Page 20 - CV April-May 2019 issue

Even for those and 50,000 sq. ft.) accounted for about 48 per
who are cent of the transaction activity, while small-
getting sized transactions (less than 10,000 sq. ft.)
finance, the had a 33 per cent share.
cost has risen
While the share of large-sized deals (greater
by at least 200
than 100,000 sq. ft.) increased from seven
basis points.
per cent in Q4 2018 to 10 per cent during this
However, Garg quarter. Hyderabad followed by Bangalore,
said, all the dominated large-sized deal closures in Q1
stakeholders 2019, while a few such deals were also
are working reported in Mumbai, Noida and Chennai.
closely to
“Office leasing activity is expected to remain
overcome this
stable in the short term, backed by corporates
crisis and the
looking to expand or consolidate their
same will be
operations. While interest from American
eased by March if there is no stress in the
corporates is expected to sustain, we
CONSTRUCTION EQUIPMENT system or other NBFCs.
SECTOR GROWTH SLOWS anticipate that India's position as a preferred
DOWN TO 10 PER CENT The construction equipment makers are outsourcing destination would continue to
working closely with the NBFCs to tailor attract corporates from other geographies
PTI Kolkata | Updated on February 03, 2019
products till confidence builds up such as EMEA and APAC,” said Anshuman
Published on February 03, 2019
Magazine, Chairman and Chief Executive
.
Office (CEO), South East Asia, Middle East
HYDERABAD OVERTAKES
IL&FS and its subsidiaries have defaulted on and Africa, CBRE.
BENGALURU, EMERGES AT
many debt instrumentsdue to insufficient
TOP IN TOTAL OFFICE
funds The report added that tech corporates
LEASING IN Q1 OF 2019: continued to drive office space take-up in the
REPORT
The growth of construction equipment sector country, with their share in total leasing rising
has hit a bumper after liquidity crisis gripped Medium-sized transactions accounted for from 22 per cent in Q1 2018 to 33 per cent in
non-banking financial companies (NBFCs) about 48 per cent of the transaction activity Q1 2019.
following the Infrastructure Leasing &
Financial Services (IL&FS) default, a In a first, Hyderabad overtook Bengaluru to Meanwhile, the share of key flexible space
construction equipment makers' body has emerge at the top in the total office leasing in operators rose from five per cent to 16 per
said. the first quarter of 2019. The overall leasing cent during the same time period. Other
activity touched 12.8 million sq.ft in the same sectors such as engineering and
“The construction equipment sector was period with four dominant cities including manufacturing (10 per cent), BFSI (nine per
growing around 20 per cent prior to the IL&FS Mumbai and Delhi-NCR accounting for more cent) and research, consulting and analytics
crisis. The growth has now slowed down to than 75 per cent of the leasing activity, (seven per cent) also contributed to the
10 per cent,” Indian Construction Equipment according to a report by CBRE, a real estate leasing activity in Q1 2019.
Manufacturers' Association president Arvind consulting firm.
Garg said.
The report titled 'India
IL&FS and its subsidiaries have defaulted on Office MarketView –
many debt instruments in the past few Q1 2019 report'
months due to insufficient funds. mentioned that as in
the previous quarters,
“Almost 90-95 per cent of construction
office space take-up
equipment are financed. NBFCs are the
was dominated by
largest players in this sector with about 70-75
small and medium-
per cent share of financing,” he said.
sized transactions.
Medium-sized
He pointed out that lenders themselves were
transactions (ranging
now facing liquidity challenges, so they have
between 10,000 sq. ft.
become cautious about lending.
18 / CONSTRUCTION VISION / May June 2019