Mumbai: A building on Mumbai’s upscale Carter Road in Bandra, where actor Shah Rukh Khan is said to own a lavish terrace apartment, is now up for redevelopment. Around 30 companies have expressed initial interest, and nearly two dozen have submitted bids, according to multiple developers familiar with the project.
While Shah Rukh Khan’s name has helped sell everything from satellite television and bedsheets to fairness creams and even toilet cleaners, this rush of developers has little to do with the star’s association with the building.
Instead, it’s emblematic of a broader trend in Mumbai’s real estate market.
Going high is the only way for land-starved Mumbai to make space for its teeming masses. On the one hand, the Maharashtra government is driving the redevelopment of large slums and public housing colonies such as Dharavi, the BDD chawls, and Ramabai Nagar. On the other, there’s been a surge in private buildings and cooperative housing societies opting for redevelopment. Thuds, vrrrrms, and whirrs of jackhammers, drills, and heavy construction machines are now part of Mumbai’s soundscape.
This frenetic and frantic redevelopment is now generating new housing stock even in saturated pockets of the city like Bandra, Colaba, Andheri, and Chembur. Developers peg the number of buildings at various stages of redevelopment across Mumbai at about 2,050. In almost every neighbourhood, one can spot buildings hidden behind barricades, with demolishers hard at work. The debris, dust, and the relentless din of construction throw up another concern—will it worsen the population density of already crowded neighbourhoods?
For now, developers are lining up to grab plots. There’s a race between developers to win over society members, who are being offered several carrots—more living space, better rentals, and higher corpus funds.
“The market is over-competitive right now,” said Dominic Romell, president of MCHI CREDAI. “But everybody has their own economics and maths.” Societies may pick a certain developer because the offer appears lucrative, but it’s never that simple.
During the course of the project, the developer may not find it economical to deliver the promised ceiling height or additional space, for which buyers are willing to shell out crores even for a 500-square feet apartment.
“Society members may find themselves in a Catch-22. That’s when renegotiations begin.”
Still, Romell added, some plots are so attractive that a developer doesn’t mind going all out to get the deal, even if it doesn’t make immediate financial sense.
“It helps establish the company’s presence in that neighbourhood and elevate their profile,” Romell said.
Suddenly, you had a market where investors were positive and all coastal regions opened up—Bandra, Worli, Colaba, Malabar Hill, Napean Sea Road, Versova. Historically, in these coastal seafront locations, the average primary sales were about 300 units every year. These are the houses with a ticket size of over Rs 15 crore
Meanwhile, residents are approaching these deals like high-stakes corporate M&A transactions—closely guarding information from anyone other than their respective society members and arriving at the table with architects, lawyers, and project management experts.
“The process is very stressful. There are constant fights between members,” said a management committee member from a society in Andheri’s Seven Bungalows. “We signed the development agreement a couple of months ago, and now the developer is busy securing permissions, which will take time. Many residents are worried that the developer has run away. To protect the deal and our sanity, it’s best to give out as little information as possible.”
Despite the current frenzy, many developers and market analysts say this wave is unsustainable. Eventually, the bubble is going to burst, spreadsheet calculations will stop making sense and residents will be forced to lower their expectations.
“We have reached a very scary situation in Mumbai’s redevelopment scene. We have reached the market’s peak. When prices start going down, none of these calculations are going to make sense and society members could be left in the lurch,” said Gulam Zia, senior executive director at Knight Frank India.
In their eagerness to outbid competitors, developers are giving societies everything they ask for, often at the risk of “being squeezed till the last drop.”
“But two years later, the same developer may come back, asking societies to revise that 70 percent to 50 percent (additional area over the existing area), saying it is not sustainable,” Zia added.
We have reached a very scary situation in Mumbai’s redevelopment scene. We have reached the market’s peak. When prices start going down, none of these calculations are going to make sense
The triggers behind Mumbai’s redevelopment wave
Chetan Dabke, a pharma marketing professional, just moved into a swanky new apartment in a redeveloped building this week.
His old Santacruz building, constructed in 1970, had become so decrepit that “if anyone so much as hammered a nail for a photo frame, the wall would cave in.”
The 60-family society had been contemplating redevelopment since 2007. But no developer would touch the building even with a flagpole.
Reasons were many: the building was located in the airport funnel zone, limiting height to 45 metres (more than 14-15 floors); proximity to the infamous Mithi River, which resembles a drain and emits foul smell; and a slum nearby.
“Over a hundred builders saw our site and rejected it,” Dabke said.
Just before the Covid-19 pandemic hit in 2020, the society floated a fresh tender. A year later, their luck turned.
The Maharashtra government announced stamp duty waivers between August 2020 and April 2021. Soon after, the BMC offered a 50 percent concession on premium charges for the calendar year 2021—moves intended to revive the struggling real estate sector. Dabke’s society wasn’t the only one to benefit.
“A lot of projects were stuck between 2016 and 2019 due to rising costs. When the concessions came in, the redevelopment expenses dropped by 10-15 percent,” said Ritesh Mehta, senior director at JLL India. He added that this revived 30-40 percent of previously unviable projects.
While the concessions helped, it was a heady cocktail of multiple factors—most notably rising demand—that eventually got the market moving.
Luxury demand reshapes the game
In the years before the pandemic, India’s stock markets surged, senior executives saw their salaries jump, and successful investments generated sudden wealth. Covid and its subsequent lockdowns then sparked a desire for larger, personal spaces among affluent buyers, especially in the city they had built their lives in.
Meanwhile, regulatory relaxations in 2018 and 2019 allowed construction within 50 metres of creeks and bays (down from 100) and delinked Floor Space Index (FSI) from Coastal Regulation Zone (CRZ) norms. This made it easier to redevelop properties in prime coastal zones using the same FSI as applicable to other parts of the city.
The result: booming demand for houses and potential for supply in posh areas.
“Suddenly, you had a market where investors were positive and all coastal regions opened up—Bandra, Worli, Colaba, Malabar Hill, Napean Sea Road, Versova. Historically, in these coastal seafront locations, the average primary sales were about 300 units every year. These are the houses with a ticket size of over Rs 15 crore,” said the head of business development at a listed real estate firm.
“Now, with every sea-facing society going for redevelopment, wealthy buyers have a lot more options,” he added.
According to a report by India’s Sotheby International Realty and CRE Matrix, 1,040 luxury homes, priced above Rs 10 crore, were sold in Mumbai between July 2023 and June 2024. In just the first half of 2024, sales crossed Rs 12,300 crore, with more than half of the buyers aged between 35 and 55.
Ultra-luxury homes—priced above Rs 40 crore—have also seen a spike. As per ANAROCK Group, a real estate research and advisory firm, 52 of the 59 transactions nationwide in 2024 were in Mumbai—up from 11 in 2022.
Even top-tier developers, once reluctant to take up small plots yielding just 5-7 apartments, are now diving in. Prestige Developers is redeveloping a 1-acre plot in Bandra’s Pali Hill; Kalpataru is building 4 BHKs and 7 BHK duplex apartments on a 0.37-acre plot on Altamount Road.
“I met a lot of business development teams and senior members in Prestige, Godrej. They were really reluctant earlier. They maintained they wouldn’t make a building with only seven or nine apartments because of the huge overhead cost,” said a real estate consultant. “But views changed as demand for luxury homes rose and developers realised that redevelopment is now the only way to get access to premium locations in Mumbai.”
The pitches, stressors, and tears
On a balmy May evening in 2023, a banquet hall in central Mumbai’s Dadar resembled a wedding venue—with trays of samosas, sandwiches, dhoklas, jalebis, and servers handing out tea, coffee and fresh juice. Except, it wasn’t a wedding reception—it was a pitch battle.
Multiple developers had gathered to woo residents of a large Sion society, promising sprawling gardens, kids’ play areas, infinity pools, jogging tracks, and balconies with skyline views that looked more like Chicago than Mumbai.
A similar event was held for the Andheri Seven Bungalows society. Eleven developers were shortlisted to five, and the society of 60 tenants sat through 9am-6 pm pitches across two Sundays.
Such events are organised by project management consultants, who now form the backbone of most redevelopment projects.
“Societies today are far more informed and calculative in their negotiations,” said Niranjan Hiranandani, co-founder of the Hiranandani Group and chairman of the National Real Estate Development Council (NAREDCO).
Typically, consultants, architects and legal teams work with societies for 2 to 2.5 years—drawing up plans, sorting out internal issues, getting consensus on members’ expectations, and drafting bid documents. After tenders are floated and bids evaluated, the winning developer signs a development agreement, conducts legal checks, and determines flat sizes (since older buildings often had non-standard layouts).
Finally, a Permanent Alternative Accommodation Agreement (PAAA) is signed with all members, who hand over the keys to their apartments. And then, the wrecking ball swings, reducing the past to rubble, clearing the way for spanking new structures and Mumbai’s vertical future.
Every third lane in Mumbai has some or the other building behind barricades, so people feel there will be a huge supply. But any redevelopment project will only yield anywhere between five and 40 apartments for sale. The issue will be more about a mismatch—more people wanting 1,000 sq ft houses, but developers are making 1,500 sq ft homes
The entire process—from initial consensus to handover—takes about six to eight years, depending on the scope of the project. Along the way, it is often marked by scuffles, heated arguments, fears, frustrations, and tears.
In one society in central Mumbai, for instance, an irate resident tore up a set of ballot papers when the final vote on the developer didn’t go his way. An office bearer had to threaten legal action to calm him down, according to residents who attended the meeting last year.
“My team is taking care of more than 13 redevelopment projects. I have been going to many of these Annual General Meetings and Extraordinary General Meetings, and the toughest part of our job is handling frustrated members venting all their issues at us,” a senior executive at a project management consultancy recalled.
For developers, it’s crucial that these internal conflicts are resolved before they step in. Technically, a simple majority of 51 percent is sufficient to push a redevelopment forward. But in practice, developers aim for near-unanimous consent among society members to disruptions or legal complications later. This is partly why both societies and developers tend to be coy about sharing too many details until agreements are signed—especially now, when members are spoilt for choice.
The rush to grab projects
Earlier this month, a building in Breach Candy circulated a term sheet with a gist of developer offers to its members. The number of interested developers was in the double digits. Among the top eight bids, the lowest offer promised a 78 percent increase in carpet area over residents’ current sizes, while the highest offered 105 percent, a consultant associated with the deal said.
Developers are also throwing in generous corpus funds and higher rentals to sweeten the deal.
“Previously, offering 25-30 percent additional area was the standard. But today, developers provide significantly more space, better rental deals, and larger corpus funds,” said Hiranandani. “This heightened competition stems from the scarcity of available land. This makes redevelopment projects a prime opportunity for developers to establish their presence in Mumbai’s coveted areas.”
The frenzy isn’t limited to established Mumbai developers. Builders from other cities—and even companies from unrelated industries—are using their brand name and foraying into real estate, hoping to gain a foothold through marquee projects.
For instance, Sayaji Realty, part of the Sayaji Group whose core business is hotels and hospitality, clinched a redevelopment deal in Andheri’s Seven Bungalows with 60 resident families.
“We chose Sayaji Realty because of their track record in construction, even during Covid,” said a member of the society’s management committee. “They were offering only 30 percent more area, and other developers were willing to give much more. But we trusted their delivery track record.”
After the society picked Sayaji Realty, rival developers began upping their offers to 50-60 percent more area. Some who hadn’t even participated in the bidding process began approaching residents informally, hoping for a backdoor entry.
“But we stayed firm. We wanted to conduct the process by the book,” she said.
Similarly, a Sion society picked Raymond Realty, part of the Raymond Group known for textiles and apparel, over developers who have been in real estate for decades.
Then there are hyperlocal players—lesser-known beyond their neighbourhoods but trusted by local societies.
In Dadar-Shivaji Park, for instance, the skyline has changed vastly over the past three-four years. Many of the area’s new towers bear a familiar neon sign: ‘Sugee.’ The company, run by the Deshmukh family (relatives of Raj and Uddhav Thackeray), has completed 12 projects in Dadar and has 10 more ongoing.
Among the latest in Sugee’s portfolio is an old society behind Dadar’s Portuguese Church, spread over 4,000 square meters.
“Sixteen builders bought the bid document, six actually submitted bids. Of those, three were dropped. We picked Sugee because of its track record in getting work done. It also has some political clout, so getting permissions from different government authorities will not be too difficult,” a resident of the society said.
Other micro-markets also have their go-to names—Supreme Universal and Satguru Builders in Bandra-Khar, H Rishabraj in Borivali-Dahisar, and Lotus Developers in Juhu.
“In a given micro-market, the locally well-known developer may not be the one with the best offer,” said Ritesh Mehta of JLL. “But it is a known name in the area. These micro market players can clock better deals with tenants, pick up projects at a lower cost, and deliver because they know that if they make even one mistake, they are finished.”
Mumbai redevelopment: Will prices rise?
Individually, redevelopment projects don’t always create a lot of saleable housing stock, But collectively, with the sheer number of projects currently underway in Mumbai, they are beginning to reshape the city’s housing market.
A senior executive with a city-based developer noted that just along Mount Mary Road in Bandra, more than 10 lakh sq ft of saleable carpet area is expected to enter the market within the next 24 months.
What this means for prices, however, is unclear.
Zia from Knight Frank said that society redevelopments alone will not impact prices significantly. “More volume will actually come from slum redevelopments and public sector projects like the Dharavi revamp or the redevelopment of BDD chawls,” he said.
What may be more likely is a mismatch between demand and supply.
“Every third lane in Mumbai has some or the other building behind barricades, so people feel there will be a huge supply. But any redevelopment project will only yield anywhere between five and 40 apartments for sale,” Mehta said. “The issue will be more about a mismatch—more people wanting 1,000 sq ft houses, but developers are making 1,500 sq ft homes.”
NAREDCO chairman Hiranandani said the impact on prices will be upward, with Mumbai’s real estate gaining even more appeal.
Yet, there’s a growing concern: can all these developers, who have promised the moon to get coveted plots and squeezed their own margins, actually walk the talk?
Pankaj Kapoor, managing director of real estate research firm Liases Foras, warned that developers are entering a “very risky zone,” relying on future price appreciations to justify today’s aggressive bids.
“The biggest problem in Mumbai’s redevelopment scenario today is that all kinds of developers are participating in this frenzy—even those who may not have easy access to formal funding, or those who may have to resort to a high cost for financial closure. The costs will increase anyway because of inflationary pressures, and if prices don’t go up to the level of the developers’ expectations, the projects they have bid for will become unviable,” Kapoor said.
So far, it’s been good. Most projects have been delivered on time and as promised.
“But overall,” Kapoor added, “the redevelopment market now suffers from a problem of overestimation.”
(Edited by Prashant)