Jul 28, 2023

Hyderabad Outperforms Bangalore to Secure the Highest New Office Supply in FY23

Office Spaces

Hyderabad is the city of dreams, for which everything here turns into reality. The capital city of Telangana has always been a centre of attraction for jewellers, wanderers and foodies. But today, with continuous developments and a thriving business ecosystem, it has become one of the prime cities in India for commercial purposes. Post-pandemic, there has been a surge in the demand for flexible office spaces in Hyderabad due to many reasons. Going ahead, we will thoroughly discuss the rise of Hyderabad as a prominent business hub in India. Along with this, we will also highlight some of the factors that make this city an ideal destination for MNCs and large domestic corporates.  

The first half of 2023 has been an exceptional period for several cities and business sectors. Engineering & manufacturing firms experienced a humongous rise of 197 percent in office leasing during Q2 of 2023. On the other hand, a report from a renowned organization revealed Hyderabad as a prominent rival, surpassing Bangalore with the highest influx of new office space supply throughout 2023. The rising demand for managed office spaces in Hyderabad explains its dominance over other metropolitans.  

Now, let’s understand how Hyderabad has gradually become a leading hub for IT and many other business domains for flex workspaces. 

The Dominance of Hyderabad in New Office Supply in 2023 

Gone are the days when Hyderabad used to gain all attention due to tourist spots, vivacious bazaars, natural pearls, and of course biryani. In recent years, the authorities initiated numerous measures to transform the entire commercial setup of the city for the betterment of its economy and people. With large-scale infrastructural development, the city has now become a prime alternative for IT, E-commerce, FinTech, Manufacturing, and many other business domains. 

Coming back to the focal point, let's highlight the major elements that prove the dominance of Hyderabad in office space leasing in IT and other sectors.  

  1. The report indicates that 2023 has been no different from 2022. So far, Hyderabad has witnessed a rise of 14.94 million square feet for new office spaces, accounting for a total of 31 percent share of the total supply among the top 7 cities. On the other hand, Bangalore recorded 12.66 million square feet, which is 13 percent lower than the previous fiscal. Not only Bangalore, but Hyderabad also overtook NCR (National Capital Region) and MMR (Mumbai Metropolitan Region) as both the regions were closed at 8.82 and 4.18 million square feet of new office supply. 

  1. This is not the first time Hyderabad challenged Bangalore and other metropolitans in the office space segment. Previously, office space leasing picked up steam in the city as many corporates began to summon their workforce to the offices. In 2022, office space absorption across six major Indian cities stood at 54.8 million square feet, recording a 48.5 percent increase. Hyderabad saw an outstanding infusion of 16.5 million square feet and witnessed an impressive YoY growth of 92 percent.  

  1. The thriving employment sector in Hyderabad remains strong as ever. State Street, one of the largest asset management companies, is expanding by adding 5,000 new employment opportunities. As we said, Hyderabad has gradually become a prominent hub for the IT sector. With this evolution, there will be hiring for jobs in AI augmentation, Data Analytics, and other emerging domains. Covid is no longer a matter of concern and with the vision of expansion, businesses are now looking for flexible office spaces in Hyderabad to provide flexibility and streamline their operations.  

Currently, the Indian economy is performing better than many developed nations. The robust growth in the commercial real estate market during the first half of 2023 indicates the further dominance of flex spaces across different business domains. Initially, entrepreneurs used to look for office spaces in Bangalore, Delhi-NCR, and Pune because of their reputation. But with time and awareness, they’re now considering and exploring other cities to unlock their true potential with utmost efficiency. 

Heading towards the conclusion, let’s bestow the elements that make Hyderabad a suitable alternative for large & medium business entities for managed or flex office leasing. 

  1. HITEC City:  
    The heart of Hyderabad is known as HITEC City. It is a planned commercial region within the city which provides easy access to all infrastructural facilities and empower technological outbursts. Many renowned and established IT corporates have their offices in HITEC city as they get the right exposure and support to succeed. 

  1. Acclaimed Educational Entities: 
    Many ambitious individuals from different corners of the nation consider Hyderabad as their dream city. Institutes like Osmania University, Jamia Nizamia, and the University of Hyderabad are some of the best entities that provide the best learning to students. Also, the presence of big IT, E-commerce, Fintech, and other companies provides a better scope of immediate employment. 

  1. Breeding Ground for Startups: 
    With deeper technology penetration in the city, Hyderabad has also produced some promising startups in recent years. Bharat Biotech, Darwinbox, Next Education, Zippr, Neeman's and many others are there who started their humble beginnings in Hyderabad and are now flourishing their brands on a large scale.  

Apart from this, high-quality infrastructure, a cosmopolitan lifestyle, and a prominent manufacturing hub are some other elements that attract many enterprises to lease flexible office space in Hyderabad. So, the time is right to lease a fully-furnished and tech-enabled office space in Hyderabad as the city will continue to evolve and provide more and better opportunities. 

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