GST Road, on the other hand, has SEZ developments such as Mahindra, L&T , Shriram, etc, along with multiple industrial units being set up in the vicinity. This consequently allows for mixed developments to be witnessed along the stretch which caters to a larger strata of society . Presently, Rajiv Gandhi Salai is faced with an oversupply situation with vacancy levels greater than 45% while GST doesnt suffer from that problem.
Physical infrastructure is strong in both the locations with the recent upgradation of roads, although connectivity in GST is stronger owing to the Southern Railway line and its proximity to the airport. As State-run buses use the East Coast Road instead of Rajiv Gandhi Salai, lack of public transport continues to plague most stretches of the latter. GST Road also boasts of stronger social infrastructure such as schools, higher education institutions, retail space, hospitals , etc, in comparison with Rajiv Gandhi Salai.
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However, social infrastructure in Rajiv Gandhi Salai is presently being established and as time progresses, is expected to strengthen further with more schools, hospitals, entertainment and retail centres. Both locations over the long term have the capability to be self-sustaining micro markets in Chennai, although the pace of the growth may vary. With the recent completion of the fourlane GST Road, additional infrastructure (such as rail and road over-bridges ) is expected in the near future.
In the present scenario, GST has an advantage as compared to Rajiv Gandhi Salai in terms of wholistic sustainable growth coupled with the presence of manufacturing and IT companies. Further, the development in this region is more spread out as compared to Rajiv Gandhi Salai as the latter is developed only on either side on the corridor. That said, Rajiv Gandhi Salai has the potential to develop and may emerge as a hotspot , depending on the pace of infrastructure developments in the region. Rental values for a 1,000 sqft apartment
GST Road – As can be seen in the tabulated column, one can expect to receive a rent anywhere between Rs6,500 to Rs10,000 for low-end apartments; Rs12,000 to Rs20,000 for middle-end apartments and Rs18,000 to Rs35,000 for luxury apartments. The hiked rentals result in the good connectivity of this road to the city, thanks to the suburban trains. Its proximity to the airport also plays a huge part in the spiked rental value of apartments here. ————————————————-
Rajiv Gandhi Salai – Quality amenities in apartments play a pivotal role in perking up the rentals in this stretch. Often, the location of the apartment and its proximity to the city are factors that decide the value of the rent. Residents of this stretch are mostly BPO (Business Process Outsourcing) employees, essentially bachelors and spinsters on a transferable job. Students from across the country studying in colleges along this stretch also hold a share of the resident profile as do corporate guests.
The lack of public transport on this stretch is also a major cause of worry for potential investors who wish to rent out their apartments. It is all these factors that reduce the rental value of an apartment on this stretch, in comparison with that on GST Road. As the arterial highway connecting Tamil Nadu’s capital Chennai to the southern regions of the state, the Grand Southern Trunk Road — or GST Road as it is popularly known, was a silent witness to zipping buses and trucks, carrying loads of people and goods for years.
While Standard Motors, located on the southern outskirts of the city, had long stopped rolling out automobiles, the Madras Export Processing Zone (MEPZ), tucked a few km into the city on the stretch, was less glamorous to attract attention. In the mid-to-late 90s, when Ford and Visteon, along with a few auto component units set up base on the stretch, GST Road figured on the global automobile map, along with Sriperumbudur, which attracted the larger investment from Korean major Hyundai Motor. Today, there is a whole lot of new meaning for GST Road.
With four SEZs already approved and room for at least a couple more, it may soon turn out to be Chennai’s ‘SEZ Corridor’. Thanks to Infosys, which is setting up its largest development centre in Mahindra SEZ, GST Road now offers a fair mix of IT and manufacturing and has become a hub for property developers. “GST Road offers unparalleled accessibility and the best transportation infrastructure in Chennai in terms of connectivity as it is connected by road, rail and air,” says Mr Ramesh Nair, local director, Jones Lang Lasalle Meghraj, which has bagged the marketing rights for the Shriram Gateway SEZ. GST Road is also in close proximity to thickly populated middle-income catchment zones like Tambaram, Chromepet and Pallavaram, besides Perungalathur, making it attractive to IT and BPO companies,” he added. Besides MEPZ, which houses several export units and is also offering space for IT Parks to come up, and Mahindra Global City SEZ, construction work has begun on Shriram Gateway and L&T Arun Excello SEZs on the stretch. In addition, India Land, which is building a large IT Park at Ambattur, is planning a mixed-use SEZ on GST Road. Unlike OMR and Sriperumbudur stretches, GST Road is the only place that has established infrastructure already in place. With a slew of SEZ projects underway, the stretch is fast developing into a kind of SEZ Corridor because of the availability of large tracts of land,” said Mr Rajesh Babu of leading property consultants, RECS Group. Sensing the emerging potential, leading property developers L&T Arun Excello launched ‘Estancia’, a large residential township, adjacent to their SEZ project. Akshaya Homes, which was an early bird on the OMR, has already moved into GST Road and launched a 520-unit residential township, Metropolis.
Hallmark Constructions too has just about launched its 2,000 unit residential project on the GST Road. “Besides established infrastructure, rail connectivity, which runs almost parallel to the road is the biggest advantage for GST Road. Several established educational institutions are well entrenched on the stretch,” industry sources said. “Unlike OMR, which is set to house just a couple of hotels, there are over half a dozen hotels already there or being planned,” they added. Source: The Economic Times Main Residential areas abutting GST Road between Kathipara and Chengalpattu St. Thomas mount Pazhavanthangal
Meenambakkam Pallavaram Chromepet Tambaram Perungalathur Vandalur Urapakkam Guduvancheri Potheri Kattangalathur Maraimalainagar Singaperumal koil Chengalpattu It sez
The IT, ITES and Electronic Industries SEZ spread over across 500 acres is located in Padalam, Madurantakam Taluk close to GST Road about 65 kms south of Chennai City * Chennai is witnessing heavy growth in its southern and western peripheral areas, the Multi National companies situated near the site include Infosys, Ford Motors, BMW etc.
Numerous colleges and residential townships are coming up around this area * The SEZ is accessible from Chennai city and Chennai Airport through road (NH – 45 or GST Road) and rail, the nearest railhead being Karunguzhi station on the Chennai – Villupuram Sectionl erungalathur, Vandalur, Urapakkam, Guduvancheri, Potheri, Kattankalathur, Maraimalai Nagar, Singaperumal Koil, Chengalpattu, all are now seeing lots of residential and industrial developments esp in the past 9-10 yrs.
I just did a simple population calc based on 2001 census data (rounded to nearest 1000):
Perungalathur -19000, Vandalur -13000, Urapakkam -14000, Guduvancheri – 27000, Potheri + Kattankalathur = 20000, Maraimalai Nagar= 49000, Singaperumal Koil = 8000, Chengalpattu = 63000. Total = 2,13,000 (2. 13 lakh) Mahindra World City, GST Road, Near Chengalpattu 1. MAHINDRA WORLD CITY Mahindra World City, New Chennai – Corporate India’s first operational Special Economic Zone (SEZ) and India’s first Integrated Business City is promoted by the Mahindra Group and TIDCO (Govt of Tamil Nadu Enterprise).
It is a public-private initiative Ascendas tech park 3. BMW 4. Infosys 5. WABCO TVS 2. SRM University SRM (Sri Ramaswamy Memorial) University, is a co-educational private university in the state of Tamil Nadu, India. The university has four campuses in Tamil Nadu at Kattangulathur, Kancheepuram district, Ramapuram, Vadapalani, Trichy and one in Modinagar, near Delhi. Previously functioning under Anna University, as SRM Engineering College, the institute gained deemed status in 2003-04, and was renamed SRMIST (SRM Institute of Science and Technology) and then eventually called SRM University.
The SRM University campus at Potheri in GST road is its main and biggest campus. Some pictures of the campus L&T Estancia, GST Road, Vallanchery, Guduvancheri ESTANCIA IT SEZ is a notified SEZ and the first project of its kind in Chennai, providing a totally integrated township for discerning IT professionals to work and live, away from the congestion and pollution of the city. Located on the GST (NH 45) Road in Guduvanchery, just a 20-minute drive from the airport, it is spread over an area of 82 acres. Surrounded by lakes and hills it already has a resort like environment.
Adding to the natural beauty will be the landscaped campus of Estancia, serene and environmental friendly, to accommodate around 50,000 people. Estancia will consist of three major components developed under three SPVs, promoted by the Larsen & Toubro Limited and Arun Excello Infrastructure Pvt Ltd. , 27 acres IT Special Economic Zone (SEZ) with 3. 04 M sq. ft of office space. 41 acres Residential Gated Township with over 2000 apartments 11 acres Commercial and retail development with a Hotel Service apartment (By Holiday Inn) and a Mall cum Multiplex. 3 acres for a school run by Vidya Mandir (Mylapore).
The total project, spread over approx. 82 acres is expected to be completed in two phases by 2010 or even earlier as per demand. World-renowned architects RMJM of UK, have created the master plan and designed each building, keeping modern international practices of township layouts in mind. Strata a subsidiary of RMJM has created the landscapes. Estancia will no doubt rival similar townships in Singapore and Hong Kong in scale and grandeur on completion. Ford India Factory Ford India has its factory at GST Road, Maraimalai nagar. Shriram Gateway Shriram Properties Limited in joint venture with SUN-Apollo is developing a 4. million sf mixed use development project in the erstwhile standard motor property. Out of the 4,800,000 sq ft (446,000 m2), 3,600,000 sq ft (334,000 m2) will be under SEZ called ‘The Gateway’ in GST Road, Perungalathur. The Gateway is spread over an area of 57. 94 acres (234,500 m2) and will comprise an IT SEZ, retail mall, multiplex & serviced apartments. Companies that have leased space in the Gateway: * Accenture – has leased up 4. 60 lakh sq. ft. * Mahindra Satyam – has leased up 2. 10 lakh sq. ft. * Take Solution- has leased 1. 0 lac sft * Mobius, * Trianz, * Sybrant Technologies * Redington * Congruent, http://www. mdachennai. gov. in/listofsubprojects2. html B. Construction of Road Over Bridges (ROB) and Road Under Bridges (RUB) 21. Construction of RUB in lieu of LC4 between Villivakkam and Ambattur 22. Construction of RUB in lieu of LC6 between Thiruvottiyur and Ennore 23. Construction of ROB in lieu of LC 32 & 33 between Tambaram and Vandalur 24. Construction of R. O. B. in lieu of L. C. 4 in between Tiruvotriyur – Ennore (Near Tiruvotriyur Railway Station) 25. Construction of R. O. B. in lieu of L. C. 47 in between Guduvanchery and Singaperumalkoil Rly. Station 26. Construction of R. O. B. in lieu of L. C. in between Tondiarpet and Thiruvottiyur 27. Construction of R. O. B. in lieu of L. C. 14 in between Tirunindravur – Tiruvallur (Near Sevvaipet Railway Station) 28. Construction of R. O. B. in lieu of L. C. 40 in between Vandalur Guduvancheri on Madambakkam Adanur Padappai Road 29. Construction of R. O. B. in lieu of L. C. 5 in between Villivakkam – Ambattur (Near Pattravakkam Railway Station) C. Construction of Pedestratin Subways. 30. Pedestrian Subway at TVS on Anna salai 31. Pedestrain Subway at Anna Salai – Theagaraya Road Junction 32. Pedestrain Subway at Periyar Salai – Evening Bazar Road Junction D.
Construction of Grade Seperators. 33. Combined Flyover at Annasalai for General Patters road junction and Spencers Junction (From 2/4 – 3/2 G. S. T. Road) 34. Combined Flyover at Annasalai from Eldams road junction to C. I. T. Nagar 1st main road (km 6/0-8/6 of G. S. T. road) 35. Grade Separator at the twin junctions on Periyar EVR Salai at Anna Nagar Arch MEPZ SEZ established in 1984, Mahindra World City, New Chennai, Shriram’s Gateway SEZ, Estancia SEZ, ETL Infrastructure and India Land SEZ. http://www. commonfloor. com/arun-estancia-chennai/povp-pyikbo | | | Basic Cost for 3rd Level
From 4th to 12th Level an incremental value of Rs. 20/- per sq. ft. per Level will be charged. | Rs. 3,950/- per sq. ft| Basic Cost (From Level – 1,2,13th to 17th)| Rs. 4,450/ sq. ft| Registration, E. B. deposit, Legal ; Documentation, Infrastructure and Amenities Charges| Rs. 425/- per sq. ft (all Levels)| Car Park| Rs. 2,00,000/-| Corpus Fund| Rs. 75,000/- *| Club House Membership fee| Rs. 1,25,000/- *| Maintenance fee payable for 3 years in advance| Rs. 2. 50 / sq. ft / Month *| Service Tax| Extra as applicable| | | Sraraswathi saw mill
AMBIKA WOOD INDUSTRIES SDNB VAISHNAV ARTS AND SCIENCE MIT
National Institute Of Siddha Standard Motor Factory Ponds India Ltd TTK Health Care Kishkinta Anna zoological Park Cresent Engineering college Sankara Vidayalya Urrpakkam High school Royal wear international ltd Skylim infotech pvt ltd HIELDERBERG INDIA Abode Valley ARM COLLEGE OF ENGINEERING AND TECHNOLOGY CENTIGRADE APPARELS PVT LTD UCAL FUEL SYSTEMS LTD MIDAS RUBBER LTD SPEL SEMI CONDUCTORS International components India Ltd Areva Bio energy India Ltd Texcel international limited Renault Nissan Technology Mind tree Tambaram As of the 2001 Indian census, Tambaram had a population of 137,609.
Males constitute 51% of the population and females 49%. Tambaram has an average literacy rate of 78%, higher than the national average of 65%: male literacy is 82%, and female literacy is 74%. In Tambaram, 10% of the population is under 6 years of age. The number of people below the poverty line is 9,171. Growth mode: Chennai has emerged as the second largest office market in the country. The year 2007 was another record year for the Chennai Office real estate market with approximately 7. 1 million square feet of office space being absorbed.
This is a growth of over 40% as compared to 2006 which saw an absorption of around 5 million square feet reiterating Chennai’s position as the second largest office market in the country after Bangalore and one of the most sought after IT and BPO destinations in the world. Very few office real estate markets in the world have undergone such a dramatic and rapid change in such a short span of time as the Chennai office market in the last 4 years. Major transactions in the SBD included EDS Mphasis, IBM, CSC and Symantec leasing space in DLF IT Park @ Chennai, Pfizer and Lionbridge leasing space in Ascendas ITPC Phase 2.
Major transactions in the PBD included Accenture leasing space at Shriram Gateway, HCL in ETA Techno Park, Mindtree in Ascendas Mahindra City and EBay in Futura. Major transactions in the CBD were RR Donnelley and Oracle leasing space in Acropolis, ABN Amro and JLLM leasing space in TVH Belicaa Towers and Sony Ericsson leasing space in Sterling Towers. Chennai is witnessing a sustained real estate demand that has largely been a result of growth spearheaded by a spurt in the knowledge sector largely comprising of the IT /ITES segments. Mount Poonamalle Road and GST Road have emerged as alternative IT destinations to Old Mahabalipuram Road.
Although supply has outstripped demand in 2007, most of the vacancy was seen in STPI IT Parks. The yield levels stabilized at 10% to 11 %. Developers and land owners should realise that projects in Chennai are not just competing with each other but also with projects from other competing low cost cities such as Bangalore, Hyderabad and Pune. Therefore stability in rentals and low operating costs are important to maintain Chennai’s position as one of the most preferred IT destinations in India. Outlook With the current vacancy of less than 0. 5% and limited future supply in the CBD, the rentals are expected to further increase by around 20%.
The rentals in the PBD are expected to stabilize given the quantum of supply coming into the market in 2008. However, SEZ rentals are expected to go up in 2008 as the quantum of SEZ space coming up in 2008 is very limited. Developers offering SEZ space in 2008 will find ready takers. Also the emergence of satellite townships are expected to change absorption dynamics. The oversupply situation may not be as bad as it was expected, given that the self correction phase has started with developers slowing down the their construction and changing usage of their projects expecting a market correction.
STPI buildings in close proximity to SEZ projects could get impacted, unless STPI is extended beyond 2009. The demand for Serviced offices or business centres is expected to increase. Retail No new malls were completed in the last one year in Chennai. Inspite of nearly 8. 5 million sft of retail mall space under planning or construction, the overall supply addition in 2007 was negligible. Significant preleasing activity was witnessed in malls under construction a clear pointer to the fact that there is still enough unmet demand for retail space in the city.
The vacancy levels in high street was also at its lowest given the limited space availability. This shortage of space pushed the rentals up by 20% in 2007. High street leasing activity further increased in locations such as R K Salai and Arcot Road. Given the shortage of space and spiralling rentals, many retailers have found it difficult to acquire space of the right size at the right location at the right price in Chennai. Only 2 reasonably sized malls currently exist in Chennai – Spencer Plaza with 5. 6 lakh sft of retail space and operational since 1991 and Chennai City Centre measuring 3. 5 lakh sft which has been operational since 2006. Most of the organized retailers in these malls have been successful due to the lack of competition, short supply of mall space in Chennai and the current CBD location. Around 15 new malls totaling 8. 5 million sft is expected to be operational in the next 3 years. The majority of these malls are located in the CBD, Old Mahababalipuram Road, GST Road and Velachery. However, some mall developers need to realize that at current rentals, retailers will find it difficult to sustain their business in the medium term.
At present the CBD and suburbs such as Velachery and Anna Nagar definitely hold good potential for malls. GST Road and OMR are expected to evolve as mall locations in the medium term given the fact that primary catchment zones are still growing in these corridors. Most of the upcoming malls are expected to do well, given the fact that these malls are spread out in different directions – in the centre, west, south east and south west. Also the existing mall space is negligible compared to NCR, Mumbai and Bangalore. A number of factors have contributed to the current mall boom in the city.
Chennai has been the pioneer in organized retail from early 1990’s. The penetration of organized players especially in the food segment is quite high. Favourable demographics, rising disposable incomes, growing middle classes, rise of “super rich”, Increased double income no kids (DINKs) families, returning NRI’s, shift from “saving” to “spending” mentality, domestic retailers consolidating and aggressively expanding and new market entrants have all contributed to this growth. Most of the new malls have received good response and anchor tenants are already in place.
Retail in Chennai has traditionally been of the high street retail format and is still evolving and getting more structured. There has always been a scarcity of good quality retail space due to the unavailability of land in the concentrated retail hubs. The ground coverage rules of CMDA, whereby FSI decreases with increase in ground coverage is another one of the reasons why developers have not gone for mall construction. Outlook High Street rentals are further expected to go up by around 15% given the short supply of space.
Net addition to mall space in 2008 is expected to be only 600,000 sft with Ampa Mall and Coromandel Plaza being completed. Many malls which were expected to be completed in 2008 and 2009 is further expected to be pushed further due to delay in planning approvals and slow speed of construction. In the future, the size of a mall will definitely play an important role but size has to be proportionate to the catchment. Given the width of experience and depth of product offering expectations from a shopper, large malls will definitely have an advantage over smaller malls.
Mall developers need to analyze the characteristics of the catchment in detail before finalizing on the size and tenancy mix. Developers need to realize that sustaining a mall is more important than developing one and focus on areas such as Mall Management. Due consideration should also be given to issues such as circulation, parking and experience. The author is a Managing Director with Jones Lang LaSalle Meghraj http://timesofindia. indiatimes. com/city/chennai/Migration-to-Chennai-follows-industrial-growth-but-quality-of-life/articleshow/5798687. cms he idea of a special economic zone is perhaps more than 100 years old in the region.
The East India Company was the first to come up with a plan to create an enclave that offered a 30-year tax exemption for those who settled near Fort St George and traded with them. Today, the state offers similar benefits inside SEZs — tax breaks, quick clearance of paperwork, infrastructure facilities, with the idea of attracting both investors and working populations. Chennai’s demographics have reflected the fact that people always move where the work is. “Till 1975, people migrated from the other southern states to Chennai primarily in search of work in mineral-based industries,” says DLF executive vice-president K K Raman.
But with the emergence of the knowledge sector post 1991, a number of large players in the telecom, software and banking sectors have set up offices here. Although the 2001 census put the city’s population at 42. 16 lakh, the agglomeration that has developed around Chennai is estimated to be nearly twice that. Roughly 25% of the country’s 18 lakh IT workforce is located in Chennai and the city earns about Rs 36,000 crore annually through software exports. “Of late, north Indians have started moving to Chennai for core industrial jobs, especially in the auto sector,” says Raman.
The growth of Chennai’s population has been linked to the development of its outlying areas. In the book ‘Madras – The Land, People and Their Governance’, Dr C Chandramouli says emergence of satellite towns is one of the main reasons for population growth, with people moving from the centre of the city to the periphery. Settlements have mirrored industrial development — between 1971 and 1981, the highest population growth was in Ambattur, Madhavaram, Meenambakkam and Poonamallee, where manufacturing industries were coming up.
By 2001, population had doubled in Maduravoyal, Pallikaranai, Okkiyam Thoraipakkam and Neelankarai, south and west of the city, close to the IT and GST corridors and Sriperumbudur. Chennai’s education system provides a steady stream of skilled labour as well as attracts migrants who want good schools for their children. “This will add to the working population,” says Ramesh Nair, MD, Jones Lang LaSalle Meghraj, a realty consultant. This will squeeze the city’s resources further. “There’s no housing or schools in the industrial hubs,” says B Santhanam, MD, Saint Gobain. People have no choice but to live in Chennai and commute, adding to the pressure on resources,” he says. “Social infrastructure has not kept up with industrial growth. ” Planners say there should be an effort to address the lack of housing and road space. “New colonies like Anna Nagar and Ashok Nagar were created to cater to a growing middle-class workforce,” says AN Sachithanandan, expresident, Institute of Town Planners of India. Since there was land, the colonies came up with well-laid out roads and other amenities. But the land value was so high only top executives could afford it,” he says. In the next 10 years, Chennai’s population is expected to touch 10 million, making it a mega city. Chennai Corporation, with an area of 176 sq km, will accommodate 59 lakh people while the rest of the metropolitan area of 1,013 sq km will have 66 lakh by 2026. Planners have begun to reclassify agricultural land around the city as residential zones in a bid to disperse the population, but large investments are still needed to boost educational, healthcare, recreation and civic amenities. The government has the vision to build industrial parks, but more is needed — you need to encourage people to live where the work is, and to do that you need schools, hospitals, affordable housing, mass transportation systems,” says Kumar Subramaniam, MD, Sanmina SCA, in Oragadam.
The Indian economy and the real estate sector in particular are high on its ride to prosperity. As India’s economic growth curve rises, real estate in India has emerged as one of the most appealing investment areas for domestic as well as foreign investors. Indian real estate has huge potential demand in almost every sector, especially commercial, residential, retail, industrial, hospitality, healthcare etc. But maximum growth is attributed to its growth from the booming IT sector, since an estimated 70 per cent of the new construction is for the IT sector. Investment scenario has certainly undergone a paradigm shift in India.
Gone are the days when potential investors used to seek investment options like equity bonds and park money in shares where the return ranges between 5. 55 to 6%. Data showcased by property surveys show that returns from rental incomes on investment in commercial property in Indian metros, is around 10. 5%, the highest in the world. Key Facts 1. Selling and buying Indian property is now considered the most profitable and attractive business opportunity in the present real estate scenario in India. New demands have added to strength of real estate markets across the commercial, residential and retail sectors in India.
Not surprisingly, demand for Indian property has been increasing steadily for the past few years and it has exceeded supply. There has also been an upward swing on the real estate price values in the recent years. Due to the huge demand and rising prices, investment and speculative interest in real estate is growing while excess money supply, stock market gains and policy changes are adding to the trend in favor of the real estate sector. 2. In the last one year, the capital values of the commercial office spaces has increased by up to 40% owing to the increase in the demand from IT / ITES and BPO sector across major metros in India. . India has a distinct regulatory and financing management in place. 4. Real estate boom in India is supported by its own flourishing economy on a sustainable basis. Here, growth of the property market is not a result of renovation and overhauling; but rapid development that witness for India riding the high growth wave. Lower interest rates, easy availability of housing finance, burgeoning income and better job prospects, increase of nuclear families have given a boost to the demand for residential properties in India.
The net yields (after accounting for all outgoings) on residential property are currently at 4-6% p. a. However, these investments have benefited from the improving residential capital values. As such, investors can count on potential capital gains to improve their overall returns. Capital values in the residential sector have risen by about 25-40% p. a in the last 2 years. The retail market in India has been growing due to increasing demand from retailers, higher disposable incomes and opening up of FDI in Retail. The capital appreciation in this sector is close to 20-35% p. . After their cyclical upheaval in 2008, the real estate markets across India seem to have stabilized in the last two months, and at present reflect a more mature market. The increase in prices witnessed in 2009 can be majorly attributed to the realization that extreme pessimism was unwarranted and had led to bargains and opportunities which were exploited by astute investors. All major markets across India are witnessing extremely high rates of urbanization, which is still considerably low as compared to advanced nations.
The year 2010 is expected to be a challenging one as opportunities for easy money are few and far between and this will enable stronger industry players to emerge even stronger. From a development perspective, some of the new corridors in established markets as well as newly emerged and emerging markets for residential real estate are highlighted below: Established Markets – New Corridors| Newly Emerged Markets| Emerging Markets| Mumbai – Navi Mumbai Pune – Mundwa, Kharadi, Wakad, Rawet,Hinjewadi and Hadapsar Bangalore – North East Corridor Hyderabad – Uppal, Papanguda and Shamsabad Corridor
NCR – Greater Noida and Golf Course Extension in Gurgaon Chennai – GST Road touching Pallavaram,Mount Poonamalle| Chandigarh Jaipur Kolkata Kochi| Bhubaneswar Nagpur Mysore Mangalore Coimbatore| Chennai Chennai, the largest city in South India, is known for its efficient infrastructure and has seen sustained real estate demand that has largely been the result of growth spearheaded by a spurt in the knowledge sector comprising the IT and BPO led businesses. Many of the IT companies that have a presence in Bangalore maintain a secondary or tertiary presence in Chennai.
One of the main considerations for this move is the proximity to Bangalore, which makes disaster recovery and the management of resources easier. Chennai has also witnessed the entry of financial giants such as the Government Investment Corporation of Singapore investing in its residential real estate market, driven by the relaxation of FDI norms in real estate. The market is performing in sync with the national trend of increasing end-user investments in housing. As companies grow and expand to suburban areas, a corresponding growth in the residential segment has followed.
The growth is especially strong along GST Road and Rajiv Gandhi Salai, with the presence of pan Indian developers. The residential market is likely to continue to see a lot of activity, both in the sale and leasing segments. As the supply of apartments starts steadily increasing, prices will continue to remain stable in the foreseeable future. The IT and BPO industries, which have become the prime drivers of the real estate market in Chennai and also led to a significant migrant population in the city, are driving the demand for apartments and high-rises which was previously negligible.
High-end projects continue to be developed although, after the downturn and stabilization of prices, developers are focusing on launching more mid-end projects
Humongous Demand of Affordable housing in Chennai suburbs Indian Realty News The city is fast expanding, and proof of this is the fact that about 7,000 housing units are developed in Chennai Metropolitan Area (CMA) annually. More than 95% of them are promoted in the suburbs. Still, the city faces a shortage of more than one lakh houses.
At least 50% of them are in the affordable housing segment and going by the present pace of development, this shortfall could mount to eight lakh units in the next 15 years as per Chennai Metropolitan Development Authority (CMDA) estimates. The primary concern of most prospective apartment buyers is that there isn’t enough supply of affordable houses. Whenever a builder promotes budget housing project, it gets sold out fast. Akshaya MD T Chitty Babu says he had to sit in his office till late in the night to accept bookings when he launched a budget housing project on OMR last year.
Plaza group, which launched a 176 apartment project at Perumbakkam, off OMR, last month, sold out the entire stock in five hours. JBM Dakshin, which launched a 120-apartment project in the Rs 15-42 lakh price bracket on the GST Road last month, sold the entire lot in two days. Every promoter of budget housing has a similar story to narrate. “A real estate boom in Chennai is led by a locality. In 1998, it was Velachery. The 2006 boom was led by OMR. Next, it is a race between GST Road and Sriperumbudur,” said Chethan Jhabakh, partner, JBM Dakshin.
All the three growing corridors — OMR, GST Road and Sriperumbudur — had specific triggers for their development. “For OMR, it was Tata Consultancy Services setting up shop at Semmancheri, for GST Road, it was Ford starting its factory at Maraimalainagar, and for Sriperumbudur, it was the Hyundai factory at Irungattukottai,” said Ramesh Nair, MD, Jones Lang LaSalle Meghraj, an international realty consultant. Irrespective of attractions like employment potential in new industries, there has been substantial migration from the city to the suburbs in the last 20 years.
CMDA estimates that about 10 lakh move out of the city into suburbs every decade. This is the fallout of conversion of residential space into nonresidential for uses, such as offices, shops and hotels within the core city. It leaves the rest of the residential space unaffordable for middle-income groups, who escape to the suburbs. Lack of social infrastructure is a cause of worry. Though integrated townships, which which provide everything from schools, and healthcare to malls and multiplexes, like Hiranandani Palace Garden at Oragadam, Estancia on GST Road, and DLF on OMR are being developed, there aren’t similar facilities in stand-alone esidential projects. http://www. credaincr. org/research_details. php? r_id=4 Special Economic Zones (SEZs): Opportunities Unlimited for Developers * Under the new SEZ Policy, formal approvals have been granted to 366 SEZ proposals * 142 have already been notified as SEZs, as on 30th August 2007 * Fiscal benefits to IT Parks expected to come to an end in 2009; SEZs likely to be preferred for * IT/ITeS commercial office space development * Policy allows usage of as high as 50% of area as non-processing zone, offering immense potential for residential & other support infrastructure.
Listings posted with Magicbricks. com between July and September 2010 reveal that the top ten localities which posted maximum listings were T Nagar,Velacheri, Porur, Adyar, Ambathur, ECR, Kolathur, OMR Road, Besant Nagar and Virugambakkam. Requirements posted on MagicBricks. com reveal that 2 BHK multi-storey apartments are most in demand followed by 3 BHK and 1 BHK apartments. Overall,the supply was highest in the 2 BHK and 3 BHK categories with multi-storey apartments posting maximum listings comprising 52 per cent of the total supply.
However, on comparing the demand and supply data,a mismatch was observed in the number of available options as compared to the demand especially in the 1 BHK and 2 BHK segments where the demand outstrips the supply. The 1 BHK category, which caters to the affordable housing segment,is where the mismatch lies. The demand is robust but options are limited. On the other hand,in the 3 BHK segment, there is a significant supply of multi-storey apartments with little demand to absorb the existing housing stock.
When an investor looks at regular returns out of a residential real estate investment,this is a critical parameter to consider. The smaller units have more demand and are easier to lease out. The demand for bigger units is limited. Localities such as Adyar,T Nagar and OMR posted 2 BHK and 3 BHK apartments within a higher price range ( 100 lakh and above), while localities such as Ambattur and Kolathur posted more affordable options ( 18-30 lakh). Residential projects comprised 23 per cent of the total supply and maximum listings were posted in the 3 BHK category.
However,requirements posted with Magicbricks. com indicated that the demand was highest in the 2 BHK category which is not being met adequately by the existing housing stock. In the 3 BHK category on the other hand,there is an over supply. The market demand has moved in the direction of apartments. The traditional fixation of standalone property is fast giving place to modern apartments with latest amenities and lifestyles. When one buys a property,the constraints of price are a big consideration.
However,for the occupant,the rental options are as wide and scattered as he or she is willing to look for. In the residential segment,there exists a significant demand for more premium options of 4 and 5 BHK categories which are adequately met by the existing housing stock as indicated by listings posted with MagicBricks. com. The premium segment is well catered to and even the rental market in this segment is mature and well-established. In the rental housing category catering to young and mobile professionals,furnished property fetches better values.
Most lessees prefer to move into a new city into furnished accommodation. In cities such as Gurgaon, Delhi and Bangalore,where the workforce is very young,the escalation in rental values from furnished property can be as high as 35-50 per cent. Times of India epaper, 27 November 2010 Real estate industry in India is currently estimated to be US$ 16 billion with a CAGR of 30%. Growth in this sector is driven primarily by IT/ITeS, growing presence of foreign businesses in India, the globalization of Indian corporate and rapidly increasing consumer class.
Commercial Office Space Growth Drivers * Growth in IT/ITES sector at 30% annually (Source: NASSCOM) * Significant growth in FDI Market Structure * Dominated by a few large national developers with pan-India presence * Regional players are expanding to achieve a Pan-India presence * Shift in the type of operations from Sale Model to Lease & Maintain Model Segmentation * Commercial Space can be classified broadly into Grade A and B * Business activity shifting from CBD to SBD and from Tier I to Tier II & III Outlook Commercial market expected to grow at CAGR of 20-22% over the next 5 years * IT/ITeS sector expected to require in excess of 250 million sq. ft of commercial office space by 2012-13 Residential Rising Urbanisation in India Rapid Urbanisation: Urban Population expected to touch 590 million by 2030 Growth Drivers * Decreasing Household size: Average H/h size fell from 5. 4 in 1981 to 5. 1 in 2000 * Increasing working age population (Almost 64% in 16-64 age group) * Increasing income levels: Average salary levels increased by 13. 5% in 2005 * Easier access to mortgage, long tenure loans and tax incentives Market Structure Highly fragmented and unorganized * Regional players are expanding to achieve a Pan-India presence
Profiling GST, OMR and Oragadam September 18, 2010apartment ownerLeave a comment HOLISTIC LIVING With rising population,integrated townships are poised to be the next big thing in Chennai,even as suburbs in the city play host to a number of such projects. RADHIKA RAMASWAMY visits three important corridors in the city to find out more GRAND SOUTHERN TRUNK (GST)
The 20-kilometre stretch from Tambaram to Maraimalai Nagar on GST Road could well be mistaken to be within city limits. Such is the development here. GST Road has been touted as a premium industrial corridor and connects all the Southern districts of the State to Chennai via both road and rail. Home to manufacturing giants, IT majors, schools and colleges, the road, over the past three years, has turned into a commercial hub of sorts. One of the first companies to set up its unit on GST Road was Team (Team co Hitech Enginering Ltd) in Vandalur (20 years ago).
This was followed by a series of developments in and around Maraimalai Nagar. Mahindra World City,an integrated township,spread across 1,500 acres,developed in the year 2000 transformed the landscape of GST and triggered the growth of integrated townships in this area. Arun Excello’s Estancia and Shriram Properties’ The Gateway are upcoming integrated projects here. ”While OMR is IT-centric, GST is a mix of IT, telecom, automobile and ancillary units,”says P Suresh,MD,Arun Excello. ”The city has reached a saturation point in terms of significant residential development.
With Chennai expanding and peripheral areas playing host to large-scale industrial boom,self-contained townships have become the order of the day. ” OLD MAHABALIPURAM ROAD (OMR) The OMR phenomenon occurred in the late 90s. What was once a stretch with green patches and large land parcels on either side of the road has evolved into a premier IT corridor. Tidel Park was the first IT establishment to foray into OMR,which is now called Rajiv Gandhi Salai. This was followed by the mushrooming of several other IT parks. Today,over 2. 7 lakh people work out of here. The IT boom led to an unprecedented residential demand along the stretch and several residential projects have come up since 2000,”says K K Raman,Vice-President,DLF Homes “Nobody has the time or the energy to go to far-away places for entertainment and recreation. People prefer everything right from education to healthcare centres in the vicinity of their homes. This is where integrated townships come into play. An integrated township is not just about a home. It is about creating a lifestyle that takes care of every single need of the resident. ”DLF Homes is coming up with a 58-acre ntegrated township project called Garden City in Shollinganalur. Over the next two years,the number of people working in OMR is expected to cross four lakhs. With this,the demand for gated communities will only increase. There are currently over five full-fledged integrated townships on OMR. ORAGADAM AND SRIPERUMBUDUR Oragadam,centrally located between Grand Southern Trunk and NH4,has been touted as Chennai’s largest and the most developed industrial belt. With over 22 Fortune 500 companies (of which six are global car manufacturers),the Sriperumbudur-Oragadam belt has seen tremendous industrial growth in less than four years.
The area is well-connected via road and rail and according to industry experts,the presence of automobile giants like Renault and Nissan and Ford has triggered growth around Oragadam. Several manufacturing giants such as Motorola, Dell, Flextronics, Samsung, Nokia, Apollo Tyres,and TVS Electronics,have set up their respective units in the industrial belt stretching from Sriperumbudur to Oragadam. Three integrated townships – Arun Excello’s Temple Green,Hiranandani (Hirco Group)’s Palace Garden and Inno Geo City are being developed in Oragadam.
Aniruddha Joshi,Executive Director,Hirco Group,Says, “Today,owning a home in the city has become cumbersome and costly. The only solution to the spiralling price and increasing interest rates on home loans is to own a property in an integrated township coming up in the outskirts of the city. The new industrial corridor foraying into places like Oragadam will generate new jobs and will attract people to relocate out of Chennai. Our township will provide them with homes that are located conveniently close by. We are building the whole infrastructure from the ground up – roads,electrical power,telecommunications backbone,water and sanitation.
By doing so,we reduce our townships dependence on the public infrastructure and make them self-sustaining – a key differentiator in a country where the public infrastructure is under considerable pressure. ”That apart,today’s buyer profile consists mainly of young people,who want to fulfil their aspirations at the earliest. Moreover,these buyers want all this,within the constraints of a certain level of pricing. Townships are an ideal option for such buyers,due to the inherent advantages of economies of scale – they offer various amenities,at relatively lower price points.
Times Property, Times of India, 18 September 2010 Should Intergrated Townships be accorded an infrastructure status HARINI SRIRAM records points of view from people who matter. Consider this: Our country currently has a housing shortage to the tune of 24. 72 million. Of this, Tamil Nadu has a shortage of 2. 8 million and Chennai, 0. 4 million. One way of bridging the gap is by developing self-contained residential clusters complete with ameneties – roads, schools, parks, hospitals, retail outlets, etc. It is here that integrated townships come in.
Since provision of all these amenities translates into infrastructure development, developers suggest that infrastructure status be conferred on integrated townships. P Suresh,MD, Arun Excello,says, “We provide amenities like telephone exchange, water treatment plants, build infrastructure for schools, hospitals,water supply and so on. Besides,we pay an infrastructure fee to the government,when,in fact,the infrastructure is developed by us! ” Some of the benefits that developers will be entitled to, if infrastructure status is accorded to townships,include tax holidays and access to preferential lending at lower interest rates.
That apart, funding of such projects will also become relatively hassle-free. In its rule book, the government classifies roads,bridges,dams,power projects,airports and transport corridors,to name a few,as infrastructure. But roads within townships, for instance, are currently not eligible for infrastructure status. Oscar Braganza, Executive Director, Real Estate and SEZ, Marg Ltd, explains, “We need to first look at what really defines a township. Townships need to have social infrastructure, learning components and must be holistic cities by themselves.
Oscar continues, Integrated townships need to be of a certain size and have specific amenities to qualify as a township. Only then will it make sense to confer infrastructure status on them. ”He explains,”By 2030,it is estimated that 300 million people will move from rural to urban areas in the country. There’s a dearth of space in existing cities. The only solution is to build new cities, in the outskirts of existing cities, and this can be done effectively through partnership with the government. ” In places like Delhi,for instance,the government created spaces for townships which have now grown to become Gurgaon and
Noida. Even in Tamil Nadu,townships like SPIC Nagar in Thoothukudi,Salem Steel Plant Township, Neyveli Lignite Corporation Township,etc,were developed long ago and are managed by the corresponding companies. Rajesh Babu,Chief Consultant, RECS Group, a city-based real estate consultancy service, is of the view that development in Chennai needs to be planned and organised. “When private players get into development of townships,growth tends to be scattered, but the city will expand in all directions and the government will take notice and work on provision of infrastructure.
The government should specify norms and guidelines for townships and must accord infrastructure status to them accordingly. “He adds that the government needs to acquire land for townships,provide amenities – roads,lung spaces,transport,etc,and assign residential/commercial development to developers. K Moses, Head, Sales and Marketing,VME Group, a city-based construction activities firm, is also of the opinion that the government needs to help with infrastructure development within townships.
He says, “It will help if infrastructure status is accorded to townships,as any cost the developer pays is finally passed on to the end user. ” Property Times, Times of India, 18 September 2010 Houses for weaker sections to come up near Vandalur Published by Newsroom September 8th, 2009 in City Scape, Affordable Housing – Newand Newsbytes. Chennai: The Chennai Metropolitan Development Authority (CMDA) plans to make use of a 50-metre strip of vacant land along the proposed Outer Ring Road from Vandalur to Minjur to build houses for economically weaker sections.
Addressing a seminar organised here by the Confederation of Real Estate Developers’ Associations of India (CREDAI) and the Confederation of Indian Industry (CII) on Saturday, CMDA Member Secretary Vikram Kapur said, “Guidelines are being prepared on provision of TDR (transferable development rights) of 20 sq m to slum dwellers affected by urban infrastructure projects for resettlement. ” Rehabilitation of slum dwellers in Chennai alone may require Rs. 2,000 crore and 700 acres. Additional demand was there on account of renewal or redevelopment of dilapidated structures and meeting the needs of the homeless pavement dwellers.
As there was a severe shortage of basic services and budgetary resources, the focus was on multiple stakeholders to promote public-private partnerships for ensuring equitable supply of land, shelter and services at affordable prices to all, he said. Mr. Kapur reiterated that the State government had taken various initiatives through regulatory mechanisms such as reservation for EWS/LIG in new layouts and group housing on sites exceeding one hectare. As there were limitations for parastatal agencies such as TNHB and TNSCB in catering to the demand for affordable housing due to paucity of land, funds and manpower, Mr.
Kapur pointed to the scope for a greater role for the private sector in this regard. Principal Secretary Housing and Urban Development Department Surjit K. Chaudhary said builders’ attitude should change. “Rather than catering to the high-end segment they should serve the weaker sections. The government is ready to accept good recommendations of the builders and other stakeholders. ” President of CREDAI-Tamil Nadu Prakash Challa said: “As the entire demand few years ago came from a certain segment seeking premium apartments, private developers had to cater to the segment.
New initiatives on meeting the emerging demands for affordable housing will be taken up. ” Source: The Hindu havana Acharya Following a boom , the realty sector is now hit by lower repayment capacity and higher borrowing costs, which have affected house buying. Developers across the country are facing lower demand, slower sales and reduced and expensive funding. How has the Chennai residential market fared? Chennai City has seen an average correction in apartment prices of around 10 per cent over the past six months, according to realty market participants.
The correction is driven by what buyers are willing to pay now rather than actual rate cuts by developers. This being said, the main city areas and the central business districts have remained relatively unaffected, given the advantage of location and lack of developable space. It is the suburbs and the peripheral areas such as Ambattur, an industrial suburb to the west of the city; along the OMR towards Siruseri, Kelambakkam – about 25 km south of Chennai; and the GST Road (NH45) that have borne the brunt of correction. Developers predict that prices may remain stagnant or may even fall further n the short term. A steady rise in interest rates, excess supply and weak market conditions prevailing across the residential belts of Chennai appear to be the prime cause for the correction in real-estate prices. Lack of infrastructure development at the expected pace in the suburbs is also a factor limiting demand for higher-priced properties in these areas. While apartment prices have witnessed a correction, developers feel that the capital value of land has remained stagnant in the past few months, with room to strengthen in the long term.
The volume of transactions seen in purchase or sale of land itself has got reduced. Sale of land is partly need-based and developers are restraining themselves from further acquisition. Demand drivers According to leading developers, the price correction may not have a uniform impact on demand; this may depend on the location of the property. Within and just off the central business areas, a price correction will, in all likelihood, boost demand for property, given the limited supply.
On the other hand, in peripheral and suburban areas, a price correction may not be the only trigger needed to improve demand. Though inflation and rising interest rates have led to a correction of sorts, consultants continue to view Chennai as a promising market for developers over the long term. Global real-estate consultant Cushman Wakefield lists an increasing migrant population due to the upcoming manufacturing, IT and IT-enabled services (ITES) sectors in Chennai as the demand drivers for real-estate in prime locations with good amenities, citing areas such as GST Road.
Second sales up In an interesting trend, the slowdown in new home sales has sparked off some beneficial trends for existing home owners. Second sales of homes have increased as a result of reduced new home buying. With the city attracting a fairly large floating population, demand for rental property is also on the rise. In the central business districts, quality residential properties rank high, while towards south of Chennai, minimal supply of quality completed projects has pushed up rental values.
Sales strategies On new homes, developers are devising innovative sales strategies to promote purchases. According to Mr Subba Reddy, MD, Ceebros, upfront payment of the entire value of an apartment could allow room for a discount of up to 12 to 25 per cent on the overall sale value. While price cuts are necessary to induce buyers, amenities such as swimming pool, gym and adequate parking play a vital role in inducing buyers to purchase apartments, say the builders.
Other factors include quality of construction, location, and value add-ons such as 100 per cent power back-up. Better infrastructure Affordable housing, in the bracket of Rs 10-20 lakh for a two-bedroom apartment in city outskirts, is said to be the biggest segment of the market. On this count, Chennai ranks better than most cities on account of the improvements expected in its infrastructure three to five years from now, even with the slow pace of current development, as well as a more stable demand, according to Mr Pratish Devadoss, MD, VGN Enterprises.
Demand in Chennai originates not just from one or two segments of buyers, but from a wide cross-section — sectors such as IT, auto, healthcare and manufacturing, professionals such as doctors and architects. In the light of these factors, developers see the current downturn as a cyclical one, and believe the situation may take anywhere from a year or more to stabilise. More Stories on : Real Estate & Construction | Tamil Nadu -business line Sunday, Nov 02, 2008 http://www. brixresearch. com/brixresearch/content/IRE_vol8Issue1. pdf http://www. risil. com/star-ratings/rating_by_city/chennai_index. html The apartments in areas near the road were priced in the range of Rs. 2,700 to Rs. 4,500 per sqft, he said. http://www. hindu. com/pp/2009/11/28/stories/2009112850020500. htm Saturday, Nov 28, 2009 All eyes on GST Road This emerging growth corridor is well connected with industrial and IT areas, writes T. Chitty Babu Preferred Destination: Many apartments are under construction on the GST Road The landscape south of Tambaram, is fast emerging as a place of work and as well as a place to live.
It is well connected both with the emerging IT corridor, Auto corridor, SEZ corridor and EMS corridor stretching from beyond Siruseri to Sripermbudur. The tranquil ambience that once represented the GST south of Tambaram is passe, today it calls for a multi-skilled workforce that needs to be transplanted to this area to cater to the growing needs of the IT / ITES / BPO, Automotive & Manufacturing industry. It is not surprising to find many real estate players have already ongoing housing projects in this area to cater to the growing need for quality housing closer to work place.
Projects such as the Metropolis and Belvedere from Akshaya homes, Estancia from L&T Arun Excello, HIRCO’s township Chennai palace Gardens are some of the large residential projects along the GST corridor providing quality housing near work places Well connected with rail and road links the auto corridor alone with Oragadam as its epicenter is all set to roll-out over 1. 25 million cars by 2012 and hosts auto giants like Ford, Hyundai, BMW, Daimler, Nissan, Caterpillar, Komatsu and many others.
The EMS corridor (electronic manufacturing services) stretching from Sriperumbadur to Oragadam houses MNC’s like Nokia, Dell, Motorola, Samsung, Flextronics and many others already in operation. In close proximity to the GST sits the emerging IT corridor covering Siruseri – OMR sector with all the IT gaints having set up shop. And SEZ projects are not far behind with the partly operational Mahindra World city showing the way, more SEZ’s are set to cover this part of south Chennai making GST the favorite destination for huge investments.
This area also has good educational infrastructure with schools and colleges like the Mahindra World School, Cresent school, SRM university, Sai Ram engineering, Vidya Mandir and many more. To complete the social infrastructure upcoming entertainment and shopping projects include the Gold Souk mall, Estancia mall, Belvedere Mall, Sriram Gateway and malls in Mahindra World city. There are also adequate health care facilities; the GST corridor has big names like the SRM Hospital, Hindu Mission, Apollo Hospitals, Deepam etc already running excellent healthcare facilities here.
With all ongoing industrial, residential and infrastructure projects the GST corridor has many things going for it. The author is the Secretary of CREDAI-Tamil Nadu.
Expected work force CHENNAI: Even as various parts of Chennai experience considerable reduction in property and rental values, many residential localities in proximity to Grand Southern Trunk (GST) Road are able to maintain the rental values over the last few months.
At some locations, an increase of 10 per cent in residential rentals over that of last year is also being reported. “GST Road is one of the first roads on the outskirts of the city to witness development many decades ago. Better road and rail connectivity, proximity to airport, availability of water in plenty in many of the localities have made people opt for residential accommodation near GST Road,” said M. K. Sundaram, Chairman of Builders’ Association of India (South Centre).
People in the realty sector say the locational advantage is the main factor behind the popularity of GST Road. The workforce of the industrial belt at Maraimalai Nagar, Padappai and Oragadam areas finds living along the GST Road more convenient than in localities near their workplace. The areas had witnessed a flurry of construction activity in 2006 and 2007, leading to an increase in the availability of housing stock. However, property values have reduced by around 30 per cent going by the market value of recent transactions, says P.
Raja, a broker. The rate of reduction in property values has been relatively high in areas beyond Tambaram. The decrease in property value is not significant in areas such as Chromepet, Tambaram and Pallavaram, according to Ganesh Murthy, a broker. In the past, the rate of increase in rental values in many of the residential areas near GST Road had been lesser than in other localities of Chennai, according to brokers. So it is not surprising that the rental value has not moved significantly in the recent months, says B.
Velu, a broker. One of the major rail network in the city – Chennai Beach to Chengalpattu – running parallel to GST Road, has also contributed to the sustenance of rental values in some areas, say brokers. While middle class families continuing to opt for residential accommodation in areas near GST Road is a key reason for sustenance of the rental values, IT professionals experiencing pay cuts have started taking interest in the area because of relatively affordable rentals with better connectivity.
With regard to property transactions, the number of sellers is increasing significantly even as the number of buyers remains a microscopic minority, according to Mr. Velu. Residential areas near the Paranur railway station near Mahindra City have experienced an increase in residential rental value of around 10 per cent, said K. T. Inbasekaran, a broker. However Maraimalainagar, a few km away, has been witnessing a reduction in rental value. The availability of larger number houses without tenants in Maraimalainagar has contributed to the reduction, he says. Given the fact that the GST road precinct is close to upcoming IT SEZ’s, excellent residential catchment locations such as Tambaram, Chromepet and Pallavaram with good rail and air connectivity, rentals have seen an increase in many areas over the last 2 years from Rs. 10 to 15 per sft per month,” said Ramesh Nair, Managing Director-Chennai, Jones Lang LaSalle Meghraj. The apartments in areas near the road were priced in the range of Rs. 2,700 to Rs. 4,500 per sqft, he said. Properties along roads such as Thoraipakkam Pallavaram and Kelambakkam Vandalur Road, which originate from GST Road, are expected to also benefit in the medium term,” he added. Roads to the future – Future Mount Road – GST Road Found this article in last week Hindu property plus. http://www. hindu. com/pp/2010/03/27/s… 2750020100. htm http://www. hindu. com/pp/2010/03/27/s… 2750020100. htm Kelambakkam-Vandalur; Vandalur-Oragadam-Walajahbad; Sriperumbudur-Singaperumal Koil. These three stretches are hot topics in Chennai’s realty circles. They are spoken of as roads of the future.
It is easy to see why. There is a flurry of business activity and infrastructural development along these roads and in their vicinities; moreover, they directly feed into big corridors of development. All three connect to GST Road; in addition, Kelambakkam-Vandalur Road leads into Old Mahabalipuram Road and Sriperum budur-Singaperumal Koil Road into the Bangalore Highway. “The GST Road is like a spinal column and these feeder roads, like vertebrae. What Mount Road does for Nungambakkam High Road, Cathedral Road, Venkatanarayana Road and a few others, GST Road does for these three roads.
If you look at it, GST Road is but an extension of Mount Road,” says R. V. Shekar of Lancor Holdings. Urban planning and the lack of space for expansion in the city’s north have fuelled the development of these areas. As they are linked to arterial roads, they figure prominently in the plans of town planners. In keeping with the larger goal of decongesting the city, these three roads are being widened. According to official sources from the State Highways, four-laning of these three roads is underway (a 12-km stretch on the Sriperumbudur-Singaperumal Koil road is in fact getting a six-lane).
At the Oragadam junction where the Sriperumbudur-Singaperumal Koil road and the Vandalur-Walajahbad road meet, a grade separator is coming up. Close to OMR Above all, the speedy growth of OMR as an IT hub has generated interest