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 sentiment being 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