Bengaluru is expected to lead India’s RE growth in 2023


*According to CBRE’s Asia Pacific flexible office market (hybrid of office and industrial space) findings, Bengaluru topped the list of Asia-Pacific region (APAC) cities having the highest flexible stock ahead of 11 major cities. As of September 2022, it recorded 10.6 million sq. ft. (Grade-A Assets), ahead of Shanghai, Beijing, Seoul, Tokyo, and Singapore.

* According to Colliers there is robust growth in new supply led by Bengaluru and Hyderabad in office space.  2022 would soon be adjudged the best year in terms of office space leasing, with absorption likely to cross 50 mn sq. ft across the top 6 cities of Bengaluru, Chennai, Delhi-NCR, Hyderabad, Mumbai and Pune.

* As of November 2022, cost of construction increased by 28%, higher than pre-pandemic (November 2021) levels. The costs of key construction materials jumped 32% in a span of three years, affecting margins and operational schedule of construction companies. The government’s efforts such as reducing exports and cutting import duties have kept raw material costs in check over the last few months.

* Key construction materials such as cement, steel, aluminium and copper saw a significant increase in prices, along with fuel and labour costs due to geopolitical issues, inflation etc. This created a challenge for developers who were facing high debt and liquidity concerns. According to Ramesh Nair, CEO-Colliers, cost of key construction materials is likely to remain volatile for the next few months due to uncertainties created by geo-political issues, persistent lockdowns in China and a probable global recession. Prices of materials will hinge on multiple factors including global economic situation, inflation rates and supply constraints. Therefore, developers are likely to push new launches.

* Knight Frank’s ‘Asia – Pacific Outlook 2023’ (24 markets in APAC region) covered three Indian cities – Bengaluru, Mumbai and New Delhi. On the aspect of residential outlook, Bengaluru has been highlighted as the second best market to watch out for.amongst the APAC cities in 2023. Bengaluru’s residential price is expected to grow by up to 5% YoY, highest amongst the leading three Indian markets tracked in the report. 

Source link

Leave a Response