Research &

Forecast Report
Gurgaon | Office
April 2015

Absorption dips
marginally by 6%
QoQ but solid
pipeline for 2Q
Gurgaon commercial real estate market remained active
in the first quarter of 2015. The citys office absorption
was recorded at approximately 1.12 million sq ft, which is
about 6% lower than that of the previous quarter. IT/ITeS
and BFSI with 47% and 25% share, respectively were the
prime contributors to this demand. Apart from this, media
and entertainment, manufacturing, pharma, FMCG and
engineering sectors also leased large office spaces during
the quarter. A few notable transactions this quarter were the
0.12 million sq ft office lease by Ernst & Young in Unitech
Cyber Park located at Sector 39, 0.10 million sq ft by Arvato
in JMD Megapolis located at Sector 48 and 0.08 million sq ft
by Boston Consulting in Bestech Business Park located on
Sohna Road.
At the end of the quarter, the total available office supply
stood at 16 million sq ft. Areas with the highest available
supply were Golf Course Road Ext / Sohna Road (30%),
Manesar (25%), National Highway 8 (15%), Udyog Vihar
and Industrial Sectors (14%) and Golf Course Road (9%).
The city witnessed the completion of three small projects
this quarter, namely, Spaze Palazo (0.25 million sq ft) by
Spaze Group at Sector 69, JMD Empire (0.18 million sq ft)
by JMD Group at Golf Course Extension Road and Legends
Heights (0.25 million sq ft) by ILD at National Highway
8. Given the large vacant stock, developers continued to
refrain from adding speculative supply. Only Earth Group in
collaboration with AMB Group launched Earth SKY GATE at
Sector 88. It is a mixed-use development project of about 1.5
million sq ft, which will have retail, commercial, bank space
and restaurant components.

City Office Barometer

INDICATORS

1Q 2015

2Q 2015 F

Vacancy
Absorption
Construction
Rental Value
Capital Value

Rental Values
MICRO MARKETS

RENTAL
VALUE*

% CHANGE
QoQ
YoY

MG Road

100 - 145

0%

7%

DLF Cyber City (IT)

90 - 100

0%

20%

Golf Course Road

55 - 80

0%

17%

55 - 95

0%

20%

55 - 80

0%

17%

National Highway 8

50 - 150

0%

14%

Udyog Vihar &

Industrial Sectors

30 - 45

0%

-12%

Manesar

40 - 45

0%

4%

Institutional Sectors
(Sec 44, 32, 18)
Golf Course Road
Ext./Sohna Road

*Indicative Grade A rents in INR per SF per month

Research & Forecast Report | April 2015 | Colliers International

2.00
1.60
1.20
0.80

1Q 2015

4Q 2014

3Q 2014

2Q 2014

1Q 2014

4Q 2013

3Q 2013

Average Rental And Capital Value Trend

14,000

Forecast

120

12,000

100

10,000

80

8,000

60

6,000

40

4,000

20

2,000
1Q 2017F

1Q 2016F

1Q 2015

1Q 2014

1Q 2013

1Q 2012

1Q 2011

1Q 2010

0
1Q 2008

Captial Values INR Per SF

140
Rental Values INR Per SF Per Month

With the number of RFPs floating in the market, we

anticipate an increase in office absorption in the near future.
The Udyog Vihar and Institutional sectors will continue to
remain the most preferred office locations due to location
advantages and competitive rents. Rents are expected to
remain on the same levels due to the high vacancy levels
and robust under-construction developments in the
pipeline, especially in micro markets, such as the Southern
Peripheral Road and Golf Course Extension Road, in the
coming quarters.

1Q 2013

0.00

Colliers View

2Q 2013

0.40

1Q 2009

On the infrastructure front, the new state Government has

scrapped the decision to terminate the Kundli-ManesarPalwal (KMP) Expressway project, and instead has injected
fresh funds to the tune of INR 1,200 crores for completion
of the project. This project will be taken over by the Ministry
of Transport from Haryana Industrial and Infrastructure
Development Corporation (HSIIDC).

Quarter Wise Absorption

Million Sq.ft

Rents and capital values in Gurgaon remained stable in 1Q

2015 across all the micro markets due to the large available
supply and low absorption witnessed during the quarter.

Top 5 Transactions of the Quarter

CLIENT

BUILDING NAME

AREA (SF)

LOCATION

LEASE / SALE

Ernst & Young

Unitech Cyber Park

125,000

Sector 39

Lease

Boston Consulting

Bestech Business Park

80,000

Sohna Road

Lease

Nagarro

Tower of Arc

70,000

Udyog Vihar

Lease

HSBC

Plot No. 80

67,000

Udyog Vihar

Lease

TCS

Vatika Business Park

62,000

Sohna Road

Lease

AREA (SF)

LOCATION

POSSESSION

Key Under Construction Projects

BUILDING NAME

DEVELOPER

Business Club

AIPL

700,000

Golf Course Extension

Road

2015

Parsvnath IT Park Technicia

Parsvnath Developers

695,000

Sohna Road

2015

Unitech Infospace, Gurgaon

Phase 2 Building 7

Unitech

450,000

NH-8

2015

Notes:
1. Office Market: The prime business locations in Gurgaon are MG Road, Golf Course Road, Cyber City and Udyog Vihar. Manesar on the outskirts of Gurgaon is also emerging as
the citys new office destination.
2. Rents/Capital Value: Market average of indicative asking price for Grade A office space.
3. Available Supply: Total Grade A office space being marketed for sale or lease in surveyed quarter.
4. City Barometer: Represents increase, decrease or stable scenario; as compared to previous quarter.
5. All the figures in the report is based on market information as on 25th March 2015.

Research & Forecast Report | April 2015 | Colliers International

Primary Authors:

502
67 countries on
6 continents
United States: 140
Canada: 31
Latin America: 24
199
EMEA: 108

Surabhi Arora
Associate Director | Research
+91 124 456 7500
surabhi.arora@colliers.com
Sachin Sharma
Manager | Research
Amit Oberoi I National Director
Valuation & Advisory Services & Research
For Oce Services:
Mumbai: George Mckay I South Asia Director
george.mckay@colliers.com
Delhi / NCR: Vikas Kalia | National Director
vikas.kalia@colliers.com

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billion in
annual revenue

1.7

billion square feet

under management

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professionals

About Colliers International

colliers.com

2015

Bengaluru: Goutam Chakraborty I Director

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