200 201
7 Absorption and Vacancy of the Micro-market
In 2014, OMR witnessed a total supply of around 0.9 million sq ft accounting for 44% of the total supply in Chennai. Leasing
during the same time period was registered at 1.9 million sq ft. OMR contributed around 46% to the overall absorption in
the city. The overall vacancy in OMR was registered at approximately 16.0% as against the overall city vacancy of 14.0%.
With limited supply infused in the micro-market during 2014 and the absorption taking place in the completed buildings
available in the micro market, the vacancy in the micro market has seen a dip from 18.1% in 2013 to 16.0% in 2014.
8 Competition Analysis – GST Road
The influx of IT/ITES space into the GST corridor is largely due to the spillover demand from the IT corridor, higher rentals in
OMR and better physical connectivity. With availability of large land parcels along the GST Road, this corridor has become
an ideal ground for SEZ developments. The corridor houses one of the first few SEZs in Chennai which is the Madras Export
Processing Zone. The other prominent SEZs in this corridor are the Shriram The Gateway IT SEZ and the Mahindra World
City SEZ which houses an IT/ITES SEZ, an apparel SEZ and a multi-product SEZ.
The prominent development in the micro market apart from Ascendas CyberVale is:
Building Name
Developer
Year of
Development
Completed
Area
(sq ft)
Vacancy
4Q 2014
Quoted
Rentals
( /sq ft/month)
Main
Occupiers
The Gateway
Shriram
Properties
2008-2014
1,510,000
8%
45
Accenture,
Take Solutions,
Redington
Source: C&W Research
Another prominent project in the micro-market is L&T’s Estancia SEZ which was purchased by Zoho Corp for their captive
use in 2013.
Area (million sq ft)
Vacancy (%)
Supply (million sq ft)
Absorption (million sq ft)
Source: C&W Research
4
3
2
1
0
2010
2011
2012
2013
2014
2015
(F)
32.3%
24.5%
18.6%
18.1%
16.0%
16.5%
