Office space absorption across Asia Pacific’s (APAC) top 11 markets surged 15.9% annually to 94.7 million sq ft, led by India, Mainland China and Japan, according to a new report.
Second half of 2024 was particularly strong, with office demand in the region touching 50.6 million sq ft, a 6.1% rise compared to H2 2023. Demand growth in H2 2024 was notable in markets such as India, Japan and particularly impressive in Australia, which had a lower base. Leasing activity, however, remained relatively subdued in New Zealand, the Philippines, South Korea, Hong Kong, and Taiwan in H2 2024, a report from property consultant Colliers said on Friday.
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The report found a significant increase in the APAC office space demand to be driven by corporate expansions, return-to-office and the growth of global capability centres. The report captured the key markets of Australia, Mainland China, Hong Kong, India, Indonesia, Japan, New Zealand, Philippines, Singapore, South Korea and Taiwan.
Office market activity was particularly strong in India, which saw 66.4 million sq ft of leasing during 2024, led by a stronger second half. With 37 million sq ft of gross leasing in H2 2024, India continued to lead office leasing activity in the APAC region, witnessing an 11% y-o-y rise compared to H2 2023, according to the report.
In India, technology firms and flex space operators together accounted for 46% of the total demand across the top 6 cities during H2 2024. New supply remained robust, with over 30.3 million sq ft of completions in H2 2024, a 7% y-o-y growth across the top six cities, it said.
Bengaluru and Hyderabad led the office market activity during H2 2024, cumulatively, driving more than half of the country’s Grade A space demand and supply. Amidst an uptick in both leasing activity and new supply, India vacancy levels largely remained stable at around 17%.
“Contrary to larger trends, India witnessed 7% y-o-y growth in new supply, contributing 60% of the new supply in APAC region during H2 2024. Looking ahead, we anticipate improved demand-supply dynamics in 2025, supported by balanced economic growth and likely moderation in inflation,” said Arpit Mehrotra, managing director, office services, Colliers India.
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“During H2 2024,
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