Bangalore Overview 2Q12
Office | Retail | Residential
Real Estate Intelligence Service
June 2012
“SILICON VALLEY OF INDIA”
9.6 Million
POPULATION
GSDP
271,956 Cr*
76,000 Cr**
SOFTWARE
EXPORTS
KEY
INDUSTRIES
“BEST INDIAN CITY TO LIVE IN”
MERCER SURVEY 2011
LARGEST URBAN METROPOLIS IN
KARNATAKA
“LEADER” IN INFORMATION TECHNOLOGY
HIGHLY EVOLVED REAL ESTATE MARKET
IT / ITES, TELECOM AND
ELECTRONICS, ENGINEERING,
BIOTECH,AEROSPACE,
AUTOMOTIVE, TEXTILES AND
APPAREL
DEVELOPING INFRASTRUCTURE
WELL DEVELOPED VIRTUAL CONNECTIVITY
STRONG ACADEMIC AND R&D BASE
CITY OVERVIEW
*Expected GSDP in Fiscal 2010 – 2011, **Software Exports for 2009 - 2010 , Source (GDP) : http://www.hindu.com/2011/02/24/stories/2011022462350600.htm , Source (Mercer Survey) : http://www.bbc.co.uk/news/world-asia-india-15956457
2
Advantage Bangalore
Large Talented Human Resource Pool
Large English Speaking Cosmopolitan Population
Good Educational and Research Institutions
Relatively Economical Cost of Labour and Operations
Conducive Labour Relations
Progressive Infrastructure
Better State Policy and Investor Perception
Good Telecom Connectivity
Moderate Climate
Good Law and Order situation
Technological Prowess
Among the Fastest Growing Cities in Asia
3
Bangalore : Knowledge Capital of India
Large and Growing Pool of Skilled Professionals In Information Technology (IT) and IT Enabled Services (ITES)
AVAILABLE TALENT POOL
POTENTIAL TALENT POOL
Availability of High Quality Work Force with Varied
Experience and Diverse IT Skills  Ease of
Scalability and Maturity of Process
Large resource pool in the form of graduating
students suitable for IT/ITES
Highest Availability of Middle And Top Management
The maturing talent pool  Sophistication of jobs
Better Access to Research and Development
Institutions
High Synergy between the Academia and Industry
•Highest number of employees in the IT/ITES
sector
•Approximately 600,000* IT and ITES Professionals
Home to
• Indian Institute of Science
• Indian Institute of Management
• Indian Institute of Information Technology
*Business Today
4
Real Estate Infrastructure : Commercial
International Standards in Office Space
 Bangalore becoming a preferred destination for IT / ITES
companies owing to Brand Bangalore, A Global Hub for
IT Products & Technology
 International standard Software Tech Parks in different
business districts
 Major Link Roads in South and East being developed as
Mutation Corridors  More software parks and other
commercial establishments
 Current Office Space Stock of approx. 65 Million Sq.ft
 Approximately 4 Million Sq.ft of office space to be added
by Q4, 2012
 11 Operational Multi-tenanted SEZs
•
•
•
Comparatively Economic Rental levels
Availability of Quality Residential and Commercial development
High Transparency in Real Estate
High Office Market Activity
•
•
•
•
•
Amenities and Services
Large Efficient floor plates
Plug and play facilities for temporary accommodation
Building Management System where air conditioning, lifts, water
level, lighting are centrally controlled
Complete backup for essential services
Water Storage and Sewage Treatment Plant
Liberal parking standard to accommodate employee transport
fleets
Independent control and high-end security systems
Dedicated security teams
5
Preferential Incentives and Policies
STATE POLICY AND INCENTIVES
Incentives and Concessions under Millennium IT Policy
• Fiscal : Exemption to IT companies from payment of entry tax on certain capital goods, concession on stamp duty &
registration charges, rebate on cost of land
• Power : Continuous and uninterrupted supply of power at industrial rates
• Simplified procedures/laws : Pollution control clearances, urban planning/zonal regulations, relaxation in labour laws,
facilitation through single window agency
• Financial Support : Venture capital from Government for start-ups
GOVERNMENT INITIATIVES FOR FUTURE GROWTH
• The Karnataka government is planning to come out with a semiconductor policy
• Special focus on manufacturing of photovoltaic cells/solar panels for energy conservation and efficiency
• A fast track mechanism to expedite clearance of IT and BT projects within a period of 30 days ( under consideration )
• Special emphasis on electronic hardware manufacturing
• IT parks to be set up in the Bangalore-Mysore Infrastructure Corridor Planning Area.
6
Infrastructure Initiatives
Peripheral Ring Road
Bangalore
International Airport
• Under Construction.
• 110-km peripheral ring road to circumnavigate the city linking
the major highways - Tumkur Road, Mysore Road, Old Madras
Road, and the Hosur Road.
• Likely to be operational by 2015 - 2016
Bangalore Mysore Infrastructure Corridor (Phase 1): Under
Construction*.
• 41 km of Peripheral road linking NH-7 and NH-4
• 9.1 km Link Road linking City Centre to Peripheral Road
• 12 km Expressway from the Peripheral road upto Bidadi
• Current Status : Feeder roads are completed
Metro Rail : Under Construction.
• Phase 1 : Mysore Road to Byappanahalli and from
Hesarghatta Cross to Puttenahalli. To be operational by mid
2014
• Ensuring Enhanced Connectivity across the City
• Phase 2 (61 stations covering 72.06 kms )to be operational by
2017
M G Road to Byappanahalli (~ 7kms) : Operational
Signal free south to north Outer Ring Road : Under Construction
To be operational by 2012
Flyover
Bidadi
Underpass
Flyover and Underpass
Hebbal - Yelahanka Expressway
• 22.12 km long elevated six lane expressway connecting
Hebbal & Yelahanka.
• Proposed Completion Timelines : 2 years starting from 2011.
Proposed High Speed Rail link (HSRL) by Bangalore Metro
Rail Corporation Ltd.
• Stations at Cubbon Road, Hebbal and Yelahanka
• Currently the project is on hold.
*Source: www.nicelimited.com
http://www.deccanchronicle.com/channels/nation/south/after-metro-bengaluru-set-high-speed-rail-link-150
Note: Peripheral Ring Road and Mysore road alignments to be confirmed
7
Bangalore Metro
METRO STATIONS - PHASE I
BIEC
40 39
38
NAGAWARA
37
36
35 34
33
32
31
30
29
2
28
24
27
23 22
21 10 9
25
26
11
12
13
8 7
6 5
4
1
3
14
15
16
18 17
19
KENGERI
20
ANJANPURA TOWNSHIP
GOTTIGERE
ELECTRONIC CITY
WHITEFIELD
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
Bayappanhalli
Old Madras Road
CMH Road
Ulsoor
Trinity Circle
M G Road
Cricket Stadium
Vidhana Soudha
Central College
Central Bangalore: Majestic
Chikpet
City Market
K R Road
Lalbagh
South End Circle
Jayanagar
R.V.Road
Banashankri
J P Nagar
Puttenahalli
City Railway Station
Magadi Road
Toll Gate
Hosahalli
Vijayanagar
Deepanjalinagar
Mysore Road
Swastik
Malleshwaram
Kuvempu Road
Rajajinagar
Mahalaxmi Layout
Soap Factory
Yeshwanthpur
ORR Junction
Peenya Village
Peenya Industrial Area
Jalahalli
T Dasarahalli
Hesaraghatta Cross
Bangalore Metro Phase 1
Proposed Metro Phase 2 : Planning Stage
Extension of Phase 1 : Alignments to be confirmed
8
Social Infrastructure
EDUCATIONAL INSTITUTES
HOTELS
OBEROI
ZURI
PARK PLAZA
TAJ VIVANTA
IVY – UNWIND ISLAND
 Presence of numerous luxury hotels and serviced apartments
 Currently over 7,700 rooms with 9,800 hotel rooms in the branded
segment slated to enter Bangalore Market over the next five years.
 22 Upcoming hotels including Prestige Group's Hilton Hotels, Nitesh
Estates's Ritz Carlton, Hyatt and JW Marriott which are at different
stages of construction
CHRIST COLLEGE
IIM, BANGALORE
IISC
St JOHN’S MEDICAL
COLLEGE
Large numbers of institutions of international repute for providing technical and
professional education : Indian Institute of Science (IISc) ,Indian Institute of
Astrophysics (IIA), Indian Institute of Management Bangalore (IIMB), Centre for
Liquid Crystal Research, National Aerospace Laboratories, Institute of Technology
(BIT), Indian Space Research Organization (ISRO), National Law School of India
University.
187 Engineering Colleges, 291 Polytechnics, 76 Fine Arts Colleges


HOSPITALS
RETAIL
MARKET CITY
PES SCHOOL OF
ENGINEERING
CENTRAL
GOPALAN MALL
UB CITY COLLECTIONS
FORUM
Quality recreational Facilities : Numerous Multiplexes, Shopping malls
and pubs
 Presence of all major global brands, Presence of World leaders in Retail
Consumer Segment
 Currently have an existing retail mall space of 4 Mn sq.ft spread over 20
major malls



World Class Health Care Centers
Apollo Hospital , Wockhardt Hospital, Columbia Asia Hospital,, Manipal
Hospital, Mallya Hospital, HOSMAT, Sagar Apollo Hospital, NIMHANS
(National Institute of Mental Health and Neuro Sciences)
9
Prominent Occupiers
Banking & Financial
IT / ITES
Others
10
NORTH BANGALORE : FUTURE POTENTIAL
• Proximity to international airport
• Features prominently in the Comprehensive
Development Plan and the Greater Bangalore
Development Plan
• Exclusive IT space (over 10,000 acres) –
Information Technology Investment Region
( ITIR) planned in Devanahalli and Doddaballapur
Region.
• Currently, Limited Social Infrastructure
Growth Corridors
•
•
•
•
WHITEFIELD & ELECTRONICS CITY: MOST
ECONOMICAL DESTINATIONS
Relatively lower rentals, Abundant supply of
quality office space
Future Plan of Metro connectivity for Whitefield
Elevated fly-over has eased the traffic and
provides better connectivity to Electronics City
NICE road provides connectivity between
Electronics City and South Bangalore.
OUTER RING ROAD : COMPETITIVE LOCATION
• Preferred Destination owing to better
connectivity and proximity to employee
catchments ( South Bangalore)
• Major SEZ developments along the stretch
• ~3 Million sq.ft of space taken off the market
based on staggered commitment from April to
August 2010
• Appreciation of 15 – 20% in rental values due to
rising demand for commercial spaces
Emerging Growth Corridor
Growth Horizon : 3 – 5 Years
Emerging Growth Corridor
Growth Horizon : 1 – 2 Years
Current Growth
Corridor
Upcoming
Location
SARJAPUR ROAD : UPCOMING LOCATION
• Upcoming IT corridor – WIPRO & Infosys
campus
• Land parcels acquired by major developers for
upcoming projects
• Development of major residential projects
• Connectivity to Electronic City, Whitefield and
North Bangalore through Peripheral Ring Road
11
Commercial Office Trends
Commercial Trends: Stock Vs Vacancy 1Q12
PAN-INDIA
VACANCY
Bangalore and Hyderabad continue to have low vacancy levels. Chennai soon to
cross the 50 million sq ft mark.
100
90
Stock (million sq ft)
80
Mumbai
70
Bangalore
60
50
40
Pune, NCR-Delhi
and Mumbai close
to average vacancy
NCR-Delhi
Bangalore and
Hyderabad have below
average vacancy
30
Chennai
Pune
Hyderabad
20
Kolkata
10
0
0%
5%
10%
15%
20%
25%
30%
35%
40%
Vacancy (%)
Source: Real Estate Intelligence Service (JLL), 1Q12
13
Commercial Trends
Rental Values
STPI Rental Range
Micro Market
Warm Shell Rent
( INR/ Sq.ft / Month)
Maintenance
( INR/ Sq.ft / Month)
Car Park Allocation
(Slot/Sq.ft)
Car Parking Charges
( INR/ Slot / Month)
CBD
70 – 110
5–7
1 per 1,500
4,000 – 6,000
SBD
40 – 65
5–7
1 per 1,000
2,500 – 3,000
PBD
25 – 38
5–7
1 per 750
2,000 – 2,500
Micro Market
Warm Shell Rent
( INR/ Sq.ft / Month)
Maintenance
( INR/ Sq.ft / Month)
Car Park Allocation
(Slot/Sq.ft)
Car Parking Charges
( INR/ Slot / Month)
SBD
42 – 53
5–7
1 per 800
2,500 – 3,000
PBD
35 – 48
5–7
1 per 800
2,000 – 2,500
SEZ Rental Range
Source: Real Estate Intelligence Service (JLL), 2Q11
Commercial Trends
Property Clock
GROWTH
SLOWING
RENTS
RISING
1Q12
Bangalore
NCR-Delhi
Mumbai
Chennai
RENTS
DECLINING
DECLINE
SLOWING
Hyderabad
Pune
Kolkata
Source: Real Estate Intelligence Service (JLL), 2Q11
Retail Trends
Retail Trends: Stock vs Vacancy 1Q12
PAN-INDIA
VACANCY
NCR-Delhi and Mumbai constitute two-thirds of pan India retail mall space.
Considerable retail activity remains on the traditional high streets of India.
30
25
Stock (million sq ft)
NCR-Delhi
NCR-Delhi and Mumbai lead
others by a huge margin in
terms of operational retail
stock; have high vacancies in
secondary districts
20
Kolkata, Hyderabad and
Bangalore have relatively low
stock and low vacancy; These
cities have considerable activity
on high streets
Bangalore
15
10
5
Hyderabad
Kolkata
Mumbai
Pune
Pune has high vacancies due to
select retail properties having low
occupancy levels. Other
properties enjoy good occupancy
Chennai
0
0%
5%
10%
15%
20%
25%
30%
35%
40%
Vacancy (%)
Source: Real Estate Intelligence Service (JLL), 1Q12
Retail Trends
Rental Values
Micro Market
Warm Shell Vanilla Rents
( INR/ Sq.ft / Month)
Prime
160– 250
Secondary
80-120
Suburbs
60-80
Source: Real Estate Intelligence Service (JLL), 2Q11
Retail Trends
Property Clock
GROWTH
SLOWING
RENTS
DECLINING
DECLINE
SLOWING
RENTS
RISING
Mumbai
1Q12
NCR-Delhi
Pune
Bangalore
Hyderabad
Kolkata
Chennai
Source: Real Estate Intelligence Service (JLL), 2Q11
Residential Trends
Residential Capital Values-Micro-market wise
Capital Values (INR/Sq.ft)
1. Prime (INR 10,000 – 26,000)
2. Secondary (INR 3,500 – 7,000)
3. Bellary Road (INR 3,000 – 8,000)
4. Tumkur Road (INR 2,500 – 5,200)
5. Mysore Road (INR 2,100 – 3,000)
6. Kanakapura Road (INR 2,800 – 5,000)
7. Hosur Road (INR 2,500 – 4,000)
8. Whitefield (INR 2,600 – 6,500)
Source: Real Estate Intelligence Service (JLL), 2Q11
Residential Trends
Supply and Absorption Trends(3Q18 – 1Q12)
capital values expected to be stable during 2012
30%
26%
10000
8000
25%
20%
19%
18%
6000
26%
18%
16%
15%
14%
14%
12%
11%
12%
4000
15%
13%
10%
11%
10%
10%
Absorption Rate (%)
Number of Units Launched / Absorbed
12000
7%
2000
5%
0
0%
1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12
Supply
Absorption
Absorption Rate
Source: Real Estate Intelligence Service (JLL), 1Q12
Residential Trends
Movement of Capital Values (3Q18 – 1Q12)
Capital values expected to be stable during 2012
(Capital Values for
Prime) (INR psf)
Forecast
14,000
6,000
5,000
12,000
10,000
4,000
8,000
3,000
6,000
4,000
2003
Prime
2004
Secondary
2005
2006
Bellary Rd
2007
Hosur Rd
2008
Whitefield
2009
2010
Tumkur Rd
2011
Kanakapura Rd
2,000
2012
Mysore Rd
Source: Real Estate Intelligence Service (JLL), 1Q12
Movement of Capital Values (1Q08 – 1Q12)
Average residential capital values appreciated by nearly 2-3% in 1Q12. With subdued
residential activity, capital values in Hyderabad remained stable during 1Q12.
Simple Average of % Q-o-Q Change in Capital Values of Constituent Micro-Markets
CV RISING
SLOW
GROWT
H
CV FALLING
DECLINE
SLOWING
CV
RISING
Capital Value
Movement
GROWTH SLOWING
1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12
NCR-Delhi
8.8%
1.6%
0.6%
-5.7%
-4.9%
-2.4%
2.3%
1.1%
2.1%
2.6%
2.0%
2.3%
2.4%
2.6%
1.9%
2.5%
Mumbai
7.0%
2.2%
0.0%
-8.3% -12.9% -4.0%
6.7%
8.0%
6.4%
5.3%
3.6%
6.0%
0.8%
1.5%
1.3%
1.6%
3.2%
Bangalore
4.2%
3.6%
1.7%
-8.4%
-4.4%
-1.1%
0.0%
4.9%
2.5%
4.9%
5.6%
1.7%
5.2%
2.8%
2.5%
0.5%
2.3%
Chennai
19.6%
4.7%
0.0%
-6.5%
-6.9%
-1.8%
2.0%
2.6%
3.0%
3.0%
3.4%
3.7%
0.3%
1.8%
2.2%
3.4%
2.0%
Hyderabad
5.1%
2.4%
0.0%
-9.1%
-4.7%
-4.1%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
1.0%
0.0%
0.0%
0.0%
0.0%
Kolkata
22.9%
3.5%
0.0%
-6.1%
-8.9%
-2.9%
0.4%
3.7%
2.9%
3.7%
5.1%
1.5%
1.7%
2.2%
2.1%
2.7%
3.7%
Pune
4.4%
1.9%
0.0%
-7.7%
-7.2% -16.0% 0.0%
5.5%
4.7%
1.6%
2.2%
1.4%
3.8%
2.7%
1.5%
1.3%
2.9%
-9.7%
1Q08-1Q12
Source: Real Estate Intelligence Service (JLL), 1Q12
Note: Figures represent the top seven cities of India – Mumbai, NCR-Delhi, Bangalore, Chennai, Pune, Hyderabad and Kolkata.
Residential Trends
Property Clock REIS
-
-
Mumbai
Chennai
Delhi
Noida
Gurgaon
GROWTH
SLOWING
VALUES
DECLINING
Bangalore
Pune
Kolkata
Coimbatore
1Q12
VALUES
RISING
DECLINE
SLOWING
Hyderabad
Source: Real Estate Intelligence Service (JLL), 1Q12
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regarding property for sale, rental or financing is
from sources deemed reliable, such information has
not been verified and no express representations made
nor is any to be implied to the accuracy thereof, and it
is submitted subject to errors, omissions, change of
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shall not be liable (to the extent permitted by law) for
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