India commercial ‘taking off'

A surge in demand for office space in India is set to revolutionize the commercial property market by 2013, it is predicted - according to an investment report from consultants Cushman & Wakefield, the pan Indian demand for office space is expected to grow to 196 million square feet...

Demand for retail space and in the hospitality sector is also expected to be high with analysts predicting growth of 43 million square feet in retail and a requirement for 690,000 room nights in the same time space.

‘Though the high growth trajectory of the previous years saw a setback during the global economic slowdown, the inherent strong economic fundamentals, low exposure to debt and state intervention, would help the sector to gradually return to the path of recovery and witness robust demand for real estate across sectors,' said Anurag Mathur, Managing Director, India, Cushman & Wakefield.

The report, Survival to Revival - Indian realty sector on the path to recovery, also indicates that demand for residential property will be over 7.5 million units by 2013 across all housing categories of which 85% is expected in the mid segment and affordable housing segment.

Of the total demand expected across India, 60% would be generated in the country's top seven cities. Mumbai is expected to witness the highest cumulative demand of 1.6 million units by 2013 whereas Bangalore and Hyderabad are expected to see the highest compounded annual growth rate of 14%.

Total office space demand will be down in 2009, the report says, but from 2010 onwards the markets will experience a healthier demand.

The highest demand is expected in Bangalore with the need for 34 million square feet followed by Chennai at 27 million square feet.

This increase in demand is largely due to improving economic conditions leading to positive market sentiments and growing corporate confidence, the report adds.

In the retail sector Bangalore in likely to see the highest demand with approximately 6.8 million square feet needed and Pune is expected to record the highest compounded annual growth of 51% in the retail segment.

NCR and Mumbai are expected to see the highest increases in demand for rooms due to the higher volume of business travellers in these cities.

Various initiatives taken by the Indian government to promote commercial and tourism activity in these locations will add to growth

Source: www.propertywire.com