Bangalore Commercial Realty Getting Bigger & Better

Formerly a quaint little cantonment town, Bangalore underwent an extraordinary transmutation that helped it to buttress the status of the fastest burgeoning metropolises in Asia, by registering an economic growth of 10.3% in the year 2015. As per JLL survey, the presence of startups, infrastructural outlays, premier office space constructions and the entrée of the tech-industry majors are envisaged to be the key factors of such a fantastic growth. As a result, this IT capital left behind the political and commercial capitals of India by acquiring the stature of the dominant realty investment destination in the country.

While the city is acknowledging the real estate development in every sector, the highest surge is seen in the commercial sector. Thinking what contributed such upsurge? Have a look:

Rise Of IT/ITES & Biotechnology

Bangalore, being a matchless source of quality manpower and industry-friendly policies, has enticed over 2,000 IT/IT Enabled Service companies that employ ballpark 6,50,000 professionals. Also, it accommodates over 200 Biotech companies that are growing at the rate of 40% per annum. It even offers space for large & medium scale industry operations to the renowned names such as Toyota, Bosch, Volvo and the likes.

The city is planning to add 12 million sq ft of office space in 2015-16 across the areas such as Hebbal ORR, Bellary Road and Thanisandra Road. Such a massive industrial growth leads to the robust demand for the large industrial land parcels and commercial office spaces, which in turn boost the absorption levels, increase the rentals and pave a way for the real estate development.

Emergence Of More SEZs

More SEZ projects are approved by the government in Bangalore regions, which subsequently will amplify the realty growth in coming years. Infosys is scheduling to invest Rs. 710 crore for 12,000 seat software developments centre of over 40 acres in Devanahalli Industrial Area. Other lined up SEZ projects includes TCS India, Itasca Software Development Pvt.Ltd, Wipro and others. Also, the government has permitted a multi?product SEZ, Technology Centre.

To bring in American companies to Indian joint?venture groups, industry representatives, and Western original equipment manufacturers, the Aero SEZ is being worked out in collaboration with the US Aerospace Supplier Development Mission. About 250 acres of the land is allotted to this SEZ from the 1000 acres of the Aerospace hub set up near the airport. The initiatives of this SEZ would see around Rs 666 crores of investment from renowned names.

Further Development Of Cargo Village

BIAL has made significant investment towards the development of a world-class cargo infrastructure with high-tech Cargo terminals towards the airport’s cargo village, spread in 11 acres of land area. Also, the airport is considering a committed perishable cargo facility to handle temperature sensitive cargo at the airport. This is to facilitate and boost the pharmaceutical and other perishable trade.

It will ensure the fast clearances of import and export consignments from the airport, thus, is predicted as the welcome move to strengthen the commerce and trade in Bangalore.

Smoother Connectivity

The striving projects of the rail and road connectivity will change the future of the Bangalore Realty. A new high-speed rail link is planned to connect the whole city and the airport. NHAI will widen the NH-7, the monorail will be launched, the commuter rail system will enable the connectivity between the Devanahalli with Yeshvantpur via Yelahanka and the NICE road connecting Mysore and Bangalore will give a major impact on state’s realty.

Surely smoother connectivity assures an expansion of micro markets and helps to reveal many places which are congested in the metropolitan silicon city, Bangalore.

Introduction Of REITs

The Real Estate Investment Trusts (REITs) gave the much-needed spur to the investors and developers during the hard-hitting condition of realty sector. By listing the commercial properties on REITs, the builders will be able to raise cheaper capital and the retail investors will be able to participate in the booming Bangalore real estate, due to the simpler entry and exit schemes.

Even the big names like Embassy Office Parks, a joint venture between US private equity fund Blackstone and Embassy Group of Bangalore, has grouped all of its properties in India to list them as a REIT.

With the major commercial developments in the pipeline and more innovative developments to come, the garden city, Bangalore will capture the penchant of both investors and the potential buyers.

I have vast experience of real estate market and own/manage RealEstateIndia.com, a leading property portal in India that manages huge database of property/agent across the country.