Mumbai: New Delhi’s Connaught Place is the world’s fourth-most expensive office location, ahead even of Tokyo and New York, according to an annual survey by global real estate consultant Cushman and Wakefield.
Connaught Place was at fifth position last year.
London’s West End is the most expensive, having regained its top position from Hong Kong’s central business district (CBD) after five years, while Rio de Janerio in Brazil took the third position.
The report ranks locations in 63 countries.
Connaught Place registered a growth of about 25% in yearly rental values over the last year to an average Rs.403 per sq. ft per month. The limited supply of quality office space in the area is one factor pushing up rentals.
“The new master plan for New Delhi by the Delhi Development Authority has not provisioned for any rapid growth of office space within the city leaving very limited choice,” said Sanjay Dutt, executive managing director, South Asia, Cushman and Wakefield.
That may be why the alarmingly decrepit state of Connaught Place, thanks to a refurbishment plan that began about four years ago and shows no sign of ending, doesn’t seem to have deterred tenants.
Fresh supply of office space in Connaught Place is essentially due to redevelopments and renovations of existing buildings that have been commanding a premium and thus are instrumental in pushing up the average rental values in this location.
Mumbai’s Bandra Kurla Complex (BKC) was ranked the eighth most-expensive in the Asia-Pacific region, according to the report. BKC was planned as an alternate office destination to Nariman Point nearly three decades ago.
India’s most expensive office space locations are Connaught Place, the international airport terminal and the south-east areas in the capital, and BKC, Nariman Point, Worli, Lower Parel and the Andheri-Kurla area in Mumbai.