2 days ago
BM Property: Bengaluru emerges as prime market for office space retrofitting
Bengaluru's commercial real estate market is poised for a major transformation, as a new report by CBRE South Asia Pvt Ltd has highlighted massive potential in retrofitting existing office spaces. Titled 'From Existing to Exceptional: A Strategic Approach to Retrofitting Indian Office Spaces', the study estimated that nearly 130-140 million sq ft of the city's 230 million sq ft office stock is ripe for upgradation—presenting a significant opportunity for value micro-markets such as Outer Ring Road, Whitefield, and the Extended Business District are identified as the hotspots for modernisation. These areas not only hold the greatest retrofitting potential but also promise varying rental premiums upon upgrade. CBRE estimates that Bengaluru alone represents an investment potential of INR 95–162 billion through targeted improvements in ageing office broader office market too, shows considerable opportunity, with nearly 50% of the office inventory across top seven cities exceeding 10 years in age. Of the estimated 882 million sq ft of total stock, more than 434 million sq ft—based on ownership and asset age—qualifies for strategic retrofitting. Bengaluru and Delhi-NCR account for nearly 45% of this older inventory, followed by Mumbai and Chennai with another 32%.The report noted that this transformation isn't just aesthetic. Upgraded buildings can command rental premiums of up to 20%, and in some cases, even 30–40% based on market demand. This makes retrofitting a smart strategy for developers and investors to align with rising occupier expectations around sustainability, wellness, and offers both immediate and long-term advantages. Tenants benefit from lower operating costs, improved amenities, and healthier work environments. Landlords gain higher leasing velocity, stronger tenant retention, and improved asset valuation. Enhanced safety, energy efficiency, and ESG alignment make such properties more appealing to institutional investors and REITs, boosting asset push for modern, high-performance workspaces is also a response to evolving workplace expectations. Retrofitted buildings can include smart systems, modular designs, wellness features like gyms and daycare facilities, and even community-centric Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE, emphasised that retrofitting has become a strategic imperative. 'This is no longer about cosmetic upgrades,' he said, adding that retrofitting is now a sophisticated, data-backed approach to transforming real estate assets to meet long-term sustainability and financial the sentiment, Gurjot Bhatia, Managing Director - Asia, PJM Advisory, Turner & Townsend, stated, 'India's office sector is at a critical juncture. With 434 million sq ft of space ready for transformation, the focus must be on creating future-ready workplaces that cater to modern occupier needs and ESG-focused investment.' As Bengaluru leads the national push towards retrofitting, the city's commercial real estate sector is set to make new benchmarks in asset performance, investor returns, and occupier satisfaction.
