The property consultant predicts the decline in rents to decelerate this yearAmid the work-from-home protocol in the ongoing COVID-19 pandemic, office markets in the country face uncertainty, in terms of occupancy and value.
However, the country's prime office sector - Delhi-NCR (national capital region), Mumbai, and Bengaluru markets are expected to remain stable in rental values over the next 12 months.
According to international property consultant Knight Frank, the robust recovery can be attributed to the improved transaction activity, even amid the uncertainty around the performance of the office sector.
(Also Read:Bengaluru Slips Four Spots In Global Prime Residential Index)According to a recent report titled, Asia-Pacific Prime Office Rental Index Q1 2021' released by Knight Frank on Wednesday, May 12,the Bandra Kurla Complex or BKCin Mumbai registereda meaningful recovery in office rents to negative 0.8 per cent quarter-on-quarter, during the January-March quarter of fiscal year 2020-21, compared to negative 5.5 per cent in the previous quarter.The report added that the central business district of Bengaluru including areas such asInfantry Road, MG Road, and Residency Road recorded a decline of three per cent quarter-on-quarter in first quarter of 2021, compared to a decline of four per cent in the corresponding period last year.
In the Delhi-NCR region,Connaught Place office rents registered a flat price change in the first quarter of 2021, compared to a negative one per cent in the fourth quarter of 2020.The property consultantpredicts the decline in rents to decelerate this year with the overall rents expected to decline by three per cent in the Asia Pacific region, compared to 4.8 per cent decline witnessedin 2020.According to the data, the property consultant's Asia Pacific Prime Office Rental index slipped negative 1.2 per cent quarter-on-quarter Q1 this year, mostly driven by large office markets such as Hong Kong, Tokyo, Bengaluru registered a rental decline between negative three - negative 2.8 per cent in the same period.
The report added that on an annual basis, the overall index was down negative 5.5 per cent on a year-on-year basis.