IT/ITeS companies grabbing office space in big cities

Despite the buzz around Tier 2 and Tier 3 cities, the space uptake by IT and BPO companies in metros and large cities will continue unabated with global research firm CB Richard Ellis (CBRE) putting the incremental supply estimates for corporate grade and IT/ITeS space in the region of 35 million square feet in 2007.

“The IT/ITeS companies are driving the office market and they account for about 80-85% of the total office space requirement. A large part of the supply in 2007 would be fuelled by large established companies which are on aggressive expansion mode, and a smaller part of it by new entrants,” Anshuman Magazine, managing director (South Asia region) of CB Richard Ellis, said.

The incremental figures will take the total space supply in metros/large cities to just under 200 million square feet in the coming year. “The overall space supply by end of 2007 is expected to be about 190 million square feet, in the National Capital Region (NCR), Mumbai, Bangalore, Chennai, Hyderabad, Pune and Kolkata,” he said.

“We feel that the talk about Tier 2 and Tier 3 cities undergoing massive expansion is somewhat exaggerated. Although they offer several advantages such as cheaper operational costs and lower attrition rates, the smaller cities still face challenges in terms of manpower and the right skill sets. So most of the activity is still focused around the metros,” he said.

Read More in The Times of India-Delhi Edition-13/12/06

Comments

[Gul Tulsiyani]

ARTICLE ON ACTUAL TREND OF REALESTATE AND IT’S FUTURE 20/5/2009.
Rates of Real Estate market in Mumbai are yet to hit more. Because even after 30% current discounted rates, none of the affording customer’s class is available. Over all only 6% customers were registered their transactions/sale deeds in the regional office of the sub-registrar and in detailed survey this sale of flats is classified in two categories Viz.:-1)4% customers are transacted; due to not have any option, other than to purchase the accommodations at the available discounted rates in the market. 2) 2% customers are always remains in the market to deviate their jack pot income. After up to date detailed survey from Mumbai stamp duty and registration Authority, they confirmed real estate sales transactions and in the opinion that, from overall customers only 6% transactions were took place in the last 6 months from above pattern customers and may continue up to May 2009.. If you will glance on the list for sale of flats available with real estate websites and agents/brokers, you will come to know that, not only newly constructed flats but reseller’s flats are still remain unsold from last 6 months, Customers are wondering but keeping mum while transacting the accommodations due to rates are still unaffordable. The basic thing behind non-transaction is loss of the job's or major cut in the salaries of IT oriented and automobile industry employees. Hence the class of higher income group is absent in the market for whom the builders/developer were boosted the rates and also overtraded the land. On the contrary this previous higher income class is now not even in a position to pay there prescribed EMI. Accordingly their flats are in the door step of loan issued banks for auction sale. Therefore another 30 to 40% fall in the real estate market will only brings the real cash flow in the concern market. Otherwise none of the attractive polices of the builders/brokers will work. In this connection, we may ask one question and that is, which income class has boomed this industry? The simple answer is IT/NRI/Automobile/ construction and ancillary industries. Major employees of this industries s are either loss their jobs or major salaries are cut down. Hence in shorter sense we can say that, none of the persons can make drama of the money. It means real-estate industry has to face the real crises and overcome themselves with the real correction in the property rates and not with the strategies applied up to date. In all the property exhibitions, attractive schemes from the builders were launched such as “ stamp duty and registration free from builders”, “No floor Rise”, “discount scheme on sq. feet rates is available for next 2 days”, “flats are in beautiful in natural surrounded area, visit with free bus facility”etc. etc. are proved fail. On the other part Share market index is also start booming after election result, this is all totally adverse atmosphere for real estate Industry. Because share market Index is always hedging type index, works with political activities. Share market investor class is always addictive with hedging type of transactions. Therefore Now and onwards specifically brokers remain alert and not to give any fake information of the rates to the buyers which they did in past few years consistently. Otherwise this market is already crashed and if overdose of the property rates will be given to ultimate customers, this market will collapse with it’s existence as it was happen in the recession of 1991 and 1996. Even new Congress govt. does not have any remedy to boom this industry. Discounted bank interest rates will be treated as placebo that would never be a real remedy; Govt. will construct new homes through MHADA, CIDCO, DDA authorities @ half of the rates than prevailing. Yesterday’s MHADA housing allotment lottery is the best example for it. Even TATA NANO HOUSING Project is also launched for budgeted 1RK and 1 BHK flats and others like Hawre construction co. are in a row to construct only budget oriented flats. This is nothing but danger warning bell for those, whose flats of 2/3 BHK are still remain unsold. Anyhow builders and developers have to cut down the prices though they have over traded. Thanks and Regards,
Gultulsiyani.

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