In a significant move, Bank of America has leased 160,000 square feet of office space in Mumbai’s Powai locality through a 12-year agreement with K Raheja Corp’s Chalet Hotels. The office in the Cignus Powai building is part of the bank’s expansion and relocation strategy, highlighting its long-term commitment to growth in India.

Expansion with Scalability

The leased space spans three floors, with provisions for scalability. The agreement allows Bank of America to lease an additional 100,000 square feet across two more floors, potentially increasing the total area to 250,000. If exercised, this expansion would increase the rental outlay to ₹6 billion, up from the current ₹3.5 billion.

This relocation replaces the bank’s existing 15-year-old facility in Andheri and marks an expansion of its Mumbai footprint, which will now exceed 425,000 square feet. Fit-out work is expected to begin shortly, with operations in the new office projected to commence within six to eight months.

Strengthening Mumbai’s GCC Market

This transaction is part of a broader Global Capability Centres (GCCs) trend that is strengthening their presence in Mumbai, particularly in the Jogeshwari-Vikhroli Link Road micro-market. International entities increasingly favour the area due to enhanced metro connectivity, which improves talent mobility.

Sources close to the development noted that the move reinforces Mumbai’s position as a hub for Banking, Financial Services, and Insurance (BFSI) operations. Advancements in technology, digital adoption, and a highly skilled workforce have driven demand in the BFSI sector, and leasing activity in 2024 is expected to surpass record levels from 2023.

Strategic Partnerships and Market Trends

JLL India facilitated the deal, though no comments were received from Bank of America or K Raheja Corp regarding the transaction. The move aligns with Bank of America’s broader strategy to optimize its Indian operations, which currently span five cities: Mumbai, Hyderabad, Chennai, Gurgaon, and Gujarat’s Gift City.

Other tenants in the Cignus Powai building include Fedbank Financial Services, Tata Projects, and Redbrick Offices, further establishing the building as a prime commercial hub for leading organizations.

BFSI Sector Drives Growth

The BFSI sector continues to dominate India’s office leasing market, driven by increased digital adoption and evolving workplace needs. Over the past six years, international firms have accounted for over 65% of BFSI office leasing activity in India, reflecting the country’s growing importance in global corporate strategies.

This landmark transaction by Bank of America underscores the resilience and growth of Mumbai’s commercial real estate market, particularly in catering to the expanding needs of global financial institutions.