Mumbai, Delhi realty price growth tops world list

NEW DELHI: This should not shock anyone. Mumbai and Delhi have witnessed the second and third fastest growth in real estate rentals across the world in 2006.

At 50.2% and 33.3%, respectively, they are next only to Me'ouyan Soreq in Isreal, which has seen an 87.5% increase. According to Cushman & Wakefield’s annual report on Industrial Space Across the World, two other Indian cities, Bangalore and Hyderabad, figure in the top 12 with rental jumps of 25% and 23.1%, respectively.

According to the study, in terms of industrial rentals, New Delhi has moved nine places to 14th position. Cushman & Wakefield executive MD (South Asia) Sanjay Verma attributes this jump to the boom in the manufacturing sector.

“Manufacturing is undergoing a renaissance in India. As export volumes are rising rapidly, the sector is becoming increasingly attractive. This is backed by the availability of private capital, strong domestic demand and a large pool of skilled and unskilled labour. The central government is continuing with its legislative reforms and infrastructure improvements,” he says.

The report says a shortage of space has pushed up rents in Mumbai and New Delhi, and has led to manufacturing and logistics activity shifting to industrial parks outside the main cities. “Meanwhile, international manufacturers in sectors such as automobile, biotech, pharmaceutical and telecoms are particularly favouring setting up of operations in the economically flourishing states of Gujarat, Maharashtra, Andhra Pradesh and Tamil Nadu,” adds Mr Verma.

According to the report, the world’s most expensive industrial location tag is retained by the area around London’s Heathrow airport, followed by Isreal’s Me’ouyan Soreq district and Tokyo.

The report was compiled based on a survey conducted by Cushman & Wakefield across 45 countries. “The main global ranking is compiled by taking the most expensive location in Euro terms in each of these 45 countries monitored,” says a spokesperson of the real estate consultancy.