Ankita Sood The National Capital Region (NCR) is spread over 43,374 sq km, making it one of the largest urban agglomerations in the world. It was initially conceived under the first Master Plan for Delhi in 1962, and was conceptualised with the foremost objective of creating a metropolitan area around Delhi, so as to ease the pressure on the national capital. NCR consists of the entire National Capital Territory (NCT) of Delhi, as well as select districts from the neighbouring states of Haryana, Rajasthan and Uttar Pradesh (UP). Due to this lateral development, peripheral areas such as Gurgaon, Noida and Greater Noida emerged as the major urban centres of NCR. The prominence of the main urban centres can be derived from the fact that of the total 31 mn urban population of NCR, 74% is constituted by these urban centres. Slowly, NCR saw the growth of the service industry, and the region witnessed huge immigration from neighbouring states. Where Gurugram and Noida have developed as corporate and IT/ITeS hubs and account for 70% of the total office stock of NCR, Delhi due to its limited availability for expansion has positioned itself as the location of choice for the Banking, Financial services and Insurance (BFSI) sector. Predominantly the NCR office market has been driven by the IT/ITeS sector but the trend has reversed in the last couple of years with the Other Services sector comprising of media, consulting and e-commerce taking up significant space. With this background, our interactions with various stakeholders from the market have highlighted the upcoming trends for the office market in the coming 6 months. Share your workspace – co-working or flexible work spaces to trend Flexible workspace as a trend has successfully altered the office space globally and it is fast becoming a trend in NCR – one of the largest office markets in the country. There are various forms of this office space trending in NCR. On one hand, we have pubs that moonlight as daytime offices, and on the other hand, we have formal players such as WeWork, CoWorks, GoWorks and AltF that provide for flexible working options at affordable rates. Apart from rents, these spaces provide a cohesive and synergised environment to their clients, along with business networking opportunities. The notion of these spaces targeting only start-ups and freelancing consultants has been put to rest with some of the mainstream occupiers, such as Adidas, Citibank, Salesforce, taking up significant space in them. Today, the flexible workspace portfolio in NCR is more than 2 mn sq ft, and we believe this portfolio will only increase in 2018. (Source: Knight Frank Research) Facelift through improving infrastructure Being an agglomeration of 5 cities, it is only imperative for the city to be well connected in order to function in a smooth manner. The road network and metro connectivity in NCR have been on a constant overhaul in the past few years. Noida has always surpassed Gurugram in terms of the quality of infrastructure and the upcoming metro connectivity from the Botanical Garden metro station to Depot station in Greater Noida, crisscrossing sectors like 71, 83, 137, 147, 153 in Noida and Alpha 1, 2, Pari Chowk and Knowledge Park in Greater Noida will only augment connectivity and public transport facility for residents of Noida and Greater Noida. Catching up to Noida, the recent infrastructure developments such as the underpass on Hero Honda Chowk, Signature Tower, and the proposed flyover from the Dwarka Expressway to the Southern Peripheral Road and the state and central governments’ investment push to infrastructure will only add to the ease of movement in Gurugram. Pre-commitment for quality space Developers in NCR in the past prioritised development of residential assets given its remarkable capital appreciation; this bias put the quality commercial fresh supply under pressure leading to an upward increase in rentals. The scenario is however changing with the residential slowdown and the developers have again started finding commercial real estate as an attractive proposition. The decline in quality commercial office space has led to a pressure on demand and this is corroborated by the fact that there is an increase in the pre-commitment office deals in NCR. A pre-commitment office deal is one where the developer/landlord leases the building to a corporate occupier while the building is under construction. Large multinationals are finding such deals to be more viable in the wake of increased rents and location constraints, since it helps them to strategise their real estate portfolio for future needs. Being the commercial pivot of NCR, Gurugram is the forerunner in this trend with few of such deals closing in DLF’s upcoming project, DLF Cyber Park, which is slated to be completed by 2019. In a nutshell The year 2018 will be characterised by significant new supply in the market and occupiers looking to optimise their real estate portfolios will opt for pre-leasing in the upcoming supply. Set apart by its marque office spaces, Gurugram will continue to be the location of choice for corporate occupiers, while we believe that being a predominantly IT/ITeS market, the occupier interest in Noida will improve with the new commercial office space supply slated to be completed by 2019.
A decline in the availability of quality commercial office space has led to a growth in flexible working spaces in one of India 's largest office clusters . NCR , one of the largest urban agglomerations in the world , is thought to have moved more towards flexible work as developers have increasingly focused on residential real estate as a result of recent increases in immigration to the other major cities in the region . The situation is likely to be gradually reversing , however . With developers now recognising the lack of commercial supply , the number of pre - commitment office spaces has doubled this year .