Mumbai commercial property market – mid-2011 update
The Mumbai commercial property market has displayed resilience in the recent past.
The Mumbai commercial property market has displayed resilience in the recent past.
Real estate stock of office premises in Mumbai has been going through a slump for the last 14 financial quarters.
India’s real estate industry has always been beset by risk, and many unwary buyers and investors have burned their fingers on it.
In Mumbai, rising costs and lack of space make it unfeasible for residents to move out of aging and often sadly dilapidated housing societies.
Buying an office or retail space is a huge investment, which is why commercial real estate has been traditionally seen as an asset class that only institutional investors or heavyweight HNIs could invest in.
Over the last six to seven years, the number of investors who enter the residential real estate sector for the purpose of capital appreciation has been increasing.
The Sensex has always been a barometer of the country’s general economic ‘mood’. The real estate index, on the other hand, is an indicator of the sentiments towards real estate developers.
After a one-year period starting 3Q 2009, which saw a strong recovery with a record 40%+ increase in prices, the Mumbai residential real estate market has been seeing a slowdown over the last two quarters across various micro markets.
Even as Lower Parel and BKC vie with each other for pre-eminence as Mumbai’s commercial real estate hotspots, Dadar – Mumbai’s oldest and most established locations – stands in a class uniquely its own by virtue of its extremely favourable geographical placement and connectivity. For this reason – and for all practical purposes – Dadar is the heart of Mumbai.
We are looking at a potential situation in Mumbai’s office…