India Office
www.cbre.co.in
The Indian economy has been largely
unaffected by the global economic
slowdown of 2008-09 and over the
Quick Stats
past few quarters has been riding
Rental Movement from last a high growth curve, banking upon
Quarter
domestic consumption and services
National Capital Region
growth. According to the Centre for
CBD
Monitoring Indian Economy (CMIE),
Secondary Market the GDP is expected to grow by 9.2%
Mumbai
in 2010-11 compared to 7.4% growth
observed in 2009-10 and 6.7% in 2008-
CBD
09. A buoyant economy has also had
Alternate Business District
a positive impact on the real estate
sector, with heightened level of interest
Bangalore
and demand across most of the top
CBD cities from the corporate sector.
Peripheral Business District Corporate office space has witnessed a
Chennai rising occupier interest and absorption,
CBD wherein domestic occupiers continue
Peripheral Business District
to be slightly more active than their
Hyderabad
global counterparts. But this interest
CBD
level is limited to the IT/ITeS, Telecom
and the Banking and Finance industry;
Surburban Areas
the new economy sectors wherein
Pune
maximum head count expansion has
CBD
taken place over the past few months.
While this interest is more towards the
Peripheral Business District
cost effective suburban locations, an
Kolkata
overall demand rise has also benefitted
CBD
the CBD and the SBD.
Peripheral Business District
In the seven cities presented under
this review, a definite improvement
in office space leasing has been
Third Quarter 2010
observed compared to the previous
year. At present, the overall trend in the
market is towards rentals firming up
on account of increase in demand and
more enquiries converting into closures
and decrease in vacancy levels. The
Central Business District (CBD) has
managed to regain its prominence in
each city’s real estate dynamics, with a
halt on tenant exodus and resurgence
in demand amidst negligible supply
leading to a marginal increase in rental
values across all major cities.
Construction activity, which had stalled
during most of 2009, has also picked
up momentum and over the coming
few months is expected to provide
a substantial addition to the existing
stock levels. This supply addition, most
of which is located in the suburban
micro-markets, is expected to counter
the effects of enhanced demand levels
in suburbs and is expected to keep any
price escalation in check in the short to
medium term.
Amongst the other asset types the
residential market too witnessed a
recovery, Overall, the real estate market
is on a recovery mode, however, a
supply influx over the next few quarters
will continue to put pressures on the
pricing spectrum across all the major
cities.
© 2010, CB Richard Ellis, Inc.
National Capital Region
Market Summary
The Central Business District (CBD) of
Connaught Place and nearby locations faces
a dearth of quality supply due to negligible land
availability. While no significant transaction was
reported during this review period, tenant exodus
was low as companies committed to high rental
values (prevailing during 2007) opted to renegotiate
over relocating out to secondary markets. Vacancy
levels continued to hover around 3% - 4%, while
the rental values for Grade A projects increased by
4%, q-o-q.
leasing activity during this review period. Metro
connectivity has enhanced the occupier interest
in this micro market, with many prominent
companies evincing interest in metro connected
areas of Gurgaon. Rental correction over the past
quarters has contributed to occupier interest, with
developers willing to tap this opportunistic demand
and not opting for rental escalation in the near term.
As a result, rental values remained largely stable in
the present quarter as well.
Noida, with abundant ready supply, yet again
exhibited increased absorption, especially in the
SEZ segment.

The Secondary Business District (SBD) of Nehru Rental Market Indicators

Place observed an increase in leasing activity Sub-market Average Rent Average Rent
with approximately 15,000 sq.ft. of space getting in Sept 10 (INR in June 10 (INR
per sq.ft. per per sq.ft. per
absorbed during the third quarter. However, with month) month)
approximately 65,000 sq.ft. of space becoming CBD (Connaught 250 240
available in this micro market, rental values Place) Grade A
remained pressurized and did not witness any CBD (Connaught 135 135
increment. This micro market is expected to gain Place) Grade B
prominence due to metro connectivity. Secondary market 150 150
(Nehru Place)
Grade A
Saket District Centre demonstrated a trend of
Secondary market 100 100
increased office space supply. Significant amount (Jasola) Grade A
of secondary space came into the market which led
Secondary market 133 133
to an increase in vacancy level to 25% - 28%. This (Saket) Grade A
micro market did face some tenant exodus as few Gurgaon Grade A 65 65
corporates preferred alternate locations (mostly in Commercial
the suburbs) due to increase in traffic congestion, Gurgaon 45 45
Grade A IT
poor access roads and parking space.
NOIDA Grade A IT 30 30
No major transaction was reported in Jasola
District Centre. DLF’s strata sold commercial Major Leasing Transactions
project had the maximum space availability in this Tenant Building, Location Approx.
Size (sq.ft.)
micro market and is contributing to the vacancy
Global Logic Oxygen SEZ, Noida 200,000
levels. Approximately 0.8 million sq.ft. of office
TCS Unitech Infospace 125,000
space became available for lease in the third (SEZ), Sector 135,
quarter. Market stagnancy and high vacancy levels Noida
led to a stable rental spectrum, with developers Supertech Windsor Cyber 100,000
willing to lock in leases at the reduced rentals. Park, Noida
Citibank DLF Square, 21,000
Despite increased traffic, travel time and Gurgaon
infrastructure related issues; the peripheral market WPP DLF Building 9, 7,800
Gurgaon
of Gurgaon continues to remain the most preferred
Invista Vatika City Point 17,000
micro market, especially for IT/ITES tenants.
Revival of expansion and consolidation plans Fidelity Information BPTP I Park 350,000
Services
by most of the existing tenants led to enhanced
Axis Bank Statesman House 4,500

Page 2

© 2010, CB Richard Ellis, Inc.

RENTAL VALUE TRENDS Mumbai

Market Summary
350
350

300
300

250
The third quarter witnessed increased market
month)

250
month)

activity with closure of a number of transactions.

perper

200

India Office
sq.ft.

200

While no new supply was added in the third quarter,

sq.ft.
per per

150
(INR(INR

150
nor is expected to be introduced in the near term,
RentRent

100

100

50
approximately 15,000 sq.ft. of secondary stock
50
0
was absorbed in the Central Business District
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
0
2008

Q1
2008

Q2
2008

Q3
2008

Q4
2009

Q1
2009

Timeline
Q2
2009

Q3
2009

Q4
2010

Q1
2010

Q2
2010

Q3
(CBD) of Nariman Point during this quarter.
2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010
CBD (Connaught Place) Secondary market (Nehru Place) Secondary market (Jasola / Saket)
Timeline
Gurgaon Noida
Rental values in the CBD increased by almost 3%
Capital Value Trends
CBD (Connaught Place) Secondary market (Nehru Place) Secondary market (Jasola / Saket) Gurgaon Noida
in the third quarter. Despite a central location, few
CAPITAL VALUE TRENDS 45,000

Capital Value Trends

40,000
existing tenants continued to evaluate options in
45,000

35,000
40,000
the Extended Business District (EBD) and the
Alternate Business District (ABD), both of which
(INRper sq.ft.)

30,000
35,000

offer good quality construction and infrastructure

25,000
sq.ft.)

30,000
Values

20,000
(INRper

25,000 along with relatively low rentals.

Capital

15,000
Capital Values

20,000
10,000
While no new supply came on line in the
15,000
5,000

10,000
Extended Business District (EBD) of Lower
0

5,000
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Timeline
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010 Parel, preleasing of space at aggressive rentals
0
CBD (Connaught Place) Secondary market (Nehru Place) Secondary market (Jasola / Saket) Gurgaon Noida
resulted in a reduction (6%) in the prevailing rental
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

values. Absorption was recorded at approximately

2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010
Timeline

250,000 sq.ft. In Worli – Prabhadevi, around

CBD (Connaught Place) Secondary market (Nehru Place) Secondary market (Jasola / Saket) Gurgaon Noida

3 400,000 sq.ft. of new supply came into this market

Market Outlook
As predicted,
increased in the National Capital Region.
The “Euphoric
among the developer / landlord community.
The prospective tenants are likely to adopt
and follow
projects with maximum value in terms of not
only low rentals but also added advantages
of metro, parking and other infrastructure
facilities. More so, the tenant focus remains
on the operational projects and those getting
operational in the next few quarters. Hence it
is imperative for developers to take a cautious
approach towards rental expectations during
this rising yet fragile market.
while absorption stood at a minimal 35,000 sq.ft.
3 However, as the building is perceived to be a
premium development and the preference among
the transaction volume
corporates for Worli – Prabhadevi, the rental values
here have actually seen a marginal increase of 4%.
sentiment” is evident
Additionally, two large land auctions witnessed in
this micro market during this review period signals
focused approach towards a strong revival of the real estate market. Indiabulls
Infratech won the bid for two - first being the 8.37
acres National Textile Corporation (NTC) Bharat Mill
land in Central Mumbai for Rs 1,505 crore and the
second being NTC’s 2.3 acre Poddar Mill land for
Rs 474 crore. Few under construction projects are
schedule to be completed by mid of next month.
The Alternate Business District (ABD) of BKC
continued to witness maximum market activity
with prime interest observed from the financial
institutions. No fresh supply is slated to hit the
Third Quarter 2010

Page 3

© 2010, CB Richard Ellis, Inc.

market until Q2 2012. Approximately 0.25 million EBD (Worli, 260 250
sq.ft. was absorbed, thus leading to a drop in Prabhadevi)
vacancy level from 18.9% in Q2 2010 to 13% in Grade A
Q3, 2010. ABD (Bandra Kurla 275 275
Complex, Kalina)
The Secondary Business District (SBD) Grade A
continued to be an attractive destination for a large ABD (Bandra Kurla 180 180
Complex, Kalina)
number of occupiers, owing to a cost effective Grade B
rental pricing. Almost 2.3 million sq.ft. of space SBD (Andheri, Vile 115 115
was absorbed in the third quarter. Shipping and Parle, Jogeshwari)
airline companies in particular continued to show Grade A

active interest in relocating to this micro market. SBD (Andheri, Vile 80 80

Parle, Jogeshwari)
Rental values remained stable and are expected Grade B
to firm up in the coming quarters. PBD (Malad) 65 65
Grade A
The Peripheral Business District (PBD) of Powai
PBD (Powai, 85 80
and Vikhroli witnessed steady enquiries from Vikhroli) Grade A
KPOs and large IT companies. This micro market PBD (Thane, New 40 40
is mostly replete with IT supply, thus a restricted Mumbai) Grade A
commercial supply is its limitation. While there
is limited availability of ready stock, substantial
Major Leasing Transactions
supply is expected to hit the market in the next two
Tenant Building, Approx. size
quarters. The micro market has availability of land
Location (sq.ft.)
parcels suitable for the development of built-to-
BNP Paribas Bandra Kurla 113,000
suit options. The rental values in this micro market
Complex
increased by 6%, q-o-q. Schering Plough Bandra Kurla 27,000
The Navi Mumbai and Thane micro markets Complex
remained vibrant in terms of enquiries and leasing Aegon Religare Hiranandani 25,000
activity due to the availability of quality supply, Business Park,
although there were limited closures reported. Powai

Rental Market Indicators RENTAL VALUE TRENDS

Sub-market Average Rent Average Rent 500

in Sept 10 (INR in June10 (INR 450

per sq.ft. per per sq.ft. per 400

month) month)
Rent (INRper sq.ft. per month)

350

300

CBD (Nariman 300 290 250

Point, Fort, Cuffe 200

Parade) Grade A 150

CBD (Nariman 200 190 100

Point, Fort, Cuffe 50

Parade) Grade B 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010

EBD (Lower Parel) 165 175 Timeline

Grade A
CBD (Nariman Point, Fort, Cuffe Parade) EBD (Lower Parel) EBD (Worli, Prabhadevi) ABD (Bandra Kurla Complex, Kalina)

SBD (Andheri, Vile Parle, Jogeshwari) PBD (Malad) PBD (Powai, Vikhroli) PBD (Thane, New Mumbai)

Capital Value Trends

Page 4

© 2010, CB Richard Ellis, Inc.

CAPITAL VALUE TRENDS CBD micro market of Indira Nagar, Koramangala,
45,000 Old Madras Road and CV Raman Nagar. This
40,000
micro market acts as a feasible option for tenants
due to ready availibility of Grade A space, relatively
35,000
Capital Values (INRper sq.ft.)

30,000

25,000
lower rentals, rapidly improving infrastructure

India Office
20,000 and good connectivity. During this review period,
15,000
absorption in this micro market was estimated
at approximately 0.28 million sq.ft., whilst fresh
10,000

5,000

0
supply was estimated at around 0.23 million sq.ft.
The demand-supply dynamics ensured that rental
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010

Timeline
CBD (Nariman Point, Fort, Cuffe Parade)

SBD (Andheri, Vile Parle, Jogeshwari)

EBD (Lower Parel)

PBD (Malad)
EBD (Worli, Prabhadevi)

PBD (Powai, Vikhroli)

ABD (Bandra Kurla Complex, Kalina)

PBD (Thane, New Mumbai)

values remained stable in the third quarter.

The South Bangalore micro market of Bannergatta

Road, JP Nagar, Jayanagar and Mysore Road
Market Outlook witnessed few small transactions with absorption
recorded at almost 70,000 sq.ft. As a result of
The overall trend in the market is towards overall buoyancy observed in the market the rental
rentals firming up on account of increase values increased by almost 6%, q-o-q.
in demand and more enquiries converting
Leasing activity in the Peripheral Business District
into closures in the coming quarters. While
(PBD) of Outer Ring Road (ORR), Whitefield,
a rising tenant demand would contribute to
Electronic City and North Bangalore continued
a decrease in vacancy levels, large amount
to gain momentum. Abundant availability of
of supply is also expected to come towards
Grade A space coupled with flexible rental values
the end of the year. This voluminous supply
and accommodative developer attitude makes
is expected to continue to pressurize rentals
it a viable option for clients seeking large space
in certain micro markets in the coming few
requirements with availability of hard options.
quarters.
The Outer Ring Road (ORR) stretch between KR
Puram Junction and Sarjapur Road witnessed
closure of significant number of transactions.
Bangalore Characterized by a strong pipeline of Grade
A supply offering affordable rentals, good
Market Summary
connectivity and infrastructure, this micro market is
The Central Business District (CBD) of MG Road, now emerging as a preferred destination for large
Richmond Road and Residency Road witnessed domestic and international players. Absorption
closure of significant mid size transactions during was estimated at approximately 0.4 million sq.ft.,
this review period. Large numbers of enquiries while approximately 0.7 million sq.ft. of new supply
were recorded from both the existing occupiers was added to the stock. Incrementing demand led
as well as new entrants. Absorption was estimated to an increase of almost 5% in the rental values in
at approximately 0.3 million sq.ft., while the fresh the third quarter.
Grade A supply added was at 0.42 million sq.ft.
The oversupply situation in the Whitefield micro
An increase in demand for office space led to a
market kept the rentals under pressure and
marginal increase in rental values of about 3%
developer attitude extremely accommodative. A
q-o-q, paving way for larger increments in the
few large transactions were concluded during the
coming few quarters.
third quarter which brought the total absorption to
Third Quarter 2010

Corporates looking for expansion options within about 0.13 million sq.ft. Fresh Grade A supply was
the city limits are readily contemplating the Non estimated at approximately 0.9 million sq.ft.

Page 5

© 2010, CB Richard Ellis, Inc.

 Grade A
South Bangalore
37 35
Grade A
North Bangalore
42 42
Grade A
Industrial Grade 20 20

Office leasing activity remained fairly inactive RENTAL VALUE TRENDS

Rental Value Trends

in the Electronic City, with no large scale 90

80

transaction being reported in this micro market. 70

Rent (INRper sq.ft. per month)

Fresh Grade A supply was estimated at a low 60

60,000 sq.ft. Rental values remained stagnant and 50

developers continued to be flexible with respect

40

30

to commercial terms. The North Bangalore micro 20

market recorded no significant leasing activity for 10

this review period. 0

Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010

Timeline
CBD (MG Road, Richmond Road, Residency Road) EBD (Koramangala, Indiranagar) O uter Ring Road
PBD (Whitefield, Electronic City) South Bangalore North Bangalore

Rental Market Indicators Capital Value Trends

Sub-market Average Rent Average Rent CAPITAL VALUE TRENDS

in Sept 10 in June 10 16,000
8
(INR per sq.ft. (INR per sq.ft.
per month) per month) 14,000

CBD (MG Road, 74 72

12,000

Capital Values (INRper sq.ft.)

Residency Road) 10,000

Grade A 8,000

CBD (MG Road, 57 55 6,000

Residency Road) 4,000

Grade B
2,000

EBD (Koramangala, 48 48
Indiranagar) Grade A 0
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010

EBD (Koramangala, 42 42 CBD (MG Road, Richmond Road, Residency Road)

Timeline
EBD (Koramangala, Indiranagar) O uter Ring Road

Indiranagar) Grade B
PBD (Whitefield, Electronic City) South Bangalore North Bangalore

Chennai
Outer Ring Road 40 38
Grade A Market Summary

Outer Ring Road 32 30 Market Outlook

The Central Business District (CBD) encompassing areas of Anna Salai, T Nagar, RK Salai,
Alwarpet, Nungambakkam witnessed absorption of approximately 0.11 million sq.ft. for larger as
Grade B well as medium size offices mainly catering to banks and corporate sector. No new supply came into
this micro market; however there are a few projects in the pipeline which are expected to be

Whitefield, Electronic 24 24 Large numbers of companies have started to

completed by end of 2010. The rentals remained constant but the capital values appreciated by 6%;
and the overall vacancy level continued to remain constant in the range of 5% - 6%. If the demand in
City Grade A revive their expansion plans. Demand levels
this micro market increases, the rentals are likely to go up in the near term.

South Bangalore 37 35 The Off/Non CBD micro market of MRC Nagar, Guindy & Taramani also witnessed an increase in
in the SEZ domain witnessed an increase.
absorption at approximately 0.12 million sq.ft. and approximately 0.74 million sq.ft. of new supply was
Grade A introduced during this quarter. The rentals in this micro market remained stable owing to active
The rentals are expected to remain stable in
enquiries and limited projects on offer. The vacancy levels in these micro market stand at 3% - 4%.

North Bangalore 42 42 The Suburban Business District (SBD) including areas like Velachery, Perungudi and Mount
Grade A the near term.
Poonamallee Road witnessed minimum activity as compared to the other micro markets.
Approximately 0.80 million sq.ft. of fresh supply was released; whilst approximately 50,000 sq.ft. of

Industrial Grade 20 20 space was absorbed in this micro market during this quarter. The rentals in this micro market
continued to remain stable and the vacancy has been estimated in the range of 5% - 7%.

Abundant supply and low demand levels were observed in the Peripheral Business District (PBD) of
Perungalathur, Sholinganallur, Siruseri, Ambattur and GST Road. No new supply was released into
the market and absorption was recorded at approximately 0.13 million sq.ft. The vacancy levels in this
Major Leasing Transactions Chennai
micro market continued to remain between 18% – 20%.

Tenant Building, Location Approx. size

(sq.ft.) Market Summary
9

Volvo IBC Golf View 103,000 The Central Business District (CBD)
Homes, Wind Tunnel
Road encompassing areas of Anna Salai, T Nagar, RK
SwissRE Vaswani Centropolis, 116,000 Salai, Alwarpet and Nungambakkam witnessed
Langford Town absorption of approximately 0.11 million sq.ft.,
Schneider Prestige Exora, ORR 55,000 largely dominated by medium size office spaces
JPMC First Technology 60,000 catering to banks and the corporate sector. No
Place, Whitefield
new supply came into this micro market in the
GMR IBC Knowledge Park, 45,000
Infrastructure Bannerghata Road third quarter; however there are a few projects in
APC Kalyani Platina, 35,000 the pipeline which are expected to be completed
Whitefield by the end of 2010. The overall vacancy level

Page 6

© 2010, CB Richard Ellis, Inc.

remained stable in the range of 5% - 6%. The rental
Off CBD ( Guindy, 44 44
values also remained stable, but the capital values Kiplauk, Taramani,
appreciated by almost 6%, q-o-q. If a demand Adyar, Anna Nagar)
Grade A
surge occurs in the near term, then rental values
Suburban Business 35 35
are also expected to face an increment. District (Velachery;

India Office
Perungudi,Mount
The Off/Non CBD micro market of MRC Nagar,
Poonamallee Road)
Guindy and Taramani witnessed an increase in Grade A
absorption of approximately 0.12 million sq.ft. Peripheral Business 24 24
of office space, while approximately 0.74 million District (Perungalathur;
Sholinganallur;
sq.ft. of new supply was introduced in this quarter.
Siruseri; Ambattur,GST
The rental values in this micro market remained Road) Grade A
stable owing to active tenant enquiries amidst
limited projects on offer. The vacancy levels in this
Major Leasing Transactions
micro market stood at 3% - 4%.
Tenant Building, Location Approx. size
The Suburban Business District (SBD) including (sq.ft.)
areas like Velachery, Perungudi and Mount Marg Futura 110,000
Geometrics SP Info City, 10,600
Poonamallee Road witnessed minimum activity
Global Perungudi
as compared to the other micro markets. The
I Gate Jayanth Tech Park, 22,500
fresh supply added in the micro market stood at Manapakkam
approximately 0.80 million sq.ft., while the space OLAM Ascendas, Taramani 34,000
absorption witnessed was at approximately SBI Rani Towers, Egmore 40,000
50,000 sq.ft. The rental values in this micro market ABCO Advisory Tamarai Tech Park 39,000
continued to remain stable and the vacancy was
estimated in the range of 5% - 7%. RENTAL VALUE TRENDS
90

Abundant supply and low demand levels were 80

observed in the Peripheral Business District

Rent (INRper sq.ft. per month)

70
90

(PBD) of Perungalathur, Sholinganallur, 60

80
Rent (INRper sq.ft. per month)

50

Siruseri, Ambattur and GST Road. No new supply

70

40
60

was released into the market and absorption was 30

50

recorded at approximately 0.13 million sq.ft. The 40

20

30
10

vacancy levels in this micro market continued to 20

0

remain between 18% – 20%.

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
10 2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010

Timeline
0 (Anna Salai, Nungambakkam, RK Salai,T Nagar,Egmore,Alwarpet)
CBD O ff CBD ( Guindy, Kiplauk, Taramani, Adyar, Anna Nagar)
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Suburban2008
Business District 2008
(Velachery, Perungudi,
2008Mount Poonamallee
2008 Road) 2009 2009Peripheral 2009
Business District (Perungalathur,
2009 Sholinganallur,
2010 Siruseri,
2010Ambattur,GST
2010 Road)

Rental Market Indicators Capital Value Trends

CBD (Anna Salai, Nungambakkam, RK Salai,T Nagar,Egmore,Alwarpet)
Timeline
O ff CBD ( Guindy, Kiplauk, Taramani, Adyar, Anna Nagar)

Sub-market Average Rent Average Rent CAPITAL VALUE TRENDS 10,000

Suburban Business District (Velachery, Perungudi, Mount Poonamallee Road) Peripheral Business District (Perungalathur, Sholinganallur, Siruseri, Ambattur,GST Road)

Capital
9,000
Value Trends

in Sept 10 in June 10 10,000

8,000
Capital Values (INRper sq.ft.)

(INR per sq.ft. (INR per sq.ft. 9,000

7,000

per month) per month) 8,000

Capital Values (INRper sq.ft.)

6,000

7,000
5,000

CBD (Anna Salai, 62 62 6,000

4,000

Nungambakkam, K 5,000
3,000

Salai,T Nagar, Egmore, 4,000

2,000

Alwarpet) Grade A
3,000
1,000
2,000

CBD (Anna Salai, 46 46 1,000

0
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010

Nungambakkam, R.K. 0
Third Quarter 2010

Timeline
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Salai, T Nagar,Egmore, 2008

CBD (Anna Salai, 2008RK Salai,T Nagar,Egmore,Alwarpet)
Nungambakkam, 2008 2008

Suburban Business District (Velachery, Perungudi, Mount Poonamallee Road)

2009 2009 2009Kiplauk, Taramani,
O ff CBD ( Guindy, 2009 Adyar,2010
Anna Nagar) 2010 2010

TimelinePeripheral Business District (Perungalathur, Sholinganallur, Siruseri, Ambattur, GST Road)

Alwarpet) Grade B CBD (Anna Salai, Nungambakkam, RK Salai,T Nagar,Egmore,Alwarpet)

Suburban Business District (Velachery, Perungudi, Mount Poonamallee Road)

O ff CBD ( Guindy, Kiplauk, Taramani, Adyar, Anna Nagar)

Peripheral Business District (Perungalathur, Sholinganallur, Siruseri, Ambattur, GST Road)

Hyderabad
As observed in the previous quarters, the real estate market in Hyderabad continued to witness an
Hyderabad
increase in demand for office space.
As observed in the previous quarters, the real estate market in Hyderabad continued to witness an Page 7
increase in demand for office space.

11
© 2010, CB Richard Ellis, Inc.
11
 10%, q-o-q. The vacancy level currently stands at
Market Outlook approximately 8%.

There has been a substantial improvement
in the market activity in terms of demand
for office space. Higher absorption levels
are expected to be observed in the next few
months. The rental values across all micro
markets are likely to remain stable in the
short term.
The Peripheral Business District (PBD) of
Pocharam and Shamshahbad continued to
witness minimal real estate activity during this
review period, primarily due to lack of good quality
infrastructure. Due to an absence of fresh supply
and low demand levels, rental values remained
relatively low as compared to rest of the micro
markets in the city.

Hyderabad
Rental Market Indicators
Market Summary
Sub-market Average Rent Average Rent
As observed in the previous quarters, the real in Sept 10 (INR in June 10
per sq.ft. per (INR per sq.ft.
estate market in Hyderabad continued to witness month) per month)
an increase in demand for office space, with the CBD (Begumpet/ 45 45
IT/ITES industry leading the demand spectrum in Rajbhavan Road,
Banjara Hills)
the city. Grade A
With most of the IT tenants relocating to the Western CBD (Begumpet/ 45 45
Rajbhavan Road,
Corridor (HITEC City, Kondapur, Nanakramguda, Banjara Hills) Grade
Madhapur, Gachibowli, etc.), approximately B
0.4 million sq.ft. of secondary space became Secondary market 44 44
(Jubilee Hills, parts
available in the Central Business District (CBD)
of Banjara Hills)
of Begumpet, Somajiguda and parts of Banjara Grade A
Hills. However, with an increase in demand for Secondary market 42 43
office space observed in the non IT segment, the (Jubilee Hills, parts
of Banjara Hills)
rental values are expected to appreciate in the near Grade B
term. Vacancy level remained constant at around Secondary market 25 25
5%. (Ameerpet,
Himayatnagar,
The non-CBD micro market comprising areas Sarojini Devi Road)
Grade A
such as parts of Banjara Hills, Jubilee Hills,
Secondary market 25 25
Himayatnagar and Ameerpet continued to (Ameerpet,
experience a lack of demand for office space, with Himayatnagar,
rental values remaining stable as the previous Sarojini Devi Road)
Grade B
quarter.
IT Corridor (HITEC 32 29
The IT corridor consisting of Madhapur, City, Madhapur,
Kondapur,
Gachibowli and Nanakramguda witnessed a rise Gachibowli)
in demand for space in Special Economic Zones Grade A
(SEZ) by various IT companies. An approximate IT Corridor (HITEC 26 25
0.8 million sq.ft. of SEZ supply was released into City, Madhapur,
Kondapur,
this micro market in the third quarter. Furthermore, Gachibowli) Grade B
due to limited availability of SEZ space vis-à-vis PBD (Shamshabad, 22 22
rising demand, the rental values increased by Pocharam) Grade A

Page 8

© 2010, CB Richard Ellis, Inc.

 Major Leasing Transactions
Average Rent in Average Rent in
Sept 10 June 10 to limited supply and increasing rentals
Sub-market
(INR per sq.ft. (INR per sq.ft.
Tenant Building,
per month) Location
per month) Approx. size
in areas like Madhapur and HITEC City,
CBD (Begumpet/ Rajbhavan Road,
Banjara Hills) 45 45 (sq.ft.)
Grade A many IT companies looking for smaller
American
CBD (Begumpet/ Rajbhavan Road,
Banjara Hills)
Navayuga
45
Inspire,
45
28,000
Solutions
Grade B Serilingampally format spaces may consider areas such as
Secondary market (Jubilee Hills,

UTC Building Number44 44

25,000 Pocharam and Uppal, which offer abundant

India Office
parts of Banjara Hills)
Grade A
Secondary market (Jubilee Hills,
parts of Banjara Hills)
9, 42Madhapur 43 ready supply at relatively low rentals.
Grade B
Liquid Air
Secondary market (Ameerpet, SEEC Building, 40,000
25 25
Himayatnagar, Sarojini Devi Road)
Grade A Madhapur
Secondary market (Ameerpet,
IBM
Himayatnagar, Sarojini Devi Road) Lanco
25 Hills, 25 13,500
Grade B
IT Corridor (HITEC City, Madhapur, Manikonda Pune
Kondapur, Gachibowli) 32 29
Grade A BHEL Central Business 14,200
IT Corridor (HITEC City, Madhapur,
Kondapur, Gachibowli) District 25
26 Market Summary
Grade B
PBD (Shamshabad, Pocharam)
Grade A
22 22
The Central Business District (CBD) of MG Road,
RENTAL VALUE TRENDS
Rental Value Trends
Koregaon Park, Bund Garden, Kalyani Nagar,
70

Dhole Patil, FC Road and JM Road witnessed

60

slight increase in demand and enquiry levels for

50
Rent (INRper sq.ft. per month)

small format office spaces. Many occupiers are

40

moving within the CBD to more efficient buildings.

30

Approximately 0.1 million sq.ft. of new supply was

20

released, but the absorption was comparatively

10

lower at approximately 85,000 sq.ft. Vacancy level

0
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010 remained constant at around 15%, while the rental
Timeline

CBD (Begumpet / Rajbhavan Road, Banjara Hills)

Secondary market (Ameerpet, Himayatnagar, Sarojini Devi Road)

Secondary market (Jubilee Hills, parts of Banjara Hills)

IT Corridor (HITEC City, Madhapur, Kondapur, Gachibowli)

values increased by almost 4%, q-o-q.
PBD (Shamshabad, Pocharam)

Approximately 0.2 million sq.ft. of fresh supply was

13
CAPITAL VALUE TRENDS released in the Off CBD micro market of Viman
Capital Value Trends
12,000 Nagar, Magarpatta, Aundh, Baner, Shanker
10,000
Seth Road, S.B Road and Nagar Road and the
absorption was recorded at approximately 0.23
Capital Values (INRper sq.ft.)

8,000

million sq.ft. The rental values remained constant

whereas the capital values observed a marginal
6,000

4,000
increase. The vacancy level remained constant at
2,000 around 18% in the third quarter.
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
The Peripheral Business District (PBD) of
2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010

CBD (Begumpet / Rajbhavan Road, Banjara Hills)

Timeline
Secondary market (Jubilee Hills, parts of Banjara Hills)
Hinjewadi, Kharadi, Hadapsar, Talawade and
Secondary market (Ameerpet, Himayatnagar, Sarojini Devi Road) IT Corridor (HITEC City, Madhapur, Kondapur, Gachibowli)
Kharadi observed an increase in tenant enquiries
Pune
and absorption levels for SEZ space. Enquiries
Market Summary
by IT/ITES companies with smaller set ups have
The Central Business District (CBD) of MG Road, Koregaon Park, Bund Garden, Kalyani Nagar,

Market Outlook
Dhole Patil, FC Road and JM Road witnessed slight increase in demand and enquiry levels for small
format office spaces. Lot of corporates are moving within the CBD to more efficient buildings.
witnessed an increase over the last quarter due
Approximately 0.1 million sq.ft. of new supply was released; but the absorption was comparatively
to the uncertainty over the further extension of
In the next few months, Hyderabad is
lower at approximately 85,000 sq.ft. Vacancy level remained constant at around 15%. The rental values
increased by 4%, q-o-q.
STPI scheme. Approximately 0.5 million sq.ft.
expected to witness higher rental values
Approximately 0.2 million sq.ft. of fresh stock was released in the Off CBD micro market of Viman
Nagar, Magarpatta, Aundh, Baner, Shanker Seth Road, S.B Road & Nagar Road, whilst the
of new supply was added, total absorption was
owing to an increase in demand for
absorption was recorded at approximately 0.23 million sq.ft. The rentals remained constant whereas
the capital values observed a marginal increase. The vacancy level remained constant at 18%.
recorded at around 0.5 million sq.ft., with vacancy
commercial office space. Fresh supply
The Peripheral Business District (PBD) of Hinjewadi, Kharadi, Hadapsar, Talawade & Kharadi
observed an increase both in the enquiry and absorption levels in SEZs. Enquiries by IT/ITES levels hovering at around 24%. The rental values
in the IT corridor is expected to come up
companies with smaller set ups have increased over the last quarter due to the uncertainty over the
further extension of STPI scheme. Approximately 0.5 million sq.ft. of new supply was added; while the
remained stable this quarter, while capital values
Third Quarter 2010

only in the second quarter of 2011. Owing

total absorption was recorded at around 0.5 million sq.ft. Vacancy levels hovered around 24%. The
rentals remained constant while capital values increased by meager 2%, q-o-q.
increased marginally by 2%, q-o-q.
Market Outlook
During this review period, Pune witnessed an increase in enquiries as well as absorption levels
compared to the previous quarter. Due to lack of office supply in the CBD, the rentals are expected to
rise marginally.
Page 9
14
© 2010, CB Richard Ellis, Inc.
 



Rental Market Indicators RENTAL VALUE TRENDS



120

Sub-market Average Rent Average Rent

in Sept 10 (INR in June10 (INR 100

per sq.ft. per per sq.ft. per

Rent (INRper sq.ft. per month)

month) month)
80

CBD (Shivaji Nagar, 57 55 60

Bund Garden Road,

Koregaon Park)
40

Grade A 20

CBD (Shivaji Nagar, 50 48 0

Bund Garden Road, Q1

2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010

Koregaon Park) Timeline

Grade B
CBD (Shivaji Nagar, Bund Garden Road, Koregaon Park) O ff CBD (Kalyani Nagar, Shankarsheth Road, F.C. Road) PBD (Hinjewadi, Kharadi, Hadapsar)



Off CBD 45 45 CAPITAL VALUE TRENDS
(Kalyani Nagar, 14,000

Shankarsheth
Road, F.C. Road) 12,000

Grade A

Capital Values (INRper sq.ft.)

10,000

Off CBD (Kalyani 36 35 8,000

Nagar, Viman
Nagar, Nagar Road)
6,000

Grade B 4,000

PBD (Hinjewadi, 30 30 2,000

Kharadi, Hadapsar) 0

Grade A Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010
Timeline

PBD (Hinjewadi, 24 24 CBD (Shivaji Nagar, Bund Garden Road, Koregaon Park) O ff CBD (Kalyani Nagar, Shankarsheth Road, FC Road) PBD (Hinjewadi, Kharadi, Hadapsar)

Kharadi, Hadapsar) 

Grade B

Market Outlook

Major Leasing Transactions During this review period, Pune witnessed an

Tenant Building, Location Approx. size increase in enquiries as well as absorption
(sq.ft.) levels compared to the previous quarter.
Barclays DLF Akruti SEZ, 100,000 Due to lack of office supply in the CBD, the
Hinjewadi
rentals are expected to rise marginally.
Tech Mahindra DLF Akruti SEZ, 130,000
Hinjewadi
Capgemini Cerebrum , Kalyani 80,000
Nagar Kolkata
PWC Panchshil Tech Park 13,000
Cross Country AG IT Park, Aundh 20,000 Market Summary
Infotech
The Central Business District (CBD) of
Motorola Cerebrum , Kalyani 20,000
Nagar Chowringhee, B.B.D Bag, Park Street and
Atos Origin Embassy Tech park, 50,000 Camac Street witnessed a substantial increase
Hinjewadi in tenant enquiries and transaction velocity in
Dresser Rand Magarpatta SEZ 44,000 the third quarter. The total supply (both fresh and

Page 10

© 2010, CB Richard Ellis, Inc.

existing) stood at approximately 0.45 million sq.ft., RENTAL VALUE TRENDS
while the absorption witnessed was almost 15,000 160

sq.ft. Vacancy level was estimated in the range of 140

8% - 10% and the rental values increased by 10%, 120

160

(INRper sft. per month)

q-o-q. 100
140

India Office
80

Leasing activity in the Secondary Business 120

month)
Rent (INRper sft. perRent
60

District (SBD) of EM Bypass, Kasba-Gariahat

100

40
80

and Sarat Bose Road gained some traction. Total 20

60

supply available stood at almost 80,000 sq.ft., 0

40
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

while the absorption was recorded at 20,000 sq.ft. 20

2008 2008 2008 2008 2009 2009
Timeline
2009 2009 2010 2010 2010

Vacancy level in Topsia was recorded at around

CBD (Park Street, Camac Street, Theatre Road) Secondary Business District Peripheral Business District (Salt Lake, Rajarhat)

0
Capital Value
Q1 Trends
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

15%, whilst that in Kasba was estimated in the 2008 2008 2008 2008 2009 2009
Timeline
2009 2009 2010 2010 2010

14,000

range of 35% - 45%. The rental values remained at

CBD (Park Street, Camac Street, Theatre Road) Secondary Business District Peripheral Business District (Salt Lake, Rajarhat)

CAPITAL VALUE TRENDS

Capital Value Trends 12,000

the same level as in last quarter.

14,000
10,000

sft.) Values (INRper sft.)

Demand levels in the Peripheral markets of 12,000
8,000

Salt Lake and Rajarhat continued to witness a 10,000

6,000
Capital

steady upward movement. Total supply (new and

Capital Values (INRper

8,000
4,000

existing) is estimated to be approximately 4 million

6,000
2,000

sq.ft. The rental and capital values both increased

4,0000

by 13% in the third quarter. Q1

2008
Q2
2008
Q3
2008
Q4
2008
Q1
2009
Q2
2009
Q3
2009
Q4
2009
Q1
2010
Q2
2010
Q3
2010

2,000 Timeline
CBD (Park Street, Camac Street, Theatre Road) Secondary Business District Peripheral Business District (Salt Lake, Rajarhat)

Rental Market Indicators 0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010

Sub-market Average Rent Average Rent

Timeline
CBD (Park Street, Camac Street, Theatre Road) Secondary Business District Peripheral Business District (Salt Lake, Rajarhat)

in Sept 10 in June 10 (INR 18

(INR per sq.ft. per sq.ft. per
per month) month)
CBD (Park Street, 110 100 Market Outlook
18

Camac Street,
Theatre Road) An increase in enquiry levels will contribute
Grade A
to an increment in the leasing activity in the
Secondary 60 60
Business District next few months. However, demand-supply
Grade A dynamics in the city will ensure that the
Peripheral Business 45 40 rental and capital values across most micro
District (Salt Lake,
Rajarhat) markets remains stable in the near term.
Grade A

Major Leasing Transactions

Tenant Building, Location Approx. size
(sq.ft.)
Kirloskar KCI Plaza, Ballygunge 4,500
Motors
LG Vishnu Tower, Sec-V, 4,331
Electronics Saltlake
CMC Vishnu Tower, Sec-V, 4,200
Saltlake
Third Quarter 2010

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© Copyright 2010 CB Richard Ellis (CBRE). We obtained the information above

from sources we believe to be reliable. However, we have not verified its accuracy
and make no guarantee, warranty or representation about it. It is submitted subject
to the possibility of errors, omissions, change of price, rental or other conditions,
prior sale, lease or financing, or withdrawal without notice. We include projections,
opinions, assumptions or estimates for example only, and they may not represent
current or future performance of the property. You and your tax and legal advisors
should conduct your own investigation of the property and transaction.