India Major Report - India Mid-Sized Corporate Sentiment Survey February 2016
CBRE India Research conducted a mid sized corporate sentiment survey in June – July 2015, covering mid sized corporates headquartered in India and abroad. Respondents of the survey included corporates based across different industries, representing typical Indian office occupiers.
The survey revealed the increasing inclination of occupiers towards adopting efficient workplace strategies, with occupiers mainly preferring to adopt a format of pure open space workstations.
The results of the survey also suggested occupier sentimentbeing positive towards India’s business environment over the next two years; despite this, majority respondents were comfortable with the CRE strategy of expanding within their existing markets.
The survey explored respondent preferences across various occupation options with results indicating majority (about 75%) of the respondents preferring to pre-lease, lease or purchase space within the core locations of the cities.
The survey also asked respondents to rate aspects of property structures effecting location decisions, with occupiers seeming to consider a holistic set of parameters while evaluating an office asset. However, on a relative scale, overall real estate cost, security and maintenance, and support infrastructure were seen to be more critical as evaluation criterion for selecting an office development
The survey showed choice of workplace to be progressively being driven by the three objectives of Talent (cost/ availability), Infrastructure (Physical/ Social) and Real Estate Options (Cost/ Availability).
Occupiers across the top industry segments were also asked to chart out the direction of office expansion over the next two years; with diverse results reported across tier I locations. Majority of IT/ITeS (about 70%) firms, for example, are likely to expand their operations in the Southern cities of Bangalore, Chennai and Hyderabad; in contrast Media and E-Commerce and BFSI respondents (about 55%) prefer to expand in Delhi-NCR and Mumbai over the next two years.
Along with future occupation decisions, the survey also threw light on challenges impacting management, with CAPEX and external costs of rental escalations (about 57%) emerging as the most critical factors affecting management decisions over the next two years.
Respondents across major industry sectors remained bullish on their India expansion plan; likely to increase their headcount over the next two years. About 80% of respondents from industries such as IT/ITeS, research, consulting and analytics, Media and Ecommerce and BFSI are aiming for a 20% increase in employee headcount over the next two years