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A TOTAL of 550,000 sq.ft. of grade A office supply
with added to the stock in the National Capital Region (NCR) during
the fourth quarter of 2004. The net absorption during this period
was estimated at 875,000 sq. ft.
While no new construction activity was observed in the Central
Business District, a net absorption of 46,000 sq. ft. was recorded
in Grade `A' office space, reducing the vacancy levels to 3.65 per
cent compared to 14.5 per cent in the beginning of the third quarter
of 2004. This decline is vacancy levels has resulted in the
escalation in quoted rents.
In the suburban micro markets, the majority of construction activity
(250,000 sq.ft.) was recorded in Gurgaon. The current vacancy level
in Grade A office buildings is approximately 12.4 per cent.
As a result of low vacancy rates and stable demand, there was no
significant change in the rental and capital values.
In the suburban district of NOIDA, 300,000 sq. ft. of Grade `A' was
added with the completion of Express Towers.
Residential
Construction and launch of prime residential projects were observed
in Delhi and the suburbs during the last six months.
Demands for independent bungalows continued to rise in prime
locations in Delhi, though supply levels remained low. In south
Delhi, Vipul launched 40 premium apartments at Aurobindo Marg, which
were sold by invitation only. The second half of 2004 saw increased
leasing of medium to high-end residential projects in Gurgaon.
Amongst the prime residential projects, Unitech,Vipul and DLF have
launched approximately 850 prime apartments, and 570 villas in
Gurgaon over the last six months.
There was an appreciation of 10-15 per cent in the capitals values
across all micro markets in the NCR from the levels prevailing in
the second quarter of 2004. The rate of escalation in prices reduced
marginally towards the end of the fourth quarter of 2004. The
rentals across all micro markets were relatively more stable.
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