Bengaluru recorded gross office leasing activity of 12.32 million sq ft in 2020, a drop of 19 per cent year-on-year, according to a recent report by Knight Frank India.
In H2 2020, office leasing activity in Bengaluru was highest across the top eight cities at 7.54 million sq ft, registering an 8% year-on-year growth.
ORR, comprising areas such as Hebbal, Marathahalli, Sarjapur Road, remained the most preferred office business district accounting for 3.71 million sq ft of the total leasing volume in H2 2020.
The weighted average rent was stable on an annual basis to Rs 80 per sq ft per month. The city reported an exponential increase in the average deal size by 61% from 56,503 sq ft in H2 2019 to 90,890 sq ft in H2 2020. With regards to the sectoral profile, the manufacturing industry doubled its demand share to 25% in H2 2020 compared to 12% in H2 2019.
New office supply in the city in 2020 was 9.42 million sq ft, a dip of 41 per cent whereas in H2 2020 it recorded 5.42 million sq ft, a drop of 35 per cent year-on-year.
“The pre-committed activity remained strong with 2.47 mn sq ft of space being taken up in Q4 2020, including large deals by ANI Technologies, Google and Amazon. Developers ensured quick deal closures in Q4 2020,” said Shantanu Mazumder, senior branch director (Bangalore), Knight Frank India
Residential sector
Gross home sales in Bengaluru in 2020 fell by 51 per cent and stood at 23,576 units while the new launches dipped by 41 per cent and stood at 19,929 units. In H2 2020 the residential market recorded home sales of 11,402 units, a drop of 43 per cent whereas new launches recorded 9,123 units during the same period.
South Bengaluru saw the highest quantum of homes sold in H2 2020 to 3,860 units followed by East Bengaluru with 3,750 units. South Bengaluru (Koramangala, Sarjapur Road, Jayanagar, JP Nagar, HSR Layout, Kanakapura Road, Bannerghatta Road) also registered maximum home launches to 3,740 units during the period.
The share of the above Rs 5 million ticket size category, home sales remained stable in H2 2020 to 65% YoY. The residential property prices which were increasing in the beginning of 2020, have now softened a bit. However, with the underlying characteristics of the market and improved sales performance, the pricing power in the city has been maintained, the city recorded a marginal drop of 1% year-on-year in weighted average price during 2020.
The recurring spate of sales compared to launches have affected a gradual decline in the inventory level in the city. On an annual basis, unsold inventory is down 5% to 74,764 housing units as at end of 2020.
