Small Opt to Lease
Time was when businesses run out of garages were in fashion. Of course, those who could afford, rented out an office in the central business district (CBD) for easier networking and access. Nowadays the job has become a tad difficult for those even with deep pockets, and a nightmare for the rest. And with good reason — the country’s realty magnet, Bangalore, has been ranked # 3 among global cities for the office space absorbed in 2005 in a survey done by London-listed international real estate consultancy firm DTZ.
A record 9.28 million sq ft of Grade A leasehold office space was absorbed in Bangalore last year, marginally behind London, where the net absorption was 9.96 million sq ft. Tokyo tops the list with annual net absorption of 12.33 million sq ft. A recent Prestige Group-Graphite India deal saw prices in the hot and happening investment destination in Bangalore—Whitefield—rocketing to an eye-popping Rs 7 crore an acre. Office rentals (warm-shell ) in Whitefield currently range between Rs 30-45 per sq ft. Owning commercial space can cost anywhere between Rs 3,500-4 ,500/sq ft depending on the quality of construction.
While this reflects positively on Brand Bangalore, it spells the difficult times ahead for the small and mid-sized companies in the IT hub with land prices skyrocketing to record levels. Despite infrastructure concerns, India’s Silicon Valley witnessed a 22% jump in the space absorbed in 2005, against the 7.6 million sq ft absorbed in 2004. The numbers exclude large owned campus-style developments and built-to-suit facilities. “The continued demand for space from the Information Technology (IT), Information Technology Enabled Services (ITeS) and Business Product Outsourcing (BPO) sectors is the main driver behind this dramatic increase in absorption in Bangalore. The financial services sector and high-end engineering companies are also expanding and taking up a substantial portion of office space,” say industry experts.
source:http://infotech.indiatimes.com/articleshow/1536734.cms
A record 9.28 million sq ft of Grade A leasehold office space was absorbed in Bangalore last year, marginally behind London, where the net absorption was 9.96 million sq ft. Tokyo tops the list with annual net absorption of 12.33 million sq ft. A recent Prestige Group-Graphite India deal saw prices in the hot and happening investment destination in Bangalore—Whitefield—rocketing to an eye-popping Rs 7 crore an acre. Office rentals (warm-shell ) in Whitefield currently range between Rs 30-45 per sq ft. Owning commercial space can cost anywhere between Rs 3,500-4 ,500/sq ft depending on the quality of construction.
While this reflects positively on Brand Bangalore, it spells the difficult times ahead for the small and mid-sized companies in the IT hub with land prices skyrocketing to record levels. Despite infrastructure concerns, India’s Silicon Valley witnessed a 22% jump in the space absorbed in 2005, against the 7.6 million sq ft absorbed in 2004. The numbers exclude large owned campus-style developments and built-to-suit facilities. “The continued demand for space from the Information Technology (IT), Information Technology Enabled Services (ITeS) and Business Product Outsourcing (BPO) sectors is the main driver behind this dramatic increase in absorption in Bangalore. The financial services sector and high-end engineering companies are also expanding and taking up a substantial portion of office space,” say industry experts.
source:http://infotech.indiatimes.com/articleshow/1536734.cms
posted by Real Estate India at
9:49 PM
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