Office traction at glance- October 2012

Hyderabad office market sees absorption of 2.5 mn.sq.ft; 64% of the total area transacted was occupied by the IT/ITES Sector

- 64% of the total area transacted was occupied by the IT/ITeS sector in H1 FY13 as against 78% in H1 FY12

-Office space absorption in Hyderabad was primarily led by the Suburban Business District (SBD) micro-markets during H1 FY 2013 (April-September 2012)

- The SBD office micro-markets of Hitech City, Madhapur and Kondapur have been the prime hubs of office space transaction activity in the city and continued to be the preferred office destinations of the IT/ITeS sector

- Peripheral office locations, which had exhibited a strong foothold in previous periods, have fallen behind in the new financial year 2013

- Substantial demand was seen during the first half of FY 2013, with absorption of about 2.5 mn.sq.ft of office space during the period

- However, the IT/ITeS sector was hit by the global economic slowdown and cautious occupier sentiments led to a decrease in the sector’s share of absorption in H1 FY13

- The reduction in the share of the IT/ITeS sector was compensated by the office space taken up by other non-IT sectors in the city, particularly the healthcare/biotech industry

- Occupiers are expected to remain restrained owing to the low GDP growth and economic uncertainty. Hence, the demand for office space is expected to remain moderate in the next two quarters