Here's some bad news for corporates wanting to set up base in Mumbai. The financial capital of the country recorded the biggest increase in industrial property rents — at 94 per cent over a single year — across the world in 2007, says a new study by global real estate consultancy, Cushman and Wakefield.
The rise in rentals has propelled Mumbai to take a leap of 11 places to become the 26th most expensive industrial location in the world.
According to the study Industrial Spaces Across the World 2008, Mumbai commanded a rental value of $10.88 per sq. ft. per month (approximately Rs 428.78 per sq. ft. per month) in December 2007 as against $ 5.6 per sq. ft. per month (Rs 221.02 per sq. ft. per month) in January 2007.
Mumbai is followed by Istanbul with a rise of 60 per cent, while IMT Manesar near New Delhi came at fifth position vis-à-vis rise in global industrial rents with a nearly 30 per cent increase, the study found.
Globally, the area around London's Heathrow airport retained its position as the world's most expensive industrial location with a monthly rental of $ 28.91 per sq ft. No Indian location has made it to the list of top 10 most expensive locales.
Said Sanjay Dutt, Joint Managing Director, Cushman & Wakefield India, "High levels of owner occupancy in Mumbai have led to a shortage of product at a time when demand is being stimulated by India's strong economic growth. This in turn has increased rents. With a shortage of space in the city, many occupiers are locating in industrial parks in the outskirts, in particular as the infrastructure improves and with the introduction of state incentives.”