The Hindu Business Line : Bandra Kurla Complex: Rentals rise in line with record property prices

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Bandra Kurla Complex: Rentals rise in line with record property prices

Rentals in BKC range between Rs 450 and Rs 500 per sq ft, while it is between Rs 350 and Rs 450 per sq ft at Nariman Point.

Suresh P. Iyengar
S Shanker

Mumbai, Jan 11 Rentals at the Bandra Kurla Complex (BKC), the financial hub here, seem to be dovetailing its record-breaking property rates. A sudden spurt in rentals post-MMRDA auction of a 7,107 sq metre plot for Rs 5.04 lakh per sq m has forced the commodity exchange NCDEX to relocate part of its operations elsewhere.

The NCDEX plans to move its back office operations from Exchange Plaza in BKC to Kanjur Marg.

“Rentals have been more than doubled from Rs 175 per sq ft last year to Rs 450 per sq ft this year. So we are moving our back office operations on the ground floor to Kanjur Marg and vacating the fourth floor,” said Mr Ravi Kumar, Managing Director, NCDEX.

Rentals in BKC, on an average, range between Rs 450 and Rs 500 per sq ft depending on the facilities offered, while it is between Rs 350 and Rs 450 per sq ft at Nariman Point.

“Rentals in BKC are charged on built-up area, but in Nariman Point it is on the carpet area. This pushes up the cost further for the corporates,” said Mr Sanjeet Narain, Managing Director, Narains Corp, a Mumbai-based property consultant and realtors.

Given the prevailing rates in BKC, some corporates prefer to be located on the nearby localities of Bandra or Kurla and this in turn pushed up prices in these areas, said Mr Anand J. Gupta, Chairman, Builders’ Association of India, Mumbai Chapter.

The high rate in BKC has also stoked up real estate prices in adjoining areas such as Kalanagar, Gandhi Nagar and Khernagar in Bandra and CST Road in Kurla.

“Builders are offering Rs 30,000-35,000 per sq ft for old buildings in Bandra and property rates in Kurla are between Rs 15,000-20,000 per sq ft,” Mr Gupta said.

Landlords charge about one per cent of property rate as rentals. “Once developed, the rates at the recently auctioned MMRDA plots may fetch up to Rs 60,000 per sq ft and it might push up rentals to around Rs 600 a sqft,” Mr Gupta said.

“Lack of small to medium size office space has made BKC a hub for large corporates. “Office space of 10,000-15,000 sq ft are in plenty at BKC, but smaller ones between 1,500 - 5,000 sq ft are in great demand.

“New projects coming up at LBS Marg, Goregaon and along the western and eastern expressways will ease pressure on BKC after a year,” said Mr Narain.