BANGALORE:
India's biggest e-commerce company Flipkart has doubled its demand for
office space to 3 million sq ft, barely two months after approaching top
developers to lease 1.5 million sq ft. Embassy Office Parks, the equal
joint venture between Blackstone and Embassy Group, is said to bag this
lease deal which is pegged to be the largest office space transaction in
India in at least a decade.
The deal, at Rs 52 per sq ft, is
likely to be inked as early as this week. Flipkart plans to absorb the
entire office space in two phases, but in a record four to five years.
The e-commerce poster boy had short-listed Bangalore-based Bagmane Group
and Embassy in a process advised by real estate consulting firm JLL.Senior officials at Embassy Office Parks declined comment.
Flipkart, which is sitting on about $1.5 billion in cash, has already said that by the end of this financial year its employee strength would be increased to 25,000 from 12,000 at the beginning of the year. In real estate parlance, 3-million sq ft of office space could seat around 30,000 to 50,000 employees.
The breakneck growth of India's e-commerce market and Flipkart's aggression at the top would mean that hiring is likely to remain robust for the seven year-old-company co-founded by Sachin and Binny Bansal.
Rival Amazon has already leased out around 300,000 sq ft of office space at the World Trade Centre in Bangalore, a tenth of the office space requirement that Flipkart is projecting.
The office deal with Embassy Office Parks will see Flipkart being housed in the 106-acre Embassy TechVillage, which has around 500,000 sq ft of space that is yet to be leased of the 1.9 million sq ft developed, with the potential for to develop an additional 10 million sq ft of office space.
So far India's e-commerce leased about 600,000 sq ft space in the first of the ongoing calendar, said a report by consultancy firm CBRE South Asia, adding that office space deals by the well funded startups were rising.
Sectoral experts said that India's real estate sector will gain from e-commerce. CBRE South Asia deputy MD Ram Chandnani said e-commerce will stimulate demand for warehousing/logistics space for building back-end infrastructure, more than commercial office space.
