur, KR Puram, Hebbal; Suburban East
– Indira Nagar, Old Airport Road, C.V. Raman Nagar; Peripheral East – Whitefield; Suburban South – Koramangala, Bannerghatta Road, Jayanagar; Peripheral North – Bellary Road, Thanisandra Road, Tumkur
Road; Suburban North West – Rajaji nagar, Malleshwaram.
US$ = INR 69.17 AND € = INR 77.84
Numbers for the first quarter are based on market information collected until 20th March 2019
DATA
INTO
ACTION
KEY LEASING TRANSACTIONS – Q1 2019
PROPERTY SUBMARKET TENANT SF LEASE TYPE
A Cushman & W akefield Vaishnavi Signature ORR WeWork 250,000 Fresh Lease
Research Publication RMZ Azure Peripheral North Boeing 280,000 Fresh Lease

SIGNIFICANT PROJECTS UNDER CONSTRUCTION

Cushman & Wakefield (NYSE: CWK) is a leading global real estate
services firm that delivers exceptional value by putting ideas into PROPERTY SUBMARKET MAJOR TENANT SF COMPLETION DATE
action for real estate occupiers and owners. Cushman & Wakefield is Prestige Technostar Peripheral East NA 1,000,000 Q2 2019
among the largest real estate services firms with 48,000 employees
in approximately 400 offices and 70 countries. In 2017, the firm had Embassy Manyata Hub Towers Outer Ring Road NA 750,000 Q1 2020
revenue of $6.9 billion across core services of property, facilities and
project management, leasing, capital markets, valuation and other
services. To learn more, visit www.cushmanwakefield.com or
follow @CushWake on Twitter.

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Copyright © 2018 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources considered to be reliable. The information may contain errors or omissions and is presented without any warranty or representations as to its accuracy.