Hyderabad: Office space supply in Hyderabad is likely to grow close to three fold to 22 million sqft in two years from the current about eight million sqft. On the otherhand, most of the space that is to be added is already booked by the companies across IT, ITeS, BFSI and manufacturing segments, said real estate industry experts.
This will also trigger a proportionate demand for the residential units.The office projects are proposed near Gachibowli, Financial District, Rayadurgam, Uppal , Pocharam, Kokapet and other locations.
“We estimate the office space supply to be in the order of 25 million sqft in three to five years. We also understand that most of space that will be available is already booked by the companies,” said R Chalapati Rao, Executive Vice President, Telangana Real Estate Developers Association.
In the real estate parlance, every 100 sqft office space will mean creation of one employment directly. It implies 25 million sqft projections will mean creation of 2.5 lakh new jobs.
This will also create a corresponding demand for residential units. Telangana has been one of the most sought after investment destination for multinational and national level companies.
The investor friendly policies and infrastructure development initiatives undertaken by the Telangana Government attract local and national level talent to consider Hyderabad as a location to migrate and reside, he said.
According to Samson Arthur, Hyderabad Director of real estate consultancy Knight Frank India, the office space segment is now seeing a lower supply than demand. Hyderabad has seen a steady growth in the past three years and as a result the available space is absorbed.
He said the supply for 2018 is likely to be 8 million sqft. It is likely to increase more than two-fold to about 20 million sqft in 2019 and then increase further to 22 million sqft in 2020.
“Many companies are already negotiating with the developers for premises,” he said adding that the rentals too have been on the upward swing in the recent time. Premium properties in key locations are already commanding rentals of about Rs 65 per sqft.
The developers include the likes of Solarpuria Sattva, Raj Pushpa, Jayabheri, Amarender and others.
The supply crunch will end around 2021 as more projects will come, he said.