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Commercial real estate has been doing really well in the country as the GDP continue to shine and outpace many other developing and developed nations. The absorption of all segments of commercial real estate namely office building, retail spaces, warehouses and hospitality has been fairly high in the last few years. There will be an increasing trend towards cost efficiencies as well as making the property safe and secure. We take a look at some of the key trends to watch out for in 2019:
You are reading: Trends To Watch Out For in 2019 for Commercial Real Estate
Corporates Going For Longer Leases
With increasing property rental trends, corporates have started signing longer term leases than the usual 9 years. Companies are trying to negotiate 10-15 year lease tenures in order to shield themselves from rental hikes for a longer duration. While on one hand corporates will be benefitted from rental hikes for a longer duration, one the other hand developers will also have lower probability of vacancy in their buildings with long duration lease tenure.
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Pre-committing Office Spaces
There are many corporates, especially MNCs, that are going in for pre-commitment in the Indian scenario. Some examples include Bank Of America, Google and BCG that have pre-committed huge spaces in DLF’s Cyber Park and Unitech’s Signature Tower. This trend is likely to intensify in 2019, given that fact there is paucity of quality office spaces. There are obvious benefits for pre-commitment by a company with a developer of its office space requirements. A pre-committed deal is one where the developer has leased the building to a company when the building is under construction.
Incorporating Technology
Developers are increasingly using technology to bring out efficiency in a building for the occupiers. Bringing about efficiency in office spaces and other commercial buildings has been long overdue and the year 2019 will see developers making use of automation and robotics. Even warehousing spaces are witnessing infusion of lot of technology to enhance their use and efficiency.
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Pro-Environment Features
With rising awareness and lot of thrust on environment related aspects in the society, developers are adopting various measures not just in constructing but also in day-to-day use of the building by the tenants which results in environment protection. These include energy-saving smart lighting, water conservation, rain water harvesting, etc. They are using raw materials that help in lower heating and cooling requirements of the buildings. 2019 will see developers going one step further than just ensuring optimum energy usage and installing things like solar roof tops and garbage recycling units as well.
Construction Of Safer Buildings
Developers are increasingly adopting enhanced security features for their buildings which include making lot of fire prevention and fire management provision and constructing earthquake resistant structures. This trend will intensify in 2019 as the government and judiciary get strict about security related provisions. There will be greater compliance with laws related safety. An added succor for developers will be that a safe and secure building command better rentals and tend to have longer lease tenures. The elevators technology is also evolving and there are now much safer elevators and lifts in the buildings in overseas markets. These will make their way in India in 2019.
Source: https://ecis2016.org/.
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Source: https://ecis2016.org
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