From Chennai to Bangalore: Insights into India’s Dynamic Commercial Real Estate Scene
The Indian economic saga in the last decade has been one marked by resilience and defiance of global forces of economic decline. The country today boasts of having the fifth-largest economy in the world, backed by a robust infrastructure, a large working population, and high investor confidence.
While the rest of the world’s commercial real estate absorption has severely struggled in recent years, the segment in India has defied this trend. According to a recent study, the Indian commercial real estate market, valued at a staggering USD 33.62 billion in 2023, is expected to grow at a CAGR of 21.10% during the next five years, reaching 87.57 billion by 2028.
Another study has revealed how the fourth quarter of 2023 has culminated in office space absorption reaching record-breaking levels, with 58.2 million square feet of gross absorption.
Let’s look at some of the other trends about the Indian commercial real estate market that the study has revealed.
Which cities are leading the office absorption growth?
The study reveals that it is peninsular India and Delhi NCR that are leading the country in terms of commercial space absorption, with Bengaluru accounting for one-fourth of the share. However, a surprising reveal in the study was the growth witnessed in Chennai, with the city recording 10.5 million square feet of uptake, doubling absorption as compared to 2022. It is the first time Chennai has been placed among the top three cities in terms of office absorption, along with Bangalore and Hyderabad.
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