The demand for office space in India is expected to be driven by the foreign retailers. There are many foreign retailers who are set to expand their shops in India.
Once the foreign retailers start expanding their stores in India, the commercial real estate sector will gain boost from this. Their expansion will demand more office space.
Up to now majority of the office space absorption is demanded by IT and ITeS sectors. The office space absorption is dependent on the performance of these sectors and if they do not raise demand, then the cities will face a downward growth of office space absorption.
This situation is going to get changed by the arrival of foreign retailers. Once they start up their offices in India, the demand for office spaces will be improved.
The top foreign retailers; who wish to expand their offices in India, are Gron Stockholm, Hamleys, Hennes and Mauritz (H&M), Lacoste and Starbucks. They are only a few among many.
Among the foreign retailers Starbucks has already set up stores in Mumbai and Delhi. The American coffee major runs its shops with entering into partnership with Indian brand Tata.
In the same manner i.e. partnering with Indian companies, UK based Gron Stockholm and Hamleys also have set up shops in the country. These foreign retail firms deal with toys and kids-wear items respectively.
Lacoste, French apparel brand, is yet another foreign retailer to set up stores in India. The French firm also has set up offices on partnership basis.
Many other foreign retailers are waiting for the approval from the Indian Government. The furniture major IKEA and the fashion chain major H&M, (both are Swedesh) are prominent ones among them.
IKEA plans to invest Rs.10,500 Cr in India as part of their expansion policy. However they have not yet received the clearance from the Cabinet Committee on Economic Affairs (CCEA). Once they get the clearance from CCEA, they will also set up shops in India.
