Among the seven major office markets in India, Bengaluru has emerged as the one enjoying lowest vacancy levels. At slightly more than 3%, the office vacancy levels are at an all-time low in the IT capital of India. Bengaluru is followed by other IT hubs like Pune and Hyderabad having vacancy levels of 6% and 9%, respectively. Chennai comes next at around 12%, Kolkata and Mumbai around 19% and Delhi-NCR at almost 32% vacancy levels. At a pan-India level, the average vacancy in commercial real estate stands at 15%, as of 2Q16. The figures say that IT hubs continue to see a good supply-demand equilibrium compared to some other markets in the country. The time to supply more quality space has, however, arrived and developers in Bengaluru need to look into addressing the existing space crunch. Some developers have rightly started advancing completion of their commercial projects in the city. In 2015, more than 10 mn sqft of office space got occupied, and another 2 mn sqft of leasing was done in under-construction projects. In 1Q16, Bengaluru had seen the highest leasing volumes in Asia Pacific on the back of big-ticket transactions. Although there is demand for 10 mn sqft, the supply of only 8-8.5 mn sqft non-captive office space is expected to come up by the end of 2016.
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