Ahmedabad office transactions scale to historic high in 2024;

Residential sales volume 10-year high: Knight Frank India

• India-facing business accounted for 67% of office leasing volume
• GIFT City accounted for over half of the area transacted in H2 2024
• 18,462 housing units sold in 2024 registering a growth of 15% YoY
• Sales in ticket size of INR 100 – 200mn saw massive YoY growth of 200% in 2024

Ahmedabad, January 07, 2025: Knight Frank India, in its latest report, India Real Estate: Residential and Office (July – December 2024) cited that Ahmedabad’s office market achieved a historic high of 3 mn sq. ft. of transactions in 2024, recording a 64% YoY growth. India facing businesses continued to drive volumes in the market. Office space completions grew by 45% from 1.9 mn sq ft in 2023 to 2.8 mn sq ft in 2024.

Residential sales in Ahmedabad witnessed a growth of 15% YoY from 16,113 units sold in 2023 to 18,426 units sold in 2024.The ticket size category of INR 5 mn – 10 mn witnessed the highest sales in the city contributing 42% of total sales in the city. Driven by strong demand, developers have prioritized lifestyle-focused projects with enhanced amenities and spacious designs to meet evolving buyer preferences. However, the pace of new unit launches has slightly moderated. In 2024, 22,043 units were launched, to outpace sales volumes during the period, ensuring adequate supply to support the market’s sustained growth momentum.

Office Market Update: January – December 2024

Annual transaction volumes in the Ahmedabad office market had ranged between 1 – 1.5 mn sq ft until the pandemic era. However, the market has seen a steady resurgence since 2022, driven by business expansions in the city. Ahmedabad’s rising prominence as an economic hub, bolstered by the establishment of the International Financial Services Centres Authority (IFSCA) in 2020 and strong support from state and central governments, has been instrumental in enhancing business prospects in this emerging office market.

The year 2024 concluded on a high note, marking the highest transaction volumes ever recorded in a single year. A total of 3.0 mn sq. ft. was transacted, reflecting a 64% increase compared to the previous year. To put this into perspective, this figure is nearly double the transaction volumes seen in any year prior to the pandemic. The average transacted rent saw a growth of 5% YoY to INR 44 per sq.ft/month.

AHMEDABAD OFFICE MARKET SUMMARY

Note: 1. 1 square metre (sq m) = 10.764 square feet (sq ft), Source: Knight Frank Research

Throughout the year, India facing business remained the key driver of market activity with transactions of 2 mn sq ft, constituting 67% of the total transacted volume in the city. Flex office spaces ranked second constituting 16% of the total transacted volume in Ahmedabad.

Occupier activity that had traditionally been concentrated in the CBD West, was broad based in H2 2024 with the Peripheral Business District (PBD) attracting 65% of the total area transacted during the period. GIFT City emerged as the hot spot during the period, accounting for 82% of the area transacted in the business district and a substantial 53% of the area transacted in the entire market. While mapped as part of the PBD, GIFT City’s ample infrastructure, high grade environmentally compliant properties and business friendly policies position it as an office market unique in its own right.

Source: Knight Frank Research

Rumit Parikh, Branch Head (Ahmedabad) & Senior Director- Occupier Strategy and Solutions, Industrial & Logistics and Retail said, “The growing depth and diversity of Ahmedabad’s occupier base are key indicators of its rapidly evolving office market. The focused efforts of both state and central governments to establish Ahmedabad as an economic hub, along with its affordable real estate and robust connectivity infrastructure, continue to make the city an attractive option for office occupiers. Rental growth has also picked up, driven by the record transaction volumes seen this year. With increasing occupier activity, particularly the rising interest in GIFT City, the Ahmedabad office market is well-positioned for continued growth in 2025.”

 Residential Market Update: January – December 2024

Ahmedabad’s residential market has bounced back and shown steady growth after the pandemic-induced slowdown. This recovery has been fuelled by rising homebuyer confidence, resulting in a notable increase in sales volumes. In response to the surge in demand, developers have introduced new projects offering larger spaces and upgraded amenities, along with price adjustments to align with the ongoing strong interest from buyers. This revitalized demand has propelled annual home sales to a 10-year high of 18,462 units in 2024. Even H2 2024 constitutes a 10-year high in terms of half-yearly sales volumes, a 12% growth in YoY terms from 8,131 units in H2 2023 to 9,085 units in H2 2024. 

AHMEDABAD RESIDENTIAL MARKET SUMMARY

Note: 1 square metre (sq m) = 10.764 square feet (sq ft), Source: Knight Frank Research

Ahmedabad, known for having the lowest per square foot residential prices among the top eight markets, traditionally saw the highest sales in the segment with units priced below INR 5 mn. However, a macro trend of declining sales in this segment, coupled with growing interest in higher-ticket segments, began to influence the Ahmedabad market in the second half of 2023 and has continued since.

The share of units in the sub-INR 5 million category dropped to 35% in H2 2024, falling below the INR 5-10 million segment, which accounted for 43% of sales in Ahmedabad. Meanwhile, the proportion of sales for units priced above INR 10 million has increased to 22% in the current period, up from 16% a year ago.

 Ahmedabad ticket size split comparison of sales during H2 2023 and H2 2024

Source: Knight Frank Research

The ticket size category of INR 5mn-10mn witnessed the highest sales in the city which also grew substantially by 36% YoY, the highest growth in this category among all cities. While still miniscule, Ahmedabad does have a market for units priced upto INR 200 mn. During 2024, the city witnessed of the sale of 12 units priced in the luxury category or ticket size between INR 100-200 mn, while the ticket size between INR 20-50mn saw a growth of 104% YoY from 502 residential units in 2023 to 1,024 units in 2024.

Ticket-size split of sales

Source: Knight Frank India

 Rumit Parikh, Branch Head (Ahmedabad) & Senior Director- Occupier Strategy and Solutions, Industrial & Logistics and Retail said, “Homebuyers’ growing preference for spacious apartments in modern high-rises marks a notable shift in the Ahmedabad residential real estate market. High affordability, relatively lower price per square foot, and an improving local economy are key factors driving this market forward as it heads into 2025.”