Jan 27, 2016 (LBO) – Sri Lanka’s commercial property market will see a rise in demand as local firms expand their businesses and foreign firms start setting up in the island, a global work-space provider said.
“There is huge demand for the commercial property in post war Sri Lanka and in the last 12 months the sentiment has improved with our local businesses expanding and foreign firms setting up,” Nirmal De Silva, Country Manager, Regus Sri Lanka said.
“There seems to be more FDI potential here the demand will only continue to grow. The government has also come up with some progressive measures like relaxing the 15 percent tax on foreign ownership, leasing ect.. ”
“So we will see more and more foreign companies coming here and Sri Lanka is a country that we are hoping to grow in as flexible working working starts to take off. This is the market we are targeting.”
He was speaking at the official launch of the company’s sixth location in the capital, Colombo.
Sri Lanka’s commercial property data shows that the market has been dealing with an acute shortage in supply of grade “A” space in and around the city for several years.
The top end of commercial space offers around 2.5 million sq. ft. of space in total provided by around a dozen developments, according to a recent research report by the Research Intelligence Unit, a real-estate consultancy.
The World Trade Centre tops the list for aggregate capacity with a total of over 700,000 square feet available for commercial purposes and the prevailing rental rates show that the WTC is still well ahead of the pack.
RIU says overall rental price levels have enjoyed exceptional price hikes over the past five years.
“The prevailing average of around 200 rupees to 220 rupees represents phenomenal price growth of around 15-20 percent per annum as forecasted by the RIU Real Estate Market Report in 2011.”
“This price surge is due to the fact that the market has been dealing with an acute shortage in supply of grade A space in and around the city for several years. With occupancy at the top facilities close to 100 percent, those seeking large space have had to settle for the middle market, both in the city and in the suburban areas.”