The lease takes global investment bank’s total deal size to 1.5 million sq. ft., stacking it among the largest office transactions in India.
Global investment bank Morgan Stanley has leased 3.35 lakh sq. ft. of office space from real estate developer Oberoi Realty in its commercial tower, Oberoi Commerz III in the Goregaon suburb of Mumbai for a long-term tenure.
This leased space is in addition to Morgan Stanley’s earlier transaction of 1.1 million sq. ft. of office space in the same office tower, taking its total deal size to 1.5 million sq. ft. and placing it as the biggest office space transactions in India.
The deal is significant not just because of the size of office space leased but also because Morgan Stanley has pre-committed to the under-construction office space, as against the usual practice of leasing ready properties.
Amid the Covid-19 pandemic, the US-based global investment bank finalised the deal to lease 1.1 million sq. ft. in this over 40-storey tower, making headlines as the largest office leasing transaction. It is one of the tallest mixed-use office towers in the country.
Both the deals will have a total tenure of 9.5 years and Morgan Stanley will be paying rentals of Rs 115 per sq. ft. per month, taking its total pay-out to nearly Rs 2,000 crore over the total tenure of the lease. The deal agreement also includes a rental reset clause every 3 years with a 15% escalation.
“The construction of the tower is in an advanced stage and is likely to be completed by the end of the first quarter of 2023. Morgan Stanley is expected to then take it up for fit-outs and to move in 9-10 months aft.er that, in early 2024, “said one of the people aware of this development.
This is the largest space taken up by any company along the western express highway. The upcoming tower is part of a larger layout called Oberoi Garden City, spread over 80 acres, which is a premium mixed-use development in Goregaon located adjacent to the upcoming metro station.
Commerz III is a 2.9 million sq. ft. mixed use building, and with this deal, over half of the tower is already pre-leased.
Morgan Stanley will be consolidating its Mumbai Global In-house Centre (GIC) operations to this single campus in the city. The investment bank established the Mumbai GIC in 2003 and the Bengaluru GIC in 2014 to support its global institutional securities, wealth management and investment management businesses.
The global investment bank has been operating in India since 1993, and has an institutional securities platform, offering a range of investment banking, capital markets, equities, fixed income, private equity and derivative products, research, as well as growing investment management businesses.
