Mumbai likely to get 14% more office space in 18 months: JLL report
Mumbai is among the top five cities globally that will see the maximum addition to its office footprint in the next 18 months, according to a JLL report.
Mumbai figures after Shanghai, Mexico City and Beijing—among 99 cities studied globally. The financial capital of India is expected to add up to 14% of its current stock to grow its office footprint. “As the current total of grade-A offices in the city is 109 million sq ft, a stock of about 16 million sq ft could be added in the next one and a half year as per construction schedules announced by developers,’’ it said.
“There is a probability of delays, based on historic trends, in which case the supply figure could be around 13 million sq ft, which is also significant,’’ said the report.
In this survey covering all office sub-markets in each city, the markets from emerging economies figure prominently in the top-10 list. Shanghai comes on top with 37% of its current stock to be added in the next 18 months, followed by Mexico City and Beijing adding 18% and 16% respectively.
The other cities from emerging economies that figure in the top-10 list include Sao Paulo (7%) and Moscow (6%). Cities from mature economies figuring in the top-10 list are Tokyo, Singapore, San Francisco and London. Tokyo is expected to add 11% of its current stock through 2018 followed by Singapore (10%), San Francisco (7%) and London (slightly less than 5%).
“While Mumbai’s supply pipeline consists of office projects launched years ago, it remains to be seen whether they would all get constructed over the next 18 months. Also, the supply pipeline could dry up in the existing business districts over the next 2-3 years while a major chunk would come up in the emerging business districts and will, therefore, not help much,” said Ashutosh Limaye, National Director & Head –Research, JLL India.
For example, the core BKC area and secondary business district-central (Lower Parel, Elphinstone Road, etc) reveals that only 2.5 million sq ft—out of the 13-16 million sq ft that will enter the market through 2018—would be in the key demand areas while a majority of the rest will come up in the upcoming locations.