14 AUG 2019
The Indian economy is on a steady growth trajectory with strong GDP growth of above 7%. While there are questions around employability and employment levels in the country, urban centres are seeing relentless growth in offices.
Occupiers are also viewing the Indian market favourably, with office-space demand in 2018 at its highest ever at 50 million square feet. This optimism is expected to continue with cities like Bengaluru and Hyderabad witnessing a robust pre-commitment to space. Strong demand, while stemming from technology and IT companies, is well-supported by other sectors, resulting in flexible spaces and global in-house centres etc.
This uptrend in leasing comes at a time when commercial real estate (CRE) is becoming more professional, with foreign investors emerging as major landlords. The first REIT launch in India was successful and paved the way for future listings in the country.
With this in mind, it is imperative that landlords create value for occupiers; it is pivotal that occupiers create a user-friendly experience for employees. In addition, as co-working spaces continue to disrupt the sector, and with millennials forming a larger proportion of the employee base, occupiers and landlords must evolve their workplaces to embrace and embed new technology.
The next decade will usher in new workplace formats, with landlords emerging as wellness creators, where occupiers amalgamate space and technology to increase productivity. This will lead to an evolution of facilities management (FM) as a profession, which is critical to the efficient management and operation of any organisation. Linking FM to operational cost and lifecycle cost management leads to a more organised approach to asset management, one that creates an environment that supports long-term sustainable activity.
This is essential as the sector has long-grappled with issues related to the availability of capital and the management of assets. A persistent issue has been access to data, which allows property portfolios to benchmark accurately. With an increased focus on globalisation and cross-border transactions, there is a need for "commonality" — much of the confusion has stemmed from the varied definitions of area measurement.
The introduction of internationally recognised and locally relevant best practices can contribute towards uniformity, quality assurance and credibility of the sector. This is all the more prevalent given that the Indian real estate sector has gone to great lengths to improve its perception among international stakeholders. Given the convergence of real estate business across borders, the adoption and use of internationally accepted standards will only aid the sector's development.
Understanding the needs of occupiers is cruicial in corporate real estate today, but keeping pace with changing requirements isn't easy. Our upcoming summit will explore how proessionals can use technolgyy to improve workplace efficiency and sustainability