Declining real estate prices may weigh on sale of Air India building
MUMBAI: The sale of the iconic Air India (AI) building at Mumbai’s tony Nariman Point neighbourhood could fetch ₹600-700 crore, real estate consultants said, far below the price the 23-storeyed building could have fetched a decade ago.
Nariman Point, once among the world’s costliest office locations, has lost its sheen as more and more companies move to the Bandra-kurla Complex (BKC), according to property consultants.
“The buildings at Nariman Point are old and are not conducive to setting up modern offices with large floor plates and automation facilities,” said Pankaj Kapoor, managing director, Liases Foras, a real estate advisory firm.
The former headquarters of the national carrier, considering the complexity of property and limited redevelopment potential, could fetch the airline about ₹650-700 crore, said Kapoor.
“A lot of people also live within the vicinity of BKC, at residential complexes nearby, and travel to BKC for work which has led to Nariman Point to further lose its appeal as a prime office location,” Kapoor said.
According to a real estate broker, who didn’t want to be named, property rates stand at ₹28,000 to ₹32,000 per square foot, depending on buildings, for purchase at Nariman Point. At the Bandra-kurla Complex, the rates are ₹32,000 to ₹35,000 per square foot.
The property rates at Nariman Point, before the financial crisis a decade ago, stood at over ₹50,000 per square foot.