IDFC First Bank has leased 1.64 lakh square feet at Commerze III, Goregaon East, for INR 3.85 crore per month, marking a major expansion. The lease, covering floors 22 to 25, is valued at INR 34 crore in security deposits and includes 165 parking slots. With a rent of INR 233 per sq ft and a 15% escalation after three years, the agreement reflects the rising demand for premium office space in Mumbai. The lease registration, with a stamp duty of INR 74.65 lakh, signals a rebound in the commercial real estate market as businesses adapt to new workspace needs.
IDFC First Bank has signed a lease for 1.64 lakh square feet of office space in Mumbai. This move marks a pivotal step for the bank as it secures a prominent location in one of the city's key business districts. According to documents obtained by FloorTap.com, a commercial real estate analytics platform, the bank will pay a starting monthly rent of INR 3.85 crore for the space located at Commerze III, part of the International Business Park in Goregaon East, situated conveniently off the Western Express Highway.
The lease covers four entire floors of the Commerze III building, specifically floors 22 through 25, and is set for a period of five years. As part of the agreement, IDFC First Bank has provided a security deposit of INR 34 crore. This deal not only highlights the bank's growth strategy but also reflects the ongoing demand for quality office space in Mumbai. The transaction was registered on July 30, 2024, with a stamp duty of INR 74.65 lakh paid for the agreement.
Accompanying the office space are 165 dedicated car parking slots. The rental agreement stipulates that the monthly cost per square foot is INR 233, with a rent escalation clause that permits an increase of 15 percent at the three-year mark. The license commencement date is set for January 15, 2025, allowing a fit-out period from July 15 to December 31, 2024. The monthly charges for common area maintenance are estimated at INR 41.23 lakh.
This leasing activity comes as part of a broader trend in Mumbai's commercial real estate market. Recent months have seen significant transactions, reflecting a rebound in office space demand post-pandemic. For instance, in July 2024, Nielsen Media India and its subsidiary, Whats On India Media, leased a combined 1.52 lakh square feet in the same Commerze III building for a starting rent of INR 3.87 crore. Additionally, prominent figures in the entertainment industry have invested in commercial spaces, with Bollywood actor Amitabh Bachchan acquiring office units in the Veer Savarkar Signature building for around INR 60 crore just last month.
The trend of big-ticket deals indicates a robust recovery of the commercial real estate sector in Mumbai as businesses re-evaluate their space needs in a changing economic environment. Companies are looking for modern office spaces that facilitate collaboration and innovation, particularly in a rapidly evolving corporate landscape. The demand for office space has been bolstered by the return of employees to workplaces, hybrid work models, and expansion by both established and emerging companies.
In another notable development, Tata Digital Private Limited, a subsidiary of Tata Sons, renewed its lease for its headquarters in Fort, Mumbai, at a rental rate of INR 2.98 crore per month in May 2024. This renewal showcases the confidence major corporations have in Mumbai's commercial property market, and their long-term commitment to having a physical presence in the city.
As IDFC First Bank gears up for its move into the new office space, it joins a wave of companies that are adapting to the changing dynamics of work and office environments. With the commercial real estate market in Mumbai on an upward trajectory, it remains to be seen how these developments will shape the future of business operations in the city. As companies continue to secure large office spaces, it signals a positive outlook for the commercial property sector and the economy as a whole.
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