India Office Property Market Overview_april 2013

Office PrOPerty Market Overview iNDia

QUarterLy UPDate | aPriL | 2013

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MACRO ECONOMIC OVERVIEW

GDP growth was recorded at 4.5% in 4Q •2012, the lowest in the last decade. The economic growth in the first nine months of fiscal year 2012-13 stood at 5%, much lower than 6.6% recorded during the same period last year.

Headline inflation, based on the wholesale •price index, stood at 5.96% for the month of March 2013 as compared to 7.96% for the corresponding month of previous year. The reduction in the inflation was primarily due to low food inflation.

The Reserve Bank of India reduced the CRR •(Cash Reserve Ratio) of scheduled banks by 25 basis points from 4.25 to 4%, effective from January 2013, to induce immediate liquidity in the market. The central bank also reduced the repo rate by 50 basis points in two tranches in January and March this quarter.

The Indian Rupee remained under pressure •and closed at 54.28 to the USD and 70.37 to the Euro as on 15 March 2013.

The commercial office market showed signs •of revival in almost all markets. The six major markets, i.e. Mumbai, NCR, Bangalore, Chennai Kolkata and Pune recorded an overall absorption of around 8 million sq ft in 1Q 2013. Bangalore saw the highest absorption, followed by the Mumbai and NCR markets. The Kolkata and NOIDA markets to witnessed relatively weaker demand. IT/ITeS and BFSI remained the key demand drivers this quarter in almost all major markets.

COLLIERS VIEW: The prevailing recovery in occupier demand is anticipated to continue in medium term. We anticipate stability in rental values across the major markets due to large inventory in pipeline despite recovery in demand.

ECONOMIC BAROMETER

RETuRN ON AlTERNATIVE INVEsTMENTs

RESEARCH & FORECAST REPORTsYDNEY CENTRAl BusINEss DIsTRICT

INDIA OFFICE MARKETREsEARCh & fORECAsT REpORT

Mar-12 Mar-13

REPO RATE 8.50% 7.50%

REVERSE REPO RATE

7.50% 6.75%

CRR 4.75% 4.00%

INFLATION (WPI)1 7.69% 5.96%

PLR2 10.00% - 10.75% 9.70% - 10.25%

DEPOSIT RATE3 8.50% - 9.25% 7.50% - 9.00%

ExCHANGE RATE INR - USD 50.39 54.28

INR- EURO 65.89 70.37

Mar-12 Mar-13 YoY %

Change

GOLD 27,300 29,348 7.50%

SILVER 56,014 53,859 -3.85%

EQUITY (BSE

SENSEx) 17,676 19,428 9.91%

REALTY INDEx 1,,822 2,048 12.46%

Source: Colliers International India Research

ECONOMIC INDICATORs

INR

Cror

eIn

Per

cent

age

2005

- 0

6

2006

- 0

7

2007

- 0

8

2008

- 0

9

2009

- 1

0

2010

- 1

1

2011

-12

April

-Fe

b 13

fDI in Real Estate

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

Jan

- M

ar 0

9

Apr

- Ju

n 09

Jul -

Sep

09

Oct

- D

ec 0

9

Jan

- M

ar 1

0

Apr

- Ju

n 10

Jul -

Sep

10

Oct

- D

ec 1

0

Jan

- M

ar 1

2

Oct

- D

ec 1

2

Jun

- Se

p 12

Oct

- D

ec 1

1

Jul -

Sep

11

Apr

- Ju

n 11

Jan

- M

ar 1

1

Gross Domestic product at factor Cost

0.0%

1.0%

2.0%

3.0%

1Q 2013 | OFFICE

70

80

120

130

100

110

90

1-fe

b-20

13

1-M

ar-2

013

15-f

eb-2

013

1-Ja

n-20

13

15-J

an-2

013

30-J

an-2

013

15-M

ar-2

013

BsE sensex & Realty Index

BSE Sensex Realty Index* Rebase to 100

USD Euro

Exchange Rates

65

70

55

60

50

75

80

1-Ja

n-13

15-J

an-1

3

30-J

an-1

3

15-F

eb-1

3

1-Fe

b-13

1-M

ar-1

3

15-M

ar-1

2

Note : All values in the above tables are as on 15th of March 2012 and 20131 Wholesale Price Index2 SBI Prime Lending Rate3 SBI interest rate < INR 1 crore Term Deposits for ≤1 Year

Apr

- Ju

n 12

Note: All the rentals shown above are indicative Grade A rentals in INR per sq ft per month.

COllIERs INTERNATIONAl | p. 3

iNDia | 1Q 2013 | OFFICE


MuMBAI

During the surveyed quarter, about 8.2 million •sq ft of Grade A commercial office space was available for fit-out. More than 65% of this available space was concentrated in Lower Parel, Andheri East and Thane.

No new major Grade A commercial office •supply was added to the city’s office inventory.

During the quarter, office space absorption •was recorded at around 2.17 million sq ft. A number of large-sized (40,000 – 100,000 sq ft) leases were signed. BFSI and IT/ITeS were the primary sectors contributing to this demand.

No major movement in capital values were •recorded across the submarkets, except in Bandra Kurla Complex (BKC) and Lower Parel, where capital values increased in the range of 2 -5% QoQ.

Average rental values remained stable in •almost all micro–markets, except for a marginal decrease in the range of 1 -3% in areas like Nariman Point and Lower Parel.

In this quarter, construction work on the •Eastern Freeway project was completed. The 16 km long elevated road connects south Mumbai to Wadala and continues onwards to Ghatkopar in the eastern suburbs.

COLLIERS VIEW: In 1Q 2013, occupier demand is expected to remain healthy with micro-markets like Andheri, BKC and Lower Parel continuing to be the preferred destination for the occupiers. Overall rentals across the micro-markets are expected to remain unchanged, while rentals for premium office space may increase slightly due to limited availability.

Andheri East 25%

CBD 1%

Thane / LBS 21%

Worli / Prabhadevi 1%

Goregoan / JVLR 5%

Powai 4%

Malad 6%

Navi Mumbai 5%

Lower Parel 22%

BKC 9%

Kalina 2%

AVAIlABlE supplY IN pRIME AREAs

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value

CITY OffICE BAROMETER

Micro Market Rental Values

% Change

QoQ YoY

CBD 225 - 260 -3% -3%

Andheri East 90 - 125 0% 0%

BKC 225 - 315 0% 3%

Lower Parel 140 - 180 -3% -3%

Malad 80 - 90 0% 0%

Navi Mumbai 55 - 75 0% 0%

Powai 100 - 120 0% 0%

Worli/ Prabhdevi 175 - 225 0% 0%

Goregaon/ JVLR 80 - 110 0% -5%

Kalina 175 - 210 0% 0%

Thane / LBS 50 - 100 0% 0%

Andh

eri E

ast

BKC

Low

er P

arel

Mal

ad

Navi

Mum

bai

Pow

ai

Wor

li/Pr

abhd

evi

Gore

gaon

/

JVLR

Kalin

a

Than

e /

LBS

CBD

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

GRADE A CApITAl VAluEs

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

1Q20

08

1Q20

09

3Q20

08

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11

50 5,000

0 0

100 10,000

150 15,000

200 20,000

250 25,000

300 30,000

AVERAGE RENTAl AND CApITAl VAluE TREND

Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

Note:Available Supply: Total Grade A office space being marketed for sale or lease in surveyed quarter.

Grade A Rental/Capital Values: Indicative asking price for Grade A office space.

Prime Office Average Rental Trends: Average market rental values for Grade A properties.

KEY uNDER CONsTRuCTION pROJECTs

BUILDING NAME DEVELOPER AREA (SQ. FT.) LOCATION ExPECTED COMPLETION

Godrej One Godrej & Boyce 758,000 Vikhroli 2013

Marathon Futurex Phase III Marathon Group 360,000 Lower Parel 2013

iThink Techni Campus C wing Lodha Developer 212,700 LBS Marg 2013

KEY MARKET TRANsACTIONs

CLIENT BUILDING NAME AREA (SQ. FT.) LOCATION TRANSCATION TYPE

Aditya Birla Minacs Worldwide Ltd. Symphony IT Park 30,000 Andheri East Lease

Axis Securities Ltd. Phoenix Market City 40,000 Kurla Lease

Barclays Nirlon 180,000 Goregaon Lease

Colgate Palmolive India Ltd. L&T Business Park 100,000 Andheri East Lease

Future Generali India Insurance Co. Ltd. iThink 27,000 Thane Lease

Tata Group Lodha Simtools 100,000 Thane Sale

MUMBAI

p. 4 | COllIERs INTERNATIONAl

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value



DElhI

In 1Q 2013, more than 1.5 million sq ft of •Grade A office space was available for fit-out. The majority of this supply was located in the Jasola and Saket micro-markets.

During 1Q 2013, the completion of Red Fort •Capital Parsvnath Towers by Parsvnath Developers added approximately 0.5 million sq ft of Grade A new supply to the CBD.

Commercial projects launched in 1Q 2013 •include Prime Towers at Okhla by DLF Ltd measuring 0.7 million sq ft. The project is expected to be completed by the end of 2014.

Steady occupier demand was noticed during •the quarter. A few mid-sized (15,000 to 50,000 sq ft) leases were concluded in micro-markets such as Netaji Subhash Place, Minto Road and Okhla Phase I. The city witnessed absorption of approximately 0.1 million sq ft during the quarter.

The investment market continued to remain •sluggish with no major sales transactions concluded this quarter.

Rental values in new buildings completed •recently in the CBD are commanding higher than the market rentals due to their state-of-the-art facilities and amenities. However, the overall rents and capital values for Grade A offices remained stable in all micro-markets.

COLLIERS VIEW : Not much supply is anticipated in Delhi except in Aerocity, an emerging location near the International Airport. Demand is expected to remain steady, the limited supply of Grade A office space will keep overall rents at the same levels.

Jasola 59%

Nehru Place 10%

Saket 29%

Connaught place 2%




% Change

QoQ YoYConnaught Place 330 - 384 0% 5%

Nehru Place 180 - 192 0% 9%

Netaji Subhash Place

65 - 75 0% 1%

Jasola 112 - 130 0% -4%

Saket 162 - 180 0% 3%

Nehr

u Pl

ace

Conn

augh

t Pla

ce

Jaso

la

Sake

t

Neta

ji Su

bhas

h

0

10,000

20,000

30,000

40,000

50,000

60, 000


Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

50 5,000

0 0

100 10,000

15015,000

20020,000

25025,000

400

350

300

30,000

35,000

45,000

40,000


Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.






Caddie Commercial Tower Caddie Hotel 100,000 Aerocity 2013

DLF Towers DLF Ltd. 420,000 Okhla 2013

NBCC Plaza NBCC 350,000 Okhla 2013



Essilor A-3 15,000 Okhla Phase I Lease

OTIS Cyber Plaza II 14,896 Netaji Subhash Place Lease

Ebay Statesman House 5,850 Barakhamba Road Lease

VFS Global Konnectus 50,000 Minto Road Lease

George Institute Splendor Forum 3,000 Jasola Lease

DELHI


1Q20

08

1Q20

09

3Q20

08

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11




MG Road 4%

Institutional Sectors /Sushant Lok

8%

Manesar 23%

DLF Cyber City 4%

NH8/Udhyog Vihar 21%

Golf Course Road/Ext /Sohna Road

42%



Golf

Cour

se

Road

/Ext

/S

ohna

Roa

d

NH8/

Udh

yog

Viha

r

Inst

itutio

nal

Sect

ors

/Su

shan

t Lok

Golf

Cour

se

Road

/Ext

/So

hna

Road

(IT)

NH8/

Udhy

og

Viha

r (IT

)

Man

esar

(IT)

Man

esar

MG

Road

0

5,000

10,000

15,000

20,000

25,000

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

20 2,000

0 0

40 4,000

60 6,000

80 8,000

100 10,000

120 12,000Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.








Corporate Green - Tower 1 DLF 660,000 NH-8 2013

Digital Greens Tower A Emmar MGF 350,000 Golf Course Ext Rd. 2013

Unitech Infospace, Phase 2 Building 7 Unitech 432,000 NH-8 2013

KEY MARKET TRANsACTION


Carlsberg Paras Twin Tower 15,000 Golf Course Road Lease

Clairvolex Unitech Infospace 12,000 Dundahera Lease

Daffodil World Tech Centre 22,000 Silokhera - NH8 Lease

Macy’s Plot no 32 10,000 Sector 44 Lease

Toshiba Building-10 25,000 DLF Cyber City Lease

xerox Bestech Park 40,000 Sohna Road Lease

GURGAON

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value


% Change

QoQ YoYM. G. ROAD 112 - 121 1% -1%

Golf Course Rd./Ext /Sohna Rd. 55 - 108 -1% -11%

NH8/Udhyog Vihar 110 - 140 0% 10%

Manesar 45 - 62 0% 0%

Institutional Sectors /Sushant Lok

60 - 117 0% 21%


GuRGAON

More than 17 million sq ft of Grade A office •space was available for fit-out during 1Q 2013. Most of the available supply was concentrated along Golf Course Road and its extension, Sohna Road, Udyog Vihar and NH-8,up to Manesar.

More than 1.5 million sq ft of Grade A office •space was added to the city’s total inventory.

In 1Q 2013, a number of commercial projects •were launched, including Elvedor by Imperia Structures in Sector 37D; Capital Cyberscape by Capital Builders at Sector 59; GPL Trade Towers by GPL Group and Business Club by AIPL Group, both of which are located on Golf Course Extension Road. All of these projects are expected to contribute around 1.5 million sq ft to the city’s Grade A office space by the end of 2015.

The office take-up rate in this quarter was •around 1 million sq ft. Demand from both new tenants and existing tenants seeking to expand increased, especially in the IT/ITeS sector.

Rental values posted moderate growth in •the range of 1 to 2% QoQ in micro-markets such as NH-8, Udhyog Vihar and M.G. Road; however other micro-markets remained stable on account of huge supply availability.

COLLIERS VIEW : The office market shall witness increased vacancy due to the massive new supply in the pipeline expected to be completed in the next 12 months. The office rental value growth will be capped due to existing vacancy and the forthcoming new supply. Moreover, due to the cost-cautious approach taken by most occupiers, micro-markets with affordable rents will remain the preferred location.

1Q20

08

1Q20

09

3Q20

08

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11




NOIDA

In 1Q 2013, around 8.8 million sq ft of Grade •A and Grade B office space was available for fit-out. About 90% of this available space was IT/ITeS office space located primarily in Sectors 16A and 62, and Sectors 125 to 143 along the NOIDA Expressway.

More than 1 million sq ft of Grade A office •space was added to the city’s total inventory.

Two new commercial projects were launched •in 1Q 2013: Mist Avenue by Bhasin Group at Sector 143; and Cosmic Corporate Park II by Cosmic Group at Sector 140. These two projects together will contribute about 1.4 million sq ft of Grade A office space by the end of 2015.

Occupier demand from the traditional demand •drivers IT/ITeS in the city remained muted and very few large floor-plate deals were executed during the quarter. Total absorption of around 0.5 million sq ft was recorded in the surveyed quarter.

Following last quarter’s trend, the rental •values further declined by 2% in most of the Commercial and Industrial sectors, while rental values in the Institutional sectors remained stable.

COLLIERS VIEW : Demand decreased marginally for the third consecutive quarter in NOIDA. Further a large commercial supply is expected to hit the market by the end of 2013 and in early 2014, we anticipate that the rental values will remain stable in the near future. This is primarily because the rental values have already reached levels at which there is not much scope for further reduction.

Commercial Sectors (Sec 18) (Grade B)

0.7%

Industrial Sectors (Sec. 1-9, 57-60, 63-65)

(Grade B) 8.6%

Commercial Sectors (Sec 18) (Grade B)

0.2%

Institutional Sectors (Sec.16A, 62, 125-142

90.5%




% Change

QoQ YoYInstitutional Sectors (Non IT) 61 - 72 0% -11%

Institutional Sectors (IT) 46 - 50 0% -6%

Comercial Sectors 95 - 105 -2% -0%

IndustrialSector 23 - 32 -2% 2%

Inst

itutio

nal

Sec

tors

(Non

IT)

Inst

itutio

nal

Sect

ors

(IT)

Com

mer

cial

Se

ctor

s

0

3,000

6,000

9,000

12,000

15,000


Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

20 3,000

0 0

40 6,000

9,00060

12,000

80

15,000120

100


Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.



Amigo Cyber Park Amigo 250,000 NOIDA Expressway 2013

Corporate Park Ansal API 200,000 NOIDA Expressway 2013

Oxygen SEZ Tower F 3C Group 250,000 NOIDA Expressway 2013



ACL Mobile Express Trade Tower 18,000 Sector 132 Lease

HCL Individual Building 98,000 Sector 1 Lease

Fiserv DLF IT Park 200,000 Sector 62 Lease

Sunguard Financial Services Advant IT Park 10,000 Sector 142 Lease




NOIDA

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value


1Q20

09

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11



PROJECT NAME DEVELOPER AREA (SQ. FT.) LOCATION ExPECTED COMPLETION

Purva Moneta Puravankara Projects 300,000 Guindy 2013

Ramanujan IT City Little Wood Tower Block D Tata Realty & Infrastructure 600,000 Taramani 2013

SP InfoCity Shapoorji Pallonji Group 1,200,000 OMR 2013



ChENNAI

Approximately, 13.5 million sq ft of Grade •A office space was available for fit-out this quarter. More than half of this supply was located along the OMR IT corridor.

The city has not witnessed any major •completions this quarter. Developers have adopted a cautious approach due to high vacancy levels, and have slowed the pace of their construction works

•Demand in special economic zones (SEZs)

remained upbeat and a number of medium to large floor plate size deals (40,000 – 200,000 sq ft) were concluded this quarter. The total office space absorption was recorded at around 1 million sq ft. More than 60% of the total absorption has taken place in SEZs. BFSI and IT/ITeS were the primary sectors contributing to this demand.

•Nomajormovementofcapitalandrentalvalueswere recorded, across all micro-markets.

In 1Q 2013, the Chennai Corporation Council •approved the proposed property tax for buildings that accommodate IT companies. This will increase tax rates in the range of 50-200%.

COLLIERS VIEW: In 1Q 2013, the city witnessed moderate leasing activities, with demand mostly driven by IT/ITeS occupants in SEZs. We anticipate the same level of absorption momentum in the coming quarters. With controlled supply in the near future, rental values are expected to remain at current levels in preferred micro-markets such as the CBD, OMR and Guindy. However, there will be downward pressure in locations on the fringes of the city due to lower demand for such locations.

CBD 14%

Guindy (SBD) 6%

Velachery 1%

Vadapalini 0%

GST Rd 3%

OMR (IT Corridor) 51%

Ambattur 24%




% Change

QoQ YoYCBD 65 - 85 0% 0%

Guindy (SBD) 50 - 60 0% 4%

Ambattur 25 - 30 0% 0%

OMR (IT Corridor) 25 - 40 0% 0%

GST road 35 - 40 0% 0%

Guin

dy (S

BD)

Amba

ttur

OM

R (IT

Co

rrid

or)

CBD

0

2,000

4,000

6,000

8,000

10,000

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

0

1Q 2

008

1Q 2

009

3Q 2

008

1Q 2

010

3Q 2

010

1Q 2

011

3Q 2

011

1Q 2

012

3Q 2

012

1Q 2

013

3Q 2

013

3Q 2

009

1Q 2

013F

3Q 2

013F

20

0

40

2,000

4,000

60 6,000

80 8,000

100 10,000Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.



ADP India Tamarai IT Park 41,000 Gunidy Lease

Altimetrik Ascendas 24,000 OMR Lease

Barclays India DLF SEZ 69,000 Guindy Lease

Flextronics RMZ Millennia Business Park 80,000 OMR Lease

Mindtree Ramanujam IT SEZ 200,000 OMR Lease

Tata Consultancy Services Ramanujam IT SEZ 100,000 OMR Lease






CHENNAI

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value





BENGAluRu (BANGAlORE)

About 11.2 million sq ft of Grade A office space •was available for fit-out. Most of this available supply was concentrated in areas such as the EPIP Zone, Whitefield, Outer Ring Road (ORR) and Electronic City.

During 1Q 2013, construction activities in •Bangalore remained active, resulting in numerous completions. More than 1.5 million sq ft of Grade A office space was added to the city’s total inventory.

Following last quarter’s trend, most of the •demand was generated by small and medium enterprises in the IT/ITeS sector, in micro-markets such as Whitefield, Electronic City and ORR. More than 2.6 million sq ft of Grade A office space was absorbed during this quarter.

Despite healthy occupier demand, rental values •remained stable across all the micro-markets. This is primarily due to the supply/demand equilibrium in the city’s office market.

COLLIERS VIEW : In 1Q 2013, we witnessed improved absorption from the IT/ITeS sector, the traditional driver of office demand in the city. We anticipate that in the short to medium term, rental values will remain stable on account of supply/demand equilibrium. There will be limited additional supply in the near to medium term, as developers are refraining from speculative development due to the uncertainty in the future performance of the IT/ITeS sector, and competitive developments in from other locations such as Pune and Hyderabad.

Hosur Road 3%

CBD 7%

Bannerghatta Road 2%

Electronic City 12%

EPIP Zone/ Whitefield 46%

Outer Ring Road 30%




% Change

QoQ YoYCBD 80 - 100 0% 6%

Hosur Rd. 20 - 40 0% 0%

EPIP Zone/ Whitefield 23 - 32 0% -2%

Electronic City 25 - 35 0% 7%

Bannerghatta Rd. 48 - 54 0% -4%

Outer Ring Rd. 47 - 60 2% 5%

-

Hos

ur R

oad

EPIP

Zon

e/

Whi

tefie

ld

Elec

tron

ic

City

Bann

ergh

atta

Ro

ad

Out

er R

ing

Road

CBD

0

5,000

10,000

15,000

20,000

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

20 2,000

0 0

40 4,000

6,00060

80 8,000

100 10,000Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.



Divyasree Tech Park Divyasree Developers 650,000 Whitefield 2013

Vaswani Presidio Vaswani Group 125,000 Outer ring road 2013

RMZ Eco World 5A & 5B RMZ Corp 500,000 Outer ring road 2013



Goodrich Aerospace Netra Tech Park 45,000 Whitefield Lease

Linkedin Prestige Tech park 80,000 Outer Ring Road Lease

Microchip Technology Renaissance First Face 155,000 Whitefield Lease

SAP RMZ Nxt 34,765 Whitefield Sale

Siemens India Golden Supreme Tech Park 240,000 Electronic City Lease

VM Ware RPS Green Space 60,000 JP Nagar Lease






BENGALURU

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value


1Q20

08

1Q20

09

3Q20

08

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11




KOlKATA

About 0.5 million sq ft of new Grade A office •supply was added to the city’s office inventory. Most of this new supply was located in the PBD micro-market such as Sector – 5 and Sonarpur.

During the quarter a few mid sized projects •such as “Arihant Square” by Arihant Group (at Park Street), and “Primarc Tower” by Primarc Group (at Sector 5 in Saltlake) were launched.

Occupier demand remained bleak during •the surveyed quarter and a limited number of small-sized leases were concluded, predominately in micro-markets like Park Street, Rajarhat and Saltlake. The city witnessed total absorption to the tune of approximately 0.15 million sq ft.

Due to poor uptake of commercial stock, rental •values declined in the range of 5 - 7% QoQ in micro-markets like Ballygunge Circular Road and Sector-5, however other micro-markets remained stable.

Capital values remained stable during the •quarter with the exception of New Town – Rajarhat, which recorded a decline of 6% in capital values QoQ.

COLLIERS VIEW: Rental values declined in few micro-markets in 1Q 2013; other micro markets are also facing considerable downward pressure due to low occupier demand. We anticipate that demand will continue to remain low in the near term and rental may further decline in the range of 2 - 5% QoQ.

Sector-5 86%

PBD (Narendrapur, Sonarpur, VIP, Madhyamgram)

14%




% Change

QoQ YoYCBD (PARK ST,CAMAC ST,AJC BOSE ROAD)

110 - 130 0% 4%

Ballygunge Circular Rd. 100 - 110 -5% -5%

East Kolkata 75 - 85 0% 0%

Sector-5 48 - 50 -7% -7%

PBD (New Town, Rajarhat) 34 - 39 0% 0%

CBD

(Par

k St

,Cam

ac S

t,AJC

Bo

se R

oad)

Bally

gung

e Ci

rcul

ar

Road

East

Kol

kata

Sect

or-5

PBD

(New

To

wn,

Ra

jarh

at)0

5,000

10,000

15,000

20,000

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

20 2,000

0 0

40 4,000

60 6,000

80 8,000

100 10,000

120 12,000Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.



Acropolis Merlin Group 500,000 EM Bypass 2013

IT Godrej Simocco Phase 2 Godrej Waterside 1,000,000 Salt Lake Sector V 2013

Unitech Infospace, Kolkata Phase 3 B Unitech Ltd. 1,306,800 Rajarhat 2013



General Motors Apeejay Tower 3,300 Ruby Lease

HP Apeejay Surrendra 30,000 Taratala Lease

ITC Limited Apeejay Surrendra 60,000 Taratala Lease

Prax Air DLF IT Park 1 6,000 New Town, Rajarhat Lease

Reliance Industries Eco Space 50,000 New Town, Rajarhat Lease

Sanofi Pharma Apeejay House 10,000 Park Street Lease






KOLKATA

4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value


1Q20

08

1Q20

09

3Q20

08

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11




puNE

During 1Q 2013, more than 5.8 million sq ft •of Grade A office space was available for fit-out in the city. Most of this supply was concentrated in the Hinjewadi, Airport Road, Kharadi and Nagar Road micro-markets.

Approximately 0.8 million sq ft of Grade •A office space was added to the city’s total inventory during this quarter.

Occupier demand showed a marginal •reduction in 1Q 2013. The city witnessed more than 1 million sq ft absorption in Grade A office space. The most active micro-markets during the quarter were Hinjewadi, Hadapsar, Viman Nagar and Yerwada.

Overall, average rentals in almost all the micro •markets remained stable in 1Q 2013. A few new completions in micro market such as Baner, Bavadhan, Aundh and Nagar Road was leased above 10 to 15% above market rentals due to their state of an facilities and amenities. This resulted in increase of 5 to 10% in overall average rental values in these micro markets.

The Pimpri Chinchwad Municipal Corporation •(PCMC) has planned to construct dedicated Bus Rapid Transit System (BRTS) lanes on the Pune-Mumbai Highway and Aundh-Ravet Road, at an estimated cost of INR 12 Crore. This will improve connectivity between the Mumbai & Pune.

COLLIERS VIEW: Pune witnessed significant demand from the IT/ITeS sector this quarter when compared to same period last year. The demand momentum is likely to remain the same in the upcoming quarters. We anticipate a marginal appreciation in rental values in micro-markets like Hinjewadi, Hadapsar, Viman Nagar, Yerwada and Kharadi.

Bavdhan 3%

Kalyani Nagar 7%

Senapati Bapat Road 2%

Aundh 3%

Baner 6%

Bund Garden 4%

Airport road/pune station

21%

Hinjewadi 21%

Nagar Road 11%

Kharadi 17%

Hadapsar/Fursungi 5%




% Change

QoQ YoYBaner 45 - 55 11% 18%

Bund Garden 60 - 70 8% 8%

Airport Rd. 47 - 60 2% 2%

Aundh 45 - 51 13% 13%

Senapati Bapat 65 - 90 3% 3%

Bavdhan 38 - 44 9% 9%

Kalyani Nagar 45 - 60 0% 5%

Nagar Rd. 40 - 50 6% 6%

Hinjewadi 32 - 40 3% 31%

Hadapsar/Fursungi 32 - 45 -9% 10%

Kharadi 32 - 50 -9% 9%

Bund

Gar

den

Airp

ort r

oad/

pune

sta

tion

Aund

h

Sena

pati

Bapa

t Roa

d

Bavd

han

Kaly

ani N

agar

Naga

r Ro

ad

Hin

jew

adi

Had

apsa

r/Fu

rsun

gi

Khar

adi

Bane

r

0

2,000

4,000

6,000

8,000

10,000

12,000

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.

20 2,000

0 0

40 4,000

60 6,000

80 8,000

100 10,000Forecast

Rent

al V

alue

s -IN

R Pe

r Sq

.ft. P

er M

onth

Capi

tal V

alue

s -IN

R Pe

r Sq

.ft.



Marvel Edge Marvel Realtor 500,000 Fursungi 2013

DLF IT Park, Phase 2 Building 6 DLF Ltd. 750,000 Hinjewadi 2013

SP InfoCity, Building 6 Shapoorji Pallonji Group 500,000 Fursungi 2013



Axa Technologies Marvel Edge 120,000 Viman Nagar Lease

Kohler India P5 50,000 Hadapsar Lease

PRAJ Industries Ltd. Vascon 111,000 Hinjewadi Lease

Siemens Embassy Tech Zone 84,000 Hinjewadi Lease

Synechron Ascendas 600,000 Hinjewadi Lease

Synygy India Business Bay 50,000 Yerwada Lease






PUNE


4Q 2012 1Q 2013

Vacancy

Absorption

Construction

Rental Value

Capital Value

1Q20

08

1Q20

09

3Q20

08

3Q20

09

3Q20

10

1Q20

10

3Q20

13F

1Q20

13

3Q20

14F

1Q20

14F

3Q20

12

1Q20

12

3Q20

11

1Q20

11

MumbaiThe major business locations in Mumbai are the CBD (Nariman Point, Fort and Ballard Estate), Central Mumbai (Worli, Lower Parel and Parel), Bandra Kurla Complex (BKC) and Andheri Kurla stretch. Powai, Malad and Vashi are the preferred IT/ITES destinations, while Airoli at Navi Mumbai and Lal Bahadur Shastri Marg are emerging as new office and IT/ITES submarkets.

DelhiThe commercial areas in New Delhi metropolitan area can be broadly classified into the CBD (Connaught Place), SBD Nehru Place, Bhikaji Cama Place, Netaji Subhash Place, Jasola and Saket .

GurgaonThe prime business locations in Gurgaon are MG Road, Golf Course Road, Cyber City and Udyog Vihar. Manesar on the outskirts of Gurgaon is also emerging as the city’s new office destination.

NOIDANOIDA market is comprised of sectors broadly classified as institutional, industrial and commercial sectors. Institutional sectors include sec 16A, 62 and 125-142, industrial sectors include sec 1-9, 57-60 and 63- 65 while sector 18 is the most developed commercial sector.

ChennaiPrime office properties in Chennai are located in four principal sub-markets: the CBD, the IT Corridor, the SBD and the PBD. The SBD comprises Guindy, Manapakkam, Velachery and other areas. The PBD primarily includes Ambattur and GST Road, while the IT Corridor is the Old Mahaballipuram Road (OMR) in south Chennai.

Bengaluru (Bangalore)Prime office properties in Bengaluru can be divided into three principal sub-market— CBD, the SBD consisting of Banerghatta Road & Outer Ring Road (ORR) and PBD including Hosur Road, EPIP Zone, Electronic City and Whilefield.

PuneThe prime office sub-markets of Pune include Deccan Gymkhana, Bund Garden Road, Senapati Bapat Road & Camp (CBD), while the Off CBD includes Aundh, Airport Road and Kalyani Nagar, among other locations. The eastern corridor, along with Nagar Road and Kharadi, have emerged as a preferred location for financial and IT/ITES companies.

KolkataThe major business locations in Kolkata are CBD (Park Street, Camac Street, Chowranghee Rd), SBD (AJC Bose Rd, Ballygunge circular Rd, East Kolkata), East Kolkata and PBD (New Town & Rajarhat). The area around Park Street, Camac Street and AJC Bose road houses number of high-rises commercial buildings such as Chatterjee International Centre, Tata Centre, Everest House and Industry House among others.

OffICE suBMARKETs



CITY BAROMETER

Increasing as compared to previous quarter

Decreasing as compared to previous quarter

Remained stable from previous quarter


Colliers International (India) provides property services to property Investors and Occupiers. We deliver customised service solutions utilising local and global knowledge in partnership with our clients via our property Investment and Occupier service lines. These service lines include - Office Services, Facility Management, Project Management, Residential Services, Investment Services and Valuation & Advisory Services.

www.colliers.com/india

For national offices services related queries please contact:

George Mckay, South Asia Director Vikas Kalia, National DirectorOffice & Integrated Services Office [email protected] [email protected]: +91 22 4050 4553 Tel: +91 124 456 7531

INDIA OFFICE INDIA RESIDENTIAL APAC OFFICE APAC INDUSTRIAL GLOBAL RETAIL INDIA BUDGET

Mumbai : Vaibhav Kumar, Office Director [email protected] 31/A, 3rd floor, Film Center, 68, Tardeo Road, Mumbai, India - 400 034. Tel : +91 22 4050 4527, fax : +91 22 2351 4272

Delhi NCR : Ajay Rakheja, Office Director [email protected]

New Delhi : Statesman House, 4th Floor, Barakhamba Road, Connaught Place, New Delhi, India - 110001 Tel : +91 11 3044 6423, fax : +91 11 3044 6500

Gurgaon : Technopolis Building, 1st floor, DLF Golf Course Main Road, Sector 54, Gurgaon, India - 122002 Tel : +91 124 456 7500, fax : +91 124 456 7502 Bengaluru : Goutam Chakraborthy, Office Director [email protected] Prestige Garnet, Level 2, Unit No.201/202, 36 Ulsoor Road, Bengaluru, India - 560 042 Tel : +91 80 4079 5500, fax : +91 80 4112 3131

Pune : Suresh Castellino, Office Director [email protected] Hotel Le Meridian, 101, R.B.M. Road, Pune, India - 411 001 Tel : +91 20 4120 6438, fax : +91 20 4120 6434

Chennai : Kaushik Reddy, Office Director [email protected] Heavitree Complex, Unit 1C, 1st floor, 23, Spurtank Road, Chetpet, Chennai, India - 600 031 Tel : +91 44 2836 1064, fax : +91 44 2836 1377

Kolkata : Soumya Mukherjee , Office Director [email protected] Infinity Business Centre, Infinity Benchmark, Room No 13, Level 18, Plot G - 1, Block EP & GP, Salt Lake Sector V, Kolkata - 700 091 West Bengal, India Tel : +91 33 2357 6501, fax : +91 33 2357 6502

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AUTHORS

Amit Oberoi MRICSNational Director, Valuation & Advisory; ResearchEmail: [email protected]

Surabhi Arora MRICSAssociate Director, ResearchEmail: [email protected]

Sachin SharmaAssistant Manager, ResearchEmail: [email protected]

Heliana ManoAssistant Manager,Valuation & Advisory Email: [email protected]

For general queries and feedback :[email protected] Tel: +91 124 456 7580

This report and other research materials may be found on our website at www.colliers.com/India. Questions related to information herein should be directed to the Research Department at the number indicated above. This document has been prepared by Colliers International for advertising and general information only. Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. Colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from.

© Copyright 2012 - 2013 All Rights Reserved.

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Over 13,500 + professionals

ASIA PACIFICOFFICE MARKET OVERVIEW3Q 2012


ASIA PACIFICINDUSTRIAL MARKET OVERVIEW


May 2012

STREET/PRECINCTRENT

(USD)**

ANNUAL CHANGE

(%)

New York – Fifth Avenue ��,�� .�

Hong Kong – Queen's Road Central, Central (tie)

��,�� .�

Hong Kong – Canton Road (tie)

��,�� .�

London – Old Bond St.*** ��,�� .�

Paris – Avenue des*** Champs-Élysées

��,�� flat

Hong Kong - Causeway Bay

��,�� .�

New York – Madison Avenue

�� .�

Zurich – Bahnhofstrasse �� flat

Milan – Via Monte Napoleone

�� (�.�)

Sydney – Pitt Street Mall �� (��.�)

HIGHLIGHTSGLOBAL

www.colliers.com

MID-YEAR 2012 | RETAIL

ANN T. NATUNEWICZ Manager | Retail Research | USA

Colliers’ 2012 Global Retail Streets survey found that of 129 locations tracked, 51 posted higher year over year average rental rates, 49 were flat, and 24 were down (5 lacked comparable data).

Retailers entering new markets—both developed and developing—continue to hedge risk by targeting the same one or two premier locations, generating heated competition and outsized rental rate growth in a handful of space-constrained corridors.

Companies with the most ambitious long-term expansion plans remain focused on emerging markets with rapidly growing middle-class populations, but recently institutional capital has pulled back somewhat to favor core markets and investments.

While economic and political turmoil did affect rental rates in headline-generating markets (such as Cairo and Athens), high streets with strong fundamentals remained remarkably resilient, suggest-ing, at least for now, some separation between macroeconomic issues and underlying real estate fundamentals.

Since we conducted our survey, however, weakening consumer sentiment among affluent shoppers has already begun to impact retailers’ revenues and could hinder landlords’ near-term ability to raise rents, suggesting flattening growth rates for the coming year.

This spring proved to be a tricky time to conduct global benchmarking, as market sentiment has deteriorated markedly since April. During the past year, virtually every entity making a forecast—including Colliers in our 2012 U.S. Retail Outlook —included a caveat related to not-yet-quantifiable global fallout from Europe’s fiscal issues. As the past few months have illustrated, the time to face Eurozone issues has finally arrived, spawning a new wave of financial uncertainty.

More than two years post-recession, though, results from our annual survey of High Street rents illustrate that the world’s priciest retail corridors continue to attract the most sought-after tenants at lofty rental rates. Eight of Colliers’ top ten Global Retail Streets in 2011 made the list again this year. The big story, however, lies with the explosive year over year rental growth achieved in a handful of markets. Six of our Top 10 grew at double-digit levels year over year in local currency units, five of them by more than 20%.

At a regional level, streets in areas that entered 2007-08 better-positioned economically—Australia, Canada, parts of Eastern Europe—had a higher percentage of this year's flat-to-higher rents than those slower to emerge from the recession. We will be watching these areas closely. Even as they represent some of the most attractive destinations for expansion-minded companies and yield-seeking investors, they too are vulnerable to softening consumer demand and, for those with reliable data, encroachment of e-commerce.

This report contains two parts. The first summarizes the results of our annual Global Retail Streets survey, conducted in April 2012. The second incorporates content from Colliers’ brokerage and research teams worldwide who contributed market operational metrics, nuanced commentary on retail conditions, and forward-looking opinions on what the next year will hold for consumers, landlords, and investors.

Record Rents for Top Retail Corridors; Global Slowdown Impacts Momentum Elsewhere

TOP 10 GLOBAL RETAIL STREETS*(USD PER SQUARE FOOT PER YEAR)

REGIONAL RETAIL RESEARCH CONTACTS

AMERICAS > Ann T. Natunewicz [email protected]

EUROPE/MIDDLE EAST/AFRICA > Zuzanna Baranowska [email protected]

ASIA > Simon Lo [email protected]

AUSTRALIA/NEW ZEALAND > Nora Farren [email protected]

Source: Colliers International* selected cities** exchange rate as of March 31, 2012*** Zone A rents

India Office Property Market Overview_april 2013

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