Bangalore is all set to overtake Tokyo in the office space absorption rate and become the most happening place in the Asia-Pacific region. Signs of recovery in global IT markets is one of the major reasons for the high demand of office space in the IT city, according to industry experts.
Vestian Global Workplace Services has predicted that around 9.75 million sq ft (MSF) of commercial space will be absorbed in Bangalore. IT Minister S R Patil has also claimed that the city will most probably absorb more office space than what has been predicted by some agencies.
Earlier, Cushman and Wakefield (C&W), an international property consultancy, had predicted that Tokyo, with 7.6 MSF of office space absorption, will witness the highest demand and Bangalore will witness the second highest demand for office space, with a likely absorption of 6.3 MSF. However, going by Vestian’s analysis, Bangalore is likely to overtake Tokyo.
Vestian Asia Pacific Chief Executive Officer Shrinivas Rao said factors like completion of the elevated expressway from Hebbal to Devanahalli, which will provide better connectivity to the airport, expansion plans of some IT and ITeS companies in the city, the state government’s support to the automobile and aerospace sectors and their keenness on developing the proposed Bangalore-Mumbai and Bangalore-Chennai corridors will help increase the office space demand.
Multinational companies like Volvo, Honda, Scania and Bando are already expanding their bases in Bangalore.
“The IT and ITeS sector is likely to drive the office space absorption and these companies may set up shop around the outer ring road due to the availability of Grade A office spaces and good infrastructure,” Shrinivas said.
“Due to non-availability of vacant offices in the central business district, the development is likely to happen in secondary business district areas like Malleswaram, Rajajinagar, Magadi Road and Mysore Road”, Shrinivas said. The Vestian report also says that there will be increased industrial activity in Narasapura, Vemgal, Hoskote, Dobbspet and the Greater Peenya Industrial Area, which will contribute to the demand for commercial space.
Minister Patil said, “Many IT companies are willing to come to Bangalore. The fact that we have initiated the process of developing the Information Technology Investment Region in 10,500 acres of land near Devanahalli, the office space absorption will exceed the predictions made by some agencies.”