Major IT Firms like Infosys and Google Continue to take up Larger Office Spaces!

IT industry in India has certainly played a crucial role in putting up India on the global map and has also been a main reason for the growth of Indian economy. Today, few major IT firms like Cognizant, Accenture, Google, Infosys and others continue to take up larger office spaces across the country even though they are not hiring large number of people. According to a property advisory firm, with the end of first quarter of 2015, the total absorption of Class A office spaces was 8.5 million square feet, which is 20% more than the previous year’s absorption.

With such an increase in a very short period of time, we can clearly say that the leasing activity and the rent appreciation have been terribly increased; it is more likely to be continued as the demand seems to be long lasting. Bengaluru, Kolkata, Mumbai, Chennai and Pune are a few cities that showed significant increases in office space absorption. Recently, Oracle signed for a space of 400,000 square feet at JP Nagar in Bengaluru and Wipro is also looking to expand its capacities in the cities like Hyderabad, Chennai, Pune and Delhi over next two years.

Colossal increase in the absorption rate

Bengaluru, a centre of operations for most of the domestic and multinational companies, saw a tremendous increase of 500% in the absorption rate in the year 2014. Normally, the cities like Bengaluru and Pune are the hubs preferred by most of the IT companies as they provide commendable infrastructure and manpower. These developments are creating a lot of job opportunities which in turn is increasing the potential of residential spaces in these cities.

Few companies are locking the plots in advance

As the demand for office spaces is increasing day by day, the real estate prices are also likely to be increased within 3 to 5 years down the line and we may also see the situation where the companies fall short of Grade A office spaces. So some top companies are locking the plots in advance and also leasing the office spaces to gain advantage from current market prices.

IT majors like Google and Infosys are planning for expansion

According to a well-known property advisory firm, several major IT companies are planning to expand their operations. Google is planning to have one of its largest facilities in Hyderabad with a built-up space of about 2 million square feet. This new facility would double the headcount of Google employees over next four years.

Likewise, Infosys is also planning for a significant expansion of its operation in Bengaluru by adding about 21,500 new employees to the hub at Electronic City where it owns an 80-acre campus. If it happens, it will be the biggest centre for the company in India. These swift expansion plans of several major IT companies would create a lot of job opportunities in the cities like Bengaluru, Pune and Hyderabad.