Banking, Financial Services and Insurance (BFSI) companies' share has jumped to 29% in the total office space leasing during the July-September period across nine cities from 16% in the previous quarter, according to CBRE.
Real estate consultant CBRE South Asia released its office market data on Tuesday, showing that BFSI firms took on lease 4.63 million square feet of office space, which is 29% of the total absorption during the July-September period. In the previous quarter, the BFSI companies had taken 2.2 million square feet of area on lease, accounting for 16% of the total leasing.
Overall, the consultant said that gross office leasing activity increased by 33% Year-on-Year (Y-o-Y) to 15.8 million square feet during the July-September period across nine cities -- Delhi-NCR, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad, Pune, Kochi and Ahmedabad.
'The BFSI firms' leasing share surged from 16% in the April-June quarter to 29% during July-September, driven by significant deal closures by global capability centres of BFSI corporates, while Indian banks and insurance firms continued to expand their footprint in the country, CBRE said.
Leasing activity was also driven by technology companies, comprising a 23% share, followed by engineering and manufacturing companies (10%), life sciences firms (10%), flexible space operators (8%), and research, consulting, and analytics firms (7%).
American and domestic firms equally lead the absorption in the July-September period with a share of 42% each.
"India's office sector has outperformed expectations this year with sustained absorption, driven by optimistic occupier sentiment and a surge in inquiries," Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa at CBRE, said.
"While the office sector in 2023 is likely to perform better than predicted at the beginning of the year, India has demonstrated resilience in the face of global economic challenges and remains one of the most attractive destinations for global corporations establishing their global capability centres (GCCs)," he added.
Bengaluru, followed by Delhi-NCR, Chennai and Hyderabad, are expected to drive absorption in 2023, while Mumbai, Pune and Kolkata are also likely to witness steady space take up during the year, Magazine said.
Gagan Randev, Executive Director at India Sotheby's International Realty, said India would continue to be the preferred destination for large GCCs.
"Physical offices offer the most conducive environment to keep people motivated and encouraged. And most companies have used the pandemic years to refashion the interiors of office spaces to cater to the health and wellness norms, to bring back employees back to work, safely," Randev said.
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