Delhi-NCR is the 6th most expensive office space rental market across the Asia Pacific region with an average monthly rental of ₹340 per sq ft and Mumbai is ranked 8th with an average monthly rental of ₹317 per sq ft. Hong Kong SAR continues to be APAC’s most expensive office market during the quarter, as per Knight Frank’s latest edition of the Asia-Pacific Prime Office Rental Index for Q3 2024.
Prime rents in the NCR remained stable in Q3 2024, while Mumbai and Bengaluru saw year-over-year (YoY) increases of 5% and 3%, respectively, driven by strong occupier demand and limited new supply.
The prime office market of Delhi-NCR continues to see rental values maintain levels seen in the past four quarters. The prime office rent of the city was recorded at ₹340 per sq ft per month, making it the 6th most expensive office market in the APAC region.
In Mumbai, the prime office rent of the city was recorded at ₹317 per sq ft per month and was the 8th most expensive commercial market in the APAC region.
Bengaluru ranked 18th in the list
Bengaluru stands 18th on the list and is one of the least expensive prime office markets in the APAC region. The prime office rent of the city was recorded at ₹138 per sq ft per month. The rental value in the city is projected to remain steady during the following 12 months, it showed.
In Q3 2024, Bengaluru saw the largest volume growth, up 158% YoY. Bengaluru’s standing as a Global Capability Centres hub was further supported by the fact that 62% of the space traded in the city was from GCCs. The majority of Mumbai and NCR’s business volume was made up of companies that dealt with India.
Also Read: Bengaluru leads in large office space leasing, transaction volumes touch 4.5 mn sq ft in H1 2024
Prime office rentals in Delhi-NCR, Mumbai, and Bengaluru remained robust year-on-year, and rental rates are expected to stay stable over the next 12 months.
Overall, 16 out of the 23 monitored cities globally reported stable or increasing rents year-on-year, up from 15 in Q2 2024. Notably, Brisbane recorded the highest year-on-year growth in Q3 2024, reflecting a positive trend across many markets. The stabilising vacancy rates across the region have declined marginally by 0.2 percentage points, the report said.
Also Read: Office space leasing touches 53.43 million sq ft in Jan-Sep period: JLL
“The resilience of the Indian economy continues to attract strong global corporate interest, as reflected in the sustained demand across India’s major office markets. Quarterly transaction volumes have reached record highs and are likely to exceed annual benchmarks in 2024, while rental rates remain stable. This positive outlook, supported by consistent physical occupancy, steady rent levels since 2022, and rising demand in 2024, underscores our confidence in the sustained strength of the Indian office market in the near to medium term,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India.
The Asia-Pacific prime office sector is poised to remain tenant-favourable in 2024. With an ample supply pipeline, landlords have had to adopt accommodative strategies to sustain occupancy levels. Following the delivery of over 12 million sqm of office space in 2024, the supply pipeline for 2025 is expected to decrease by about one-fifth.
Also Read: Gross office leasing touches 66.7 mn sq ft in Jan-Sep period, to cross 80 mn sq ft in 2024
