We Aim to Provide Adaptable, Efficient and Engaging Office Spaces

Torbit - July 06, 2024 - - 0 |
Colliers hires Peush Jain as Managing Director

Anarock, a leading property consultancy with a strong foothold in residential real estate. has entered the corporate office leasing segment amidst booming demand for commercial spaces. In this exclusive interview with Torbit Realty, Peush Jain, Managing Director, Commercial Leasing & Advisory, Anarock Group, talks about the opportunities and challenges in corporate leasing, occupier trends amidst evolving commercial real estate landscape , Anarock’s unique value proposition and future goals. Excerpts        Vinod Behl

What made Anarock, a residential play consultancy, enter office leasing? What kind of competition do you foresee and how do you propose to meet the competition? Have you set any targets?

Anarock’s entry into the office leasing space is a strategic response to the evolving real estate market in India. With rapid urbanization, improving infrastructure and a strong local economy, the demand for commercial spaces has surged, from both domestic and international organizations. The demand for Grade A office spaces in India increased by 24 percent  last year and is poised to have its best year in 2024.

Anarock identified this trend as the right opportunity and timing to enter the commercial leasing market. Our industry-leading team has facilitated deep relationships in the market for us to successfully diversify into the corporate leasing business. Anarock’s unique value proposition includes deep market insights, robust client and developer relationships, and a team of seasoned professionals. Our agenda is to utilize our expertise in data analytics and provide advisory-led client-centric solutions to differentiate ourselves.

Our targets include capturing a sizeable market share in the commercial leasing sector within the next three years and increasing our footprint in Tier 2 and Tier 3 cities, which are witnessing rapid commercial growth.

 What kind of opportunities and challenges do you foresee for the commercial office sector in the near to mid to long-term?

In the near to mid-term, the commercial office sector offers numerous opportunities driven by hybrid work models and the increasing demand for flexible workspaces. According to a report, the flexible workspace sector is expected to grow by 15-20 percent  annually over the next five years. Additionally, with many organizations making a commitment to net zero targets and 100 percent  renewable energy in the next decade, there is a significant push on their corporate real estate functions to look towards sustainable and smart office buildings. Fifty percent of new office spaces by 2025 will have a sustainability rating and will form one of the main criteria for occupiers shortlisting them.

Challenges include economic fluctuations, regulatory changes, and the need for sustainable infrastructure that has been slow to catch up with the demand and pace of corporates expanding their operations. The pandemic has also highlighted the importance of health and wellness in office design and facility offering, which adds another layer of complexity to a lot of the existing office stock. In the long-term, Anarock anticipates a shift towards more integrated, tech-enabled office environments, driven by advancements in IoT and AI and being highly focused on employee experience.

 How do you look at the current and future occupier trends/needs and how do you plan to meet them, especially through tech-driven solutions?

Current occupier trends show a strong preference for flexible and collaborative workspaces, enhanced digital connectivity, and sustainable building designs. Future trends indicate an increasing demand for smart office technologies and wellness-centric work environments. Surveys suggest, 67 percent of occupiers prefer buildings with advanced technological amenities, and 54 percent consider wellness features as critical. Many occupiers are also going for WELL certifications in their offices in a bid to improve employee experience and aid in their return to office.

Anarock plans to address these needs by integrating advanced PropTech solutions. With the inhouse technology that we are  developing , we will implement IoT-enabled building management systems, AI-driven space utilization analytics, and digital collaboration tools to enhance efficiency and tenant experience. By staying ahead of these trends, Anarock aims to provide adaptable, efficient, and engaging office spaces.

 How do you foresee the investment landscape for the commercial office segment, particularly with regard to global institutional investors?

The investment landscape for the commercial office segment is increasingly favourable, attracting substantial interest from global institutional investors. In H1-2024, foreign investments in Indian real estate surged with a significant portion directed towards the commercial office assets. Factors such as India’s robust economic growth, urbanization, and the expansion of the IT and services sectors contribute to this trend.

We expect sustained investment inflows as global investors seek high yields and diversification, and developers are consistently delivering such yields. With our established capital markets team, Anarock plans to capitalize on this  by offering well-researched investment opportunities, backed by comprehensive market insights and rigorous due diligence processes. We will also focus on creating value by advising on leasing, strategic property enhancements and sustainable practices, which are crucial for institutional investors. Our goal is to establish Anarock as a trusted partner for global investors looking to enter the Indian commercial real estate market.

 Your expectations for commercial real estate from the FY 25 budget?

From the FY 25 budget, we anticipate and hope for several favourable policies that will boost the commercial real estate sector. Key expectations include tax incentives for green buildings and sustainable practices, increased funding for infrastructure development, and streamlined regulatory approvals to facilitate faster project execution. The Union Budget 2023-24 already allocated INR 10,000 crore for infrastructure development, which positively impacts the commercial real estate sector.

Additionally, we expect initiatives aimed at enhancing ease of doing business, which would encourage more domestic and international firms to set up shop consequently boosting demand for office space. Measures such as simplifying compliances and offering tax rebates for investments in commercial real estate would further stimulate growth. Anarock believes these steps will significantly benefit the commercial real estate market, promoting growth and enabling us to provide best in class office leasing and advisory services to our clients.

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