India's Office Market to Remain Resilient In 2021

India’s office market is expected to remain resilient in 2021, with Bengaluru expected to see a rise in rental values and Mumbai and the National Capital Region (NCR) likely to remain stable, a report by international property consultant by Knight Frank says.

BY Realty Plus
Published - Thursday, 03 Dec, 2020

India's Office Market to Remain Resilient In 2021

India’s office market is expected to remain resilient in 2021, with Bengaluru expected to see a rise in rental values and Mumbai and the National Capital Region (NCR) likely to remain stable, a report by international property consultant by Knight Frank says. In terms of APAC Capital market forecast, the commercial yields for Mumbai, NCR and Bengaluru under office and warehousing segment are expected to remain stable in 2021, says the report Asia-Pacific Real Estate Outlook 2021: Navigating the Post-Pandemic Recovery. In the APAC region, industrial investment share of commercial transaction volumes increased by half in 2020 and is expected to continue do well in 2021, as investors continue to jump on the e-commerce growth, the report says. The prime office rents across the region for 2020 fell 4 percent year-on-year, which was in line with Knight Frank’s growth expectation of -5 percent to - 3 percent. At the same time, vacancy rose 1.8 percent to 12.6 percent in 2020. However, the significant headwind for the Asia-Pacific office sector in 2021 will come from the new supply as several markets such as Jakarta, Manila, Shanghai, Beijing and Bengaluru have large development pipelines due for completion over the coming years. Manila and Bengaluru will witness the benefit of existing low vacancies that will enable them to absorb much of the supply. Bengaluru, in particular, has the added benefit of expected improving leasing activity, it says.