HYDERABAD: Despite being one of the top cities in the country, Hyderabad has the lowest price for office space rentals among all metropolitan cities.
According to Anarock Property Consultants, a leading real estate services company, the average monthly office space rentals in Hyderabad in 2021 stands at Rs 57 per sqft. and this is the lowest price among all metros in the country, while the Mumbai Metropolitan Region (MMR) is the costliest at Rs 125 per sqft.
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In Hyderabad, the average monthly office rentals rose from `51 per sqft in FY18 to nearly Rs 57 per sqft in FY21. Hyderabad is followed by Chennai with average monthly rentals standing at Rs 60 per sqft, rising from Rs 54 per sqft in FY18. In Bengaluru, the monthly office rentals were Rs 67 per sqft in FY18 and it increased to Rs 77 per sqft.
Southern cities fare better
The research by Anarock said that the southern India office market has overtaken other regions in terms of new supply, net absorption, and rental growth. Among the seven metro cities, Bengaluru, Hyderabad and Chennai saw their share of total office leasing increase to 66 per cent in FY21, against 47 per cent in FY18.
It said that the net office absorption in FY21 in the top cities was 21.32 million sqft, and these three southern cities absorbed approximately 14.06 million sqft, while MMR and Pune absorbed 4.56 million sqft and NCR absorbed 2.3 million sqft.
Anuj Puri, Anarock Group chairman, said that the remarkable growth in the office market of these three southern India cities when viewed against their western and northern counterparts is directly attributable to robust demand by the IT/ ITeS sector, affordable rentals, and the exponential growth of startups locally over the past few years. The manufacturing and industrial sectors are also driving demand here.”
Rajshekhar Reddy, General Secretary, CREDAI Hyderabad, said that Hyderabad has always been an affordable city in terms of office rentals. “Even though the sale prices of buildings have been increased recently, overall rentals still remain to be less when compared to other metro cities,” he said. In terms of the new office supply too, the southern cities continued to ramp up their share, rising up from 40 per cent in FY18 to nearly 63 per cent in FY21.