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MARKET OVERVIEW
MUMBAI
BANKING AND FINANCIAL SECTOR SUMMARY
25-30%
45.70
3.0%
Banking and Financial Sector Trends
In a bid to create cost eciencies and improved
returns, domestic and global firms in the
banking and financial sector are eyeing growth
opportunities in the Indian market. The Indian
market, at present, is characterized by new
entrants in the Banking sector (as a result of
the Reserve Bank of India’s issuance of new
bank licenses), and existing firms expanding
their footprint. Global banks are continuing
to set up captive centers for back-oce and
support functions. Indian banks, on the other
hand, are consolidating their oce space and
bringing out cost-eciencies through a mixed
strategy of purchasing or leasing consolidated
oce spaces. Non-banking financial companies
(NBFCs) continue to be bullish on the commercial
real estate sector, focusing on outright purchase
of marquee assets in Mumbai. Banks prefer the
secondary business districts of Bandra-Kurla
Complex and Lower Parel for front-end oces,
while uptake of larger space for back-end
services is seen in other submarkets.
Outlook, Opportunities & Strategies for Occupiers
Led by higher business confidence on the back of strong economic
growth (India being the fastest-growing large economy), the market
is expected to witness high demand for oce space for outright
purchase and leasing.
In Mumbai, Banking, Financial Services, and Insurance (BFSI)
companies’ leasing accounted for approximately 14.0% of total leasing
over the last 2 years, which is expected to strengthen further. However,
availability of quality large space would likely pose as a challenge for
occupiers, with transactions expected to remain competitive.
% Occupancy of
Financial Sector
Prime Rent
#
(USD/Sf/Year)
Rent Growth
(YOY in local)
Key Banking and Financial Services Sector Lease Transactions – 2016
PROPERTY
SF
TENANT
TRANSACTION TYPE SUBMARKET
Om Sagar
81,000 State Bank of India
Expansion
Thane-Belapur Road
One Indiabulls Center
52,000 Capital First
Expansion
Lower Parel
Akcruti SMC
44,000 Kotak Mahindra
New lease
Thane
Indiabulls Finance Center 1
33,000 YES Bank
Expansion
Lower Parel
Key Banking and Financial Services Sector Sale Transactions – 2016
PROPERTY
SF
BUYER
PRICE
(US$ MIL)
PRICE
(US$/SF)
SUBMARKET
Marathon Futerex
62,000 IDBI Federal
17
280
Lower Parel
The Ruby
200,000 Axis Bank
3,200
242
Dadar
The Indian market is witnessing considerable activity
in banking and financial services. Going ahead, Foreign
Direct Investment (FDI) relaxation in the insurance
sector, global banks’ expansion of their captive centers,
and the government’s thrust on ease of doing business is
likely to fuel higher demand for o ce space in the sector.
- Gautam Saraf, Managing Director
#
Weighted average rent, including CBD and BKC
43