One of the world’s biggest real estate consultants – Knight Frank, has just released their Global Outlook 2019 report, which evaluates 33 cities across the globe and gives an insight on expected office rental growth for 2019 among other things.
Leading the pack for growth of prime office rental markets in the world are Australian heavyweights Melbourne and Sydney, with growth in office rentals expected to touch 10.1% and 8.6% in 2019 on the back of tight supply due to employment growth and relatively low levels of real estate development in recent years.
Indian cities took up two out of top five spots for the fastest growing office markets globally. Bengaluru and New Delhi have emerged among the top five in the world taking up position 3 and 4 respectively, thereby beating Asian giants such as Hong Kong and Singapore as per the report by Knight Frank.
Bengaluru, which saw a prime rental value of ₹ 125 per square foot per month in 2018, is expected to see a growth in rents in the range of 6.6% in 2019, due to the buoyant Information Technology and Start-up sector and lack of quality Grade A space supply. Mirroring the same trend, New Delhi with prime rental values of ₹ 326 per square foot per month is expected to see a rise of approximately 6.5% in 2019 on the back of constricted fresh supply.
In comparison, Mumbai’s prime office rentals, which stands at around ₹ 300 per square foot per month will experience a subdued growth of just 0.3% in 2019 and features nowhere in the list. Rounding up the top 7 globally after Melbourne, Sydney, Bengaluru and New Delhi are Boston, Amsterdam and Berlin.
Across the globe, uncertainty surrounding trade tensions and political events has led to a pause in developments, thereby causing vacancy rates and driving rental growth up worldwide.