Business & Investment

Grade A office space that drives real estate growth

The expansion of coworking space and changing preferences for millennial robust startup ecosystems are driving demand for Grade A office space.

While COVID-19 hit the real estate segment hard, the industry began to choose a variety of unique ways to do business and increase demand. A new and innovative way to do business in real estate, which took time to hire, helped the sector slowly and steadily recover lost land. Undoubtedly, the festive season was icing on the cake.

Prior to COVID-19, the sector grew thanks to policy changes such as the influx of 100% foreign direct investment (FDI) and regulatory reforms such as the Real Estate (Regulatory Development) Act (RERA) and the Goods and Services Tax (GST). I’ve done it. – Everyone expects growth in this sector and it’s been pretty good. Other policy amendments, such as a real estate transaction concession that raises the circle rate to 10%, an investment of 100 lacquerle in infrastructure, and a concession tax rate on co-operatives, have also significantly boosted the sector.

Finance Minister Nirmala Sitharaman said India received $ 24.4 billion in FDI between April and November 2019. That was $ 21.2 billion in the year-ago quarter. This was a big improvement. And commercial real estate, especially grade A office space, has attracted a significant portion of FDI as a whole.

Grade A office space

Grade A office space is the main reason for the increase in real estate FDI and is in demand due to multiple factors. Multinationals, large Indian companies, and brands headquartered in various Indian cities are the main drivers of this demand. Grade A office space provided a strategic location, state-of-the-art design, architecture, and well-managed office space in the heart of the city’s business centre. These three segments needed the best office space available for urban development centers such as Bangalore, Hyderabad, Pune, Mumbai, Gurgaon and Neuda, back office operations, research facilities and stores. There was steady demand from them. Companies like CISCO, Amazon, Merrill Lynch, GE and Goldman Sachs have the largest offices based in India outside their home countries.

Reasons for business growth

The expansion of coworking space and changing preferences for millennial robust startup ecosystems are driving demand for Grade A office space. Another factor is the increase in leasing and investor activity that was once dominated by IT / ITES (although investors were a bit cautious this year) and is now leasing by many other sectors. I’m witnessing. BFSI, consulting services, FMCG companies, healthcare, start-ups, to name a few. All of them are actively working on Grade A office spaces nationwide.

Supply

The market is full of opportunities for suppliers / builders as the demand from different industries is so high. From what we see, within the office space supply ecosystem – the largest chunk is the supply of grade A office space. Ticket sizes for such properties range from Rs 20 to Rs 100, which certainly has deep pockets, a sophisticated understanding of the leasing structure, the need for active asset management, and finally, We need a desire for the best.

Grade A office supplies are fairly easily filled despite the effects of a pandemic. Even market experts weren’t expecting the growth it achieved. However, there may be markets such as Bengaluru, Pune, and Chennai where tenants may face problems in finding the right option. This is primarily due to the very few builders who have begun offering grade A office space solutions to their customers.

(By Divaker Bhalla, CEO of DNA Ventures Pvt Ltd)

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Grade A office space that drives real estate growth

https://www.financialexpress.com/money/grade-a-office-space-fueling-growth-in-real-estate/2156737/ Grade A office space that drives real estate growth

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