HomeNewsCommercial realty developers are cautiously optimistic about recovery

Commercial realty developers are cautiously optimistic about recovery

Despite the prevailing trend of ‘work from home’, commercial realtors are confident that demand for office spaces will return steadily in the second half of the financial year. Most of the realtors, who attended a recent webinar, felt that with steady normalization of the economic environment, offices are expected to start opening up post Diwali.

Though, presently substantially high proportion of the workforce is working from home, this proportion will start declining as the threat of pandemic goes on receding. According to most of the developers, the impact of ‘Work from Home’ is expected to be evident somewhat, with only 20-25% of the workforce likely to work from home permanently. This may result in 10-15% loss of office space in the immediate term which can be nullified in the medium term.

Confidence of the commercial realtors is boosted by the fact that there is an increase in headcounts in IT/ITES & other sectors and also the adoption of the ‘hybrid’ work model by majority of corporates amid the rapid vaccination drive.

The retail sector, on the other hand, has witnessed recovery in sales faster post the second covid wave. However, footfalls at malls still remain subdued given the uncertainties about full-time operation of restaurant chains and multiplexes at full capacity and growing preference for e-commerce platforms. This may have some impact on the retail realty sector in the short to medium term.

Meanwhile, retail sales reached 55-60% of pre-pandemic level in July 2021, showing an improvement from 20% in June 2021. Retail sales further improved to 70-75% of pre-pandemic level in August 2021, led by gradual opening up of malls across cities.

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