Divya Guleria, Senior Director A&T and Head - Office Services, Pune, CBRE highlighting a few statistics said, “Pune witnessed close to 6.5 mn sq ft of Grade A commercial real estate absorption in the year 2022. Last year showed signs of revival. Technology IT/ITES and manufacturing, BFSI continued to be a major space taker and about 25 per cent of office space leasing came from flex- space providers."
Hrishikesh Manjrekar, Executive Director, Amar Builders shared his observation, “The year 2023 is going to be very interesting, we have barely any new supply coming in. The office space vacancy will keep dropping and I doubt there is any grade A supply coming. We see rents going up and there will be a big spike in the rent in the next 18 months or so.”
Pratik Agarwal, Chief Business Officer, Smartworks expressed that for flex space operators Pune offers geographical advantage, “The proximity to Mumbai, improved infrastructure with new airport terminal and metro and the cost arbitrage, compared to other cities makes Pune a favourable destination for occupiers.”
Prasanth Gopinath, Director - Commercial (Business Unit), Kohinoor Group added, “Pune contributes about 15 % of the country’s share in terms of commercial real-estate. Pune has abundance of talent due to migration from other cities. Given the talent pool and the infrastructure growth, there is tremendous growth potential for Pune.”
Ruchika Choudaha, Senior Director and Head Office Services, Pune, Colliers agreed that while there has been a lot of talk about recessionary market. I would say it is more precautionary. There are a lot of enquires in the market and there are new entrants in the market from engineering and the manufacturing sector, R&D centers, and flex operators.”
Siddhivinayak Gajre, Sr. Associate Director, Business Space Advisory, Stallion Universal stated, “Pune’s commercial real estate market is very positive. “There is a growing demand from flex space operators apart from IT Companies. Even during the pandemic the demand for office space in Pune was there.”
DEMAND & SUPPLY DYNAMICS
Prasanth Gopinath highlighted, “Pune has two major industries automobile and IT which has huge demand for Grade-A commercial real estate in Pune. PCMC is one of the most attractive destinations for commercial real estate currently.”
Siddhivinayak Gajre added, “Pune has been growing in circular outward manner. The definition of micro markets is changing. For example, it’s no more Wagholi its new Kharadi, Mudhwa, is now Koregaon park Annexe, likewise the sentiments of people are changing. We see the growth coming in the new Khardi and Wakad side.”
Divya Guleria concurred that improving connectivity is making newer micro markets gain a lot of traction among occupiers. “I believe a lot of occupiers are going to make their leasing decisions based on infrastructure of the region.”
Hrishikesh Manjrekar stated, “Ring Road will be the game changer more than the metro and it will bring in limelight more micro markets. Riverside Road which has been stuck for various reasons once completed will improve traffic situation and enhance commercial real estate demand as well as supply.”
Pratik Agarwal shared, “Fit-it out offices are in great demand. For instance Smartworks takes up large independent buildings and campuses and creates an eco-system that is deep tech integrated with end-to-end integrated apps for a seamless work experience from visitor management to parking to ordering food to booking seats, meeting rooms, even ticketing feedback etc.”
Ruchika Choudaha concluded that the return of workers to office and hybrid model of working have both worked in favour in terms of demand for traditional offices and flex work spaces.
Pune now rubs shoulders with Hyderabad, Bengaluru in terms of IT and ITeS back offices, R&D and global innovation centres.
Pune infrastructure is improving rapidly, what it lacks is enough Grade-A commercial developments.
The favourable climate, cosmopolitan crowd with a neutral accent, talent and reasonable cost of living compared to other cities makes Pune attractive for occupiers.
Pune commercial real estate has always seen single digit vacancy range and 40-50 per cent of the back offices of the world’s leading players are in Pune.
What drives global companies is value proposition and a well curated experience. ESG, compliances and amenities are the top of their agenda.
Wakad, Khardi and Pimpri Chinchwad are new pockets of commercial real estate development due to the infrastructural progress in and around them.
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