Delhi Beats Mumbai In Office Space Scarcity

Pradeep Jain is a property developer with a unique problem. The chairman of Parsvnath Developers Ltd, India’s second biggest listed real estate company, just can’t find space for a bigger office in India’s capital city. Jain wants to move to an office that is double the size of the 30,000-sq. ft one Parsvnath currently occupies in Connaught Place, Delhi’s central business district. The company did develop a building with 100,000 sq. ft of space in Delhi’s suburb of Gurgaon, but it was fully leased out even before it was completed.
Jain’s problem is unlikely to be solved anytime soon; a recent drive by Delhi’s local administration shut down businesses operating out of premises in residential areas.
“There’s a big shortage and the demand is more,” says Jain. “You have to wait because no commercial land is available today in Delhi, Gurgaon, or Noida (another Delhi suburb).
In terms of the sheer unavailability of space, India’s capital and its suburbs have overtaken Mumbai, which has traditionally been more strapped for the commodity. Mumbai can grow only to its north, while Delhi can in all directions, and has done that.
Yet, Mumbai has a 5-6 percent surplus of commercial space, largely in its suburbs. The corresponding number in Delhi is zero; in its suburbs, 1.4 percent. A 7 percent surplus is considered the ideal balance between demand and supply.