In recent times Pune has emerged as a leading real-estate spot for those interested in India’s commercial property rental market. This shows the growth of the city through the years. As per a recent study done by the Indian Institute of Management, Bangalore (IIMB) and the CRE Matrix, Pune has recorded a staggering 122% increase in the Grade A commercial property rentals market in Q1 of 2012 – Q3 2024. This fast growth positions Pune at the forefront of the commercial rental market.
Key Findings From The Study
– The Growth Of Pune: With a Cumulative Annual Growth Rate of 6.9% over a 12-year period, the city has been the best performing city in India. The highest rental value was seen by the Central Business District of Pune in Q3 2024. A lot of this growth has to do with the city’s growing infrastructure, developing metro lines, and highways amidst other things. This shows Pune’s expanding office space sector.
– In Comparison with Gurgaon: Gurgaon on the other hand saw a modest increase rate of 29% during the same timeline. But this doesn’t mean that Pune’s rental rate has surpassed those of Gurgaon. If Pune’s standard rate was ₹50 per sq. ft. in 2012, today it has risen to ₹111. On the other hand, if Gurgaon’s base rent was ₹150 per sq. ft. it has now risen to ₹193.50 by 2024.
Rental Growth Implications
The data indicates that while Pune has seen substantial growth in rental rates, this does not necessarily translate to higher absolute rents compared to Gurgaon. The rental index highlights which city has experienced maximum growth relative to its own historical rates rather than providing a direct comparison between cities.
Emerging Trends
The published report also underscores a wider trend where emerging metro cities like Pune are outperforming older markets. There are significant factors that contribute to this growth:
– Economic Growth: Pune has shown resilience, adaptability and a city attracting businesses and young professionals, driving a surge in office space demand.
– City’s Post-Pandemic Recovery: Across the country, the real-estate market is growing, especially the commercial market post the pandemic with many quarters showing positive rental growth since Q2 2022.
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In Conclusion:
Pune’s steady growth in the commercial property rental market is a reflection of the city’s evolving landscape. With the inclusion of metros, widening of roads, and international businesses such as Google setting up offices in the city, this market is only going to increase. As India moves towards becoming a $25 trillion dollar economy by 2047, these dynamics will become important for investors and stakeholders interested in the real-estate market.
