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Slowdown hits commercial rentals

india Updated: Mar 18, 2009 02:13 IST
Naresh Kamath
Naresh Kamath
Hindustan Times
Slowdown hits commercial rentals

The global economic slowdown has resulted in a reduction in demand for industrial spaces in the city. As a result, the city has slipped 11 positions in the list of the world’s most expensive industrial rental locations, from 26th position last year to 37th this year.

The finding was released in a report titled Industrial Spaces Across the World that was prepared by global real estate consultant Cushman and Wakefield.

Harleen Oberoi, executive director, Cushman and Wakefield, said rental rates had stagnated because of the slowdown. “Large corporates, especially the multinationals, have become very cautious with their development plans,” said Oberoi.

He said a property that fetched a monthly rent of Rs 18 per sq ft in 2006 had begun to bring in Rs 33 per sq ft during the boom last year.

The slowdown now had resulted in the rates not climbing beyond last year’s levels.

The premier Thane Turbe creek estate registered no increase in rentals this year.

It was a similar story at the Taloja industrial estate, which commands Rs 22 per sq ft, the same as last year. Small-scale indigenous industries continued to shift to smaller industrial sheds to continue remaining profitable. Other places in the country have also been affected by the economic slowdown. The monthly rental at Talegaon in Pune is Rs 22 per sq ft, the same as last year.

Sriperumpudur in Chennai came down to Rs 28 from Rs 30 per sq ft, and Gurgaon to Rs 11 from Rs 12. The report was compiled using data from 52 countries across the globe and 135 top industrial locations were examined.