Asia Pacific Office Outlook 2024

KOLKATA

K E Y M E S S AG E S

SUPPLY

DEMAND

RENTS

KEY OUTLOOK

 New supply of 1.5 msf in 2023 is expected across the Salt Lake Sector V and CBD micro-markets.  Over 2 msf of new supply is expected in 2025 including expansion of a property owned by Brookfield India REIT.

 Net absorption has rebounded strongly from the lows witnessed in 2021. It crossed 1 msf in 2023 and is likely to gain momentum in 2024 and 2025.  Vacancy is expected to decline to around 20% by 2026, thereby continuing its declining trend on the back of healthy demand from the IT-BPM and professional services occupiers.  The market remains tenant

 Rents are forecast to grow by less than 1% in 2023 before accelerating gradually in the subsequent years; however, rental growth will remain in the 1– 2% range during 2024– 2026 as rising tenant demand is offset by significant new supply.  This movement will take rents to INR INR 570 sf/yr at the end of 2023 and subsequently over INR 600 sf/yr by 2027.

 Flight to quality is a key trend witnessed in the Kolkata market. Most of the Grade A, under construction projects, especially in the prime office corridors Salt Lake Sector V and Rajarhat, are incorporating modern amenities, technology solutions and sustainability features, which are in demand from prominent occupiers.

favourable in 2023 and is likely to remain so in the near term.