The Hindu Business Line : Mumbai in 5th spot in global office space list

Rise in Mumbai's ranking attributed to the entry and expansion of several major investment banks, including Goldman Sachs, UBS and Credit Suisse First Boston.

Advertisement

Bangalore Feb. 16 The country's financial hub, Mumbai, has climbed up six places to the fifth position in the world's top shopping streets rankings this year, according to the latest Office Space Across the World, a global report on office occupancy costs produced by real estate services firm Cushman & Wakefield.

The report says that Worli in Mumbai, the country's most expensive office location, has witnessed a 107 per cent annual rental growth, making it one of the biggest risers in the ranking.

Like Mumbai, Dublin in Ireland has gone up six places to reach the sixth position, where rents went up by 43 per cent last year. The strong growth by Dublin and Mumbai has pushed Midtown New York down two places to ninth position. This is despite rents increasing 28 per cent in US dollar terms last year, as the office vacancy rate dipped below 7 per cent for the first time since the summer of 2001, before the attack on the World Trade Centre.

Mr Sanjay Verma, Executive Managing Director - South Asia, Cushman & Wakefield, attributes the rise of Mumbai's ranking to the entry and expansion of several major investment banks, including Goldman Sachs, UBS and Credit Suisse First Boston. "This strong demand, along with the lack of new development and the low vacancy rates, has resulted in the significant escalation of rents," he said.

Rental growth

India also accounts for eight of the top 10 locations in terms of rental growth. Besides Worli (which also has the highest occupancy costs in Mumbai), Mumbai's Bandra Kurla Complex has seen rents increase 93 per cent. In terms of rental increases last year, the major component of office occupancy costs, the biggest rise in local currency terms was in Abu Dhabi in the UAE, with rents going up 200 per cent. Mumbai's Worli and Bandra Kurla Complex are ranked two and three, respectively, and New Delhi's central business district (88 per cent) is ranked four, followed by Gurgaon by 88 per cent. Other cities from the country to figure in this list include Mumbai central business district (58 per cent), Chennai's Guindy (47 per cent), Chennai's central business district (46 per cent) and Pune (46 per cent).

Mr Verma says the new quality specifications of office developments in Worli and Bandra Kurla Complex have outshone the office space in Mumbai's central business district. "This in turn has led to the escalation in rents."

London's West End district retains its title as the world's most expensive office location, followed by Tokyo, Hong Kong and Paris. The report compares office occupancy costs in 211 locations in 51 countries. Of those, 94 per cent recorded positive or stable annual growth and only 6 per cent experienced a decline in rents.

More Stories on : Real Estate & Construction | Maharashtra

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page