Hyderabad’s Gachibowli area have been listed as "emerging investment hotspots" among India's top eight locations as prime business districts have reached a saturation point, this place is which is close to Hitec City and mostly houses IT campus developments and IT SEZ developments. Residential prices here are expected to soar with increase in launches.
The other six destinations chosen as emerging or growing sub-markets, likely to be supported by excellent infrastructural development, include Noida and Greater Noida in the National Capital Region, Thane in Maharashtra, Whitefield (Bengaluru), Southern Suburbs (Chennai), Pune’s Viman Nagar and Nagar Road and Rajarhat (Kolkata).
Of the eight investment hot spots, Noida and Greater Noida witnessed the largest number of residential unit launches in the country in the last three years. Hosting of the Indian Grand Prix and opening of the Yamuna Expressway gave a fillip to the real estate sector there. Both these places are a middle class favourite also because they offer affordable prices and good connectivity. However, the report cautioned that there is an impending oversupply situation here which is why property and office space prices in the region have not appreciated in the recent past.
“As the oversupply situation is capping the appreciation of rents, many developers will slow down or resist construction activity to rationalise the supply. This is expected to increase the rents and capital values going forward,” said Anuj Puri, Chairman CII Real Estate Summit and Chairman & Country Head, Jones Lang LaSalle India.
Thane and Navi Mumbai have been listed as third best hotspot among eight locations across seven top Indian cities as prime business districts have reached a saturation point, according to a report released by the Confederation of Indian Industry and Jones Lang LaSalle India.
Cost-conscious buyers are seen the as the driving force behind Thane‘s emergence as a prime business district where rental and capital values are expected to increase by almost 50 percent in the next five years from the last trough in 2009.
“Thane offers housing for high-income and middle-income groups. It is witnessing increased interest from investors due to its good infrastructure and connectivity. While the residential property prices have surged in past few years, we expect it to continue its northward movement on the back of healthy demand. Thane is expected to witness strong residential demand due to increasing workforce in the sub-market,” the report said.
Navi Mumbai, on the other hand, offers options across all asset classes.
While the mid- and upper mid-income class reside at well-established precincts like Vashi, Belapur and Nerul, the lower mid-income population opt for farther emerging locations like Ulwe, Turbhe and Kamothe.
Investment activities are higher at these emerging locations compared with the established ones as they serve as affordable residential options. In other words, while end users can find end users properties that suit their budget, investors have ample emerging precincts to invest in.
“Availability of land and improving connectivity with the prime city is expected to drive the investment potential,” it stated. The region, the report said, is developing in a planned manner and with the completion of proposed infrastructural projects the problem of internal commuting is also likely to be addressed.
“Navi Mumbai has large land parcels available and it is offering housing options for middle-income groups at reasonable prices,” the report added.
Bangalore’s Whitefield is the most preferred IT and residential suburb of Bangalore’s mid-income and upper mid-income population thanks to its connectivity and ready-to-use social infrastructure.
Residential launches are expected to increase catering to the increasing demand from the IT/ITeS employees with increase in office spaces in Whitefield. Consequently the submarket will see appreciation in rentals and capital values,” the report said.
The southern suburb of Chennai which covers the major corridors along the Great Southern Trunk (GST) Road, Old Mahabalipuram Road (OMR) and East Coast Road (ECR) has been witnessing fast development over the recent years.
Old Mahabalipuram Road (OMR) continues to be the favourite for new launches. However, the City Centre, where there is little available land, also witnessed a few high-end launches.
The growth in IT/ITeS sector has paved way for overall development as it witnessed development of large-scale residential townships from both national and local developers.
“Existing physical and social infrastructure along the GST Road coupled with ongoing and proposed infrastructure projects are likely to drive property values in GST Road. Located in between both these corridors precincts such as Keelkattalai, Pallikaranai, Medavakkam, Chitlapakkam, Selaiyur and their neighbouring locations are expected to see rapid capital appreciation in the coming years,” the report said.
Viman Nagar in Pune has found increased favour on account of the IT-related developments in surrounding areas such as Magarpatta, Hadapsar and Kharadi. With affordable property prices, good road connectivity, established social infrastructure and proximity to IT/ITeS office space, this location has attracted different classes of buyers.
In Kolkata, all the action though seems to be at Eastern Metropolitan (EM) bypass and Rajarhat.
Rajarhat, a satellite city in Kolkata, planned way back in 1990s, has witnessed both the peak and trough of property prices in the last few years but the development in infrastructure in Rajarhat is expected to improve its investment potential even further eventually. Here prices are typically between Rs 3,000 and Rs 5,000 a square feet.
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