To Re-Emerge As
Mumbai’s Power Location...!
by Mr. Ramesh Nair, JLL India
Nariman Point may never regain its
lost glory as the premier business location it once was. However, it will
remain an important business district for certain industry-specific occupiers.
For instance, established and individually-owned chartered accountancy firms
will not move away from this location, since their proprietors own their
offices and do not lease them.
Likewise, law firms actively
specializing in extensive and high-profile litigation need to be close to the
courts and will, for this reason, always prefer Nariman Point - which offers
walking distance to the High Court as well as Mantralaya (the seat of
Parliament) - to other locations like BKC and Lower Parel. Interestingly,
start-up firms looking for smaller offices will also continue to prefer Nariman
Point to other locations, since they are unlikely to get affordable 500 sq. ft.
offices anywhere else in the city.
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| Ramesh Nair, JLL India |
Still A Superlative Location
Nariman Point has good rail
connectivity with both Churchgate and VT Station in close proximity, and is in
the same vicinity as South Mumbai's elite luxury residential areas Napean Sea
Road, Breach Candy and Cuffe Parade.
In terms of social infrastructure too,
Nariman Point scores extremely high with the Trident Hotel, a Inox multiplex,
high-end restaurants and its unmatched sea view.
Nariman Point's fortunes may change
for the better in the future. The proposed Coastal Road will certainly lead to
increased traction for this location when implemented, and the deployment of a
metro line that ends at Cuffe Parade will mean greater accessibility from here
to Churchgate station, effectively negating the once obligatory taxi commute.
It should also be mentioned that the rapidly decreasing rentals there will
inevitably lead to an increase in demand for offices at Nariman Point.
While the above factors do not
exactly translate into a possible return to former glory, it does mean that
Nariman Point will not sink into obscurity anytime soon.
Commercial Future
Nariman Point is unlikely to
re-attract larger MNC occupiers who have already moved out to other SBD
locations. What can be expected is that companies which are currently based out
of Nariman Point will expand within their current buildings, or into other
buildings close by.
Companies currently occupying leased office premises at
Cuffe Parade and Churchgate may, in fact, aspire to move to Nariman Point since
it is more up-market and the rental differential it offers will be at its
lowest in the next few years.
Currently, office rentals at Nariman
Point are equivalent to or 10% lower than rentals at Lower Parel, and 35% lower
than rentals are BKC. The best buildings at Nariman Point command rentals of
Rs. 275 to 300/sq. ft. on carpet area.
In comparison, the rentals for the best
buildings in Lower Parel and Worli range between Rs. 300 to 350/sq. ft. For some
further perspective, some buildings in BKC fetch a rental of over Rs. 450/sq.
ft. on carpet area.
Residential Pitfalls...
On the residential real estate
front, things could certainly be better at Nariman Point.
Apart from the fact
that there is zero fresh supply, ongoing property tax disputes between many
Nariman Point societies and the local authorities are causing buyers to look
askance at buying into some of the resale options in these projects.
If matters on this front clear up,
the local authorities could use the property tax collected to refurbish the
buildings and embellish them with modern facades and better amenities.
Meanwhile, the dire need to widen roads at Nariman Point is not going away;
unfortunately, only greater willingness by the authorities can help on this front.
Also, pushing the Coastal Road proposition will definitely improve matters.
About the author..
Mr. Ramesh Nair is COO (Business & International Director) at JLL India
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