Market Research of Real Estate Business in Pune.
The Pune office space market has been reeling under an acute supply crunch over the past 3 years with supply not keeping up with the demand. This demand-supply gap had pushed down vacancy levels from 15% in H1 2015 to around 5.7% in H12018
• The Pune office space market has been reeling under an acute supply crunch over
the past 3 years with supply not keeping up with the demand. H1 2018 witnessed the
the past 3 years with supply not keeping up with the demand. H1 2018 witnesseion of 0.25 mn sq m (2.7 mn sq ft) of supply, but this was inadequate compared to
• The fact is that the city saw just 0.92 mn sq m (9.9 mn sq ft) of supply since H1 2015,
compared to the 1.64 mn sq m (17.7 mn sq ft) of transaction volume. This demand-
supply gap had pushed down vacancy levels from 15% in H1 2015 to around 5.7% in H1
2018. The 0.25 mn sq m (2.7 mn sq ft) delivered during H1 2018 was the highest in any
half-year period, but it could not mitigate the pressure on vacancy levels.
• The transaction volumes during H1 2018 outstripped the supply and rose by 118%
year-on-year (YoY) to 0.36 mn sq m (3.9 mn sq ft) compared to the healthy 54% growth
in supply. The growth in transaction volumes was high as the volumes also included
pre-commitment (pre-lease) deals. The presence of large pre-commitments reflects the
impact of supply shortage in the Pune office market.
The IT/ITeS sector has been the largest consumer of office space in the city. H1 2018 saw the IT/ITeS sector take up only 0.11 mn sq m (1.1 mn sq ft), which
translates to 30% of the total space transacted during H1 2018, a significant
and steady drop from the 60% during H1 2017.
• The Banking, Financial services and Insurance (BFSI) sector has consistently taken up an increasing amount of space over the past 18 months and vastly increased its share
in total transactions during the analysis period, filling up the vacuum left by the IT/ITeS sector, to an extent. The BFSI sector also dominated the pre-commitment transactions space.
• The CBD & off-CBD, PBD East and PBD West markets witnessed the largest growth in transaction volumes.
• The BFSI sector accounted for almost 0.14 mn sq m (1.5 mn sq ft) of the
total office space transacted during H1 2018. The volumes were high on
account of a major pre-commitment deal by BFSI occupiers.
• The two peripheral business districts accounted for 67% of the transaction activity during H1 2018, which included the pre-commitment deals as well. The transaction volumes in these business districts was higher on account of available supply and lower rentals.