M A R K E T B E AT

BENGALURU
Office Q1 2024

Strong momentum in leasing activity continues in Q1

6.74 msf GROSS LEASING (Q1 2024)
Bengaluru recorded gross leasing of 6.7 msf in Q1, a sharp jump of 3x on an annualised basis though it was 19% lower than the record high leasing figure of
previous quarter. Number of deals were completed during the quarter by global multinationals either looking to set up or expand their capability/delivery centres
in the city. Moreover, active demand remains healthy, thereby indicating that market could witness strong momentum in the coming quarters too. Fresh leasing
accounted for over 70% of gross leasing volumes while pre-commitments contributed nearly 30% with multinationals committing to large space take-ups. Net
absorption for the quarter stood at 3.6 msf, a 2.3x jump on an annualised basis on the back of robust fresh leasing.

2.9 msf NEW SUPPLY (Q1 2024) Large deals (>100,000 sf) contributed nearly 56% of quarterly GLV, with occupiers across IT-BPM and engineering & manufacturing segments looking to expand
operations. The quarter saw significant activity from global capability centres, with leasing volumes by GCC centres, both greenfield and expansion, accounting
for over 40% of quarterly GLV of the city. This points towards healthy medium-term outlook as far as the business operations of global occupiers are concerned
and this trend of growing numbers of GCC centres is likely to continue in the upcoming quarters as well. IT-BPM and engineering & manufacturing sectors
10.0% VACANCY (Q1 2024) dominated leasing volumes during the quarter, contributing 43% and 30% respectively, followed by flex space operators at 8%. Outer Ring Road, contributed
around 32% of quarterly leasing volumes followed by 21% by Peripheral East and 15% by Peripheral North, the city’s fast emerg ing office corridor.

Supply addition in ORR and Peripheral North; drop in headline vacancy rate
Bengaluru recorded new supply of 2.9 msf in Q1, a 35% growth on an annualised basis though lower than the record supply seen in the previous quarter. Outer
MARKET INDICATORS OVERALL Ring Road and Peripheral North cumulatively accounted for nearly all the supply. Strong demand has led to developers expediti ng project completions and at
Q1 2024 ~12.5 msf, the pipeline for the rest of the year remains healthy. A number of projects are nearing completion and some of those are already pre-committed by
global tech, manufacturing and BFSI firms. Headline city-wide vacancy dropped to 10% in the first quarter with some micromarkets recording much lower
vacancies, driven by robust fresh leasing activity. Headline vacancy rate is likely to remain rangebound in the near term wit h supply moving in line with demand.
Q1 2023 Q1 2024 12 month
Forecast
Headline rentals remain stable in the quarter
Overall Headline rentals remained stable on a quarterly basis in the city and is likely to remain so in the near term due to the expe cted parity in demand and supply.
9.5% 10.0%
Vacancy However, existing Grade A properties, which have high demand and tight vacancies, as well as upcoming premium -grade properties, are likely to command
above market rentals with large occupiers looking to provide the best infrastructure to their employees.
Weighted Average
Net Asking Rent 82.7 83.3
(INR/sf/month)

YTD Net
1,541,569 3.598,732
Absorption (sf)
NET ABSORPTION & SUPPLY OVERALL VACANCY & ASKING RENT

20.00 90.00 12.00%

75.00 10.00%
15.00 60.00 8.00%
45.00 6.00%
10.00
30.00 4.00%
15.00 2.00%
5.00
0.00 0.00%

Q3 2020

Q4 2021

Q1 2023
Q1 2018
Q2 2018
Q3 2018
Q4 2018
Q1 2019
Q2 2019
Q3 2019
Q4 2019
Q1 2020
Q2 2020

Q4 2020
Q1 2021
Q2 2021
Q3 2021

Q1 2022
Q2 2022
Q3 2022
Q4 2022

Q2 2023
Q3 2023
Q4 2023
Q1 2024
2024F
0.00
2018 2019 2020 2021 2022 2023 Q1 2024 2024F

NET ABSORPTION (MSF) NEW SUPPLY (MSF)

WEIGHTED AVERAGE RENTS (INR/SF/MONTH) OVERALL VACANCY(%)
M A R K E T B E AT

BENGALURU
Office Q1 2024
MARKET STATISTICS

YTD GROSS PLANNED & UNDER GRADE A WTD. AVG. RENT

INVENTORY YTD CONSTRUCTION YTD NET
SUBMARKET VACANCY (%) LEASING CONSTRUCTION
(SF) COMPLETIONS (SF) ABSORPTION (SF)
ACTIVITY# (SF) (SF)^ INR/SF/MO US$/SF/YR EUR/SF/YR

CBD / Off-CBD 7,713,322 2.4% 422,985 657,584 50,000 45,000 163.00* 23.59 21.71
Outer Ring Road 86,611,155 7.9% 2,139,397 16,266,780 1,601,864 1,122,600 107.50 15.56 14.32
Peripheral East 39,521,714 16.3% 1,437,822 8,193,734 515,000 70.00 10.13 9.32
Peripheral North 12,080,293 23.4% 614,500 6,280,129 1,232,000 1,037,000 75.00 10.86 9.99
Peripheral South 12,327,410 12.4% 1,038,632 1,213,993 232,632 65.00 9.41 8.66
Suburban East 21,369,292 2.2% 595,770 3,027,185 - 283,000 129.00** 18.67 17.18
Suburban North West 1,648,000 23.1% 113,461 3,860,985 113,500 116.00 16.79 15.45
Suburban South 9,249,337 3.2% 379,219 3,285,607 250,000 95.00 13.75 12.65
TOTALS 190,520,523 10.0% 6,741,786 42,785,997 2,883,864 3,598,732 83.3 12.06 11.09
The report highlights Grade A project details only. Certain historical numbers may have been corrected through addition / deletion of older / and or refurbished projects, basis grade A building
classification. It might also have been revised to account for changes in built-up / and or leasable area and modifications in tenant leases, in order to reflect accurate market conditions.
^ Includes planned & under construction projects until 2026
Net absorption refers to the incremental new space take-up; Swarnava Adhikary
Weighted average asking rental rates for vacant spaces that provide core facility, high-side air conditioning and 100% power back up
*CBD/Off-CBD- Weighted average rents, submarket includes certain outperformers where quoted rentals are above INR 220-250/Sf/Month Assistant Vice President, Research Services
**Suburban East - Weighted average rents, submarket includes certain outperformers where quoted rentals are above INR 150-160/Sf/Month. +91 080 40465555 /swarnava.adhikary@cushwake.com
Key to submarkets:
CBD/Off-CBD – M.G. Road, Millers Road, Vittal Mallya Road, Residency Road, etc.; Peripheral South – Electronic City, Hosur Road, Mysore Road; Outer Ring Road – Sarjapur, KR Puram, Suvishesh Valsan
Hebbal; Suburban East – Indira Nagar, Old Airport Road, C.V. Raman Nagar; Peripheral East – Whitefield; Suburban South – Koramangala, Bannerghatta Road, Jayanagar; Peripheral North –
Bellary Road, Thanisandra Road, Tumkur Road; Suburban Northwest – Rajaji Nagar, Malleshwaram.
Director, Research Services
US$ = INR 82.9 AND € = INR 90.1 +91 22 6771555 /suvishesh.valsan@cushwake.com
Numbers for the first quarter are based on market information collected until 20th March 2024

KEY LEASE TRANSACTIONS Q1 2024

PROPERTY SUBMARKET TENANT SF TYPE
cushmanwakefield.com
Embassy Tech Village 8A Outer Ring Road Intuit 400,000 Precommitment
About Cushman & Wakefield
Divyasree Greens Suburban East Atlassian 200,000 Fresh Lease
Cushman & Wakefield (NYSE: CWK) is a leading global commercial
Cignus Tower 1 Peripheral East Onsemi 154,000 Fresh Lease real estate services firm for property owners and occupiers with
approximately 52,000 employees in nearly 400 offices and 60
Bagmane Capital – Angkor West Outer Ring Road Wayfair Global 120,000 Fresh Lease countries. In 2023, the firm reported revenue of $9.5 billion across its
core services of property, facilities and project management, leasing,
capital markets, and valuation and other services. It also receives
numerous industry and business accolades for its award-winning
SIGNIFICANT PROJECTS PLANNED AND UNDER CONSTRUCTION culture and commitment to Diversity, Equity and Inclusion (DEI),
sustainability and more. For additional information, visit
PROPERTY SUBMARKET MAJOR TENANT SF COMPLETION www.cushmanwakefield.com..
DATE
Sattva Ecity Peripheral South 475,475 Q2 2024 ©2022 Cushman & Wakefield. All rights reserved. The information contained within
this report is gathered from multiple sources believed to be reliable. The information
Mfar 37 Cunningham CBD/Off CBD Columbia Sportswear 227,584 Q2 2024 may contain errors or omissions and is presented without any warranty or
Kalyani - Camellia Peripheral East - 484,278 Q2 2024 representations as to its accuracy.