Mumbai jumped 11 notches to become the 26th most expensive industrial location in the world in terms of rental values. The area around London’s Heathrow airport remains the most expensive this year, too, with a monthly rental value of $28.91/ sq ft/ annum (Rs 93.36/ sq ft/ month).

According to Industrial Spaces Across the World 2008, a Cushman & Wakefield Report, Mumbai recorded the highest percentage growth of 94 per cent in rental values in one year within India between December 2006 and December 2007. The rental value rose to Rs 35/ sq ft/ month in December 2007 from Rs 18/ sq ft/ month in December 2006. The financial capital is followed by Ranjangaon of Pune, IMT Manesar and Okhla Industrial Area of the National Capital Region (NCR) and Hyderabad. Bangalore stands last in the list of 15 destinations across India.

The report looks at prime industrial space for manufacturing, logistics and warehousing in 138 of the world’s top industrial locations. The main global ranking is compiled by taking the most expensive location in Euro/$ terms in each of the 52 countries monitored. In this year’s survey, 89 per cent of locations showed rising or stable occupancy costs for industrial space in 2007, with only 11 per cent showing a fall. Globally, rents increased by an average of just over 6 per cent in 2007, with South America showing the strongest growth on a regional basis, with 25 per cent.

Speaking to The Indian Express, Cushman & Wakefield-India joint managing director Sanjay Dutt said, “The periphery regions of Mumbai or Delhi are merging with the city areas because of the high demand and expansion of residential areas. This has led to a severe space constraint in Mumbai. There is also a big shortage of good quality construction office space, with no new development in Mumbai. This, in turn, has increased rents. With a shortage of space in the city, many occupiers are choosing industrial parks in the outskirts because of improving infrastructure and state incentives. In Chennai, locations such as Sriperumbudur and in NCR, Manesar and Greater Noida, have seen a similar shift towards developments in peripheral locations.”

... contd.