Prestige Group to add 10 million sq ft of office space in Bengaluru in 2 years

Juggy Marwaha, CEO of Prestige Office Ventures.

Bengaluru-based listed real estate developer Prestige Group plans to develop 28 million sq ft (msf) of office space in Bengaluru within the next five years. In total, across India, the Group plans to develop 40 msf, garnering annual revenues to the tune of Rs 3,000 crore, Juggy Marwaha, CEO of Prestige Office Ventures, told Moneycontrol.

Currently, under-construction inventories in Bengaluru are at about 15 msf and the company is looking to add about 10 msf in two financial years.

“In the 40 msf pipeline, about 7 msf will be in Mumbai, 1 msf in Pune, 0.5 msf in Delhi, and 2 msf in Hyderabad and Chennai each,” Marwaha added.

In terms of location, Prestige Group said the company is looking at north Bengaluru, Outer Ring Road, east Bengaluru and the central business district (CBD).

“Specifically, we are looking at locations such as Hebbal, Bellandur, Whitefield and Varthur. The 40 msf pipeline will have about 60-70 percent of large business parks, while the rest will be standalone office spaces in CBD areas,” he said.

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Last year, the company leased about 2 msf in Bengaluru, 1 msf in Pune and 0.5 msf in Chennai.

Data centre plans

The company entered the data centre sector last year. “Around October, we signed a Rs 400-crore deal in north Bengaluru to develop a data centre with 100 mw capacity. We are hoping to complete the development by the end of this year,” Marwaha said.

He added that the company is looking to close two deals this year for data centres with 50-60 mw capacity.

GCCs picking up in office space vertical

Marwaha said last year the office sector as an asset class had crossed pre-Covid leasing of 56 msf, with the GCC (global capacity centre) sector bouncing back strongly.

“For example, places that used to lease about 5-6 msf saw leasing of 10 msf last year with GCCs taking up most. Chennai overtook Hyderabad last year and did about 8 msf of transactions,” he added.

For Bengaluru, Prestige Group said that apart from the IT/ITeS sector, the Banking, Financial Services and Insurance (BFSI) sector and the manufacturing sector have become major space takers. “Manufacturing has gone up by at least 20 percent. We also leased a big space to Deloitte in Bengaluru, and Bank of New York in Pune,” Marwaha added.

However, he said, several challenges, such as traffic issues and infrastructural failures in parts of Bengaluru continue to affect the office space sector, especially in places like Outer Ring Road.

“Additionally, today in Bengaluru it is difficult to get a space in the CBD area. After the new metro line came up in the eastern IT corridor of Whitefield, we have seen major transactions increasing in the area,” said Marwaha.