Synonymous with congestion, make-shift garages, small stores for industrial spare-parts and slums for years, and more recently being a changeover suburban station to reach the swanky business district of Bandra Kurla Complex (BKC), Kurla has started seeing real estate deals running into several crores of rupees. The location is witnessing integrated development in the form of good quality residential, commercial, office, education and entertainment.
Media house Mid-Day, owned by the stock exchange-listed Jagran Prakashan Group, is close to completing purchase of 24,000 square feet space for nearly R24 crore in Phoenix Market City. The company is understood to be buying the space for its new office for about R10,000 per sq ft. Sources in know of the development told FE, the term sheet has been signed and just the last leg of formalities are being completed. Jagran Prakashan did not respond to queries from FE on the deal.
Kurla, like now-upmarket Lower Parel, housed the mill industry in the beginning of the 20th century. In the 50s and 60s, it became an automobile industrial zone, with Premier Automobiles and steelmaker Mukand setting up shop here. Today, Premier?s land has given way to Kohinoor City, an upcoming 1.5 million sq ft township project. Atul Ruia promoted Phoenix Mills? ?Phoenix Market City, a high end shopping cum office project also dons its landscape.
Phoenix Market City, with around 2.5 lakh sq ft of office space above a mall spread across nearly one million square feet, is seeing good absorptions. Tuscan Ventures, a venture capital fund, is said to have picked up about 10,000 sq ft space for a sum believed to be about R10 crore. Ashish Raheja, MD of Raheja Universal is also understood to have bought office space in Market City. Its mall is housing some of the leading global fashion brands like Zara, Marks and Spencer and Mango among others.??
American School in December 2011 had bought a full building of 1.4 lakh sq ft for a said amount of R125 crore in Vidyavihar, a suburb close to Kurla. Ajay Piramal-owned Piramal Realty along with Mumbai-based Neptune Developers is also looking to develop 2 million sq ft of mixed use project in Kurla. Ashok Piramal Group?s realty arm Peninsula Land is also constructing a 9 lakh sq ft Peninsula Technopark to cater to IT/ITeS companies here.
?The good value proposition emerging in Kurla is leading to this increased offtake,? said Nikhil Bhatia, co-head (capital markets), CBRE South Asia, global property consultants. ?Proximity and accessibility to different pockets in the city and the scale for appreciation in prices are key drivers for this micro-market,? he said.
With Kurla still developing, the capital values of office spaces here are competitive to already established locations like Lower Parel or BKC, say property consultants.
The prices in Kurla are hovering around the R10,000 per sq ft mark against Lower Parel which is said to be in the range of R17,000 to R20,000 per sq ft , or even higher values in BKC, believed to be in the range of R30,000 per sq ft. It is noticeable that BKC, which is a stone?s throw from Kurla, saw Rs 10,000 per square feet levels eight years ago in 2004.
According to a November 2012 office report by global real estate consultant Knight Frank India, the central suburban locations of Kurla, Powai, Vikhroli and the LBS Marg belt have seen a significant amount of deliveries between September 2011 and September 2012.
?As quality office properties like Phoenix Market City and Godrej IT Park hit the market, the central suburbs have consistently claimed a larger slice of the transactions pie,? it said.