M A R K E T B E AT BENGALURU Industrial Q4 2019

Steady demand drives rental appreciation in warehousing sector Demand for Grade A warehousing space in the city continued to remain steady during the second half of the year with space take-up being driven by FMCG and manufacturing companies. The north-western corridor of the city along Road has emerged as one of the prominent Y-O-Y AND Q-O-Q GROWTH IN warehousing nodes based on the excellent connectivity and demand it enjoys from the adjacent industrial hubs at Peenya and Yeshwanthpur. 7% WAREHOUSING RENT IN PEENYA Rentals for organised warehousing space here in Peenya has seen a increase of 7% both on an annual and half-yearly basis on the back of rising occupier demand. City level average rentals for warehousing sector were also up by 1.4% y-o-y on due healthy demand and current dearth of quality supply in this asset class. Y-O-Y GROWTH IN MANUFACTURING 10% RENT IN NELAMANGALA Investments by prominent developers set to rise in the industrial asset class With GST being the enabler towards creating an unified marketplace in , there has been a greater demand for quality warehousing space, WAREHOUSING SPACE LEASED especially across all major metros, which also happen to be big consumption centres. With high growth potential and already robust demand 0.15 msf BY BRITANNIA (Q4 2019) trends, major developers have set up warehousing verticals to invest into creating industrial and warehousing spaces across large, integrated developments. In Bengaluru, RKV Developers is coming up with a logistics park spread across 100 acres at Attibele, located around 12-15 km ahead of while Embassy Industrial Parks is also developing a logistics hub of around 60 acres and development potential of 1.3 msf along NH-44 in Hosur, a key industrial suburb in the south-eastern quadrant of the city. Few other noted developers who have been adding warehousing facilities and contributing to the incremental capacity building in the vicinity of industrial pockets are Indospace, AllCargo, VCNR ECONOMIC INDICATORS Q4 2019 among others. Nodal Growth along North West and South East corridors 2020 2018 2019 Forecast Easy land availability, improved transport connectivity and presence of an existing manufacturing and industrial ecosystem has driven investments in the North-West and South-East corridors of the city. Peenya Industrial Area in the North-West quotes the highest land rates and is closely GDP Growth 6.8% 5.0% 5.5% followed by in the South-East with both these locations benefitting from the presence of several manufacturing units across electronics, engineering and aerospace industries. While warehousing sector growth in the north-west is further expanding to Nelamangala and Dobbaspet along Tumkur Road, the proposed Bommasandra – RV Road metro route is further expected to enhance connectivity to the south- CPI Growth 3.5% 7.3% 4.5% eastern quadrant, making a case for potential increase in investments going forward. Attibele, an emerging warehousing hub in the south-eastern corridor has been quoting rentals towards the higher end of the prevailing rental range despite of its currently remote location, as it is witnessing Consumer 8.1% 5.5% 7.0% healthy addition of organised and quality warehousing space supply. Spending INDUSTRIAL RENT / Y-O-Y GROWTH WAREHOUSING RENT / Y-O-Y GROWTH Govt. Final 40 8% Expenditure 9.2% 15.0% 14.0% 40 12% Growth 35 10% 30 30 6% Source: Oxford Economics 25 8% 20 6% 20 4% 15 4% 10 10 2% 5 2% 0 0% Bommasandra Peenya Bidali Industrial Nelamangala 0 0% Industrial Area Industrial Area Area Bommasandra Peenya Bidali Industrial Hosur Road Nelamangala Whitefield/ Industrial Area Industrial Area Area Soukya Road

INDUSTRIAL RENT (INR/SF/MONTH) INDUSTRIAL RENT Y-O-Y % GROWTH WAREHOUSING RENT (INR/SF/MONTH) WAREHOUSING RENT Y-O-Y % GROWTH M A R K E T B E AT BENGALURU Industrial Q4 2019

LAND RATES - DECEMBER 2019

SUBMARKET INR MN/ACRE US$ MN/ACRE EURO MN/ACRE Y-O-Y Change

KIADB Hitech Zone 26 0.37 0.33 0.0%

Narsapura 15 0.21 0.19 0.0%

Bommasandra 100-152 1.40-2.13 1.27-1.93 0.0%

Bidadi 35 0.49 0.44 0.0%

Dabaspet 25 0.35 0.32 0.0%

Harohalli 15 0.21 0.19 0.0%

Peenya 152-196 2.13-2.75 1.93-2.48 7.0%

Note: Land rates in Bommasandra and Peenya are provided in a range due to difference in rates along the highway and interiors. Percentage growth are in local currency; Y-O-Y – Year on Year Conversion Rate: US$1= INR 71.26 and Euro 1 = INR 78.92 Rohan Sharma Director, Research Services +91 124 4695555 /[email protected] SIGNIFICANT LEASE TRANSACTIONS H2 2019 Kapil Kanala Associate Director, Research Services Lessee Lessor Type Submarket Area (sf) +91 40 40405555 /[email protected] Actuant NA Industrial Yeshwanthpur 35,000 cushmanwakefield.com Britannia Manjushree Warehousing Bidadi 145,000 A CUSHMAN & WAKEFIELD RESEARCH PUBLICATION Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is KEY SALES TRANSACTIONS H2 2019 among the largest real estate services firms with approximately 51,000 employees in 400 offices and 70 Buyer Seller Type Submarket Area countries. In 2018, the firm had revenue of $8.2 billion Local Developer MNC Industrial Peripheral North 16.0 acre across core services of property, facilities and project management, leasing, capital markets, valuation and other Local Developer MNC Residential Peripheral North 27.0 acre services. Rio Tinto EPIP, Whitefield Industrial Peripheral East 1.04 acre ©2020 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources believed to be reliable. The information may contain errors or omissions and is presented without any warranty or representations as to its accuracy.