There will be likely an addition of 200 m sq ft in the realty sector by 2019

The addition of roughly 200 million sq ft space will be occurring to the Indian real estate by 2019. This will be including various categories like the retail, the office, the residential and the logistics, which will be reaching 3.7 trillion sq ft by this time. Out of this, there will be a 40 million sq ft of development that will be taking place for the new office space, for the period of the upcoming 12 months, a study conducted by CBRE South Asia reported.


Among this addition, there will be a 30% allotted for the SEZ or the Special Economic Zone space. There has been a rise for the need and preference of the technology parks and the SEZ’s recently due to the closing date of March 2020 knocking the door ahead. For the occupiers, this impact is surely beneficial.


During this year, one can expect that the activity for both development and the absorption is going to be highlighted due to the need of the SEZ and the tech park spaces. As for the overall take up of space in the whole country, the share of the technology in all these is most probable to remain between the expected range of 30% to 35%, and this is not very much likely to change till the end of 2019 at least.

2018 can be treated as a landmark year, especially because the absorption of the office space reached an all time new height, setting the record as high as 47 million sq ft. This is equivalent to an increase of almost 5% that occurred among the 9 cities, and this definitely received a boost by the supply influx of nearly 35 million sq ft. This value increased up to 17% on this year. Delhi NCR and Bangalore were the cities, which as usual are continuing to dominate the taking up. After these two cities, came Hyderabad as the 3rd most preferred city to create the destination for the office, even overtaking the likes of Mumbai.

Realty Sector

As per CBRE, the rents will be continuing their growth among the markets, especially the key markets that are now currently in Bangalore, Pune and Chennai mostly. This growth will be seen in the other cities as well, but not by such a huge amount. As expected, Mumbai and Delhi NCR being gateway cities, the rental growth will be observed well in those cities as well, but not everywhere, more precisely, in specific locations only. Additionally, the SEZ and the non SEZ rentals are expected to face a convergence in the year 2019 as well.

Overall consideration

If we only consider the logistics segment, the year has been pretty good overall. Even, the year can be termed as excellent as it has been highly significant. The main highlight is the rise of the absorption rate. The rate rose in a humongous manner as the massive 44% increase in the absorption rate was nowhere to be seen. Due to this sudden and unexpected huge surge in the absorption rate, the net value of the absorption equaled to a massive 24 million sq ft. This was as equally unexpected and no one guessed or expected such an increase in the absorption rate in one year itself.  As for the e-commerce players, a huge demand is expected from them. There have been considered many a legit reasons for this demand. The main one however, is because of the policy disruptions that are happening and will continue to hamper the speed of these e-commerce players over this short span of time, as per CBRE.