Sunday, April 06, 2008

Mysore on my mind

The article fails to recognize that Infosys has a training center in Mysore. Most IT companies operate from premises located in an STP and now SEZ. There are no tax incentives otherwise. Infosys is on neither so it will end up with being a hub with migrant trainee population. Infoys's Sarjapur road campus will be the biggest whenever it is built. As for others am sure IT companies are looking out 5 years into the future and acquiring land. Economic times and the bennett coleman company are ad-space sharks which aid the land sharks. All these articles are written with an intent to scare the common bangalorean that Mysore will soon become unaffordable. There is some truth in that but I think that will take another 5 years. The competition is not between end uses to acquire plots and land. Its between big developers to acquire large parcels of land at low prices. In this context buying a plot with a time frame of 5 years doesn't look to be a bad idea. Interestingly the hype over devanhalli seems to be died down. People now appreciate that building infrastructure takes 10x more time then the time to move prices up.

Soaring land prices in Bangalore, realtors battle it out for space in Mysore

MUMBAI/BANGALORE: Soaring land prices in Bangalore have led to a rush by developers to secure space in Mysore, the heritage city of Karnataka. The influx of IT/ITeS professionals is seen as instrumental in driving the demand for residential property since land rates in Mysore are low compared with Bangalore, industry officials said.

Currently, residential real estate prices in Bangalore vary anywhere between Rs 2,500 per sq ft and Rs 14,000 per sq ft. In Mysore, land prices have shot up significantly, said Cushman & Wakefield joint managing director (India) Anurag Mathur. The asking rate for land in the new outer ring road (ORR) area is in the range of Rs 1,200-3,000 per sq ft (Rs 5.2-13 crore per acre approximately) for converted land. In the outskirts (beyond ORR), it is in the range of Rs 70 lakh-2 crore per acre.

In comparison, a year ago, the rates were approximately half the present price range. Within the city, prices varied between Rs 600-1,500 per sq ft (approximately Rs 2.6 crore-6.5 crore per acre) and in the outskirts between Rs 25 lakh-1 crore per acre. The BMIC is likely to further fuel growth in this market. The Future Group’s real estate fund Kshitij has bought five acres near Mysore Palace to develop a mall while Shobha Developers is developing another five acres property as retail property. Delhi-based real estate major Unitech is also developing another one acre in Nazarbad as retail property.

A majority of these malls are expected to be up and running by 2010, by which time there would be enough demand for retail space in the city. DLF, another Delhi-based firm, is planning to build its biggest residential project in Bidadi which is on the Bangalore Mysore expressway and the upcoming inter-city infrastructure corridor. Central Mysore has a large unorganised retailing base and organised retailing in the city is still in the nascent stage. Shopper’s Stop and Inox are expected to mark their entry in the near future

“At present, the vacancy levels are in the range of 10-15%, with some of the complexes developed to house malls now being used as commercial space. There are no operational malls in the city. However, this is expected to change, with five planned malls having a total area of 1.7 million sq ft expected to be operational in the next two years,” said Cushman & Wakefield joint MD-India Anurag Mathur. Property experts said that as real estate prices in Bangalore have touched its upper limits, the developers have started targeting Mysore. Many IT and software companies, which have been eased out of the mainstream in Bangalore, have now chosen Mysore as the next destination.

“The IT sector helped Mysore gain prominence after Bangalore. The coming years could see the city develop as an important MICE destination since travel time to the city is shorter now,” said Brigade Enterprises CEO-hospitality Vineet Verma. Many domestic IT companies have already started their campuses in Mysore, notable among them being Infosys. According to reports, Accenture, IBM, Cognizant Technologies and Honeywell too might extend their operations in Mysore. Wherever IT companies go, they usually provide a push to other residential and retail sectors too.

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