Rise in demand for office space in Chennai

Chennai

There has been a marginal increase in the demand for office space in Chennai. While the suburban business district witnessed a decrease in demand for office space with absorption recorded at around 0.28 million square feet compared to approximately 0.35 million square feet during the previous quarter, the peripheral business district witnessed healthy demand levels with absorption levels recorded at 0.30 million square feet during the quarter compared to 80,000 square feet registered during the previous quarter.

“While Chennai has witnessed a marginal increase in demand for prime office space, supply constraints might result in rental values continuing to appreciate in the near to medium term. IT and back office operations are expected to remain major contributors to overall office space absorption in the city,” Anshuman Magazine, chairman and managing director, CBRE, South Asia said.

Transaction activity in the central business district remained low during the quarter and there was no addition in the existing supply. The non central business district micro market witnessed an increase in transaction activity during the quarter with absorption of around 0.26 million square feet, compared to 0.16 million square feet during the previous quarter. On the supply front, around 0.21 million square feet of Grade A office space was released in the region.

Source: The Times of India, Chennai