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Office fit-out costs up 8% on-year in India, Mumbai most expensive, report

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Office fit-out costs up 8% on-year in India, Mumbai most expensive, report

The average cost of designing and building workspaces has risen by 8% year-on-year in India, with the average fit-out cost per sq m now ranging from high of $814 or Rs 61,050 in Mumbai to low of $669 or Rs 50,175 in Ahmedabad, showed a ‘s Asia Pacific Fit-Out Cost Guide 2021/2022.

The direct implications of the pandemic, such as supply chain disruptions, labour shortages, material availability and the rising cost of raw materials are the key factors behind the price increases in most markets, the global real estate firm said.

“As most organizations open their offices for re-entry, we’re seeing a significant jump in pricing for office fit-outs. Given the progress of the nation’s vaccine rollout, fiscal spending is likely to remain elevated as the recovery is still prone to setbacks. Consumption and investment should improve as restrictions ease,” said MV Harish, Executive Managing Director, Project Development Services, JLL India.

According to him, material availability and disruption in the supply chain are predicted to be the biggest cost drivers for 2022. Increased competition and aggressive pricing of margins in cities such as Pune, where contractors are chasing reduced work, may offset some of these price hikes.

JLL research reveals that over the next 12 months higher spending will be witnessed in areas of audio visual, M&E, sustainability, furniture, wellness facilities and partitions. The top three areas that business leaders have earmarked for further investment in 2022 are technology and audio-visual tools, mechanical and electrical facilities, like sensors and filtration, and sustainability features, such as rooftop gardens, indoor greenery and water conservation.

As per the findings of JLL research, Mumbai is the most expensive city to fit-out offices with maximum average fit-out office cost of Rs 61,050 per sq meter, followed by Kolkata and Delhi with average fit-out office cost of Rs 56,625 and Rs 56,325 per sq meter, respectively.

Despite rising costs, office design will continue to feature strongly on many companies’ agendas in the year ahead.

The building environment is in the epicentre of all the environmental and social impacts. The built environment currently accounts for almost 40% of carbon emissions. Building developments are responsible for 50% of raw materials consumed globally.

Decarbonizing the built environment is a top priority. Real estate is key to both making net zero goals a reality and driving economic and social equality. With more and more employees looking to get involved in their organization’s sustainability initiatives, a significant acceleration of sustainability initiatives will shape the future of office design.

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