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The overall net absorption of office spaces in Chennai in the last one year decreased by 25 per cent on a year on year basis, according to Cushman & Wakefield, real estate property consultants.
High volumes of leasing activity in the form of relocations and consolidations by IT companies from Central Business District to peripheral and suburban areas were the major cause for the decline in net absorption levels.
About 3.1 million sq ft of space was leased during the year with a total of 3.4 million sq ft of new office space available in the market during the year. This was a 27 per cent decline on a yearly basis.
In continuation with the trend witnessed last year, all pre-commitments by IT/ITeS companies were in Grade A developments.
This was mainly due to the upcoming contiguous spaces in suburban locations at relatively lower that offer scalability of operations in the coming year.
In 2014, nearly 2.2 million sq. ft of new office supply is expected to be added in locations of suburban Guindy, suburban Perungudi, Taramani, peripheral-RGS and CBD.
Almost 1.0 million sq. ft of this upcoming supply will be dedicated IT/ITeS space, followed by 0.5 million sq. ft commercial spaces and the remainder in Special Economic Zones for IT/ITeS.
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