Bangalore Q2 Office report :CBRE

The Central Business District (CBD) of MG Road, Richmond Road, Residency Road and Lavelle Road witnessed closure of a few mid sized transactions with absorption recorded at around 50,000 sq ft (primarily in the second generation space). Due to limited Grade A supply being available during this quarter, rental values increased by 5 - 6%, q-o-q.With no fresh supply coming in the Extended Business District (EBD) of Indira Nagar,Koramangala, Old Madras Road, CV Raman Nagar in the near term, most of the companies are either expanding within the existing micro market in the limited sublease space that is becoming available or relocating to peripheral markets such as ORR,Whitefield, etc. Lack of Grade A supply in the EBD has

led to increase in rental values (7-8% q-o-q), predominantly in the second generation office space.

The commercial development in the South Bangalore micro market of Bannergatta Road, JP Nagar, Jayanagar and Mysore Road is limited to Grade B buildings with no new Grade A buildings likely to come in the near future. Rental values appreciated by 7 - 8 % on q-o-q basis.

The Peripheral Business District (PBD) of Outer Ring Road (ORR), Whitefield, Electronic City and North Bangalore are being preferred by corporates looking for consolidation and expansion plans. As most of the projects nearing completion or under construction have already been pre-committed on the Outer Ring Road (ORR) stretch, rentals are witnessing

an upward trend owing to lack of ready to move in space; and values appreciated by 4 -5 %, q-o-q.

Approximately 0.41 million sq ft of office space was released into the Whitefield and Electronic City micro markets, whilst absorption was estimated at around 0.4 million sq ft. Due to availability of ready to move in quality space and landlords offering favorable commercial & leasing terms, this micro market remains the favored destination for corporate occupiers. Rental values increased by 6-7% during this quarter. North Bangalore micro market also continued to find favor from some of the occupants; around 0.85 million sq ft of Grade A office space was leased in one of the large projects in this micro market during this quarter.