HIGHLIGHTS • Demand for office space in the Pune office market proved to be resilient, with increased commercial leasing recorded at around 3.5 MN SF, 11% up from 2012. • The office leasing activities in 2013 were dominated by the IT/ITeS sector with approximately 70% of the total absorption from this sector, followed by BFSI. • Average rental values registered an increase of 5% Year-on-Year (YoY) • The outlook for 2014 is promising in terms of the office market. IT/ITeS will continue to play an important role in the city’s overall commercial office space absorption.

1. Pune Office Market
Snapshot 2013

2. Pune Office Market
Snapshot 2013
Quarter-on-Quarter Absorption
Highlights
1.6
1.40
1.4
1.2
IN MN SF
In 2013, despite an uncertain global economic environment,
demand for office space in the Pune office market proved to be
resilient, with increased commercial leasing recorded at around
3.5 MN SF, 11% up from 2012. The office leasing activities in 2013
were dominated by the IT/ITeS sector with approximately 70% of
the total absorption from this sector, followed by BFSI. Amidst
the weak economic scenario, the year saw a number of companies such as AXA, Barclays, Cummins, Deutsche Bank, NVIDIA,
Symantec, Symphony Teleca, Synechron and others, lease and
purchase significant office space (100,000 SF to 700,000 SF)
across Pune, either for office expansion or consolidation.
AVERAGE
ABSORPTION
1.0
0.84
0.83
3Q
4Q
0.8
0.6
0.40
0.4
0.2
0.0
1Q
2Q
Industry Wise Absorption
Demand
Large IT/ITeS occupiers were focusing on consolidation or
expansion with the objective of keeping costs under control.
Occupiers preferred locations such as Kharadi, Yerwada,
Hadapsar and Phursungi in the east and Hinjewadi in the west
due to the availability of premium office space.
The market has also witnessed increased traction from retail
investors. Individual investors as well as small and medium
enterprises were aggressively looking for investments in small
Grade A offices.
Others 12%
Pharmaceutical
4%
2
BFSI
15%
1
IT/ITeS
69%
Top 10 Transactions of the Year
Client
Developer /
Landlord
Cummins
Panchshil Tech Park
Panchshil Realty
1,184,000
Balewadi
4Q
Synechron
Block 1
Ascendas
600,000
Hinjewadi
1Q
Deutsche Bank
Business Bay
Panchshil Realty
300,000
Yerwada
3Q
Nvidia
Commerzone
K Raheja Corp.
250,000
Yerwada
1Q
Symantec
EON Free Zone
Panchshil Realty
178,000
Kharadi
4Q
Symphony Teleca Corp. India
Indo Global IT Park
Wadhwa Developer
148,000
Hinjewadi
4Q
Axa
Marvel Edge
Marvel Group
120,000
Viman Nagar
1Q
Praj Industries
Praj Tower
Vascon Engineers Ltd
111,000
Hinjewadi
1Q
Barclays
EON Free Zone
Panchshil Realty
100,000
Kharadi
3Q
Siemens
1
Building Name
Embassy Tech Park
Embassy Group
84,000
Hinjewadi
1Q
Pune Office Market Snapshot 2013 | Colliers International
Area (In SF)
Location
Transaction Quarter

3. Supply & Vacancy
Complementing the demand, approximately 3.75 MN SF of
new supply was added to the Pune office market. Most of this
supply was concentrated in SBD micro-markets such as
Yerwada, Baner and Viman Nagar and in PBD micro-markets
like Kharadi and Hinjewadi. The overall vacancy rates
remained unaltered during the year at approximately 23%
However, there is very limited space available in Special
Economic Zones (SEZs). Due to high vacancy levels in the
market, developers continued to refrain from launching new
projects this year. However, due to high demand in SEZs,
developers such as Paranjape and Panchshil have launched
the second phase of their existing SEZ, Blue Ridge located at
Hinjewadi and EON in Kharadi, respectively.
New Supply, Absorption & Vacancy
6
30%
FORECAST
5
4
20%
3
15%
2
10%
1
5%
0
2010
Rental & Capital Values
2011
2012
New Supply (In MN SF)
During the year, average rental values registered an increase of
5% Year-on-Year (YoY). The influx of new supply with rents
relatively higher than the market average led to an increase in
weighted average rents. Capital values this year increased 8%
YoY across all micro-markets due to increased investor interest.
2014 Prognosis
25%
2013
2014 F
Absorption (In MN SF)
2015 F
0
Vacancy (In %)
Average Rental Trends & Forecast
60
FORECAST
50
The outlook for 2014 is promising in terms of the office market.
Corporates will continue to remain cost cautious in their
expansion decisions. Demand will remain upbeat in SEZs.
Meanwhile, IT/ITeS will continue to play an important role in
the city’s overall commercial office space absorption, primarily
attributed to the projects that have already seen pre-commitments or long-established interest from various IT/ITeS companies. On the supply front, including deferred projects, the new
stock expected in 2014 will be approximately 4 MN SF Most of
this supply will be located in suburban and peripheral micromarkets. Controlled supply in tandem with absorption will keep
vacancy levels unaltered. East and west Pune micro-markets will
continue to interest occupiers due to availability of large floor
plates, better infrastructure and proximity to residential pockets
of the city.
2
Pune Office Market Snapshot 2013 | Colliers International
40
30
20
10
0
2008
2009
2010
2011
2012
2013
2014 F
Average Rental Trends (INR Per SF Per Month)
2015 F

4. Primary Authors:
62 countries on
6 continents
United States: 140
Canada: 42
Latin America: 20
195
EMEA: 85
$2
Surabhi Arora
Associate Director | Research
+91 124 456 7500
surabhi.arora@colliers.com
Amit Oberoi
National Director I Valuation & Advisory Services
& Research
Sachin Sharma
Assistant Manager I Research
For Office Services:
George McKay
South Asia Director I Office & Integrated Services
george.mckay@colliers.com
billion in
annual revenue
Vikas Kalia
National Director I Office Services
vikas.kalia@colliers.com
1.12
Rishav Vij
General Manager I Office Services
rishav.vij@colliers.com
13,500
Technopolis Building, 1st Floor,
DLF Golf Course Road,
Sector 54, Gurgaon - 122 002
TEL +91 124 456 7500
billion square feet
under management
professionals
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