KOLKATA REAL ESTATE : More Supply - Less Demand

Dhruva Jyoti Chowdhury, Kolkata, India
While the property prices are moving at a great pace across the major cities in the country, Kolkata has also felt the heat. Property prices are up by 10 – 35 per cent at select areas due to demand-supply mismatch. What is more, even up market apartments are being lapped up in quick succession due to vibrant economy and the increase in disposable income. Among the areas undergoing swift real estate development in and around the city, specific mention must be made about Mayfair Road, Lansdowne, Loudon Street, Gurusaday Road, Ballygunge circular road and the Theatre Road. Residential property prices moved not less than by 10 per cent across all markets, if the realtors are to be believed.. The appreciation is steep in areas like Alipore by 36 per cent last year, 57 per cent in EM bypass, 33 per cent on Jessore Road, 20 per cent in Gariahat and Rashbehari. Even entrylevel investors are handsomely rewarded if one wants to enter at the green field stage and opts to quit at the implementation stage. However, most of the demand is end user driven and investors are yet to plunge into the city. Incidentally, Kolkata is a shining example where private-public model has been working effectively. Recently ICRA, premier rating agency, has accorded the highest published rating RT2 plus to Hiland Park Phase II which translates into strong project ever granted to a real estate developer in the country. The commercial property market is predominantly driven by IT and ITES sector and the organized retail formats. In 2005, aggregate office segment absorption of approximately 5.5 lakh sq. ft. has been reported with a majority of the demand in suburban locations of sector V, Salt Lake and New Town Rajarhat. However, with a few IT oriented development projects maturing, rentals in Sector V have remained stable at Rs. 34-35 per sq. ft. per month. According to Cushman & Wakefield, property consultants, the real estate sector is expected to witness increased activity in the short to medium term. While demand is expected to improve, quality stock will gradually enter the market (in Sector V and Rajarhat) over the next 6-18 months. Several national level developers have acquired land to tap the expected IT/ ITES demand. Technology firms are anticipated to provide employment to approximately 14,000 people translating into a real estate opportunity of around 1.10 million sq. ft. Availability of skilled professionals at relatively lower costs compared to other metros,

low attrition rates, stable power supply and proactive state government are instrumental in driving the national developers to Kolkata.

North Kolkata Jessore road VIP road Madhyamgram Shyambazar B.T. road 1,200 - 1,600 1,200 - 1,600 950 - 1150 1,300 - 1,500 1,400 - 1,800

Central Kolkata Park street Loudon street Theatre road 3,500 - 4,000 3,500 - 5,000 3,500 - 4,500

Eastern Kolkata South Kolkata Lansdowne Bhowanipore Theatre road 2,600 - 3,200 2,300 - 3,000 3,500 - 4,500 Kankurgachi Salt lake Beliaghata EM bypass (Central) Rajarhat Howrah Dobson road Salt lake G.T. road (south) Beliaghata EM bypass (Central) Rajarhat 1,400 - 1,700 850 - 1,000 1,300 - 1,600 2,000 - 3,000 1,300 - 1,500 1,800 - 2,200 1,800 - 2,200 1,300 - 1,600 2,000 - 3,000 1,300 - 1,500