Office spaces ranging from 400-1000 sq ft carpet area witness growing demand in Mumbai.
The current market scenario has led consumers to revisit their investment portfolios and increased traction towards asset creation. Coupled with the same, the lowest-ever interest rates and the reduction in stamp duty by the Maharashtra government have further given impetus to the real estate market in Mumbai. Within the commercial segment, the asset class that is witnessing an upsurge in demand in the city are small, boutique offices.
Compared to other metro cities in India, the MMR region has a unique aspect with maximum small and medium businesses (including professional services) that employ about 5-15 people. To fulfill the requisites of these businesses & services, there is a demand for office spaces ranging from 400 to 1,000 sq. ft. carpet area that best suits the needs.
Additionally, business owners and professionals who were operational from Grade B industrial estates or home offices are now seeking such setups in Grade A office buildings, present mostly closer to their residences or at a well-connected location. From an investment perspective as well, small & boutique offices are a preferable choice. The high appreciation potential and high rental yield of about 7-8%, unlike other asset classes such as bank fixed deposits make these spaces an attractive option.
Commenting on the same, Shaishav Dharia, CEO – Townships and Rental Assets, Lodha Group, said, “Grade A boutique offices are designed keeping in mind the requirements of professionals and small business owners. Offering centrally-located spaces and connected to the city’s business hubs, these small offices within the ready catchment of prime residences have garnered a lot of interest from customers looking for work-near-home opportunities. Seeing this increasing demand and need for usage, more and more developers will foray towards these offices within residential as well as mixed-use developments.”
Compared to co-working spaces, these Grade A boutique offices provide the prestige of ‘owning an office’ especially for small business owners looking for an office space for end-use. Moreover, these office spaces are superiorly designed considering vastu compliances, focus on safety & security, and offer high-end amenities like dedicated parking, private toilets, high-quality facility management, etc.
Further commenting on the category, Anuj Puri, Chairman, Anarock Property Consultants, said, “In the post-Covid scenario, the commercial office space has witnessed many disruptive trends like work moving closer to home. Several professionals and entrepreneurs like doctors, lawyers and CAs are opting for smaller office spaces across Mumbai to meet their business concerns. For such businesses, Grade A boutique offices are emerging as a potential alternate. Developers will now need to customize and create unique office spaces to cater to this niche segment.”
With small and medium businesses gradually resuming operations, there will be a rise in demand for small and Grade A boutique offices and the commercial real estate is eventually going to see growth in the future through these setups.