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According to a recent research, some of the key office micro-markets in Bengaluru, Chennai, Hyderabad and Pune witnessed highest rental growth in 2017

As the office demand continued to intensify in Q2 2017, an upward pressure on rental values was observed in a few micro-markets across India. A high rental growth was seen mostly in south cities like Bengaluru, Chennai and Hyderabad where y-o-y change ranged between 8-17 per cent at some locations. Hence, according to Colliers Research, the top eight office micro-markets that witnessed the highest rental growth in 2017 are as follows:

Bengaluru - CBD
Bengaluru CBD micro-market has always been the first preference of BFSI and IT occupiers primarily due to its connectivity and prime location. In spite of having limited availability of office spaces and supply, the micromarket has witnessed 17 per cent y-o-y rental appreciation.
Chennai - Off CBD
This micro-market, which is predominantly an IT market has observed 13 per cent y-o-y rental growth. Apart from IT and BFSI, consulting companies have their setup in Guindy, MRC Nagar and Saligramam. In Q2 2017, Chennai Office CBD micro-market accounted for 16 per cent of total absorption.
Pune - Hadapsar/ Fursungi
Hadapsar market is emerging due to some notifying projects such as Magarpatta city and other projects offering large floor spaces. This micro-market is predominantly an IT/ITeS market with residential localities in the nearby catchment area. Hadapsar market has observed 10.2 per cent y-o-y rental growth.
Pune - Kharadi
Kharadi is one of the fastest growing commercial micro-market and is rising as an IT hub. It will also witness significant amount of office spaces in the next three years. Rents in this micro-market have increased 10.1 per cent y-o-y.
Hyderabad - SBD
The SBD market in Hyderabad has prominent locations such as HiTECH City, Madhapur, Gachibowli and financial district. In Q2 2017, 89 per cent of total leasing volume was concentrated in SBD due to superior amenities and reasonable rentals compared to other cities. Rents in SBD grew by 10 per cent y-o-y.
Bengaluru - Electronic City
One of the preferred micro-markets in Bengaluru with comparatively cheaper rents than other markets of the city offering large floor spaces and superior quality office spaces, which grew by an average of 9 per cent y-o-y.
Chennai - OMR Post Toll
Increasing popularity of OMR Post Toll micro-market has shifted occupiers focus to this market and witnessed gross leasing of 33 per cent of total absorption in Q2 2017. This micro-market includes locations like Navalur, Sholinganallur and Pallavaram-Thoraipakkam Road and has observed eight per cent y-o-y rental growth.
Bengaluru - Hosur Road

This micro-market is located in the peripheral area of the city and has the potential to develop large projects due to ample land availability. Hosur Road market has witnessed 8 per cent y-o-y average rental growth.