Small developers and builders are relocating to ot
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Delhi,
India
Tuesday, November 11, 2008
The rental rates of commercial property have soared in Chandigarh, thus forcing the small developers and builders are to shift to other sectors. The number of vacant sites in sector 8 and 9 has increased. "The benchmark for rentals has increased manifold over the years. Rentals have increased by almost 100 percent in the past one year. Five years ago, the rent for a showroom in Sector 8 on the Madhya Marg was around Rs 3 lakh. Today, it has shot up to more than Rs 16 lakh. The upcoming auction will further boost the rentals considerably," said Mangat Rai Baboota, a real estate consultant.
The rent of an 8000-square feet showroom, if divided floor wise, comes out to be Rs 12 lakh for the ground floor, between Rs 3 lakh and Rs 4 lakh for basement and first floor. According to the existing trend, multinational companies take the complete showroom on rent rather than independent floors. The same rentals exist in Sector-17 main market. According to sources, recently a showroom rented out by a popular sweet shop in Sector 17 to a clothing chain is fetching Rs 16 lakh a month. "At present, the availability of vacant commercial spaces in these sectors is 15 per cent, which otherwise could have been an excellent source of income to the landlord and tenant," says R P Malhotra, general secretary, Property Owner Welfare Association, Chandigarh. The rent in other sectors like 7, 26 and 35 is almost half the rates at Sectors 8, 9 and 17. This is forcing small and medium enterprises to relocate to cheaper areas or inner markets of these sectors.
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