Mumbai: Rentals In Nariman Point Get A New Lease Of Life

Once the heart of Mumbai’s business landscape, Nariman Point is making a bold comeback.. With a surge of companies, law firms, and foreign consulates setting up shop, lease rentals in the area have been climbing steadily. What was once considered the prime Central Business District (CBD) in the ’70s and ’80s, Nariman Point and its neighbouring Fort and Ballard Estate areas are now witnessing renewed interest, with property agents anticipating the rates to soar over Rs 1,090 per square foot—nearly double the current Rs 570 per square foot.

This revival has attracted high-profile tenants, including consulates like Poland and Germany, which recently secured prime office spaces. The 3,000-square-foot lease in the Nirmal Building taken by the Polish Consulate and the German Consulate’s 7,442-square-foot space in Hoechst House signal a growing interest from international entities. Even the Consulate of China has opened an office in the area, underscoring Nariman Point’s appeal.

Top-Tier Firms Join The Neighbourhood

Consultancies like The Boston Consulting Group and investment banking giant Jefferies have joined the neighbourhood. The influx of these top-tier firms has spurred an 8-10% rise in rentals over the past year, driven in part by Nariman Point’s improved connectivity. With the upcoming 10.58-km Coastal Road and the Metro Line 3 linking Seepz to Colaba besides the proposed development of 4.2 acre plot opposite Mantralaya, companies are rediscovering the convenience and charm of the area.

Between January and September 2024, office leases for a remarkable 40,000 square feet of space were signed, and the property consultants Cushman & Wakefield predict this number could reach 60,000 square feet by year’s end. In contrast, only 17,000 square feet of leases were closed in 2023, showing just how sharply demand has rebounded.

About Nariman Point's Rentals

Currently, Nariman Point’s rentals, at Rs 570 per square foot, have outpaced those in the central business hubs of Bengaluru and Delhi, where rates stand at Rs 353 and Rs 430 per square foot, respectively. And while Bandra-Kurla Complex (BKC) remains highly desirable with rentals hitting Rs 1,000 per square foot, Nariman Point’s strategic location and classic allure are hard to beat. As businesses flock back, Mumbai’s original CBD is reclaiming its position as a prime destination for corporate powerhouses, redefining its skyline for a new era.

The COO of CREDAI-MCHI, Keval Valambhia said, "I view the resurgence of Nariman Point as a pivotal moment for Mumbai’s commercial real estate landscape. Once the heartbeat of business activity in the city, Nariman Point's renewed appeal reflects a strategic shift by both domestic and international enterprises toward centrally-located, prestigious business districts."

"Nariman Point's accessibility, iconic waterfront views, and proximity to other key business hubs have undoubtedly strengthened its appeal, allowing it to compete once again with newer districts like BKC and Lower Parel. However, it’s crucial to address Nariman Point’s infrastructural challenges to sustain this growth. Legacy structures must meet modern compliance standards, and introducing flexible leasing models and incentives could attract a broader range of industries. Furthermore, with Mumbai's commercial office vacancy rate hovering around 15% in recent years, Nariman Point’s revitalization could help optimize underutilized spaces, benefiting tenants and developers alike," he added.