American computer hard disk drive manufacturer and data storage company Western Digital has leased 680,000 sq ft office space in Bengaluru in one of the biggest transactions of the year, three people aware of the development said.
“Covid had put on hold some large office space transactions but with vaccination picking up and infection rate going down, corporates are now signing the deals,” said one of the people quoted above. “In the October-December quarter, more such deals are likely to conclude.”
Bengaluru has recorded net absorption of about 1 million sq ft in July-September quarter.
The city’s office market witnessed increased demand from co-working operators, accounting for about 48% of the leasing activity.
“The average rental in the area is Rs 90 per sq ft per month and the deal has been closed in the same price bracket,” said another person. “The building has just been completed and Western Digital, which has been considering a bigger office space for a year, signed the deal after getting the right building at the right price.”
Kalyani Developers that operates the Helios Business Park and Western Digital did not respond to ET’s email query until press time.
India’s office transactions recorded a strong quarterly growth in Q3 of 2021, despite a much more severe second wave of Covid infections and the looming threat of a third wave.
Among the larger markets, Chennai, Bengaluru, and the National Capital Region (NCR) recorded the highest recovery in Q3 2021 with transactions reaching around 123%, 112% and 93% levels respectively of the quarterly average of 2019.
Some of the largest office space deals of recent times involved Cisco Systems, Tata Consultancy Services, Concentrix, JP Morgan, IBM and Amazon.
India’s net office absorption stood at 5.85 million sq ft in Q3 2021 (July-September), a jump of 48% when compared to previous quarter and an 8% year-on-year growth in major cities.
A better awareness about the virus, preparedness along with mass vaccination drive and unlocking of the economy have aided in the revival of the office market.
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