Demand for office space dips in April-June 2012: RICS Global

New Delhi: The demand for office space in India slipped in the April-June quarter of 2012, after a bounce in the early part of the year, said the latest RICS Global Commercial Property Survey.

The weaker picture in the commercial office space segment reflects the growing concerns about the domestic economy, which has seen downward revisions in growth forecasts as well as deteriorating global climate. “On the occupier side, demand from tenants was slightly down compared with the first three months of the year,” said the survey.

RICS data shows that the need to take up office space has diminished in three of the last four quarters. This was after a period in which demand from tenants rose for nine consecutive quarters.

Rentals, which had seen some strengthening in the beginning of 2012, once again softened as the total amount of space available continued to increase as has been the case since the second half of 2007.

“A generally similar picture is visible in the investment market with the better news flow in the early part of the year unwinding in the face of the macro headwinds. Investment enquiries fell back in the second quarter as did expectations for future capital values, albeit only modestly,” said the report.

RICS also pointed out that there is likelihood of further distressed property being released in the market over the next few months and that “there appears sufficient appetite to take advantage of keenly priced asset sales.”   Source>>>