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City report - Mumbai Office Market - Q3 2010

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o Ascending corporate occupier demand …

o Ascending corporate occupier demand
o Surge in demand for land in Mumbai
o Upcoming commercial projects to be mixed use development or residential development.
o Creation of Mumbai Development Fund (MDF) to finance mega infrastructure projects in the city.

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  • 1. CITY REPORT MUMBAI OFFICE MARKET Q3 2010
  • 2. BNP Paribas Real Estate All the buildings blocks In India our specialists bring you our expertise in Transaction Advisory, Valuation, Consulting. With our international scope and on-the-ground presence, you’ll find the perfect partner that can ensure the success of your real estate project. With BNP Paribas Real Estate, all the pieces come together. www.realestate.bnpparibas.com BNPParibasImmobilier–13boulevardduFortdeVaux,75017Paris–FranceSASaucapitalde225205616€-RCSParis692012180–CodeNAF4110B Your contact in India: Bangalore: +91 80 4030 0334 - Mumbai: +91 22 6138 8088 - Delhi: +91 11 4959 8800 info.india@bnpparibas.com BNP Paribas Real Estate and Infrastructure Advisory Services Pvt. Ltd
  • 3. CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Summary p. 4 Macroeconomic Context p. 5 Mumbai Map p. 6 Central Business District (CBD) p. 7 Extended Central Business District (Extended CBD) p. 8 Alternate Central Business District (Alternate CBD) p. 9 Secondary Business District (SBD) p. 10 Periphery Business District (PBD) p. 11 Glossary p. 13Key Transactions p. 14Key Projects p. 15 CONTENTS Rental Values & Capital Values p. 12
  • 4. 4I I SUMMARY The Mumbai Metropolitan Region (MMR) witnessed strong demand from corporate end users in Q3 of 2010. There is an increase in absorption of commercial real estate and IT/SEZ real estate space in the city and in the suburbs. The absorption is mainly led by banking and financial services companies and also by telecom and IT services companies. Further, there is also a good amount of uptake of space by pharma, shipping and logistics companies especially in the SBD of Andheri. The Bandra Kurla Complex remains the most favourable location for the high end corporate occupier. This district is also the most preferred area for investment by the corporate and retail investors. Many commercial properties were launched as an “off plan offer” and attracted attention largely form retail investors and also from some corporate investors. Over all the construction activity has picked up and it is expected that approximately 3 mn. sq.ft. of new supply will be added by the end of the year. On the development side, there are many new projects being announced in all parts of Mumbai. At the same time, many developers especially in the suburbs plan to convert their upcoming commercial projects into either mixed use development or residential development. There has been a surge in demand for land in Mumbai as all major land auctions were successfully sold at a premium. Some of the land transactions announced in this quarter includes Indiabulls Real Estate buying Poddar Mill land (2.3 acre) for USD 105 mn. approx and Bharat Mills land ( 8.37 acres) for USD 326 mn. , both in Worli area, Sheth group buying 18 acres of Borosil land at Andheri for USD 185 mn. and Suntech buying 6 acres of land at Goregaon for USD 34 mn. In the SBD of Borivili, an existing building complex (Mangal Kunj) of over 100,000 sq.ft. consisting of 5 building s and 100 shops got sold at a record price of Rs. 100,000 per sq.ft. Though most of these lands will be converted into residential developments or mixed use developments, it will have a positive impact on nearby commercial developments. The real estate stocks of real estate companies or companies which announced real estate projects in this quarter saw a high upward movement in their stock prices. Some of the key stocks include Indiabulls Real Estate and Supreme Industries, which saw a major jump over the last quarter. On the Government side, The Maharashtra government has decided to create a Mumbai Development Fund (MDF) to finance mega infrastructure projects in the city. The fund will be created by imposing new levies and charges on big construction schemes and, possibly, on users of the new metro and monorail projects. The levies will also include part of the money received from charging a premium for the grant of additional FSI and TDR (Transfer of Development Rights). While USD 150 mn. is expected from additional FSI premia, additional funds will be generated by imposing a development surcharge on construction projects above 10,000 sq ft. Further, as per the draft CRZ (Coastal Regulation Zone) notification 2010, the environment ministry has announced that it will allow redevelopment on Mumbai coastal slums. This may give scope for some new hotel developments to come up on the coastal line, however it is too soon to make such an assumption. Another major development in this quarter is launch of real estate ratings by CRISIL ( a standard and poor company). The ratings are expected to bring greater transparency to assessing real estate projects. The ratings given would be city-specific and based on five parameters – the quality of legal documentation, construction- related risks, the financial flexibility of the project, and the background and track record of the project sponsor. The rental and capital values for commercial real estate in MMR are expected to remain stable, albeit certain vibrant districts like Bandra Kurla Complex, where there can be further increase in the prices. Strong corporate occupier demand. Frenzy land buying by developers CITY REPORT MUMBAI OFFICE MARKET - Q3 2010
  • 5. Repo Reverse Repo Repo & Reverse Repo Rate 7 6 3 Percent 1 CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 MACROECONOMIC CONTEXT The Central Bank takes a more sophisticated approach: maintains status quo on CRR & SLR 5I I SLR CRR CRR & SLR 30 20 10 5 Percent 0 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Mar-08 Nov-09 Jan-10 Mar-10 Gross Domestic Product (GDP) Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 9.30% 8.80% 8.80% 7.90% 7.60% 5.30% 5.80% 6.10% Q3 2007 Q4 2007 Q3 2009 7.90% Q4 2009 6.00% Wholesale Price Index (WPI) 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Source: Confederation of Indian Industries Q1 2010 8.60% Apr-10 May-10 Jul-10 22-May-09 22-Jun-09 23-Jul-09 23-Aug-09 23-Sep-09 24-Oct-09 24-Nov-09 25-Dec-09 25-Jan-10 25-Feb-10 19-Mar-10 20-Apr-10 Sep-10 15 25 20-May-10 20-Jun-10 27-Jul-10 20-Aug-10 16-Sep-10 2 4 5 0 Jul-10 Q2 2010 8.80% 2-Jul-10 The Reserve Bank's Review of Monetary Policy on July 27, 2010 expressed concerns over the global outlook. Indicators of economic activity in advanced economies continue to suggest that the recovery is slowing and that the second half of 2010 will post slower growth than the first, although expectations have generally not been revised downwards since end-July. Under the Liquidity Adjustment Facility (LAF), the RBI has increased the repo rate by 25 basis points from 5.75% to 6.0% and also hiked the reverse repo rate by 50 basis points from 4.5% to 5.0% with immediate effect. This will help maintain financial conditions conducive to sustaining growth, according to the RBI. India’s GDP during the quarter starting July 2010, rose to 8.8%. Although some of this is attributable to a favourable base effect, the growth rate indicates that the recovery is consolidating and the economy is rapidly converging to its trend rate of growth. Inflation remains the dominant concern in macroeconomic management. The main priority of the Reserve Bank is to curb the ongoing inflation, which peaked at 11% in the month of August. Interest rates have been increased by the banks to contain the inflation, but it could slow down the growth of the Indian economy in the coming months. But even though there has been a rise in the interest rates, there hasn't been much change in the distribution of loans, the Indian customer is hardly affected with the hiked interest rates. Overall, even as the global environment continues to be a cause for caution, the big picture has not worsened significantly since July. India has replaced the US as the second most important Foreign Directive Investment (FDI) destination for transnational corporations during 2010- 2012, according to a survey conducted UNCTAD. In its latest 'World Investment Prospects Survey 2010-2012', the United Nations Conference on Trade and Development said transnational corporations remain buoyant about investment prospects in China, India and Brazil. According to the survey, India is the most important FDI destination next only to China. DLF Limited 20,285 17% 4,110 2% Major Real Estate Companies in India Sales (In INR / In million) Profits (In INR / In million) Q3 2010 Q2 2010 Q on Q Change % Q3 2010 Q2 2010 Q on Q Change % Unitech 8,286 -22% 1,800 -3% India Bulls 4,337 25% 1,336 31% Sobha Developers 3,156 35% 343 72% Peninsula Land 1,483 -17% 500 28% Parsvnath Developers 2,528 -23% 318 82% Pheonix 404 10% 183 21% Omaxe Limited 2,529 40% 217 69% Mahindra Lifespace 679 31% 145 70% Anantraj 1,034 28% 459 5% Ackruti City 1,765 -8% 421 31% Ansal Properties 2,508 27% 369 -38% 5,414 1,745 4,257 589 1,226 638 443 890 247 1,624 550 3,197 228 221 23,690 4,186 3,544 368 1.329 480 6,445 1,740 1,955 579
  • 6. MUMBAI MAP 6I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Elephanta Island Butcher Island N Tulsi Lake Vihar Lake Powai Lake Domestic Airport Sahar Airport (International Airport) Sanjay Gandhi National Park knilaeSilroWardnaB ArabianSea 4 5 9 3 6 28 7 1 2 5 8 4 1 3 9 7 5 21 18 7 26 14 2 20 11 25 1 10 9 6 16 12 4 17 3 13 19 24 8 15 6 22 14 6 1 4 9 15 13 16 5 11 2 8 12 10 3 7 1 2 3 4 yawhgiHsserpxE n retsaE Chatrapati Shivaji Terminus (CST) PUNE Ahm edabad 23 1. Girgaon 2. Grant Road 3. 4. 5. 6. 7. 8. 9. Lower Parel Mahalakshmi Mumbai Central Pedder Road Prabhadevi Tardeo Worli Extended Central Business District Alternate Central Business District 1. Bandra 2. Bandra East 3. Bandra Kurla Complex 4. Santacruz East (Kalina) Periphery Business District 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. Airoli Belapur Dombivali Ghansoli Jui Nagar Kalwa Kalyan Kharghar Koper Khairne Mumbra Nerul Panvel Sanpada Thane Turbhe Vashi Central Business District 1. 2. 3. 4. 5. 6. 7. 8. 9. Breach Candy Chatrapati Shivaji Terminus (CST) Churchgate Colaba Cuffe Parade Fort Malabar Hill Marine Line Nariman Point Secondary District Business 1. 2. 3. 4. 5. 6. 7. 8. 9. Andheri Bandra West Bhandup Borivali Byculla Chembur Dadar Ghatkopar Goregaon 19. Powai 20. Santacruz 21. Sewri 22. Sion 23. Vidya Vihar 24. Vikhroli 25. Vile Parle 26. Wadala 10. 11. 12. 13. Jogeshwari Juhu Kandivali Kanjurmarg 14. Kings Circle 15. Kurla 16. Malad 17. Mulund 18. Parel
  • 7. 7I I CENTRAL BUSINESS DISTRICT (CBD) Due to attractive leasing rates, the CBD of Mumbai is witnessing some renewed interest especially from small size corporate tenants. However, the medium and large format corporate occupiers (5,000 sq.mts and above) still prefer to move to ECBD and to ACBD. The vacancy rate is increasing and therefore, there is a downward pressure on leasing and capital values. CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Stable occupier demand Source: BNP Paribas Real Estate, India Ballard Estate 250 Nariman Point 325 Fort 150 Cuffe Parade 200 Q2 2009 RENTAL VALUES ( INR / SQ.FT / MONTH) Q3 2009 Q4 2009 250 325 150 200 250 325 150 200 Q2 2010 Q1 2010 250 200 150 325 Source: BNP Paribas Real Estate, India Q2 2009 Ballard Estate 35,000 Nariman Point 40,000 Fort 22,500 Cuffe Parade 30,000 CAPITAL VALUES (INR / SQ.FT) Q3 2009 Q4 2009 35,000 40,000 22,500 30,000 35,000 40,000 22,500 30,000 Q1 2010 Q2 2010 35,000 30,000 22,500 40,000 The average headline rentals & capital values for the last 6 quarters are as follows:- 250 200 150 300 35,000 30,000 22,500 40,000 Nariman Point Ballard Estate Cuffe Parade Fort RentalValues(INR/sq.ft/month) 0 50 100 150 200 250 300 350 400 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q2 2009 Q3 2009 Nariman Point Ballard Estate Cuffe Parade Fort CapitalValues(INR/sq.ft) Q4 2009 Q1 2010 Q2 2010 — 10,000 20,000 30,000 40,000 50,000 Q3 2010 Q3 2010 Q3 2010 Q3 2010 220 200 150 290 35,000 30,000 22,500 40,000
  • 8. EXTENDED CENTRAL BUSINESS DISTRICT (ECBD) This district is vibrant in terms of number of enquiries from corporate occupiers and investors. However, very few transactions have been reported. It is expected that there will be a downward pressure on rental and capital values owing to increase in upcoming new supply in this district. 8I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Many enquiries, less conversions Q2 2009 Mahalaxmi Lower Parel Worli 30,000 Prabhadevi 25,000 15,000 18,000 Source: BNP Paribas Real Estate, India Q3 2009 Q4 2009 30,000 25,000 15,000 18,000 30,000 25,000 15,000 18,000 Q2 2010 Q1 2010 Mahalaxmi Lower Parel Worli 300 Prabhadevi 250 150 180 Q2 2009 Source: BNP Paribas Real Estate, India Q3 2009 Q4 2009 300 250 150 180 300 250 150 180 Q2 2010 Q1 2010 180 150 225 275 18,000 15,000 25,000 30,000 The average headline rentals & capital values for the last 6 quarters are as follows:- RENTAL VALUES ( INR / SQ.FT / MONTH) CAPITAL VALUES (INR / SQ.FT) 180 150 225 275 18,000 15,000 25,000 30,000 RentalValues(INR/sq.ft/month) 0 50 100 150 200 250 300 350 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Worli Prabhadevi Lower Parel Mahalaxmi CapitalValues(INR/sq.ft) Q2 2009 Q3 2009 — 5,000 30,000 Worli Prabhadevi Lower Parel Mahalaxmi 20,000 Q4 2009 Q1 2010 Q2 2010 10,000 15,000 25,000 35,000 Q3 2010 Q3 2010 Q3 2010 Q3 2010 170 150 220 250 20,000 15,000 25,000 30,000
  • 9. ALTERNATE CENTRAL BUSINESS DISTRICT (ALTERNATE CBD) There is high investor demand to buy commercial office space in this district. Most of the properties offered on sale are selling briskly on off plan basis. The new project announcement, especially in Bandra Kurla Complex have generated lot of interest from corporate and rental investors. The lease rental and capital values have again appreciated in this district. It is expected that the activity in this district will remain buyout and there can be another 5-10% appreciation in the next 3-6 months. 9I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Good investor damand Source: BNP Paribas Real Estate, India Source: BNP Paribas Real Estate, India Q2 2009 Bandra - Kurla Complex 250 Bandra East 175 Kalina 200 Q3 2009 Q4 2009 250 175 200 250 175 200 Bandra - Kurla Complex 25,000 Bandra East 17,500 Kalina 20,000 Q2 2009 Q3 2009 Q4 2009 25,000 17,500 20,000 25,000 17,500 20,000 Q2 2010 Q1 2010 Q2 2010 Q1 2010 300 175 200 30,000 20,000 22,500 The average headline rentals & capital values for the last 6 quarters are as follows:- RENTAL VALUES ( INR / SQ.FT / MONTH) CAPITAL VALUES (INR / SQ.FT) 325 175 200 30,000 20,000 22,500 Bandra - Kurla Complex Kalina Bandra East RentalValues(INR/sq.ft/month) 0 50 100 150 200 250 300 350 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 CapitalValues(INR/sq.ft) Q2 2009 Q3 2009 — 5,000 20,000 25,000 10,000 15,000 30,000 35,000 Bandra - Kurla Complex Kalina Bandra East Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q3 2010 Q3 2010 Q3 2010 350 175 190 32,000 20,000 22,500 400
  • 10. SECONDARY BUSINESS DISTRICT (SBD) There is a good demand from existing corporate occupiers to upgrade to upcoming new and modern buildings in this district. This district, today has approximately 60% of the entire supply of Mumbai metropolitan region. There is a good investor demand for projects abutting the Western Express Highway. Powai continues to attract attention from corporate occupiers. 10I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Renewed interest from corporate occupiers Source: BNP Paribas Real Estate, India Source: BNP Paribas Real Estate, India Q2 2009 Vile Parle 120 Andheri W 110 Andheri E 120 Powai 90 Vikhroli Malad Borivali 65 90 50 Q3 2009 Q4 2009 120 110 120 90 65 90 50 120 110 120 90 65 90 50 Vile Parle 12,000 Andheri W 11,000 Andheri E 12,000 Powai 9,000 Vikhroli 6,500 Malad 9,000 Borivali 5,000 Q2 2009 Q3 2009 Q4 2009 12,000 11,000 12,000 9,000 6,500 9,000 5,000 12,000 11,000 12,000 9,000 6,500 9,000 5,000 Q2 2010 Q1 2010 Q2 2010 Q1 2010 120 110 60 80 90 75 120 12,000 11,000 6,500 9,000 9,000 7,500 12,000 The average headline rentals & capital values for the last 6 quarters are as follows:- Kurla 60 65 70 70 Kurla 8,500 8,500 8,000 8,000 RENTAL VALUES ( INR / SQ.FT / MONTH) CAPITAL VALUES (INR / SQ.FT) 110 100 60 80 90 75 140 80 12,000 11,000 6,500 9,000 9,000 7,500 13,000 8,000 RentalValues(INR/sq.ft/month) Q2 2009 Q3 2009 0 100 Vile Parle Andheri East Andheri West Powai Malad Vikhroli Borivali 40 Q4 2009 Q1 2010 Q2 2010 20 60 80 120 140 160 Kurla CapitalValues(INR/sq.ft) — 4,000 Vile Parle Andheri East Andheri West Powai Malad Vikhroli Borivali 8,000 10,000 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 2,000 6,000 12,000 14,000 16,000 Kurla Q3 2010 Q3 2010 Q3 2010 Q3 2010 100 90 60 80 90 70 130 90 13,000 12,000 8,000 9,000 9,500 8,000 13,500 9,500
  • 11. PERIPHERY BUSINESS DISTRICT (PBD) There is a increase in activity in the SEZ space in this district as there is a lot of new demand from software companies. However, the IT real estate space has few takers and a lot of ready space is available to lease sell. The capital values have improved significantly owing to investor demand. It is expected that this district will remain active and some more leasing and sale activity will be reported for the remaining year. as well as to 11I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 High demand for SEZ space Thane 4,000 Airoli 3,500 Vashi 6,000 Q2 2009 Source: BNP Paribas Real Estate, India Source: BNP Paribas Real Estate, India Q3 2009 Q4 2009 4,000 3,500 6,000 Thane 40 Airoli 35 Vashi 60 Q2 2009 Q3 2009 Q4 2009 40 35 60 40 35 60 4,000 3,500 6,000 Q2 2010 Q1 2010 Q2 2010 Q1 2010 40 40 60 4,500 4,000 6,000 The average headline rentals & capital values for the last 6 quarters are as follows:- RENTAL VALUES ( INR / SQ.FT / MONTH) CAPITAL VALUES (INR / SQ.FT) 40 40 60 4,500 4,000 6,000 Q2 2009 Q3 2009 0 10 20 30 40 50 60 70 80 Vashi Thane Airoli RentalValues(INR/sq.ft/month) Q4 2009 Q1 2010 Q2 2010 Q2 2009 Q3 2009 — 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 CapitalValues(INR/sq.ft) Vashi Thane Airoli Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q3 2010 Q3 2010 Q3 2010 38 42 70 5,000 4,500 7,500
  • 12. RENTAL VALUES FOR Q3 2010 12I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Source: BNP Paribas Real Estate, India CAPITAL VALUES FOR Q3 2010 Rent INR/ sq.ft/ month Ballard Estate Nariman Point Fort Cuffe Parade Region Q on Q Change 220 290 150 200 0% 0% -12% -3% Ballard Estate Nariman Point Fort Cuffe Parade Region INR / sq.ft Q on Q Change 0% 0% 0% 0% Mahalaxmi Lower Parel Worli Prabhadevi Region Rent INR/ sq.ft/ month Q on Q Change 150 170 250 220 0% -2% -6% -9% Mahalaxmi Lower Parel Worli Prabhadevi Region Q on Q Change INR / sq.ft 15,000 20,000 30,000 25,000 0% 0% 11% 0% Thane Airoli Vashi Region Rent INR/ sq.ft/ month Q on Q Change 42 38 70 5% -5% 17% Thane Airoli Vashi Region Q on Q Change INR / sq.ft 5,000 4,500 7,500 Vile Parle Andheri W Andheri E Powai Region Vikhroli Malad Borivali Rent INR/ sq.ft/ month Q on Q Change 130 90 100 90 70 80 60 -7% -10% -9% -7% 0% 0% 0% Kurla 90 13% Vile Parle Andheri W Andheri E Powai Vikhroli Malad Borivali Region Q on Q Change INR / sq.ft 13,500 12,000 13,000 9,500 8,000 9,000 8,000 4% 9% 8% 7% 0% 23% 6% Kurla 9,500 19% Bandra - Kurla Complex Bandra East Kalina Region Rent INR/ sq.ft/ month Q on Q Change 350 175 190 8% 0% -5% Bandra - Kurla Complex Bandra East Kalina Region Q on Q Change INR / sq.ft 32,000 20,000 22,500 7% 0% 0% CBD CBD Extended CBD Extended CBD Alternate CBD Alternate CBD SBD SBD PBD PBD 11% 13% 25% 35,000 30,000 22,500 40,000
  • 13. 13I I KEY TRANSACTIONS CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 Q3 2010 Building Occupiers Space (in sq.ft) Micro Market Location Lodha Excelus, Mahalaxmi HDFC Standard Life Insurance 95,013 Extended CBD Mahalaxmi Trade View NYK Logistics 21,000 Extended CBD Lower Parel Peninsula Tower Walt Disney 7,000 Extended CBD Lower Parel Fortune 2000 Global Bio Care 8,000 Alternate CBD Bandra Kurla Complex Raheja Towers Gartner 18,500 Alternate CBD Bandra Kurla Complex Platina AIG Real Estate 3,000 Alternate CBD Bandra Kurla Complex Kohinoor City IIBF 50,000 SBD Kurla - West Nomura Bldg Religare 25,000 SBD Powai Supreme Business Park Fullerton 60,000 SBD Powai Credit Suisse Bldg Credit Suisse 40,000 SBD Powai Kohinoor City ALD Automotive 10,000 SBD Kurla - West DLH Park Max Mobile 45,000 SBD Goregaon West Kaledonia State Bank of India 20,000 SBD Andheri Rustomjee Nataraj Amway 15,000 SBD Andheri Mind Space First Source 100,000 PBD Airoli Reliable Tech Park Spanco 70,000 PBD Airoli Vishwaroop IT Park IBM 7,000 PBD Vashi iThink, Thane FLSmidth 38,133 PBD Thane iThink, Thane Pan Gulf Technologies 34,623 PBD Thane iThink, Thane Tata Capital 128,394 PBD Thane Kesar Solitaire Danfoss 8,800 PBD Sanpada Sun Infotech Park India Infoline 115,000 PBD Thane Source: BNP Paribas Real Estate, India
  • 14. 14I I KEY PROJECTS CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 New Supply – Year 2010 Building Location Micro Market Space (in sq.ft) Completion Date (expected) One India Bulls Centre Lower Parel Extended CBD 700,000 Ready India Bulls Financial Centre Lower Parel Extended CBD 500,000 Ready Cynergy Prabhadevi Extended CBD 400,000 Q4 2010 Peninsula Business Park Lower Parel Extended CBD 1,300,000 Q4 2010 Wadia Plaza Worli Extended CBD 400,000 Q4 2010 Cresenzo Bandra Kurla Complex Alternate CBD 577,000 Q4 2010 Grande Palladium Kalina Alternate CBD 150,000 Ready Supreme Chambers Andheri West Alternate CBD 275,000 Ready Pooja Constructions Bandra Kurla Complex Alternate CBD 160,000 Ready Rustomjee Natraj Andheri East SBD 286,000 Ready Silver Uthopia Andheri East SBD 400,000 Q4 2010 Rustomjee Aspire Sion SBD 124,000 Ready IT Park, Ajmera Andheri East SBD 1,100,000 Q4 2010 Supreme Chambers Andheri West SBD 240,000 Ready Ackruti Star Andheri East (MIDC) SBD 400,000 Ready Boomerang Chandivali SBD 1,000,000 Ready Western Edge Borivali SBD 400,000 Ready Ruby Dadar SBD 1,000,000 Q4 2010 Reliable Tech Park Airoli PBD 1,000,000 Q4 2010 Amruta Thane PBD 42,000 Ready G Corp Tech Park Thane PBD 700,000 Ready Mindspace SEZ Airoli PBD 600,000 Ready Gigaplex Airoli PBD 300,000 Ready Nitco Business Park Thane PBD 170,000 Ready Source: BNP Paribas Real Estate, India
  • 15. 15I I CITY REPORT MUMBAI OFFICE MARKET - Q3 2010 GLOSSARY Q3: Super Built-up Area (SBUA): Carpet Area: Sq.mt: Mn: New: Recent: SEZ: BFSI: SLR: FSI: MMRDA: Quarter 3 of the financial year (July - August - September) Built-up area + common area including lifts area, common passages, utilities, terrace etc. & varies from building to building. Actual usable area, and does not include any common areas, area occupied by walls etc. Square Meter Million Building built within the last 5 years. Building less than 10 years old. Special Economic Zone having special tax exemptions / incentives to corporate occupiers Banking & Financial Services Industry Statutory Liquidity Ratio Floor Space Index Mumbai Metropolitan Region Development Authority Absorption: Bare Shell: BPO: BUA: Completed Stock: DU: EPIP: FAR: Grade A Space: Ground Coverage: Hard Option: INR: Pre-lease: Speculative Stock: Stock: Supply: Transaction Volumes: Vacancy: Warm Shell: Q on Q: y-o-y: IT: ITES: Repo Rate: Reverse Repo Rate: SEC A, B, C & D Socio: Sq.ft: Stamp Duty: Occupied Stock (n) – Occupied Stock (n-1); Where “n” is the specified period (quarter, year etc.) Premises consisting of basic structure with lifts, power supply to junction box, water supply line, toilets Business Process Outsourcing Built up area Either the building has received occupancy certificate or the client has moved in and occupied space and started working in a particular premises Dwelling Unit Export Promotion Industrial Park Floor Area Ratio (BUA/ Plot Area) Office Space with efficiency in excess of 75%, floor plate in excess of 15,000 sq. ft., Car Parking ratio of atleast 1 per 1000 sq. ft., Floor-to-ceiling height in excess of 3.75 m, Power provision of 1.25KVA per 100 sq. ft. with 100% power-backup wherever applicable and professionally managed facilities It is the total covered area on ground by the built component and is expressed as a percentage of the plot area Real estate space reserved by the lessee for future occupation within a particular time frame and at a pre-decided rental Indian National Rupees Space committed for lease before completion of construction The stock which can be leased and excludes Built-to-Suit (BTS) and Campus facilities. Cumulative Supply New construction in a particular specified period Total number of transaction in a particular specified period Total vacant space in the completed stock Premises consisting of power backup, high side A.C., common area fit outs and fitted out toilets Quarter on Quarter year-on-year (All growth figures in this report are y-o-y unless otherwise mentioned Information Technology Information Technology Enabled Services (includes various services ranging from call centres, claims processing, medical transcription, e-CRM, SCM to back-office operations such as accounting, data processing, and data mining) Rate that an eligible depository institution (such as a bank) is charged to borrow short term funds directly from the central bank through the discount window Interest rate that a bank earns for lending money to the Reserve Bank of India in exchange for government securities Economic Classification; SEC A represents the highest propensity to spend and SEC D represents the lowest propensity to spend. Square Feet Form of tax charged on instruments (written documents) requiring a physical stamp (for government legality) to be attached to or impressed. CRR: Headline rent: Average headline rent: Disclaimer: Cash Reserve Ratio Monthly rent per square feet, charged on super built-up area basis, featured on the lease, and expressed excluding fitouts, taxes, deposits, advances, maintenance charges and does not take into account building efficiency (super built up area - carpet area ratio). Further it does not include attached premises such as parking areas, archives, staff canteens, etc. If the rental is progressive, the value applied is the average for the first 3 years or the fixed term of the lease. Weighted average of rented area. The average featured is a moving average over the quarter, to smooth out the changes, exclusive of all taxes, deposits, advances & maintenance charges. Major Refurbishment: Renovated: Modern: Old: CCI (Cost of construction index): Demand: For the occupier: New Supply: Completed new supply: Under construction: Planning permission granted: Planning permission submitted: Pre-letting: Underlying rent: Prime rents: Top rent: Second hand premises: Very good condition: Existing state of repair: To be renovated: Supply available within 1 year: Take-up: Vacancy rate: Building which has undergone structural alteration less than 5 years ago, subject to planning permission. . Building which has undergone renovation work not requiring for planning permission less than 5 years ago. High-performance building over 10 years old. Low-performance building over 10 years old. Index that makes quarterly measurements of construction prices for new house building. It is the price after VAT paid by the owner to construction companies. It excludes land-related prices and costs (site development, special foundations, etc.), fees and financial costs. A search for premises expressed to BNP Paribas Real Estate. The analysis pertains only to the flow of new demand expressed. Operation undertaken by an occupier for its own purposes. Any new building and/or heavily refurbished building that adds to the existing stocks. These are analysed according to progress. Buildings on which construction work is finished. Buildings on which construction has effectively begun. Prior demolition work is not taken into account. Authorisation to build obtained, generally booked after settlement of third party claims. Planning permission requested, being processed. Transaction by an occupier more than 6 months before the delivery of the building. Annual rent per square meter expressed free of tax and charges and excluding advantages agreed by the owners (rent incentive building works, etc). Represents the top headline rent (excluding non significant transactions) for an office unit:- of standard size, of the highest quality and specification, in the best location in each market. Represents the top headline rent for an office unit. It is not necessarily a prime rent. Premises that have been previously occupied by an occupier for vacant for more than 5 years. High-performance premises of high quality. Low-performance premises that can be rented as they are. Low performance premises that need renovation. All premises and buildings available within 1 year including the supply available immediately, new supply that has not been pre-let and second hand supply that will be vacated definitively (notable terminated leases). Rental or sale of a property asset, finalised by the signature of a lease or a bill of sale including turnkey transactions and owner-occupier. The transaction is only taken into account once any existing conditional clauses have been lifted. Ratio measuring the relationship between the supply immediately available and the existing stock. This report is released by BNP Paribas Real Estate & Infrastructure Advisory Services and the information in it is dedicated to the exclusive use of its clients. The report and the information contained in it should not be copied or reproduced without prior permission from BNP Paribas Real Estate and Infrastructure Advisory Services. The facts of these reports are believed to be correct at the time of it's release but cannot be guaranteed. Please note the findings, projections, conclusions and recommendations are based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. BNP Paribas Real Estate & Infrastructure Advisory Services cannot be held responsible if, despite it's best efforts, the information contained in the present report turns out to be inaccurate or incomplete.
  • 16. www.realestate.bnpparibas.com . Noncontractualdocument-Researchdepartment-Publishedby:RajaKaushal-ManagingDirector,BNPParibasRealEstate&InfrastructureAdvisoryServicesPvt.Ltd. Photocourtesy:IndiabullsRealEstate-November2010-BNPPARIBASREALESTATE:HeadquartersofParentCompany:13,boulevardduFortdeVaux-75017Paris-692012180RCSParis ALBANIA* Danos & Associates Blvd. Deshmoret e Kombit Twin Towers - Building 2 11th Floor Tirana Tel.: +355-4-2280488 Fax: +355-4-2280192 AUSTRIA* Dr. Max Huber & Partner Dr. Karl-Lueger-Platz 5 1010 Vienna Tel: +43-1-513 29 39 0 Fax: +43-1-513 29 39 14 BULGARIA* 28, Hristo Botev Boulevard Sofia Tel: +359-2-9532314 Fax: +359-2-9532399 CANADA* Cresa Partners Tel.: +1-617-758 6000 Fax: +1-617-742 0643 CYPRUS* Danos & Associates 35, I. Hatziosif Ave 2027, Nicosia Tel.: +357-22 31 70 31 Fax: +357-22 31 70 11 Danos & Associates GREECE* Danos & Associates 1, Eratosthenous Str. 11635 Athens Tel: +30-210 7 567 567 Fax: +30-210 7 567 267 JAPAN* RISA Partners 5F Akasaka Intercity 1-11-44 Akasaka, Minato-ku 107-0052 Tokyo Tel: +81-3-5573 8011 Fax: +81-3-5573 8012 RUSSIA* Astera 10, b.2 Nikolskaya Str. Moscow, 109012 Tel/Fax: +7-495-925 00 05 NETHERLANDS* Holland Realty Partners J.J. Viottastraat 33, 1071 JP Amsterdam, Tel: +31-20-305 97 20 Fax: +31-20-305 97 21 NORTHERN IRELAND* Whelan Property Consultants 44 Upper Arthur Street Belfast Bt1 4GJ Tel: +44-28-9044 1000 Fax: +44-28-9033 2266 POLAND* Brittain Hadley Europa Warsaw Financial Centre 13th floor Emilii Plater 53 00-113 Warsaw Tel.: +48-22-586 31 00 Fax: +48-22-586 31 16 SERBIA* 6, Vladimira Popovica Street Office B31 11000 Belgrade Tel.: +381-11-2600 603 Fax: +381-11-2601 571 SLOVAKIA* Modesta (Dr. Max Huber & Partner Group) Heydukova 12-14 811 08 Bratislava Tel.: +421-2-3240 8888 Fax: +421-2-3214 4777 SWITZERLAND* Naef Avenue Eugène-Pittard 14-16 Case Postale 30 1211 Geneva 17 Tel.: +41-22 839 39 39 Fax: +41-22 839 38 38 UKRAINE* Astera 2a Konstantinovskaya Street 04071, Kiev Tel: +38-044-501 50 10 Fax: +38-044-501 50 11 USA* Cresa Partners 200 State Street 13th Floor Boston, Massachusetts 02109 Tel.: +1-617-758 6000 Fax: +1-617-742 0643 Falcon Real Estate 570 Lexington Avenue 32nd Floor New York, NY 10022 Tel.: +1-212 271-5445 Fax: +1-212 271-5588 ABU DHABI Al Bateen Area Plot No. 144, W-11 New Al Bateen Municipality Street 32 P.O. Box 2742 Abu Dhabi, UAE Tel.: +971-505 573 055 Fax: +971-44 257 817 BELGIUM Blue Tower Avenue Louise 326 B14 Louizalaan 1050 Brussels Tel: +32-2-646 49 49 Fax: +32-2-646 46 50 DUBAI Emmar Square Building No. 1, 7th Floor P.O. Box 7233 Dubai, UAE Tel: +971-505 573 055 Fax: +971-44 257 817 FRANCE 13 boulevard du Fort de Vaux 75017 Paris Tel: +33-1-55 65 20 04 Fax: +33-1-55 65 20 00 GERMANY Goetheplatz 4 60311 Frankfurt Tel.: +49-69-2 98 99 0 Fax: +49-69-2 92 91 4 IRELAND 40 Fitzwilliam Place Dublin 2 Tel: +353-1-66 11 233 Fax: +353-1-67 89 981 JERSEY 4th Floor, Conway House Conway Street St Helier Jersey Je2 3NT Tel: +44-15 34-62 90 01 Fax: +44-15 34-62 90 11 ITALY Corsa Italia, 15/A 20122 Milan Tel: +39-02-58 33 141 Fax: +39-02-58 33 14 39 LUXEMBOURG Axento Building Avenue J.F. Kennedy 44 1855 Luxembourg Tel.: +352-34 94 84 Fax: +352-34 94 73 ROMANIA Union International Center 11 Ion Campineanu Street Sector 1 Bucharest 010031 Tel: +40-21-312 7000 Fax: +40-21-312 7001 SPAIN María de Molina, 54 28006 Madrid Tel: +34-91-454 96 00 Fax: +34-91-454 97 65 UNITED KINGDOM 90 Chancery Lane London WC2A 1EU Tel: +44-20-7338 4000 Fax: +44-20-7430 2628 *Alliances Bangalore (Regd. Office) Level 15, Concorde Block, UB City, Vittal Mallya Road, Bangalore – 560001 Tel: +91 80 4030 0334 Fax: +91 80 4030 0400 Delhi Upper ground floor, Unit No 7, Mercantile House, 15 KG Marg, New Delhi 110001 Tel: +91 11 4959 8800 Fax: +91 11 4959 8818 INDIA For Queries / Comments: Tasneem Gandhi at +91 9930141009 or email at tasneem.gandhi@bnpparibas.com BNP PARIBAS REAL ESTATE & INFRASTRUCTURE ADVISORY SERVICES PVT. LTD. Mumbai (Head Office) 704, Level 7, MMTC House, C-22, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051 Tel: +91 22 6138 8088 Fax: +91 22 6138 8089