Gaming tech firm Aristocrat leases 128,000 sq ft of office space at Noida SEZ
Gaming content and technology company Aristocrat has leased 128,000 sq ft of office space at Candor TechSpace Special Economic Zone (SEZ) from Brookfield Properties in Noida, said three persons aware of the deal.
The leasing comes at a time when companies are avoiding SEZs and are waiting for the Development (Enterprise and Services) Hubs Bill, 2022, to replace the Special Economic Zones Act.
Samsung had leased 370,000 sq ft of office space at Candor TechSpace SEZ, which is part of the Brookfield REIT portfolio.
“Companies are looking for quality space and SEZ is not a deterrent for them. However, the new Act will help the developer in reducing vacancies. Demand for office space is rising in Noida and supply pipeline of Grade A buildings is also robust,” said Vibhor Jain, managing director, North India, Cushman & Wakefield.
Savills India, which facilitated the transaction, declined to comment on the deal. Aristocrat did not respond to ET’s emailed queries while Brookfield also declined to comment.
Recently leading developers such as DLF and Tata Realty spoke on the delay of the new bill, which will replace the SEZ Act.
“The vacancies are either in the SEZ due to the amendment in the Act, which is taking a little more time than we had anticipated,” Sriram Khattar, managing director, rental business, DLF, had said during the company’s third quarter earnings call.
Sanjay Dutt, managing director, Tata Realty and Infrastructure Limited, had said that last year the minister had announced an SEZ Amendment Act to allow domestic companies to be able to operate in IT SEZs, something which was missing this year.
According to industry estimates, about 20,000 hectares of SEZ land and 100 million sq ft of built-up area are currently vacant.
Multinational companies believe there is no major financial benefit to operating in SEZs after the sunset clause, although the compliance requirements remain.
IT SEZs in India are predominantly occupied by IT services companies and capability and service centres of MNCs. SEZs account for more than 30% of India’s exports and generate 2.3 million jobs. IT SEZs are a major contributor of SEZ exports and generated $66 billion for IT and related services in 2020-21, according to industry estimates.
Demand for commercial space in Delhi-National Capital Region (NCR) is projected to reach about 11 million sq ft in 2023, driven by the return of working professionals to offices, according to Savills India.
The IT-BPM sector is anticipated to drive the commercial market of the city this year as well while the second biggest contribution in the leasing activity is likely to come from flexible workspaces.
Delhi-NCR’s overall vacancy levels decreased to 21.9% in 2022 from 23% in 2021, as a result of leasing activity outpacing new completions during the year.