Real Estate development Embassy Group has entered into a development management agreement with SAS Infra to develop 14 million sq. ft. of office assets in Hyderabad’s financial district. The tie up also marks the companies foray into the Hyderabad commercial property market.
Embassy’s decision to re-enter Hyderabad marks growing confidence in its real estate landscape, buoyed by record hiring, major expansion plans by global IT, ITeS and BFSI firms (information technology, IT-enabled services, and banking, financial services and insurance), and heightened physical occupancy levels.
“Hyderabad has emerged as one of India’s most dynamic and resilient commercial markets with its strong growth and hiring outlook. Factors such as the recent return-to-office mandates and global occupiers' anticipating their next phase of expansion indicate that demand for office spaces is primed to multiply. These trends, compounded by Hyderabad’s rapidly growing infrastructure and supply of Grade-A workspaces, have underscored its emergence as a leader in net office space absorption.”
The project will fall under NAM Estates Pvt. Ltd., and is expected to become a part of the upcoming flagship vehicle Embassy Developments Ltd., following the composite scheme of merger between Embassy and Indiabulls Real Estate Ltd. (subject to regulatory approvals).
The first of the projects, the 36-floor Embassy SAS I Tower, comprising 5.2 million sq. ft. is currently under construction, while the second project, the 3 million sq. ft. Embassy Diamond Tower has begun its excavation. The third project, Crown, will have a potential of 3 million sq. ft. of commercial space, with Embassy and SAS Infra partnering to develop it.
Embassy Group will act as the development manager for the first two projects in Nanakramguda and Khajaguda, overseeing the construction, vendors, and leasing. The construction of the three projects is likely to be completed in different phases, starting from the last quarter of 2023.
The proposed merger between Embassy Group and Indiabulls Real Estate has already entered the final lap as both the companies had filed the requisite joint application with the jurisdictional bench of NCLT, for its approval to the scheme of merger.
The combined entity will be renamed as Embassy Developments Ltd and will be co-headquartered in Mumbai and Bengaluru. Embassy Group already holds 14% of listed Indiabulls Real Estate and once the merger gets concluded later this year it will become the promoter of the combined entity.
Demand for office made a swift return despite about 1 month being disrupted by the third wave of COVID that impacted decisions in the early part of the quarter. With 10.8 msf of new leasing, office space recorded a YoY rise of 25% over the same time last year. Bengaluru maintained its top position leasing 3.5 msf of office space which was a rise of 5% YoY, Hyderabad recorded an impressive 72% YoY growth with total leasing of 1.6 msf and Chennai saw a rise of 124% YoY with leasing of 1 msf recorded in Q1 2022, mentioned Knight Frank.
“The country has returned to normality backed by a strong vaccination drive that has given India Inc confidence. We expect the office segment to return to its pre-COVID momentum in the next few quarters as the Indian economy continues to strengthen. The significant increase in hiring and the pent-up demand of the past 8 quarters, are expected to drive market volumes in the remainder of the year,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India said.
Embassy’s decision to re-enter Hyderabad marks growing confidence in its real estate landscape, buoyed by record hiring, major expansion plans by global IT, ITeS and BFSI firms (information technology, IT-enabled services, and banking, financial services and insurance), and heightened physical occupancy levels.
“Hyderabad has emerged as one of India’s most dynamic and resilient commercial markets with its strong growth and hiring outlook. Factors such as the recent return-to-office mandates and global occupiers' anticipating their next phase of expansion indicate that demand for office spaces is primed to multiply. These trends, compounded by Hyderabad’s rapidly growing infrastructure and supply of Grade-A workspaces, have underscored its emergence as a leader in net office space absorption.”
The project will fall under NAM Estates Pvt. Ltd., and is expected to become a part of the upcoming flagship vehicle Embassy Developments Ltd., following the composite scheme of merger between Embassy and Indiabulls Real Estate Ltd. (subject to regulatory approvals).
The first of the projects, the 36-floor Embassy SAS I Tower, comprising 5.2 million sq. ft. is currently under construction, while the second project, the 3 million sq. ft. Embassy Diamond Tower has begun its excavation. The third project, Crown, will have a potential of 3 million sq. ft. of commercial space, with Embassy and SAS Infra partnering to develop it.
Embassy Group will act as the development manager for the first two projects in Nanakramguda and Khajaguda, overseeing the construction, vendors, and leasing. The construction of the three projects is likely to be completed in different phases, starting from the last quarter of 2023.
The proposed merger between Embassy Group and Indiabulls Real Estate has already entered the final lap as both the companies had filed the requisite joint application with the jurisdictional bench of NCLT, for its approval to the scheme of merger.
The combined entity will be renamed as Embassy Developments Ltd and will be co-headquartered in Mumbai and Bengaluru. Embassy Group already holds 14% of listed Indiabulls Real Estate and once the merger gets concluded later this year it will become the promoter of the combined entity.
Demand for office made a swift return despite about 1 month being disrupted by the third wave of COVID that impacted decisions in the early part of the quarter. With 10.8 msf of new leasing, office space recorded a YoY rise of 25% over the same time last year. Bengaluru maintained its top position leasing 3.5 msf of office space which was a rise of 5% YoY, Hyderabad recorded an impressive 72% YoY growth with total leasing of 1.6 msf and Chennai saw a rise of 124% YoY with leasing of 1 msf recorded in Q1 2022, mentioned Knight Frank.
“The country has returned to normality backed by a strong vaccination drive that has given India Inc confidence. We expect the office segment to return to its pre-COVID momentum in the next few quarters as the Indian economy continues to strengthen. The significant increase in hiring and the pent-up demand of the past 8 quarters, are expected to drive market volumes in the remainder of the year,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India said.
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