Prashant Thakur, Director and Head – Research, Anarock Property Consultants, said it was too early to judge the impact on office space rentals in Chennai. “Long-term implications on office spaces will depend on how long COVID-19 continues to impact the world, including India.”

An ICICI Securities report had pegged the annual revenue loss at 20-25 per cent for mall operators assuming that a rent-free period is given to retailers. “There are retailers who seek 100 per cent waiver. But it is a client-to-developer-to-owner relationship that will determine the course of action. We have offered 25 to 40 per cent discount to few customers, based on the tenant relation and the tenure agreements,” Prakash Challa, CMD, SSPDL, told DT Next.

Stating that the Retailers Association of India (RAI) supported the government’s efforts to open up the retail sector, its CEO Kumar Rajagopalan said, “Malls must be allowed to open as they are professionally run and would be able to control the environment for safety and social distancing.” According to Rajagopalan, recovery may take a minimum of three quarters. As per a RAI survey, 70% of retailers expect business recovery to happen in more than six months whereas 20% expect it to take more than a year. About 20-25% of retailers may be out of business or would need financial infusion to stay afloat.

As far as office space is concerned, players in Chennai have had it easy, so far. Subba Reddy, Ceebros, told DT Next all his tenants have been prompt in their payments.

Ajit Chordia, MD, Olympia Group, concurs: “All occupants of our IT parks have paid the rents, while a few have sought a breather to arrange logistics.”

According to Thakur, an influencing factor is the extent of economic impact on markets such as the US. “US-based IT/ITeS companies are among the largest occupiers of Indian office space – almost 45%. There is also a possibility office space demand may not really see a major decline.

The per person space in offices had already declined from 100 sq ft four years ago to about 60-65 per sqft in late 2019. With social distancing to become the new normal, office spaces will need to be spaced out now,” he said.

“Even if a section of employees works from home, there will always be functions that can only be performed out of office settings.

Firms will require more space for the remaining employees due to the new social distancing norms,” Thakur added.