Prime Minister Narendra Modi has flag off two new Metro corridors in the western suburbs of Mumbai between Dahisar and Andheri on January 19. Real estate developers say the corridors will not only decongest suburban roads but will also boost the property market along the routes.
The prime minister has dedicate to the nation the Mumbai Metro Rail Lines 2A and 7, constructed at a cost of around Rs 12,600 crore. He will also travel on a Metro train.
The 18.6 km-long Mumbai Metro Rail line 2A connects suburban Dahisar (East) with the 16.5 km-long DN Nagar (yellow line) while metro line 7 joints Andheri (East) with Dahisar (East).
The two metro lines
The Mumbai Metropolitan Region Development Authority (MMRDA) will start normal operations for the second phase of the Dahisar Andheri Metro-2A and Metro-7 corridor.
The first phase between Dahisar and Goregaon was partially thrown open to the public in April 2022. Both the Metro corridors run through major arterial roads of the city, including Western Express Highway (WEH) and Link Road.
The micro-markets of Dahisar and Andheri are densely populated and that was one of the reasons to have two Metro lines operate parallel to each other on the western and eastern front.
In 2022, out of the total of over 121,000 property registrations, 51 percent were in the western suburbs, followed by central suburbs, central Mumbai, and south Mumbai, according to Maharashtra government data.
A Metro line connecting east and west of Mumbai has been operational since June 2014, connecting Versova and Ghatkopar, and Metro-2A and Metro-7 is an addition on which construction started in October 2016.
Prime Minister Narendra Modi will show the green flag to the two Metro lines at 6.30 pm on January 19. The Maharashtra state government has planned over 300 km of Metro lines across the Mumbai Metropolitan Region by the year 2030.
SVR Srinivas, Metropolitan Commissioner of MMRDA, said: "The two Metro lines were built at a cost of over Rs 12,000 crore for which there was a nominal cost escalation of 5-10 percent. The two lines are expected to boost connectivity and every infrastructure project that we will add in MMR will have a positive impact on the real estate market."
Impact on real estate
In the context of the real estate market benefits from a Metro corridor, a report by real estate consultancy JLL India said in June 2022 that land prices in Tier-II cities such as Lucknow, Patna, Jaipur, Ahmedabad, Pune, Kochi, and Coimbatore had gone up by almost 8-10 percent following the introduction of a metro corridor in these cities.
Also read: Metro corridors in tier-II cities led to 8-10% increase in land prices: JLL
The report added that the successful implementation of any metro corridor always has a direct impact on real estate as it leads to an increase in land value besides a change in land use and increasing densification along the corridor.
Metros and monorails, for example, make a significant contribution to easing traffic congestion. Real estate projects planned in the surrounding areas see an increase in value, as consumers are willing to pay more for the convenience, the report said.
A Shankar, Head, of Strategic Consulting and Valuation Advisory, India, JLL, told Moneycontrol: "Once commute time reduces, demand for that location will go up. If travel duration goes up, demand and preference for that location decrease compared to other well-connected locations. In this case, properties near Metro Stations will see a price hike in terms of rental and capital value."
Also read: Upcoming metro corridors to push up land prices in the vicinity by 10-15%: JLL
He added: "Some amount of value appreciation might already have happened since the construction of these two Metro corridors started…further appreciation will happen once these two Metro corridors get operational and ridership increases."
Giving numbers, Shankar said on an average 5-10 percent rental s well as capital value appreciation is expected in all three categories: residential, commercial, and land prices.
The increase depends on the location, type, and use of the property. In other emerging cities, say Tier-2 and Tier-3 cities, the price appreciation will be much higher, to the tune of 10-15 percent, over a period of time, since these markets are in the initial phase of their development cycle, coupled with capitalising Floor Space Index and demand creation.
Residential rates in the Dahisar to Andheri micro-markets currently range from Rs 20,000 per sqft to Rs 50,000 per sq ft. However, the per sqft rate goes above Rs 50,000 or even more in the case of ultra-luxury projects.
Pravin Doshi, a real estate broker from Borivali said: "The average price per sqft is around Rs 25,000 in the micro-market of Borivali. Several ultra-luxury projects are quoting over Rs 32,000 per sqft. In terms of commercial properties, the average price in Dahisar to Andheri market ranges between Rs 20,000 and Rs 1 lakh per sq ft. However, the pricing depends from location to location."
Developers such as Lodha, Oberoi, and Rustomjee have projects along the Dahisar to Andheri belt.
The per month rental rate for the Dahisar to Andheri micro-market is Rs 25,000 to Rs 60,000 for a 2-BHK apartment having average size of between 600 to 800 sqft of carpet area, according to local brokers.
The monthly rental for 500 sqft of office space in a commercial building will be between Rs 100 per sqft and Rs 300 per sqft in the Dahisar to Andheri micro markets, local brokers added.
The two Metro lines will also pass via several Secondary Business Districts (SBDs) in Malad, Goregaon, Andheri, and Borivali which is picking up pace as a commercial market. It will take not more than 30 minutes for a person residing in Dahisar or Andheri to reach these SBDs using the two new Metro corridors.
The two new Metro corridors will not be of any use to those wanting to travel further to south Mumbai from the western suburbs or even the Bandra Kurla Complex (BKC), which is the central commercial district of Mumbai. The connectivity to BKC from Dahisar via a Metro corridor will take another three years, according to MMRDA officials.
Also read: Will Noida’s Aqua Metro Line boost property prices in its periphery?
Prices will increase, say developers
Shraddha Kedia-Agarwal, Director, Transcon Developers, said: "Home purchasing has picked up pace in Mumbai and the residential segment in the western suburban areas because of the upward movement of the completion deadlines of core infrastructure projects such as the Metro 2A and Metro 7. We can expect the prices to increase by 2-5 percent as the new metro lines become operational and the micro markets around the metro would see upbeat demand."
"These new lines have the potential to draw more and more prospective homebuyers to this corridor. We feel that the fence sitters should buy now as property rates are bound to move upwards very soon," said Samyak Jain, Director, of Siddha Group.
Boman Irani, Chairman and Managing Director of Keystone Developers (Rustomjee), said: "The intersection of the two new metro lines (Dahisar-Andheri) with the other citywide metro lines will positively affect the whole micro market. This will increase housing demand and provide impetus to housing demand. However, I don’t want to look at it from a price point as I believe the two metro lines will enhance accessibility and attractiveness beyond price value. The entire region's real estate market will perform well due to strong demand from homebuyers seeking a better and healthier lifestyle in city suburbs."
Also read: Delhi-Ghaziabad-Meerut RRTS corridor set to change real estate dynamics along the corridor
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