No doubt there are plenty of PUSH FACTORS that would suggest one should not buy Office or Retail property in Mumbai:
1) High taxes
2) Poor infrastructure
3) Expensive for Employees
4) Expensive for Companies
7) Low Quality of Life
It’s a lengthy list of negative factors; however, after all that it would be a prudent financial decision to buy commercial real estate in Mumbai.
Now, I’m suggesting that buying this year is better than next or the year after. What I am saying is that if you have a long term view of more than five years it’s simple, buy commercial real estate in Mumbai whether it’s office or retail space. And the short reason being unless there is a catastrophic event that occurs in Mumbai, no other City in India will be able to take Mumbai’s place – its importance in India and on the global stage will continue to grow. More specifically, the PUSH FACTORS are weaker than the PULL FACTORS:
1) Commercial Heart of India
2) Financial Capital of India
3) Bollywood Capital of India
4) Importance of Face to Face Meetings
5) Talent Pool
6) Inertia Affect
Regardless of the high costs of doing business in Mumbai, companies frankly have no choice but to have at least an office in Mumbai if not their headquarters. Even in 2015, face to face meetings are of the utmost importance. This isn’t just in India this is across the world. Given that Mumbai has already established itself as the Commercial, Financial & Media/Bollywood Heart of India it would be very difficult for that to change. One of the major reasons is the talent pool. If you are working in finance or Bollywood or at a corporate, you want to come to Mumbai because that is where the best & high paying jobs are in your dream field. So you come to Mumbai, land a job, start a family, put your kids in school and before you know it you’re a Mumbaikar. It’s more likely that if you make any changes it will be to move to another company within Mumbai than changing Cities. Those companies that don’t have a location in Mumbai thus risk not having access to the best talent in India now and later. In turn an inertia affect occurs where Companies have to stay in Mumbai because that is where the talent is and individuals have to come to Mumbai for the best jobs in their field. To be fair, this is not a Mumbai phenomenon but applicable to all major Alpha Cities: New York City, San Francisco Bay/Silicon Valley, London, Hong Kong, Tokyo etc.
Simply put, India is growing faster than any other major economy and Mumbai is its commercial capital. For the long term, we think buying commercial property in Mumbai whether it be Office space or Retail space is an obvious decision. Now the question is where to buy in Mumbai? Check out our other posts.
As always, if you have any questions please feel free to contact us at email@example.com.
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