At 2.25 million sq ft, supply of commercial office space in Kolkata increased about 65 per cent over the previous year. Most of the supply was concentrated in peripheral locations such as Salt Lake and Rajarhat. However, some planned developments for the non IT-ITeS sector are expected to enter the market, early next year, in new locations such as Park Circus Connector and Rash Behari Connector.
The city witnessed total absorption of approximately 2.1 million sq ft. The majority was accounted for by the IT-ITeS sector in peripheral locations like Salt Lake and Rajarhat. Owing to low vacancy in the CBD areas of Park Street, Camac Street, Chowringhee, AJC Bose Road and Theatre Road, there have not been significant leases in these regions. The total demand for the year is estimated at 3.6 million sq ft of which approximately 1.5 million sq ft of commercial office space was pre-leased in the peripheral location of Rajarhat this year.
Overall, the office market in the country is likely to continue to grow in 2008. Rentals could stabilize in select markets as more supply gets delivered, resulting in demand-supply equilibrium in the second half of the year
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