Though demand for commercial space across the country has slowed down in the first three months of 2012, Ahmedabad has bucked the trend, registering a 5.6% increase in absorption compared to previous quarter, according to a report by real estate consultants Cushman & Wakefield.

Mumbai and Kolkata were the only other two major cities that registered positive absorption at 35 and 33.7% respectively, during a period when cumulative office space absorption for the top eight Indian cities fell 32 per cent.

Another recent report ‘India Office Demand and Trends Survey 2011-2012′ by global real-estate consultant DTZ notes that Ahmedabad has emerged as a favourite among the tier II cities for banking, financial services and insurance companies.

Demand is also being driven by the fact that many companies from sectors like automobile, pharmaceutical and engineering are setting up operations around the city.

Jaxay Shah, vice-president, Confederation of Real Estate Developers’ Associations of India (Credai), said, “The demand in the housing market is sluggish, but with a high number of companies investing in Gujarat, the market for medium and top-end commercial units in Ahmedabad remains attractive.”

Realtor Uday Vora, who has just acquired a stretch of mill land in Shahpur from Indiabulls to build around 2,000 shops and offices reports, “We have already received pre-launch bookings for around 1,200 shops.”