Mumbai’s office market saw a 79% year-on-year growth in H1 2024, with transactions reaching 5.8 million sq ft and new completions rising by 205%. Average office rents increased by 4%, reflecting strong demand. The residential market also thrived, with a 16% increase in sales and a 4% price rise.
Mumbai’s office market has witnessed a remarkable surge in the first half of 2024, with transaction volumes reaching 5.8 million square feet, reflecting a 79% year-on-year growth. According to Knight Frank India’s latest report, “India Real Estate: Residential and Office (January – June 2024),” Mumbai is the second most active office leasing market across eight major Indian cities.
The report highlights that new office completions in Mumbai totaled 4.3 million square feet in H1 2024, representing an impressive 205% year-on-year increase. Increased transactions and growing developer confidence drive this surge in new supply. Gulam Zia, Senior Executive Director at Knight Frank India, stated, “The rising demand in Mumbai is a testament to booming commercial real estate. This upsurge in leasing activity can be rightfully attributed to positive market sentiment and substantial investments in infrastructure development.”
Mumbai’s office market growth is bolstered by an optimistic economic environment, increasing physical occupancy levels, and ongoing infrastructure developments. The report notes that India-facing businesses accounted for 80% of the market share in office space transactions, reflecting a robust domestic economic climate. Flex office spaces comprised 10% of the market, while Global Capability Centres (GCC) and third-party IT services accounted for 5%.
Average office space rents in Mumbai also saw a 4% year-on-year increase in H1 2024. This rent growth, alongside the substantial rise in new office completions, underscores Mumbai’s office market’s strong demand and positive outlook.
Mumbai sold 47,259 residential units in H1 2024, marking a 16% year-on-year increase in the residential real estate sector. This is the highest half-yearly sales volume since H1 2012. Despite this, the city saw a 7% year-on-year decline in new launches, with 46,985 units introduced. The average residential prices rose 4% year-on-year over H1 2023, supported by sustained buyer demand.
The report emphasizes the continued strength of Mumbai’s primary residential market, driven by robust sales and rising prices. High transaction volumes and rising prices indicate a healthy and growing market. “The market is observing a growing graph, especially from the completions standpoint, pointing towards a glorious future for the industry at large in the coming future,” added Gulam Zia.
In summary, the first half of 2024 has been a period of significant growth for Mumbai’s office market, marked by a 79% increase in transactions and a 205% rise in new office completions. The positive market sentiment, supported by strong economic conditions and infrastructure investments, bodes well for the future of Mumbai’s commercial real estate sector. Similarly, the residential market thrives with high sales volumes and rising prices, further underscoring the city’s robust real estate landscape.
