An Explainer: CBD

In a city, the central business district (CBD) is the area where much of the commercial and business activity happens.

PropGuide Explains CBD

Central business districts emerged in ancient cities, where people gathered to trade with each other. As modern means of transportation did not exist in those times, market activity had to be concentrated in the centre of a city. When modernised transportation networks emerged, CBDs became permanent business districts near such networks. In cities across the world, the major mass-transit corridor and the central point of other transportation networks are in or around CBDs. In large cities, the CBD is often the financial district.

Generally, building density in a city is the highest in the CBD and often the lowest in its periphery. In New York, for instance, the floor area ratio (FAR) in the CBD is 15, while the lowest FAR in the city is 0.5. But, in Indian cities, this is not often true. In Mumbai and Ahmedabad, for instance, informal settlement areas and regions in the periphery have much higher FAR than in the CBD or surrounding regions. Urban policy experts like Alain Bertaud have pointed out that no other country in the world follows such a policy in large cities.

Mumbai's de jure CBD is Nariman Point, though in the past few years, the Bandra-Kurla Complex has emerged as the de facto CBD. Connaught Place is the CBD of Delhi. In New York, the largest CBD is Midtown Manhattan.

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