India OPMO

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RESEARCH & FORECAST REPORTSYDNEY CENTRAL BUSINESS DISTRICT

Research & Forecast ReportIndia I Office | April 2014

2 Research & Forecast Report | April 2014 | Office | Colliers International

www.colliers.com

Mar-13 Mar-14

Repo rate 7.50% 8.00%

CRR 4.00% 4.00%

WPI1 5.65% 4.68%

PLR2 9.70%-10.25% 10.00%-10.25%

Deposit Rate3 7.50%-9.00% 8.00%-9.25%

Exchange Rate

INR - USD 54.28 61.35

INR- EURO 70.37 85.34

Mar-13 Mar-14 YoY %

Change

Gold 29,348 30,382 3.52%

Silver 53,859 46,262 -14.11%

Equity

(BSE Sensex)19,428 21,810 12.26%

Realty Index 2,048 1,388 -32.25%

RETURN ON ALTERNATIVE INVESTMENTS

MACRO ECONOMIC OVERVIEW

Indias economic growth decreased to

4.7% in 4Q 2013 from 4.8% in 3Q 2013. Ona positive note, the Business ConfidenceIndex (BCI) rose to 54.9 in 4Q 2013 from45.7 in the previous quarter showing anincrease in business confidence levels.

Te volatility in the rupee exchange ratehas reduced significantly in the surveyedquarter ensuring continued foreigninstitutional investor interest in Indianfinancial securities.

Net export figures reflecting both export

growth and import compression suggestthat export-led sectors such asinformation technology andpharmaceuticals are performing better in2014.

About 8 million sq ft. of office space wasleased across the eight major cities inIndia showing a 7% increase on QoQbasis. All markets, with the exception ofMumbai, Chennai and Pune, have

witnessed increase in office absorption.Bangalore and NCR topped the chartcontributing 75% in the totalabsorption.

COLLIERS VIEW : Occupiers are lookingbeyond the CBD and SBD markets formore strategic opportunities. In 2014, weshould see a continuation of this trend,as players in search of more cost-effectivesolutions will move towards the PBD.

With positive signals emanating from theglobal economy, which finds resonancein our improved export performance, weanticipate that after the elections, theoffice market will start seeing a revival interms of absorption, supply and newproject launches.

ECONOMIC BAROMETER

Source: Colliers International India Research

Note: All values in the above tables are as on 15th of March

2013 and 20141 Wholesale Price Index2SBI Prime Lending Rate3SBI interest rate < INR 1 crore Term Deposits for 1 Year

INR

Crore

Jan-09

Jan-10

Jan-11

Jan-12

Jan-13

Jan-14

Apr-09

Apr-10

Apr-11

Apr-12

Apr-13

Jul-09

Jul-10

Jul-11

Jul-12

Jul-13

Oct-10

Oct-11

Oct-12

Oct-13

Oct-09

Business Confidence Index

10

20

30

40

50

60

70

80

0

2,000

12,000

14,000

16,000

8,000

10,000

4,000

6,000

2008-09

2012-13

Apr-Jan2014

2010-11

2011-12

2009-10

2005-06

2006-07

2007-08

FDI in Real Estate

BSE Sensex Realty Index* Rebase to 100

BSE Sensex & Realty Index

90

80

100

110

60

70

50

120

130

1-Jan-14

12-Jan-14

23-Jan-14

3-Feb-14

14-Feb-14

25-Feb-14

8-Mar-14

19-Mar-14

30-Mar-14

InPercentage

4.0%

6.0%

8.0%

10.0%

12.0%

Jan-Mar09

Apr-Jun09

Jul-Sep09

Oct-Dec09

Jan-Mar10

Apr-Jun10

Jul-Sep10

Oct-Dec10

Jan-Mar12

Apr-Jun13

Jul-Sep13

Oct-Dec13

Jan-Mar13

Oct-Dec12

Jun-Sep12

Oct-Dec11

Jul-Sep11

Apr-Jun11

Jan-Mar11

Gross Domestic Product at Factor Cost

0.0%

2.0%

Apr-Jun12


3/12

3

During 1Q 2014, the Mumbai officemarkets witnessed a further declinein office space absorption indicatingcautious occupier sentiment. Tis lack ofdemand can be attributed to a low levelof I/IeS sector participation in theoverall absorption, which is currently

the primary demand generating sectoracross the cities.

Tis quarter only about 0.42 million sqft of Grade A office space was leased

with a few mid-sized deals concluded inCentral and Western Suburbs, and NaviMumbai.

Construction activities remained slow.No projects / phases of projects werecompleted this quarter. Developers alsorefrained from launching new projects

due to low demand.

More than 7.5 million sq ft of Grade Acommercial office space was availablefor fit-out during the surveyed quarterof which, about 80% was concentratedin micro-markets like Andheri East,Lower Parel, BKC and Tane / LBS Road.

Vacancy remained almost stable dueto the limited addition of new supply.Rents and capital values for Grade Aoffice space remained stable in all of themicro-markets.

COLLIERS VIEW: Sectors like BFSIand FMCG, have become cautiousin office uptake. Tis coupled withreduced I/IeS absorption is likely toresult in lower demand in 2014. Rentsand capital values are thus expected toremain stable; however, micro-marketssuch as Andheri, BKC (Bandra-Kurla-Complex) and Lower Parel could see anupward movement in the range of 1 - 2%QoQ due to continued interest from theoccupiers.

Mumbai


Micro Market Rental

Values*% Change

QoQ YoY

CBD 226 - 260 0% 0%

Andheri East 91 - 125 0% 0%

BKC 226 - 320 0% 1%

Lower Parel 141 - 180 0% 0%

Malad 81 - 90 0% 1%

Navi Mumbai 56 - 75 0% 1%

Powai 101 - 120 0% 0%

Worli/ Prabhadevi 176 - 225 0% 0%

Goregaon/ JVLR 81 - 110 0% 1%

Kalina 175 - 211 0% 0%

Thane / LBS 51 - 100 0% 1%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value

CITY OFFICE BAROMETER

KEY UNDER CONSTRUCTION PROJECTS

BUILDING NAME DEVELOPER AREA (SQ. FT.) LOCATION POSSESSION

Chromium Tech-Pro Projects (KGA) 200,000 JVLR. Off Powai 2014

One BKC Wadhwa Developers 1,200,000 BKC 2015

Newa Bhakti Knowledge City Park New Tech City Group 600,000 Airoli 2015

TOP 5 TRANSCATIONS OF THE QUARTER

CLIENT BUILDING NAME AREA (SQ. FT.) LOCATION LEASE/SALE

GS Engineering Lodha iThink 30,000 Thane Lease

Merck Pharma Lighthall 70,000 Andheri East Lease

Phillip Capital Urmi Estate 20,000 Lower Parel Lease

Temple Packaging Lotus Corporate Park 20,000 Goregaon East Lease

Teradata Mindspace SEZ 30,000 Airoli Lease

Andheri East24%

Thane / LBS21%

CBD

1%

Worli /Prabhadevi

1%

Goregoan /JVLR4%

Powai4%Navi Mumbai

2%Malad6%

Lower Parel20%

BKC15%

Kalina2%

AVAILABLE SUPPLY IN PRIME AREAS

1Q2008

1Q2009

1Q2010

1Q2014F

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

505,000

0 0

100

10,000

150

15,000

200

20,000

250

25,000

30,000

AVERAGE RENTAL AND CAPITAL VALUE TREND

RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.

Note:Available Supply: Total Grade A office space being mar-keted for sale or lease in surveyed quarter.

Average Rental/Capital Values: Market average of indicativeasking price for Grade A office space.

Forecast

* Indicative Grade A rents in INR per sq ft per month.

0.00

0.50

1.00

1.50

2.00

2.50

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014

QUARTER WISE ABSORPTIONMillion Sq.ft.
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4/12


Delhi witnessed improved demand asoffice absorption nearly doubled thisquarter amounting to approximately0.3 million sq ft. Approximately 60%of this total absorption is contributedby large office space occupiers such asMoser Bear, Snapdeal and VFS Global.Remaining 40% of the leases were

small office spaces (5,000 - 10,000 sqft) occupied by the corporate officesof BFSI, airlines, real estate and mediacompanies.

In the surveyed quarter, the city added0.8 million sq ft of new, Grade A officesupply. Projects contributing this supply

were Hyatt Commercial Block by AsianHotels in Bhikaji Cama Place; Ambienceower by Ambience Developer in Rohini;and Prime ower by DLF in OkhlaPhase I.

Te total Grade A supply available for fit-out this quarter was about 2.5 million sqft, mainly concentrated in Jasola, Saketand Connaught Place.

Average rent and capital values remainedunaltered during 1Q 2014, however somenew buildings demanding above-marketprices due to their premium location andamenities offered.

COLLIERS VIEW: Occupiers will remain

cost-conscious and prefer small GradeA properties for their corporate officesin the CBD area. Te upcoming newsupply in Aero City near the airportis expected to have an impact on themarket dynamics with nearly 0.9 millionsq ft forecasted to get operational in2014. Te location is expected to attracta significant number of occupiers due toits advantageous location and availabilityof Grade A buildings with state-of-the-art amenities.

Delhi


Micro Market Rental

Values*% Change

QoQ YoY

Connaught Place 175 - 450 -2% -12%

Nehru Place 175 - 225 0% 8%

Saket 160 - 190 6% 2%

Jasola 95 - 130 2% -7%

Netaji Subhash 65 - 75 0% 0%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




NBCC Plaza NBCC Ltd. 350,000 Okhla 2014

NBCC Redevelopment NBCC Ltd. 1,300,000 Kidwai Nagar 2016

Parsvnath 27 Parsvnath Ltd. 150,000 K.G. Marg 2016



H&M India Religare Building 11,500 Saket Lease

LG Electronics Religare Building 24,150 Saket Lease

Moser Baer Okhla Phase 3 70,000 Okhla Lease

Snapdeal Okhla Phase 3 50,000 Okhla Lease

VFS Global Bharti Worldmark 70,000 Aero City Sale

0.00

0.10

0.15

0.20

0.25

0.30

0.05

0.35

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014

QUARTER WISE ABSORPTION

1Q2008

1Q2009

1Q2010

1Q2014

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

505,000

0 0

100

10,000

150

15,000

200

20,000

250

300

25,000

40,000

35,000

30,000


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast



Jasola34%

Nehru Place4%

Saket34%

Connaught place28%

Million Sq.ft.


5/12

5

In 1Q 2014, occupiers leased more than1.6 million sq ft of Grade A office spacein Gurgaon, a modest increase of 5%from last quarter. Tis marginal increasein the office space absorption figure isan indication of the reviving occupierconfidence level.

I/IeS and BFSI were the most activeoccupiers leasing large office spaces.

Te total available stock for lease or salewas approximately 16 million sq ft. Newsupply entering the market accounted forapproximately 1.5 million sq ft. Projectscontributing to this new supply includePalm Square and Eros ower, located atGolf Course Extension Road; and PalmSpring Plaza and One Horizon Centre atGolf Course Road.

Projects launched this quarter includeGateway by Unitech Ltd and Biosphereby Emmar MGF, both located on MGRoad; and KS ower by KS Groupon the Dwarka Expressway. All of theseprojects will add approximately 1 millionsq ft to the citys Grade A inventory by2018.

Rents and capital values remained flatcompared to last quarter. However,MG Road and the institutional sectors

witnessed marginal decreases in therange of 1 to 3% QoQ. Limited availabilityof large floor plate Grade A office spaceresulted in low demand in these micro-markets

COLLIERS VIEW: In 2014, it is likely thatlease volumes will increase. Stock incost-effective locations, like Golf CourseExtension Road and Sohna Road, will bepreferred, primarily because of occupiersinterest in high-quality assets at cheaperrents.

Gurgaon


Micro Market Rental

Values*% Change

QoQ YoY

MG ROAD 95 - 135 -2% -4%

Golf Course Rd 90 - 140 2% 18%

Institutional Sect.(18,32,44) 50 - 65 0% -6%

Golf Course RdExt./Sohna Rd 50 - 65 2% 2%

NH8 50 - 125 0% 0%

Manesar 40 - 42 0% 2%

DLF Cyber City 78 - 80 0% 5%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




Biosphere Emaar MGF 350,000 MG Road 2018

KST KST Group 350,000 Dwarka Expressway 2018

Unitech Gateway Unitech Ltd. 350,000 MG Road 2018



Accenture Unitech Infospace 120,986 Sector 21, Dundahera Lease

Aricent Group Unitech Infospace 550,000 Sector 21, Dundahera Lease

Copal Partners Plot 267 120,000 Udyog Vihar - Phase 2 Lease

Oracle One Horizon Centre 90,000 Golf Course Road Lease

WNS DLF Silokhera 145,000 NH-8 Lease

0.00

0.40

0.20

0.60

1.00

0.80

1.40

1.20

1.80

1.60

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014


1Q2008

1Q2009

1Q2010

1Q2014F

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

20 2,000

0 0

40 4,000

60 6,000

100

80 8,000

120

10,000

12,000


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast



MG Road5%

Golf Course Road11%

DLF Cyber City4%

Institutional Sec-tors (Sec44, 32, 18)

3%

Manesar25%

National Highway 817%

Udyog Vihar &Industrial Sectors

4%

Golf Course Road

Ext./Sohna Road31%

Million Sq.ft.


6/12


Te total volume of office absorptionin 1Q 2014 in NOIDA was recorded at0.21 million sq. ft. dominated mostlyby consulting, Engineering and BFSIsegments in sector 62 and Sector 127.Share of sector 62 in the total absorptionpie has increased as corporate are able

to get better deals with more options atcompetitive rentals.

Te delivery of World rade ower inSector 16 and two individual buildingsin Sectors 6 and 125 contributedapproximately 0.9 million sq ft of newspace to the market.

Despite low absorption levels,developers continued to launch new,commercial Grade A towers in theirmixed-use projects in sectors along the

NOIDA Expressway. New launches thisquarter include Downtown by SikkaDeveloper, and Cosmic Corporate ParkIII by Cosmic Developers. Tese projects

will contribute another 1.5 million sqft of Grade A non-I office space to thecitys inventory by 2019.

Rents in almost all micro marketsremained stable due to low transaction

volumes. Sectors along the NOIDAExpressway command premiums interms of rents due to the location and

connectivity advantages.

COLLIERS VIEW: NOIDA is expected towitness new office space completions ofapproximately 4.5 mn sq. ft. by the endof 2014. Most of this upcoming supply isnon-I/IeS office space. Te additionof Grade A non-I/IeS office space isexpected to attract corporate occupiersto this market.

NOIDA


Micro Market Rental

Values*% Change

QoQ YoY

InstitutionalSectors (Non IT) 50 - 90 0% 5%

InstitutionalSectors (IT) 30 - 75 0% 9%

ComercialSectors

95 - 100 -5% 0%

IndustrialSector

18 - 48 5% 20%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




Cosmic Corporate Park III Cosmic Group 500,000 Sector 154 2016

Downtown Sikka Group 450,000 Sector 104 2019

K Rasa - K8 K Rasa 500,000 Sector 129 2019



eGain India Unitech Infospace 11,000 Sector 62 Lease

Media Tek S B Tower 30,000 Sector 16 Lease

RDB Insurance A-31 108,000 Sector 64 Lease

Tata Consultancy Engineering Ltd. Green Boulevard - Tower B 15,785 Sector 62 Lease

Tata Consultancy Engineering Ltd. Green Boulevard - Tower C 15,786 Sector 62 Lease

0.00

0.20

0.40

0.60

1.00

0.80

1.20

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014


1Q2009

1Q2010

1Q2014

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

20

102,000

0 0

40

304,000

50

6,000

70

60

8,000

80 12,000

10,000


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast



Commercial Sectors(Sec 18) (Grade B)

0.6%

Industrial Sectors(Sec. 1-9, 57-60, 63-65)

(Grade B)15.8%

Commercial Sectors(Sec 18) (Grade B)

0.2%

Institutional Sectors(Sec.16A, 62, 125-142

83.3%

Million Sq.ft.


7/12

7

In Chenani, leasing transaction volumescontinued to remain below average.otal absorption was 0.56 mn sq. ft.during the quarter. Te majority of leasessigned were for smaller, sub-25,000 sq ftoffice spaces. Micro-markets like OldMahabali Puram Road and Guindy

remained the standout performers thisquarter. Having quality office spaceon offer combined with affordabilityhas enabled these micro-markets to bepreferred destinations for occupiers.

A few projects / phases of projectswere completed this quarter, includingRamaniyam ISHA by RamaniyamGroupat Toraipakkam; KPR owers atNungambakkam; and VikramVikra at

Vadapalani. All of these projects togetheradd 0.09 million sq ft of Grade A office

space to the citys total inventory.

New project launches continued toremain limited. A phase of about 0.25million sq ft in DLF I SEZ-Block 2,located at Manapakkam, was launchedby DLF Ltd this quarter and is expectedto be completed by the end of 2015.

Te lack of major tenant moves andexpansions by large occupiers has seenrents continue to remain steady in almostall micro-markets.

COLLIERS VIEW: Te outlook for theleasing market across Chennai overthe next 9 months is more positive thanthe previous two quarters. Improvingsentiment and prospects for the globaleconomy as well as rising businessand consumer confidence should allcombine to boost the sentiment of I/IeS tenants who make up the bulk oftenants in Chennai.

Chennai


Micro Market Rental

Values*% Change

QoQ YoY

CBD 65 - 85 0% 0%

Guindy (SBD) 50 - 60 0% 0%

Ambattur 25 - 30 0% 0%

OMR(IT Corridor)

25 - 45 0% 8%

GST road 35 - 40 0% 0%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




DLF IT SEZ - Block 2 DLF Ltd. 250,000 Manapakkam 2015

Infinite Square SKCL Ltd. 84,000 Guindy 2014

Rajkamal Suites Khivraj Group 66,000 Nugambakkam 2014



Athena SP Infocity 65,000 OMR Lease

Cash Edge Prestige Polygon 25,000 Anna Salai Lease

Equitus Spencer Plaza 37,000 Anna Salai Lease

Isuzu Prestige Centre Court 30,000 Vadapalani Lease

Kone Prestige Centre Court 30,000 Vadapalani Lease

0.00

0.40

0.20

1.00

0.60

0.80

1.40

1.60

1.20

1.80

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014


1Q2008

1Q2009

1Q2010

1Q2014

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

101,000

2,000

3,000

5,000

4,000

6,000

8,000

7,000

0 0

20

30

40

70

60

50


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast



Guindy (SBD)8%

CBD16%

GST Rd3%

Velachery1%

OMR (IT Corridor)47%

Ambattur24%

Million Sq.ft.


8/12


Bengaluru (Bangalore)


Micro Market Rental

Values*% Change

QoQ YoY

CBD 80 - 100 0% 0%

Hosur Rd. 20 - 40 0% 0%

EPIP Zone/Whitefield 28 - 36 0% 16%

Electronic City 23 - 32 0% -7%

Bannerghatta Rd. 50 - 60 0% 8%

Outer Ring Rd. 50 - 60 0% 3%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




Pritech - Block 14 Primal Group 600,000 ORR - Marathahalli Sarjapur 2015

RMZ ECO WORLD - APPL - 4A RMZ CORP 990,000 Marathahalli Sarjapur 2015

RMZ ECO WORLD - APPL - 7 RMZ CORP 790,000 ORR - Marathahalli Sarjapur 2015



Capgemini Divyasree Technopark 440,000 Whitefield Lease

IBM Embassy Business Park 770,000 Hebbal Lease

Sony RMZ Eco World 240,000 Outer Ring Road Lease

TCS Global Axis 300,000 Whitefield Lease

Titan Industries Divyasree Technopolis 163,000 Yamalur Lease

1Q2008

1Q2009

1Q2010

1Q2014

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

10 1,500

0 0

20 3,000

30 4,500

40

6,000

50

60

7,500

9,000


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast


Strong demand for Grade A office spacewitnessed during 1Q 2014 resultedin a 35% QoQ increase in absorptionin the Bengaluru market. I/IeSremained the primary demand drivercontributing approximately 80% in thetotal absorption of 3.8 million sq ft. Tis

includes approximately 1.7 million sq ftpre-commitment deals from companieslike IBM, Ericson and Hindustan CocaCola Beverages for expansion purposes.

During the quarter, many large scaledprojects / phases of projects werecompleted and added over 2.9 millionsq ft of Grade A office space to the citystotal inventory.

Enthused by this demand, a number ofdevelopers launched additional towers

in their existing projects, includingDivyasree echnopolis-Block D; MantriCornerstone-Block B; Pritech-Block 14and RMZ ECO WORLD owers 4A, 4Band all of these projects together will addover 4.8 million sq ft office space to citysinventory by the end of 2015.

With demand and supply complementingeach other, vacancy levels remainunaltered and about 11 million sq ft ofGrade A stock was available for fit-outduring the quarter.

Te capital and rental values alsoremained steady in almost all micro-markets in the city.

COLLIERS VIEW: Te strong softwareexport figures indicate increase in I/IeS uptake in the coming quarters inthe city. We anticipate modest increasesin rents in micro-markets like OuterRing Road and CBD due to occupierpreference to other micro-markets like

Whitefield and Electronic City.


Hosur Road3%

CBD9%

Bannerghatta Road2%

Electronic City16%

EPIP Zone/Whitefield

41%

Outer Ring Road29%

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014


0.00

0.50

1.50

1.00

2.00

3.50

3.00

2.50

4.00

Million Sq.ft.


9/12

9

Te city witnessed improved demandthis quarter and recorded Grade Aabsorption of about 0.18 million sqft. More than 90% of these deals wereconcluded in the Salt Lake-Sector V andNew own micro-markets. Tis quarter,

various local occupiers have relocated

from their old structures to new andbetter facilitated structures.

Construction activities remained slowduring the quarter and only a fewproperties were completed includingPecon ower by Pecon Group and Rishiechpark by Mittal Group, both of whichare at New own. ogether, these projectscontributed about 0.1 million sq ft ofGrade A commercial office supply.

Projects launched this quarter includeWeston by Siddha Group at Bentinck

Street; Arya Hub by Arya Realty ataratala; and Pressman House byPressman at New own. Te projects areexpected to be completed by 2017 and

will contribute about 0.47 million sq ft ofGrade A commercial office space in thecity.

Rental values declined in the range of 1to 4% QoQ in most of the micro-markets,except SBD where rents remained stable.During the same quarter, capital valuesremained stable, except for Sector V

where capital values decline by 3% QoQ.

COLLIERS VIEW: Upcominginfrastructure developments like metrocorridors will improve the overallconnectivity of the city. Micro-marketslike Salt Lake-Sector V and New own

will continue to see occupier interest.Rents and capital values are expected toremain under pressure due to prevailinghigh vacancy in suburban micro-markets.

Kolkata


Micro Market Rental

Values*% Change

QoQ YoY

CBD 95 - 120 -4% -10%

SBD 70 - 80 0% -6%

Sector V/New Town

46 - 50 -2% -2%

PBD 34 - 37 -1% -3%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




Arya Hub Arya Realty 85,000 Taratala 2017

Pressman House Pressman 140,000 New Town 2015

Weston Sidhha Group 250,000 Bentinck Street 2017



Disha Palm Mall 16,000 Gariahat Lease

Serco Global BIPL 38,000 Sector-V Lease

SGS Eco Space 15,000 New Town Lease

Sterling Ferrero Net Guru 10,400 Sector-V Lease

Vasan Eye Care Individual 10,000 Chetla Lease

0.00

0.20

0.10

0.30

0.40

0.60

0.50

0.70

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014


1Q2008

1Q2009

1Q2010

1Q2014F

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

40

20 2,000

0 0

60

4,000

80

6,000

100

8,000

120

10,000

12,000


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast


NEW SUPPLY IN PRIME AREAS

Sector V33%

PBD31%

SBD36%

Million Sq.ft.


10/12


Pune


Micro Market Rental

Values*% Change

QoQ YoY

Baner 45 - 55 0% 0%

Bund Garden 50 - 65 0% -12%

Airport Rd. /Pune station 42 - 63 3% -2%

Aundh 45 - 60 0% 9%

Senapati Bapat 55 - 85 0% -10%

Bavdhan 35 - 45 0% -2%

Kalyani Nagar 45 - 60 0% 0%

Nagar Rd. 40 - 60 0% 11%

Hinjewadi 32 - 45 3% 7%

Hadapsar/Fursungi 33 - 50 4% 8%

Kharadi 32 - 65 0% 18%

1Q 2014 2Q 2014F

Vacancy

Absorption

Construction

Rental Value

Capital Value




Siddhivinayak Vision Siddhivinayak Group 200,000 Tathawade 2014

The Melange Cosmos Group 70,000 Fugewadi 2015

W One U.D. Developers 80,000 Wanowari 2015



BMC Business Bay 251,000 Yerwada Lease

Compucom Software Limited S P Infocity 45,000 Phursungi Lease

Fundtech AG Trade Center 87,000 Bavhdan Lease

Gallaghar Giga Space Delta 2 34,900 Viman Nagar Lease

Geometric Limited Blue Ridge 27,000 Hinjewadi Lease

0.00

0.40

0.20

0.80

0.60

1.00

1.20

1.40

1.60

1.80

1Q2013 2Q2013 3Q2013 4Q2013 1Q2014

QUARTER WISE ABSORPTIONMillion Sq.ft.

1Q2008

1Q2009

1Q2010

1Q2014

1Q2013

1Q2015F

3Q2015F

1Q2012

1Q2011

20

10 1,000

0 0

30

2,000

50

40

3,000

70

60

4,000

80

5,000

8,000

7,000

6,000


RentalValues-INR

PerSq.

ft.

PerMonth

CapitalValues-INRP

erSq.f

t.



Forecast


Pune has witnessed more than 0.85million sq ft of absorption in 1Q 2014,

which is relatively less than the lastquarters net absorption of 1.55 millionsq ft. However, more than 65% ofthe transactions were for expansionindicating rebounding business

confidence levels.

About 1 million sq ft of new Grade Asupply was added to the citys totalinventory. Of this 0.8 million sq ft wascontributed by Business Bay ower I byPanchshil Realty, located at Yerwada.

otal Grade A total supply availablefor fit-out was about 5.7 million sq ft.mainly concentrated in the Hinjewadiand Kharadi micro-markets. Tis is anincrease of about 1.19 million sq ft of

Grade A office space over the previousquarter indicating increasing vacancy inperipheral areas.

In most of the micro-markets rents andcapital values remained unchanged,however a few micro-markets like

Airport Road, Hinjewadi, Hadapsarand Fursungi witnessed an increase inthe range of 3 - 4% on a quarterly basis.Tis is primarily due to the availabilityof grade A office space with a low rentalbase as compared to the other parts of

the city.

COLLIERS VIEW: I/IeS will continueto be the major occupier of Grade A officespace in the city. Despite the demand/ supply equilibrium in the city, rentsin micro-markets located towards thenorth-west and south-east will see a risein the range of 3 - 5% on a yearly basis.Tis is because of the large floor-plate ofthe Grade A inventory with ready socialinfrastructure that will continue to lureoccupiers in the near future.


Bavdhan2%

Kalyani Nagar7%

Senapati Bapat Road3%

Aundh2%

Baner11%

Bund Garden7%

Airport road/pune station

11%

Hinjewadi20%

Nagar Road13%

Kharadi17%

Hadapsar/Fursungi7%


11/12

11

Mumbai

Te major business locations in Mumbai are the CBD (Nariman

Point, Fort and Ballard Estate), Central Mumbai (Worli, Lower

Parel and Parel), Bandra Kurla Complex (BKC) and Andheri

Kurla stretch. Powai, Malad and Vashi are the preferred I/

IES destinations, while Airoli at Navi Mumbai and Lal Bahadur

Shastri Marg are emerging as new office and I/IES submakets.

Delhi

Te commercial areas in New Delhi metropolitan area can be

broadly classified into the CBD (Connaught Place), SBD Nehru

Place, Bhikaji Cama Place, Netaji Subhash Place, Jasola and

Saket .

Gurgaon

Te prime business locations in Gurgaon are MG Road, GolfCourse Road, Cyber City and Udyog Vihar. Manesar on the

outskirts of Gurgaon is alsoemerging as the citys new office

destination.

NOIDA

NOIDA market is comprised of sectors broadly classified as

institutional, industrial and commercial sectors. Institutional

sectors include sec 16A, 62 and125-142, industrial sectors include

sec 1-9, 57-60 and 63- 65 while sector 18 is the most developed

commercial sector.

Chennai

Prime office properties in Chennai are located in four principal

sub-markets: the CBD, the I Corridor, the SBD and the PBD.

Te SBD comprises Guindy,Manapakkam, Velachery and other

areas. Te PBD primarily includes Ambattur and GS Road,

while the I Corridor is the Old Mahaballipuram Road (OMR) in

south Chennai.

Bengaluru (Bangalore)

Prime office properties in Bengaluru can be divided into three

principal sub-market CBD, the SBD consisting of Banerghatta

Road & Outer Ring Road(ORR) and PBD including Hosur Road,

EPIP Zone, Electronic City and Whilefield.

Kolkata

Te major business locations in Kolkata are CBD (Park Street,

Camac Street, Chowranghee Rd), SBD (AJC Bose Rd, Ballygunge

circular Rd, East Kolkata) and PBD (New own & Rajarhat). Te

area around Park Street, Camac Street and AJC Bose road houses

number of high-rises commercial buildings such as Chatterjee

International Centre, ata Centre, Everest House and Industry

House among others.

Pune

Te prime office sub-markets of Pune include Deccan Gymkhana,

Bund Garden Road, Senapati Bapat Road & Camp (CBD), while

the Off CBD includes Aundh, Airport Road and Kalyani Nagar,

among other locations. Te eastern corridor, along with Nagar

Road and Kharadi, have emerged as a preferred location for

financial and I/IES companies.

Office Submarkets

CIY BAROMEERS

Increasing as compared to previous quarter

Decreasing as compared to previous quarter

Remained stable from previous quarter


12/12

12 R h & F R | A il 2014 | Offi | C lli I i l

Copyright 2014 Colliers International.

ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consulttheir professional advisors prior to acting on any of the material contained in this report.

About Colliers International

colliers.com

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Primary Authors:

Surabhi Arora I Associate DirectorResearch

[email protected]+91 124 456 7500

Mumbai:George Mckay I South Asia [email protected]

Delhi / NCR: Ajay Rakheja I [email protected]

Vikas Kalia | National [email protected]

Amit Oberoi I National Director

Valuation & Advisory Services & [email protected]

Sachin Sharma I Assistant [email protected]

Technopolis Building, 1st Floor,DLF Golf Course Road,Sector 54, Gurgaon - 122 002

TEL +91 124 456 7500

Bengaluru:Yogesh Bheemaiah I [email protected]

Pune:Rishav Vij I General [email protected]

Chennai:Kaushik Reddy I Director

[email protected]

Kolkata: Ajay Rakheja I [email protected]

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