Mumbai’s office market witnessed a healthy increase in transactions volume with 5.8 mn sq ft of office spaces being transacted, leading to a Year-on-Year (YoY) growth of 79% in H1 2024. Mumbai was the second-most active office leasing market across eight cities in the country. New office completions in the city were recorded at 4.3 mn sq ft, reporting a commendable YoY growth of 205% in H1 2024. This was stated by Knight Frank India in its latest report, “India Real Estate: Residential and Office (January - June 2024)”.
The report also said that Mumbai’s residential real estate market sold 47,259 residential units during this period reporting a 16% YoY jump. However, the city observed a de-growth of 7% YoY in new launches, with 46,985 units introduced.
In H1 2024, the average residential prices rose by 4% YoY over H1 2023. The sustained demand of buyers supported this price growth and kept the momentum ongoing. In H1 2024, office transactions observed a 79% YoY growth resulting in 5.8 mn sq ft transacted. The completions observed a notable YoY growth of 205%, with 4.3 mn sq ft.
Mumbai’s office market is experiencing a remarkable surge in new supply, driven by increased transactions and growing developer confidence. Occupier sentiments remained optimistic, driven by a steadily improving economic environment, rising physical occupancy levels and ongoing infrastructure development, the report said.
In terms of the end-use distribution of office spaces transacted, India facing businesses accounted for 80% of market share. This reflects a growing emphasis on catering to domestic businesses, supported by a strengthening domestic economic environment. Flex office spaces accounted for 10% share followed by Global Capability Centres (GCC) and Third-Party IT services which took up 5% each share of overall leasing activity in H1 2024.
During H1 2024, average office space rents increased by 4% year-on-year (YoY). The office market of Mumbai also experienced a remarkable surge in new supply, driven by increased transactions and growing developer confidence.
Senior Executive Director, Research, Advisory, Infrastructure and Valuation, Knight Frank India, Gulam Zia, said “The rising demand in Mumbai is testament of booming commercial real estate. This upsurge in leasing activity can be rightfully attributed to a positive market sentiment and substantial investments in infrastructure development. Market is observing a growing graph especially from the completions standpoint, pointing towards a glorious future for the industry at large in the coming future.”
The report stated that in H1 2024, Mumbai’s primary residential market continued to thrive, achieving the highest half-yearly sales volume since H1 2012 with 47,259 units sold, recording 16% YoY growth. During this period, 46,985 residential units were launched across the region.
