Financial services group Avendus Capital has acquired nearly 1 million square feet of office space in the Platina commercial tower in Mumbai’s Bandra-Kurla Complex business district through a five-year long-term lease with developer Wadhwa Group Real Estate.
The company will pay average monthly rents of Rs 278 per square foot including rent escalation for the full duration of the lease, bringing its total payment to around Rs 153.44 crore for the entire term. The initial monthly rent will be Rs 2.53 crore, documents seen by ET show.
Avendus Capital currently operates from a nearly 55,000-square-foot office in the former IL&FS headquarters, an iconic 10-story property in BKC. Leading global alternative investment Brookfield Asset Management recently emerged as the successful bidder for this IL&FS property and is in the process of acquiring it.
“Yes, the premise at Platina, BKC will be our new head office and house all of our businesses, home to over 450 employees based in Mumbai. We are a people-intensive company and this is part of our general growth plans. We plan to move into the new facility in the fourth quarter of FY23,” said Sameer Kamath, Group CFO, Avendus, confirming the deal.
The company has leased the office space spread over four floors through two separate transactions that were recorded on Friday. The financial services company paid a security deposit of more than Rs 15.22 crore to the developer Raghuleela Estates, a subsidiary of the Wadhwa Group.
“Front office markets like BKC, Worli and Lower Parel are seeing a very strong comeback in 2022 thanks to the leasing activity of large Indian and international investment banks, law firms, consulting firms and private equity firms. We anticipate rentals to rise aggressively for BKC trophy assets,” said Rachit Mohan, Co-Director, Office Leasing Advisory, India, JLL.
As part of the agreement, the company will also gain exclusive access to a total of 80 parking spaces.
Both the tenant and the property owner will have to adhere to a lock-in period for the full five years of the lease.
Platina is one of the first developments in the BKC business district, hosting key tenants including SAP, Sumitomo Corp, Ferrari, GROHE, Bandhan Bank and Avaya in its 3.5 square foot office space.
The commercial office segment, which was significantly affected by the pandemic, has had a strong recovery in the last 3-4 quarters, supported by strong economic growth, increased hiring and a return to office trend, maintaining the office sector on the rise.
India’s office market grew substantially and performed strongly in the first half of 2022. Registered office transactions at 25.3 million square feet, a 107% year-over-year growth, indicated the market’s potential post-pandemic waning and the promise of a sustained economic recovery.
New large leases are an indication that the market is experiencing a steady recovery and confidence among occupants regarding the real estate requirements of organizations is slowly increasing.
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