Office leasing in Ahmedabad records 0.82 mn sq ft in H2 2020 ; Knight Frank

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Office leasing surge by 1,174% QoQ in Q4 2020: Knight Frank India

Knight Frank India today launched the 14th edition of its flagship half-yearly report – India Real Estate: H2 2020 – which presents a comprehensive analysis of the residential and office market performance across eight major cities for the July-December 2020 (H2 2020) period. The report highlighted that Ahmedabad recorded office leasing of 0.08 mn sq m (0.82 mn sq ft) in H2 2020.

This was reported as 66% higher than the level witnessed in the preceding half-yearly period ofH1 2020. Thenew office completions in 2020 far outpaced the leasing activity at 0.48 mn sq m (5.1 mn sq ft), witnessing a 4.90% increase over 2019.

Office transactions witnessed a rapid recovery in Q4 2020 spiking by a massive 1,174% QoQ to 0.8 mn sq ft compared to0.1 mn sq ft recorded in Q3 2020. Q4 transaction volumes also reached a monumental high of 197% of the 2019 quarterly average.

In terms of the sectorial occupier share, Information Technology dominated with a 45% share in H2 2020, followed by BFSI at34% YoY and manufacturingat 15%. PBD (Gandhinagar, GIFT City etc) witnessed massive transaction growth of 40% YoY to 0.54 mn sq ft and accounted for 66% of the total transactions during H2 2020.

The report highlighted that Ahmedabad recorded sales of 2,810 units in Q4 2020, growing 139% QoQ. The resumption of business activity in June 2020 and low home loan rates along with innovative strategies by developers such as conducting virtual site visits, aggressive homebuyer financing, price cuts and allowing refundable deposits on booking, have kept homebuyers in play during the second half of the year.

Measures such as an increase in the maximum area for affordable housing units from 80 to 90 sq mt (BUA) helped improve homebuyers’ sentiments.

These factorshelped H2 2020 sales grow 58% sequentially compared to the first half of the year andreach 3,986 units. As construction activity restarted, new home launches reached 4,745 units in H2 2020, growing 81% sequentially compared to H1 2020. Bulk of this growth occurred in Q4 2020 with new launch volumes growing at 127% QoQ.

The under INR 5 mn ticket size, which has always seen the most demand in Ahmedabad, claimed 69% of sales in H2 2020 as well. The INR 2.5–INR 5 mn sub-segment made up 43% of the total sales, while properties sold in the ticket size under INR 2.5 mn constituted approximately 26% of the same.

In terms of business districts, North Zone registered 34% of total sales in H2 2020, followed by the West market with 24% during the same period. The city also witnessed a drop in the weighted average price of 3% YoY in H2 2020.


·         Office leasing in Ahmedabad was recorded at 0.08 mn sq m (0.82 mn sq ft) in H2 2020.

·         In Q4 2020, 0.76mn sq ft was office space transacted which was nearlytwice (197%) the average quarterly transacted volume in 2019.

·         New office completions in 2020 outpaced the leasing activity, at 0.48 mn sq m (5.1 mn sq ft), witnessing a 4.90% increase over 2019. The secondhalf of 2020 (H2 2020) witnessed 2.52 mn sq ft of new office space, a13% increase over H1 2020.

·          Of the 2.52 mn sq ft of office space completed during H2 2020, close to 90% were located on CBD West locations such as SindhuBhavan Road and Science City Road.

·         The business district – PBD recorded 66% of total transacted spaceduring H2 2020 compared to 40% in H2 2019. The CBD West business district, which usually accounts for majority of the transaction volumes saw 0.27 mn sq ft or 33% of the same. However, almost 75% of transactions during the period still took place in the CBD West area.

·         BFSI and Information Technology sectors have largely sustained their share of total transactions during H2 2020 compared to H2 2019. In H2 2020, two largest transactions took place amounting to 51% of the total transacted are during the period and represented both these sectors.

·         The largest transaction was a 0.02 mn sq m (0.2 mn sq ft) lease signed by the Bank of America at Savvy Pragya in GIFT City.

·         The Manufacturing sector experienced a substantial increase in take-up due to a 0.01 mn sq m (0.08 mn sq ft) lease signed by Baxter Pharmaceuticals at Navratna Corporate Park on Bopal-Ambli Road in CBD West.

·         In 2020, the weighted average rental declined by 4.5% YoY. Rents in the CBD West micro-market fell by -4.5% YoY whereas, PBD rental value declined by -5.5%  YoY in 2020. 


Q1 2020Q2 2020Q3 2020Q4 2020
Transactions mn sq m(mn sq ft)0.05 (0.5)– (-)0.01 (0.1)0.07 (0.8)
Transactions as % of 2019 Quarterly average127%0%15%197%
New completions mn sq m(mn sq ft)896318434720
New Completions as % of 2019 Quarterly average213%0%125%82%

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