Demand for office space has traditionally been driven by the IT/ITeS sectors that comprise software development and processing centres. This is expected to be the largest demand driver in 2008 as well. Of the total expected supply of 82.8 million sq.ft.in 2008, IT related developments will garner the largest chunk.IDC India, a leading research firm predicts that the domestic IT / ITeS market revenue will touch Rs1,10,000 crore in 2008 while sustaining the growth of 27% registered in 2007.
The firm notes that uptime, availability and performance management of infrastructure and applications will be at the core of innovation. Besides tier-I cities like Mumbai, NCR, Bangalore and Pune, cities like Kolkata and Nagpur are also being promoted as attractive destinations for such companies.
Cities that score high on the software technology park or IT park index include Bangalore, Chennai, New Delhi, Mumbai, Hyderabad, Noida, Pune, Kolkata and the states of Tamil Nadu and Maharashtra. They already house the largest IT parks in the country.
“IT/ITeS has been the focus of the Indian real estate sector for the last four years and though demand for commercial space remains consistent as compared to 2007, supply has increased significantly in anticipation of stronger growth and demand,” said Sanjay Dutt, deputy managing director, Cushman & Wakefield.
“Tier 2 and 3 cities like Mysore, Mangalore, Coimbatore, Ahmedabad, Kochi, Indore and Nagpur provide lower operational costs since the Indian IT biggies have already ventured into them,” he added.
Given below is an analysis based on feedback from realty experts on how some of the most sought after cities in this space are poised in 2008.
Pune:Buoyed by strong economic conditions, favorable demographics and consumer spending, the city is growing rapidly, a factor that is encouraging companies to chalk out expansion plans in this market. Organized retailing has increasingly shifted to newer residential pockets of Bavdhan, Hinjewadi and Baner due to their proximity to IT destinations.
The realty sector witnessed rapid growth in 2007 with maximum development in peripheral regions due to lack of large land parcels in central locations. Of this, majority of the development is concentrated in eastern and western parts of Pune.
The Rajiv Gandhi Infotech Park at Hinjewadi was one of the first developments to take place in the peripheral locations of the city. Hinjewadi’s strategic location, with proximity to the Mumbai —Pune expressway and the Mumbai — Bangalore highway has supported other developments in the region.
Of late, the eastern corridor along Nagar Road upto Magarpatta has also come up as a preferred location for the financial sector as well as the IT/ITES companies.
In 2007, a number of projects in the eastern zone obtained SEZ status. This includes the 400-acre Magarpatta City by Magarpatta Township Development & Construction Company Limited, a four million sq.ft of IT hub EON Free Zone by Panchshil Realty at Kharadi and SP Infociti by SPCL located at Sholapur Road.
Prominent projects that were operationalized in 2007 include TechPark on Airport Road, SP Infociti on Sholapur Road, Cybercity at Hadapsar, and GigaSpace and Weikfield IT Park at Vimannagar.
According to a report by realty consultants Knight Frank, approximately 7.02 million sq.ft of office space is expected to enter the market in 2008. Of this, the eastern zone will witness approximately 67% of the total supply. Important projects to be completed in 2008 include Commerzone at Yerawada, Cerebrum at Kalyaninagar and Eternia at Wakdewadi.
Puneet Wadhwa - livemint.com