Wednesday, August 26, 2015

AFTERMATH OF IT ON REAL ESTATE


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The surge of the IT companies in the past decade has resulted in the demand of prime and suitable space in the cities where there is more concentration of IT companies. In cities like Bangalore and other leading IT cities, there is a phenomenal growth of the industry and with that there is also great demand for office space in the city as well as outskirts. 

The sudden spurt in the IT / ITES organizations resulted in a huge influx of people relocating to these cities from all over the country and also from some parts of the world causing some grave infrastructure problems inside the city resulting in severe dearth of proper commercial and residential accommodation apart from traffic snarls. As the demand for commercial units rose steadily, scores of Developers came into the picture to cater to the diverse needs of the companies. Only a handful of them could remain in the reckoning while the rest faded into oblivion. Those who could face the stiff challenges and remained in the fray were very reputed builders having a great track record and also adhered to the principles of sheer eminence, work culture, strict adherence to the time schedules and customer oriented service. 

Some of the reputed builders who are continuously serving the needs of these companies viz. Ascendas (India) Pvt Ltd., L&T, Salarpuria, Divyashree Developers (P) Ltd., RMZ Corp, SJR Group, Hiranandani, Kolte-Patil Developers, Raheja Builders, and Sigma Group. They could be rated as the high performers as far as IT Parks are concerned. They are active in almost all IT cities throughout India viz. Bangalore, Chennai, Pune, Gurgaon, Chandigarh, Kolkata, Hyderabad and other second rung cities. 

IT work place here means not a mundane office but an office which would have adaptable work-live-play shop environment, Hi-fi building management system, dedicated power plant, safety and security, vehicle parking facility, Water storage and also lot of modern amenities and to top it all, an aesthetically designed structure which not only acts as a visual treat but also pumps the adrenaline levels of the employees to an all time high.

It is to be noted here that though India boasts of the state of the art Hi-tech parks, some of them were not completely designed keeping with the specific industries in mind.  But looking at the present trend, one may find a multitude of service based companies like Software, R&D, ITES and others inhabit these parks which are tailor made structures. 

The main parameters that are considered to declare a Hi-tech park as the best is always based on the technology infrastructure, superior location advantages and natural conditions, proximity to the down town city/CBD, complete associate service, suitable transportation, assembled talents and sylvan environment. The list may also add up other points like eco-friendliness, part of the modern new Sci-tech town, closeness to the High education area, specifically for companies focused on R&D, accommodating enterprise incubation and technology innovation, urban featured industries, software exemplary base, Sci-tech commercial business, Sci-tech housing areas, Out of the many Hi-tech parks that are currently in the offing all over India, some of the parks offer only space with the ready infrastructure while some offer space solutions in addition to selling the space. The customers always get a better deal when they go for space solution providers. 

Factors like brand image, International alliance, Quality benchmarks, technology infrastructure standards, innovative space solution also plays a big role while putting a park and the builder on a higher pedestal. 

At present, there are umpteen numbers of Hi-tech parks catering to the diverse needs of the clients. But not all of them could be ranked as high performing parks owing to the non-compliance of the above said parameters. It is indeed a very formidable task to adhere to all the norms and those who have climbed to that level are the market leaders and are in great demand by the clients. It has been estimated that from the present $3.5 billion, the industry may see an upward trend to around $13 billion by the year 2007. 

On the commercial front, the demand has come from information technology (IT), Business Process Outsourcing companies (BPO) and information technology enabled services (ITES) companies looking for large space. With the IT industry in India predicted to grow steadily and Bangalore as usual leading the way, the demand for good quality office space near the existing IT locations is likely to continue. About 250 ancillary industries such as cement, steel, brick, timber, building material, etc are dependent on the real estate sector. 

The year 2004-05 saw around 16 million sqft  of commercial space absorbed in India which was predominantly contributed by Bangalore (7.7 million sq ft) followed by the National Capital Region (NCR) (2.9 million sq ft), Mumbai (2.5 million sq ft), Hyderabad (2.2 million sq ft) and Chennai (1.6 million sq ft).”
The city of Bangalore has been able to absorb more commercial space (7.7 million sq ft) than its counterparts in the country in 2004, with the maximum contribution being from IT and ITES companies, according to the year-end report by real estate consultants, Cushman and Wakefield.


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