The company will be paying rentals of over Rs 60 crore for this office space spread over more than 102,000 sq ft through the lease term excluding the escalation. As per the agreement, the rentals will see a 12% escalation after the first 36 months.
Abu Jani and Sandeep Khosla are among the iconic names in the Indian fashion industry with clientele in influential circles of industrialists to leading Bollywood personalities. In April, Reliance Brands entered into a definitive agreement to acquire 51% stake in their designer label.
Even though it would acquire a controlling stake, Reliance Brands had said both Jani and Khosla will continue to spearhead the design and creative direction of the brand.
ABSA Fashions is expected to use the said commercial premise to operate its corporate office, design studio, stitching, sampling, embroidery, and storage unit, showed the documents accessed through CRE Matrix, a real estate data analytics firm.
ABSA Fashions has already paid Rs 6 crore as security deposit to the landlord Coriander Industries, erstwhile Dudhwala Builders.
As per the lease agreement, which was registered on October 18, the company will also get access to a total 60 car parking slots and the terrace area in the commercial tower along with the office space.
The company will be entitled to get five months of lease-free period. However, it will be liable to pay monthly common area maintenance (CAM) charges, electricity charges and water charges. The amount of CAM charges will be Rs 5 lakh per month excluding the Goods & Services Tax for these five months.
ET’s email query to ABSA Fashions remained unanswered until the time of going to press.
Under the terms of the agreement and its subsequent renewals, if any, the company will be permitted to install its signage on the floors, façade and the lobby of the building. The company will also hold the exclusive rights to use the terrace area that also houses a swimming pool.
The recovery in commercial real estate, especially office spaces, after the Covid-19 pandemic is getting broad-based as indicated by the rising number of small and mid-size leases and outright transactions across segments and key property markets.
The commercial office segment, which was significantly impacted by the pandemic, has made a strong comeback in the last 3-4 quarters, supported by strong economic growth, increased hiring, and a return to the office trend, keeping the office sector buoyant.
The Indian office market grew substantially and delivered a strong performance in the first half of 2022. Office transactions recorded at 25.3 million sq ft, a 107% on-year growth, indicated the potential of the market on the back of a waning pandemic and the promise of a sustained economic recovery.
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