The Hindu Business Line : Mumbai office space gets cheaper

OFFICE occupancy costs across Asia moved downwards in the last six months of 2002, according to real-estate consultancy CB Richard Ellis' recently released Asian Market Rents report. For Indian businesses, the survey's significance lies in the finding that Mumbai experienced a substantial 8 per cent fall in average office occupancy costs in the second half of last year.

According to the study, this drop in office rentals results in Mumbai moving from being the 10th most expensive office location in the world to the 15th position by the end of 2002. The fall in office rents was largely brought about by the rapid growth of Mumbai's Bandra-Kurla central business area and the consequent flight of businesses to the region from the traditional Nariman Point central business district, the report adds.

Office rents in Bangalore and New Delhi also witnessed a downward movement in the second half of 2002, the report says. While the drop in office rents in Bangalore was the result of supply exceeding demand, in New Delhi the correction could be attributed to the continued contraction of the city's information technology sector, the report explains.

However, among all the Asian cities surveyed, it was Hong Kong that registered the sharpest decline in office rentals — 14 per cent, the report says.

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