Bengaluru absorbed 11.7 mn sq ft of commercial space in CY2011, 33% of the overall absorption of India’s top seven cities. Bengaluru outperformed as it is
an IT hub and IT/ITES absorbed 35% of the commercial space across the top seven Indian cities. Bengaluru is likely to add 22-23 mn sq. ft of commercial space over CY2012-14, implying demand will outpace supply, leading to lower vacancies and rising rentals.
Strong demand for commercial space augurs well for residential volumes in the coming years. In CY2011, Bengaluru created 0.12 mn (assuming 100 sq ft of space per person) future customers for residential space, who can potentially consume 70 mn sq ft (1,200 sq ft per person assuming 50% will buy) of residential space.
Residential sales have been steady in Bengaluru at 4mn sq ft/month in CY2011, which is 20% of total sales in India’s top seven cities.
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