By Accommodation Times News Service
Prime properties are still fetching good vale in this land-starved mega polis even as rentals are seem to be falling, going by the recent trend of landmark buildings changing hands, experts have said. The landmark Cadbury House in the tony southern part of the city has already changed hands. The one which is believed to be on the block is the past headquarters of Citigroup India at the Badra-Kurla Complex (BKC) area. According to sources, the 8-storeyed Citi Centre us up for sale. Citi could not be reached for comments. Private equity firm Blackstone and Pune-based Panchshil Realty are said to be in discussions to buy majority stake in the iconic Express Towers in Mumbai in a big-ticket deal.
“Some of the deals are happening where there is land parcel as in the case of Cadbury. These land parcels are mainly used for redevelopment purposes. In the case of Cadbury, the buyer plans a mixed-use development which will have two towers with one only dedicated for residential. There are many such deals in the pipeline,” said Knight Frank Executive Director Rajeev Bairathi.
At the same time, Air India Towers, another equally iconic landmark, has been trying to lease out most of its 22 floors but with little success. TCS, SBI and just launched Mahila Bank are the only big tenants there. Also rentals in the Nariman Point area have been falling steadily as new CBDs-BKC, Lower Parel among others come up. In the last two years alone rentals have crashed over 20 percent, experts said. The Cadbury Houses was snapped up by the diamond merchant Dilipkumar Lakhi, who beat top builders to emerge as the highest bidder for the property owned by confectionery major Mondelez International, the owners of Cadbury brand. With an office area of over 36,000 sq ft, the Cadbury House has been the headquarters for over 50 years. When asked for the reasons for spike in demand for iconic properties, PwC Associate Director Bhairav Dalal said that there is huge investor interest in buying stabilized and high-yielding assets which are available in the city. Investors are interested in properties which are leased out and have good track record, he said, adding that these properties are generally iconic ones. “We expect to see such deals happening in the near future as well.” The trend is not just in south Mumbai but happening even in the suburbs like Powai or even in Thane, where sellers want to monetize the non-core/non-productive assets, said PwC Executive Director Shashank Jain. According to a CB Richard Ellis report, the quarter saw only about 0.1 million sq ft being sold in Bandra-Kurla Complex against 0.16 million sq ft in the June quarter. In the September quarter, the city saw a steep 50 percent sequential fall in large commercial space leasing. In the March quarter, the fall was steeper at 62 per cent, according industry data.