Mumbai : Multi-national companies (MNCs) operating in India are now opting for outright purchase of office space instead of taking it on lease, Real estate consultancy Cushman & Wakefield said in a report.
MNCs in India are increasingly investing in office spaces with Rs 2,470 crore worth of transactions taking place during the last two years, it said. “There is a seismic shift in the traditional approach of leasing space that such companies have had for years while considering overseas investment,” Cushman & Wakefield said in the report.
It said MNCs in the banking, financial services and insurance (BFSI), information technology enabled services (ITES), fast moving consumer goods (FMCG) and pharmaceutical sectors are among the lead commercial office buyers.
According to the report, in 2010 foreign MNCs made negligible contributions to the sales of commercial office space. But in 2012, 2013 and during the 1st quarter of 2014 foreign MNCs contributed 43 percent to the total sales value of commercial offices. “Companies that have established operations in India and are confident of their projections and potentials in the country are now tailoring their real estate requirement so that they can be more cost-effective,” Sanjay Dutt, executive managing director-South Asia, was quoted as saying in a statement by the consultancy.
According to him, companies in specific sectors such as pharmaceuticals, IT and ITES are looking to consolidate their research and development divisions with their front-end divisions in a single setup and are looking for assets to purchase as it proves to be a cost effective strategy for companies. “Another factor compelling especially the US-based companies to switch from ‘Leasing strategy’ to ‘Buying strategy’ is that corporate profits earned outside the US are not subject to federal taxes unless they are brought back to US shores,” Dutt said.
Sydney : The world is facing a global jobs crisis that is hurting the chances of reigniting economic growth and there is no magic bullet to solve the problem, the World Bank warned on Tuesday. In a study released at a G20 Labour and Employment Ministerial Meeting in Australia, the Bank said an extra 600 million jobs needed to be created worldwide by 2030 just to cope with the expanding population. “There’s little doubt there is a global jobs crisis,” said the World Bank’s senior director for jobs, Nigel Twose. “As this report makes clear, there is a shortage of jobs and quality jobs. “And equally disturbingly, we’re also seeing wage and income inequality widening within many G20 countries, although progress has been made in a few emerging economies, like Brazil and South Africa.”
