Leasing activity may improve soon in Gurgaon, Noida

With corporates formalising their expansion or consolidation plans for the present year, leasing activity is expected to marginally improve in the national capital regions (NCR) like Gurgaon and Noida, according to a report by international property consultant CBRE South Asia Pvt. Ltd.

The report said that compared to the previous quarter, rental values remained stable across all micro-markets in the NCR due to subdued demand levels.

Commenting on the findings of the report, Anshuman Magazine, chairman and managing director, CBRE South Asia Pvt Ltd, said, “Leasing activity is expected to marginally improve in the peripheral regions of Gurgaon and Noida, particularly with corporates formalizing their expansion or consolidation strategies for the present year.”

“Pre-commitment for under-construction properties is expected to remain low, as occupiers are likely to continue with their preference for ready-to-move-in spaces at competitive cost. Rental and capital values of most peripheral markets are expected to remain stable in the short to medium term,” Magazine added.

The central business district (CBD) of Connaught Place and its surrounding areas, the report said, continued to remain a priority destination for corporate occupiers, owing to its central location and ease of connectivity.

“This micro-market witnessed an increase in enquiries; however transaction closures remained low with absorption recorded at around 88,000 sq ft., as compared to around 0.1 million sq ft getting absorbed in Q2, 2013.Sustained queries from occupiers led to a marginal appreciation (2–3 per cent) in rental values in Grade-A developments during this period,” it said.

However, leasing activity in the secondary business district (SBD) of Nehru Place, Saket, Jasola, Vasant Kunj and Aero City dropped significantly. On the supply front, 0.32 million sq ft of office space was completed in Vasant Kunj and Okhla, which also contributed to an increase in vacancy levels in the region, estimated in the range of 15–16 per cent.