Top 8 Benefits of Commercial Property in Mohali

Top 8 Benefits of Commercial Property in Mohali

Mohali is one of the fastest growing cities in Punjab and has emerged as a major commercial hub in recent years. With its proximity to Chandigarh and developing infrastructure, Mohali offers several advantages for commercial and business activities. Here are 8 key benefits of investing in commercial property Mohali:

1. Strategic Location

Mohali enjoys a strategic location in the Chandigarh-Delhi-Amritsar industrial triangle. It is situated right next to Chandigarh, and the joint capital of Punjab as well as Haryana. This provides easy access to a large consumer market in Chandigarh as well as other major cities of Punjab and Haryana. Mohali’s location makes it well connected by road, rail and air to the rest of North India. The Chandigarh International Airport is just 30 minutes away. This strategic location gives commercial properties in Mohali an edge over other cities.

2. Growing Economy

The economy of Mohali has grown significantly in the last decade driven by sectors like IT/ITeS, manufacturing, healthcare and education. Many major companies have set up large offices and facilities in Mohali. The city is also emerging as an education hub with top colleges located here. This growing economy has led to increased demand for commercial real estate from corporates, startups, hospitals, colleges and others. Investing in commercial properties ensures returns from the rising economic growth of Mohali.

3. Developing Infrastructure

The infrastructure in Mohali is continuously being upgraded to support its growing commercial activities. The city has a well-developed road network with national and state highways connecting it to other major cities. An elevated light metro rail project is also underway which will further boost connectivity. Utilities like power, water and telecom infrastructure are robust. Special economic zones (SEZs) and industrial parks with ready infrastructure are attracting investments. The developing infrastructure makes Mohali an attractive destination for commercial and business activities.

4.Rising Rental Yields

Due to the increased demand for office and retail spaces driven by Mohali’s economic growth, rental yields from commercial properties have been on the rise over the past few years. While average national rental yields hover around 5-7%, yields in Mohali are higher at 8-10% for commercial properties depending on the location and type of asset. This makes commercial real estate an attractive investment class that provides good rental income along with capital appreciation.

5. Tax Benefits

The government of Punjab offers various tax incentives and benefits to boost commercial and industrial development in the state. For commercial properties in Mohali, there are benefits like rebates in stamp duty and lower circle rates. Long term capital gains from sale of commercial properties after 3 years are tax exempt under section 54F of the Income Tax Act. These tax benefits enhance the returns for commercial property investors in Mohali.

6. Appreciating Capital Values

With its rapid growth, Mohali has seen strong appreciation in capital values of commercial properties over the last decade. As demand outstrips supply, average capital appreciation has been 15-20% annually for prime commercial assets in Mohali. This is much higher than other major cities and provides multi-fold returns over a long-term holding period of 5-10 years. The rising economic profile of Mohali ensures this trend of capital appreciation will continue making commercial properties a lucrative investment class.

7. Positive Rental Demand Outlook

Mohali is rapidly transforming into a major commercial hub of North India. Over the past decade, several large corporations have established offices and facilities in the city to capitalize on its strategic location and growing economy. As more companies continue setting up shop in Mohali, the demand for leased commercial real estate is projected to remain strong. There are several types of leased commercial spaces that are in high demand. Institutional buildings that house corporate offices are a major segment.

As Mohali attracts more multinational and domestic companies across sectors, the need for large office spaces continues to rise significantly. Retail malls are another key segment seeing robust demand growth. With rising incomes, consumers are spending more on retail therapy, driving retailers to open new stores. Co-working spaces have also gained popularity as a flexible option for startups and freelancers. According to industry estimates, the total leasable area requirement for office spaces alone in Mohali is projected to cross 50 million square feet by the year 2025.

8. Hedge Against Inflation

Commercial real estate has proven to be an effective tool for hedging inflation risks over long periods of time. During times of high inflation, the costs of virtually all goods and services increase steadily year after year. For investors, inflation poses a major threat as it erodes the purchasing power of their assets. Commercial properties provide protection against this threat through built-in inflation indexing. When inflation rises, landlords are able to increase rents for leased commercial spaces to pass on higher operating costs to tenants. Lease agreements generally include clauses that allow annual rent escalations linked to inflation indices. This ensures rental income flows continue increasing in line with inflation.

At the same time, capital values of commercial properties also appreciate due to strong demand in inflationary environments. Investors are able to demand higher prices when selling commercial assets to offset depreciation caused by rising costs. This self-adjusting nature of both rents and capital values makes commercial real estate an attractive match for inflation. Investors gain assurance that their returns will be preserved in real terms even during high inflation. For example, in the emerging Indian market of Mohali, investing in commercial properties provides an inflation hedging benefit. With robust economic growth and infrastructure development fuelling demand, rental increases and asset price appreciation in Mohali are projected to stay well ahead of domestic inflation over the long run.

Conclusion

The rapid growth of Mohali’s economy and infrastructure has created an ideal environment for commercial and business activities. This translates to strong returns potential from commercial properties like double height showrooms for sale through assured rental income, capital appreciation and tax benefits. Investing in commercial properties in Mohali provides multiple advantages and remains an attractive long term investment option.

 

 

 

Aileen Scott

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