Chennai: Housing sales fell 37 per cent year-on-year during the 2020 calendar year while gross office space leasing declined 35 per cent on low demand because of the coronavirus pandemic, but demand improved significantly in the last quarter to cross pre-Covid level, property consultant Knight Frank India said on Wednesday.
In its ‘India Real Estate – Residential and Office Update H2 2020′ report released on Wednesday, the consultant reported that sales of residential properties fell 37 per cent to 1,54,534 units in 2020 across eight cities as compared with 2,45,861 units in the previous year. Similarly, the gross office space absorption declined 35 per cent to 39.4 million square feet from 60.6 million square feet.
As for Chennai, sales fell 49 per cent to 8,654 units in 2020 from 16,959 units in the previous year, while the city saw an office absorption of 4.5 million square feet in 2020 as against 5.2 million square feet, while Hyderabad witnessed leasing of six million square feet as compared with 12.8 million square feet.
Also, the data centre market in Chennai is estimated to grow to a capacity of 174 MW by 2023, more than double in three years, according to a report by Knight Frank.
The 14th edition of Knight Frank’s flagship half-yearly report- India Real Estate: Second Half 2020- which was released on Wednesday, states that Chennai’s data centre market is presently estimated to be at a capacity of around 70 MW and occupies approximately two million square feet of real estate space (built-up area).
The report says that the proposed National Data Centre Policy will further boost data centre growth in the city as proposals such as granting ‘infrastructure’ status, setting up Data Centre Economic Zones (DCEZs) and providing single-window clearance are on the cards. These, coupled with the impending rollout of 5G technology, will strengthen the data centre growth trend in Chennai, it added.
“Within Chennai, the Ambattur and Siruseri micro markets have evolved into data centres and cloud hotspots, and key national and international players such as Netmagic, Adani and Yotta have established their base in the city,” the Knight Frank report states.
The report states that Chennai has four undersea cable landing stations that offer sound optic fibre network connectivity.
As per the annual data, housing sales fell in all eight major cities during 2020, with demand falling most in Ahmedabad and least in Pune. In the office market, Hyderabad witnessed maximum decline in leasing activities and Ahmedabad the least.
Knight Frank India tracks eight property markets, Delhi-NCR, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad, Pune, and Ahmedabad.
“Despite the on-going pandemic, the H2 2020 sales growth in some cities is fairly encouraging. In Q3 2020, the real estate market started witnessing revival signs, further recording a significant improvement in home sales during Q4 2020,” Knight Frank India CMD Shishir Baijal said.