Hyderabad accounts for 30% supply share of office space in H1: JLL

Shrugging off the Covid-19-led lockdown, Hyderabad has managed to lead in the country’s office space supply and absorption in the first half (H1) of 2020, accounting for 30 per cent supply share and 18 per cent absorption share, according to a JLL-CII report.

The metropolitan city continues to show resilience and its real estate dynamics managed to keep up the momentum, says the JLL-CII report titled ‘Hyderabad Real Estate - A Road Map amid the Covid-19 crisis.’

The city’s real estate performance was far better in H1 2020, compared to other cities in India. Its formal economy was one of the first in urban India to regain stability, following relaxation of lockdown rules. Despite the nationwide lockdown, in Q2 2020, Hyderabad continued to witness relatively good office leasing and residential sales. Hyderabad also led India’s office supply with a 30 per cent share in H1 2020, significantly driving the country’s office absorption with an 18 per cent share during the same period. Further, the city reported strong sales with the least unsold inventory in India which can be offloaded within two years.

“Hyderabad’s resilience comes from the confidence of doing business instilled by the state government. The business-friendly policies of the government has helped corporates leverage the existing ecosystem in the state to maximise output and emerge as the destination of choice. While national IT exports grew by 8 per cent in 2019-20, IT exports here grew by 18 per cent in the same period. Hyderabad is a major destination for India’s young workforce,” said Ramesh Nair, CEO & Country Head, India, JLL.

JLL’s latest GRETI (Global Real Estate Transparency Index) report in 2020 says India experienced higher improvement and it is on the cusp of becoming a transparent economy. The focus of the government on sustainability transparency with focus on wellness and PropTech adoption drove this improvement.

The city reported office space absorption of 2.1 million sq ft in H1 2020, which dropped the city’s vacancy rate to 9.2 per cent. Hyderabad witnessed the highest quarterly launches ever during the lockdown period in Q2 2020. Most of these launches were in the northern and eastern submarkets.

Hyderabad recorded the highest office net absorption in 2019 (as a proportion of existing stock) compared to any city globally, while standing among the world’s best-performing cities for prime office rental growth, according to the recent JLL City Momentum Index (CMI) 2020 report.