INDORE: Rentals for commercial property in Indore, a leading business centre of the state, have fallen by around 15 per cent as compared to pre-Covid-19 time due to a plunge in demand and shrinking requirement of office spaces in pandemic.
In the commercial real estate sector, office spaces have suffered the most declines in demand and rentals due to work from home policy adopted by many companies as a result of coronavirus induced lockdown.
As per realtors, at least 20 per cent commercial property, mostly office spaces, are labelled as vacant in pandemic, while retail commercial spaces including showrooms and shops are locked in negotiations with owners over rent waiver for the lockdown period.
A realtor dealing in commercial spaces Bhoopendra Joshi said, “Rentals for commercial property have dropped by at least 15 per cent in pandemic because demand is very limited. There are negligible fresh customers in the market in rental segment. Offices are winding up sprawling spaces and have put expansions on hold.”
According to brokers, average rentals in retail segment in Indore is in the range of Rs 150-Rs 200 per sq ft on carpet area, while office spaces are offered at Rs 45-Rs 60 per sq ft on carpet area.
Indore Realtors Welfare Association president Arvind Gupta said, “Around 25 per cent people have vacated rental property due to Coronavirus enforced lockdown. Owners are ready to offer property at lower rates because bank liabilities are intact on them. But customers are in a wait and watch mode worried about an uncertain lockdown that can be imposed anytime.”
In Indore, most sought after locations for commercial property are AB Road, MG Road and Sapna Sangeeta, said real estate agents.
Property brokers said several showrooms and shops have defaulted on rents in pandemic and new agreements are having an additional condition to either waive off rent for the lockdown period or 50 per cent rent for the impact period.
Real estate agent Vinod Verma said, “Most new agreements signed these days are having an additional condition for the lockdown period as agreed upon by both the parties to avoid defaults.”