Chennai: Despite being ranked fifth in Asia-Pacific region for rise in prime office rentals in Q2 2019, Bangalore’s growth has slowed down to single digits, indicating lower spending by the IT and ITeS sector.
The central business district of Bangalore, which comprises MG Road, Resi-dency Road, Cunningham Road, Lavelle Road, Richmond Road and Infantry Road, has witnessed 9.4 per cent growth in rentals to Rs 125 per square feet per month in the June quarter against the same period last year. It was ranked fifth in terms of growth in Asia-Pacific region after Melbourne with 16 per cent growth, Tokyo 12 per cent, Bangkok 10.4 per cent and Singapore 10.3 per cent, as per a Knight Frank report.
According to Paradigm Realty, the report hints towards slowdown with Bangalore which has recorded single digit growth of 9.4 per cent in Q2 against 17 per cent in Q1. The double digit growth has been hampered in this quarter indicating business slowdown.
“The major driver for growth in cities like Bangalore is IT/ITeS and pharma sector which is challenged with looming uncertainties pertaining to US-China trade war. The rental softness shall continue as the economic slowdown is engulfing the economy in every sector. The elbow room for increase in rental is highly limited in the near-term, said Parth Mehta, Managing Director, Paradigm Realty.
Mumbai’s BKC registered growth of 5 per cent to Rs 300 per sq ft and New Delhi’s Connaught Place recorded a rental value growth of 1.4 per cent to Rs 330 per sq. ft.
Knight Frank found that largely Indian office rents remained stable in Q2 as the market received new supply.
