October 30, 2023: Prime office rent in Mumbai was recorded at Rs 302 per square foot (psg) per month, which makes the city the 9th most expensive commercial market in the APAC region, shows Knight Frank’s Asia-Pacific Prime Office Rental Index for Q3 2023.
The report also noted that Delhi-NCR is the 6th most expensive office space rental market across the APAC region. Hong Kong SAR continued to be APAC’s most expensive office market during the quarter.
Demand for office space in India’s largest occupier markets remained strong with over 700,000 sqm of office space leases during the quarter. Strong occupiers demand for setting up Global Capability Centres (GCC) constituted most of the demand, which made up for slower demand from flex space operators. According to IT trade body Nasscom, India will have over 2,500 GCCs by the end of the decade, up from 1,580 now and a labour force that will more than double to 4.5 million.
Prime office rentals in Delhi-NCR, Mumbai and Bangalore remained strong in YoY terms while the rentals for the next 12 months are also expected to stay stable at current rates. On a quarter-on-quarter (QoQ) basis, the average rents across the region showed stability, with declines in the Chinese Mainland markets moderating. This was counter-balanced by rental growth in most other developed markets. Overall, the quarterly report indicated that in line with Q2 2023, 15 of the 23 tracked cities reported either stable or increasing rents, similar to Q3 2023.
Shishir Baijal, chairman and managing director, Knight Frank India said, “The Indian economy’s relative strength remains a magnet for global corporate interest, evident in the resurgence of demand in the Indian office space market. Transaction volumes have increased, and rental rates have stayed steady in the three major occupier markets. Landlords are concentrating on boosting occupancy levels. With the positive outlook in the office market and improved physical occupancy, the stability in occupancy and rental rates since 2022, coupled with the rising demand in 2023, reinforce our belief that the Indian office market’s resilience will persist in the short to medium term.”
Asia Pacific prime office rents in Q3 2023
| Markets | City | Annual Change (YoY %) | Quarterly Change (QoQ %) | Forecast next 12 months |
| Australiasia | Auckland | 10.00% | 1.40% | → |
| Australiasia | Brisbane | 8.20% | 1.60% | ↑ |
| Australiasia | Perth | 6.40% | 0.00% | ↑ |
| East Asia | Seoul | 5.40% | 1.60% | → |
| ASEAN | Singapore | 5.10% | 0.80% | ↑ |
| ASEAN | Bangkok | 4.10% | -0.30% | → |
| Australiasia | Sydney | 3.40% | 0.00% | ↑ |
| Australiasia | Melbourne | 2.80% | 0.10% | ↑ |
| East Asia | Taipei | 2.71% | 1.10% | ↑ |
| East Asia | Tokyo | 0.60% | -0.40% | → |
| ASEAN | Kuala Lumpur | 0.30% | 0.30% | ↓ |
| ASEAN | Phnom Penh | 0.20% | 2.70% | ↓ |
| India | Bengaluru | 0.00% | 0.00% | → |
| India | Mumbai | 0.00% | 0.00% | → |
| India | Delhi-NCR | 0.00% | 0.00% | → |
| ASEAN | Ho Chi Minh City | -0.10% | -2.40% | ↓ |
| East Asia | Beijing | -3.50% | -1.60% | → |
| East Asia | Shanghai | -4.20% | -1.80% | → |
| East Asia | Shenzhen | -7.30% | -1.10% | ↓ |
| East Asia | Hong Kong SAR | -9.80% | -1.20% | ↓ |
| ASEAN | Manila | -11.00% | -2.50% | ↓ |
| East Asia | Guangzhou | -11.10% | -2.70% | ↓ |
| ASEAN | Jakarta | -16.70% | 0.10% | ↓ |
Source: Knight Frank Research
Delhi-NCR: The prime office market of Delhi-NCR continues to see rental values maintain levels seen in the past four quarters. The prime office rent of the city was recorded at Rs 340/sqft/month making it the 6th most expensive office market in the APAC region.
Mumbai: The prime office rent of the city was recorded at Rs 302/sqft/month and was the 9th most expensive commercial market in the APAC region.
Bangalore: Bangalore stands 19th on the list and is one of the least expensive prime office markets in APAC region. The prime office rent of the city was recorded at Rs 135/sqft/month. The rental value in the city is projected to remain steady during the following 12 months.
