Hines, Kanakia, Japan’s Sumitomo, Mitsubishi in JV for office project in Mumbai’s BKC

Global real estate investment manager Hines and property developer Kanakia Group have entered into an alliance to develop a commercial office project on a 3-acre land parcel near Mumbai’s business district Bandra-Kurla Complex with a total investment of over Rs 3,000 crore.

The alliance has further partnered with Japanese conglomerate Sumitomo Corporation and real estate major Mitsubishi Estate Co. for the development spanning around 1.5 million sq ft premium office spaces.

Of the total investment, the equity investment will be around $120 million or around Rs 1,025 crore.

“This project marks a significant milestone in our journey in India,” said Amit Diwan, Senior Managing Director and Head of India at Hines. “It reflects our commitment to deepening our presence in Mumbai and highlights our strategic partnerships with MEC and Sumitomo.”

As per the terms of the joint development agreement, landowner Kanakia Group will be responsible for the approvals, while the investment will be made by the US-based Hines and the Japanese entities. In addition to their investment, Hines, Sumitomo, and Mitsubishi will execute the development.

“This formation of this alliance with Hines, Mitsubishi, and Sumitomo has allowed us to deleverage our balance sheet in a significant manner. The approvals for the project have already been secured and we expect the development to be completed by the end of 2028,” said Rasesh B. Kanakia, chairman, Kanakia Group.

The project, comprising 12 upper floors and seven basements, will see Mitsubishi holding a 50% stake in the development, marking its maiden project in Mumbai and fifth in India.

Diwan, Kanakia and property consultant JLL India that acted as the advisor for the transaction also declined to comment on the project’s investment specifics.

The project is located on a corner site facing the Santacruz-Chembur Link Road and a connecting road to the BKC district.

“Given India’s strong demographic tailwinds, along with the right fundamentals and market conditions, we’ve been seeing more investor interest in the country and continued demand for our office and residential projects,” said Diwan.

India, now the world’s fifth-largest economy, is projected to become the third largest by 2029 and the working-age population is expected to grow steadily over the coming years.

Combined with a workforce, this has made the India office highly sought after by local businesses and multinational companies. Office rental yields in the key cities of Bangalore, Delhi, Mumbai, and Pune have remained some of the highest globally.

Since entering India in 2006, Hines has expanded its portfolio to 12 projects across the office and residential sectors. The firm now operates in five major Indian cities including Delhi-NCR, Mumbai, Bangalore, Pune, and Ahmedabad.