Viceroy Properties to enter commercial realty with Rs 1,600 crore plan

India's commercial leasing market has seen a high growth phase post Covid, with both office space and retail witnessing robust demand in 2024, which is expected to rise further in 2025

Mumbai-based Viceroy Properties will venture into commercial real estate development with an investment outlay of ~1,600 crore in the next five years, Cyrus Mody, founder and chief executive officer of the firm told Business Standard in an exclusive interaction.  

The development of 1.2 million square feet (mn sq ft) in area, including office and retail space will begin by the end of this year, in Mumbai, Mody said.

 

“We're planning a few commercial offices, built to lease. We think that there's a lot of up demand in the commercial sector,” he said, outlining the outlook of the commercial realty market. 

 

India’s commercial leasing market has seen a high growth phase after the pandemic, with both office space and retail witnessing robust demand in 2024, which is expected to rise further this year.

 

According to Colliers-Ficci report, the gross leasing of office space is projected at 65-70 mn sq ft in 2025, up from a record-breaking 66.4 mn sq ft in 2024, with demand led by global capability centres, IT-ITeS, banking finance, and insurance sectors and flex spaces, across six cities of Mumbai, Delhi-NCR, Bengaluru, Chennai, Pune, and Hyderabad. In retail, the six cities, along with Kolkata, are expected to see an addition of nearly 9 mn sq ft of new retail space in 2025, according to JLL India. 

 

Viceroy has been a residential real estate developer in Mumbai, concentrating in Kandivali over the last several years with luxury residences of four to five-bedroom apartments ranging between ₹3.5 crore and ₹25 crore. 

 

It has about 1.2 mn sq ft under various stages of execution and delivery, with another 4 million square feet in the pipeline, worth over ₹10,000 crore. 

 

The upcoming residential projects include a 2-acre luxury project on the coastal road in Versova and a few luxury projects in Bandra. While the company is focusing on the Mumbai Metropolitan Region (MMR) for the next four to five years, primarily in Bandra, Goregaon, and Borivilli, it remains open to opportunities in other cities in the future. 

 

For its commercial venture, it will invest ₹100 crore as equity and will take on debt of ₹200-300 crore, while the majority of the funding will come from sales. Mumbai’s commercial market is among the top seven cities in India, making the investment and earnings proposition attractive for real estate players.