Bengaluru, March 7 : Demand for office space across Asia Pacific’s (APAC) top 11 markets surged 15.9 per cent annually to 8.8 million sqm (94.7 million sq ft) in 2024, led by India, Mainland China and Japan, according to a report by real estate consultancy Colliers.
The report released on Friday states that H2 2024 was particularly strong, with office demand in the region reaching 4.7 million sqm (50.6 million sq ft), a 6.1 per cent rise compared to H2 2023 and the expansion is expected to continue in 2025.
Office market activity was particularly strong in India, which saw 6.17 million sqm (66.4 million sq ft) of leasing during 2024, led by a stronger second half. With 3.44 million sqm (37.0 million sq ft) of gross leasing in H2 2024, India continued to lead office leasing activity in the APAC region, witnessing an 11 per cent YoY rise compared to H2 2023, the report said.
Technology firms and Flex space operators together accounted for 46 per cent of the total take-up across the top six cities in India during H2 2024. New supply remained robust, with over 2.81 million sqm (30.3 million sq ft) of completions in H2 2024, a 7 per cent YoY growth across the top six cities.
Bengaluru and Hyderabad led the office market activity during H2 2024, cumulatively driving more than half of India’s Grade A space demand and supply. Amidst an uptick in both leasing activity and new supply, India vacancy levels largely remained stable at around 17 per cent, the report points out.
Colliers’ latest report, Asia Pacific Office Market Insights H2 2024 and Outlook 2025, found the significant increase in APAC office space demand to be driven by corporate expansion, return-to-office and the growth of global capability centres.
Demand growth in H2 2024 was notable in markets such as India and Japan and particularly impressive in Australia, which had a lower base. Leasing activity, however, remained relatively subdued in New Zealand, the Philippines, South Korea, Hong Kong, and Taiwan in H2 2024, the report points out.
“Office space demand in the region continued to be driven by India, Mainland China and Japan. At the same time, leasing in Australia grew manifold during H2 2024, albeit on a comparatively lower base. New office supply declined across most markets in H2 2024, resulting in a 16.9 per cent annual drop at the APAC level. Contrary to larger trends, India witnessed 7 per cent YoY growth in new supply, contributing 60 per cent of the new supply in the APAC region during H2 2024. Looking ahead, we anticipate improved demand-supply dynamics in 2025, supported by balanced economic growth and likely moderation in inflation.”, said Arpit Mehrotra, Managing Director, Office Services, Colliers India.
“With an over 70 per cent share in leasing and 60 per cent share in new supply in H2 2024, India remains one of the leading office markets in the APAC region. Strong domestic leasing, coupled with increasing Grade A space uptake by Global Capability Centers (GCCs), continues to fuel office demand in India. During H2 2024, GCCs leased 1.4 million sqm (~15 million sq ft) of office space in India, accounting for over 40 per cent of the overall leasing during the period. Factors such as rental arbitrage, abundant talent, and language proficiency will continue to support the expansion of GCCs and outsourcing hubs in India,” said Vimal Nadar, Senior Director & Head of Research, Colliers India. (IANS)
