VESTI ETc) el eeH Whitefield and Electronics City corridor Series) cecember 2010 AN WALK | Neda culbcea kode iceOffice Space 2010 & Beyond* Pees is Whitefield 10 are vacant space and ee maes SS ae LS 7 are te “ . @ uueetrerticetcs , Electronics City... 38 MS i“ Peer B ; Poe A 4 Preece \ Me feats . soi’ be rr ed Leaps 4 coon in ea VESTIANExecutive Summary * Bangalore's growth story a Silicon Valley of Indi synonymous with the emergence of Electronics City ‘and Whitefield as IT hubs in Bangalore. IT space development in Electronics City gathered traction since mid 1990s and Whitefield emerged as an IT hub in late 1990s. Though contemporary, both these micro-markets are well differentiated in develop- ment ownership, type of occupiers, development characteristics and social & businessinfrastructure. * Over the last one decade, Whitefield has developed 4s a self sustaining suburban area with development of residential projects, modern format retail malls, hotels and other social infrastructure. In comparison, Electronics City still continues to remain an economic hub. * Whitefield has almost 3 times of the non-captive IT ‘operational space as compared to Electronics City (25 million sqft versus 8.2 million sqft). However, under captive office space category Electronics City leads with 14 million sqft to that 7.9 million sqft of Whitefield. «Since 2007, Whitefield has been consistently witnessing high vacancy levels. As of Q3 2010, vacancy levels for non-captive office space are 10 million sqft in Whitefield and 3.3 million sqft in Electronics City. The high vacancy level is registered primarily in Grade B+ buildings, which are 5 million sft in Whitefield and 2 million sqftin Electronics Cty. ‘+ Currently, Whitefield has three operational I7/ITeS non-captive SEZs (3.6 million sqft) whereas, Electronics City has only captive SEZs. In Whitefield, another 2.2 million sqft is under construction and 117.1 milion sqft is planned in SEZ category. ‘+ However, this planned space quantum could drop subject to re-consideration of developers over the notified SEZ parks, reason being the shift in the occupier’s preference to ORR and Bangalore North. In comparison, Electronics City region also has one planned IT/ITeS SEZ. ** Till Q3 2010, Whitefield and Electronics City micro- ‘markets registered annual office space absorption of 17 milion sqft and 0.46 million saft respectively. In both the micro-markets, 80% of the absorption is driven by expansion of existing operations or new set- ups; only balance 20% supported relocation and consolidation of operations. + During last few quarters, office space rentals have firmed-up for Grade A (Premium) & Grade A buildings in both the micro-markets on account of increased leasing activity. But, rental levels for Grade B+ buildings are still sensitive due to high vacant stock. In Whitefield, rentals for SEZ space are likely to strengthen on account of high demand and low vacancy levels, + Whitefield is dominated by MNCs operating in IT & eS sectors. In comparison, Electronics City has 65% ofthe space occupied by Indian origin companies and 39% of the companies operating in non-IT /ITeS sector-Biotechnology, Electronics and Engineering Services. + Overall, growth rates in these micro-markets are slowing down on account of rise of alternate micro- markets (ORR and Bangalore North). Never the less, cost benefits, existing tenancy profile and proximity to talent pool are stil strong enough to support the annual absorption at current levels at least in the short term. VESTIANFigure 1: IT Hubs of Bangalore - Whitefield and Electronics City 8 + Bangalore International Airport NH 7:To Hyderabad CV Ramgn Nagsr @ BD titronoa lt Aiport Road ECS Koramangala @ pao Si Layout BTM Layout @ (@ Satiepur SH 17: To Mysore @itoraur Bannerghatta Hosur Road Road NICE Ring Road, Electronics City NH 208: To ‘Kanakpura NH 7: To Hosur © Sra eiecranlS ey” Pros of nts ‘Micro-markets of Whitefield and Electronics city @ Key Secondary 1T Hubs VESTIANPromotion of Electronics City and Whitefield EPIP Zone were key initiatives of State Government of Karnataka to transform Bangalore City into a Silicon Valley of India Electronics City * Electronics City, a 580 acres electronics industrial park is located along Bangalore — Hosur Road. The main objective ofthe development was promotion of electronics and IT/ITeS companies in the region. * Electronics City has been developed in 3 phases, The Phase 1 (332 acres), commissioned in 1978, was. jointly developed by Government bodies — Karnataka Industrial Area Development Board (KIADB) and karnataka State Electronics Development Corporation Limited (KEONICS). Whereas, Phase 2 (248 acres) and Phase 3 (100 acres), commissioned in 2003, were developed by KIADB. + Post 1997, the entire maintenance and up-keeping of Electronics City was handed over to Electronics City Industries Association (ELCIA), 2 professionally managed organization formed by the industry members of Electronics City, * In Phase 1, mainly land parcels were allotted to companies operating in electronics and T/ITeS sectors; in Phase 2 land parcels were also allotted to few biotechnology companies whereas Phase 3 has been allocated for biotechnology companies only * Key companies operating in this region include Infosys, Wipro, HP, HCL, Siemens, TCS and others. Whitefield EPIP Zone + KIADB developed Export Promotion Industrial Park (EPIP) Zone (500 acres) in Whitefield in 1994 to promote export related industries. This initiative catalyzed economic developmentin this region + Existing old industrial area, availability of land, connectivity to city centre and proximity to old airport were the main reasons to establish the EPIP Zonein this part ofthe city. + Further, development of International Technology Park Bangalore** (ITPB), established Whitefield on a global map, * Key Companies operating in this micro:market include GE (lohn F Welch Technology Center), TCS, Oracle, IGate, SAP Labs, L&T and others. LUE SRT SEE eermemeee Karnataka State Electronics Development Corporation Limited (KEONICS) KEONICS was established in 1976 with the main ‘objective of promoting electronics related industries in Karnataka. The Electronics City industrial park (Phase |) was a concept developed and implemented by KEONICS with support from KIADB. Karnataka Industrial Areas Development Board (KIADB) KIADB is a wholly owned infrastructure agency of Government of Karnataka with the primary objective to promote growth and development of industries in thestate. Primary functions include acquiring land, forming industrial areas and providing basic infrastructure. The agency is also responsible for acquiring land for Single Unit Complexes and infrastructure projects. "Note: international Tech Park Bangalore (TP) was established in 1998, This leone business park located on Whites main 08d is spread over a 28 hectare estate. wae a joint venture Between the Tata Group, Ascendas.Grovp (Singapore) and KADB. Currently managed by Ascendss the prk proves state ofthe at facies to ‘more than 145 companies who provide services including Software velopment R& andes related activites. VESTIANRs eure sons Cora Table 1: Whitefield & Electronics City - Fact Sheet —— = = (km) ty of and for devlpment Phas United Cee Phase Il; Limited (For Biotech Industries) tam: abate Zoning and Regulatory Attributes (As per Revised Master Plan 2015) Main Land-use Industral (Hi-Tech Zone) Industeal (Hi-Tech Zone) Permissible FS 2.0-3.25 Industrial HiTech Zone) | 2.0 25 (Industrial - HiTech Zone) Whitefield Main Road, Mutation Corridor** IPB Main Rozd, arthur Main Road "ie nlon Corian a por rovaes Dngsoe Manes lan 207, pot wih Forage eualtoor mare than 12 mare cig or eenveson alone ueeto ‘neers he permis bing inte rnge of 2751 3.25 (eepensing onthe let Sa, Werage ae abt ros wh). madon tthe Ronee Plots facing NH 7 VESTIANWhitefield has emerged as a self su: ® Electronics City is surrounded by green zone (protected land) and industrial area (8ommasandra & Jigani). Therefore, this micro-market has limited land availabilty for development of sustainable support infrastructure. + In comparison, Whitefield is surrounded by residential and industrial zone and has potential for future development. Further, growth in Whitefield is enhanced due to its connectivity with city through two major roads - Old Madras Road and Old Airport Road whereas Hosur Road forms the primary access to€lectronics City. * Electronics City micro-market has good business infrastructure with 12 hotels operational in two & above star category. However, lacks in social infrastructure developments - Grade A residential developments, retail, entertainment and educational institutes Whitefield region, promi- nent developers including Prestige, Adarsh, Shobha, Brigade and others have existing and upcoming residential developments. This micro- market has ‘well developed social infrastructure including retail ‘malls, entertainment options, schools, ete. + Further, public transportation facility in Whitefield is better ‘than in Electronics City in terms of fre- ‘quency and connectivity. Table 2: Whitefield & Electronics City- Business & Social infrastructure ee ee eS SE EEE ‘tribute Electronics City Whitfield Keys Hote (Budget css) HomurRoad Manipal County (Resor) aap Tal Vana (5 sta) Speen Roya Ochi Suites (Business Hote ‘Aevetiyat Central Ametiyat Vlas and | Ginger Hotel (Modern format budget tains ices ‘Amethyst Apartments (Serviced pet ee Smvannah Saevar Premiere (5 tr) Electronics ty Lemon ee 4st, un (Sstar oa Sarees oe So Paryveren (Serviced Apartments Crowne Piaza (5 star) mesa coment Svenska Hotel (5 sa), ord Plaza (star Tovote Bis Hotel (5 star Bergroen How a7 Hosur Ros Bonney Hotels (5 star) halla Hote (star) Confident Ove ($ tr) SI Constructions (25) UpcomingHotes (ri 2012) sone Renee starlet Smeondo Suites Forum Value Mall Services Apartments) pee Electonics Cry (Serviced Apartments) ‘The Courtyard -K Raheja Group (5 star) erkinn (5 star) Symerey Constructions Shangri ta Hotel (4 star) Hosur Ros ‘i Cosmos Mall Existing etal Malls — leetronies City Ni Forum Vlue Mt MouurRoad Independent Developers Phoenix Market ity Upcoming Reta Mol ParkSanre (Unde ecvonesci EAN BRUIT Forum Mal lecronescty | or on te vity Phase 2) Inoeie Mal Raheja Group Srey Constructions VESTIANOn the urban infrastructure front, both micro- markets can learn from their global counter parts. ‘The urban infrastructure across both the micro- markets including roads, footpaths, walk bridges, signage etc is not in par with infrastructure offered in other global economic hubs. * Electronics City is @ close-knit designed park with ELCIA managed surveillance services, traffic manage- ment & common amenities. Thus, giving a common infrastructure and a sense of belonging to an eco- nomic hub, the sameisnot true for Whitefield. Travel time between Electronics City and Bangalore City has reduced with commission- ing of the Electronics City Elevated Express ‘Way, NICE Ring Road and widening of Hosur Road in 2009 & 2010 ; however, approach roads to Whitefield continues to face traffic congestion at major road junctions. ‘= Whitefield can expect significant improvement in travel time only post 2015, after completion of planned Bangalore Metro Rail project Phase 3 and proposed Peripheral Ring Road (PRR) Phase 1. ‘Bangalore Metro Rail Phase 3 is planned to connect Whitefield and Electronics City. Currently, BMRCL is ‘working on the detailed project report and alignment for the phase 3 would be finalized in short term. ‘= The proposed PRR Phase 1 will connect Electronics City, Whitefield, Old Madras Road and Bellary Road (Bangalore International Airport). Currently, BDA is ‘working on the road alignment and land acquisition. VESTIANBangalore: Whitefield and Electronic City Ties Gro Over the last decade, Whitefield and Electronics City office space micro-markets extended beyond EPIP Zone and KEONICS & KIADB designated Electronics City + Electronics Cty micro-market includes 3 phases of Electronics City and the stretch of Hosur Road from Silk Board Junction to Hebbagodi. For the study purpose, Patel Realty’s integrated township project ‘Neo Town and HCL Technologies Campus in Jigani are included in this mirco-market. * Whitefield micro-market includes EPIP Zone and. areas enclosed between KR Puram Junction along, ‘Outer Ring Road (ORR) to Hope-farm Junction via Hoodi Cirlce; Hope-farm Junction to Varthur Lake Junction covering the Whitefield Road; Varthur Lake Junction to Marathaballi Junction via Kundanahalli Junction and Kundanahalli Junction to Hood Circle ‘covering ITPB Main Road. Also, for this study Beary’s, Global Research Triangle in Hoskote has been included. VESTIANFigure 3: Whitefield -IT Growth Hub LOD) eatgosi () date Manadeapuraf® Dodsworth Layout Hindustan Un Timed (Sy Kundarahall s 1 Non - captive Spaces Captive spaces © pecational SEZ spaces © Operational Non SEZ spaces |] sisting Malls /Hyper-markets © Oberational Non SEZ spaces Uncoming Mals © Under construction Non-SE2 spaces B existing Hotes/ Serviced apartments (©) Planned SEZ spaces Uncoming Hotels Serviced Apartments (Planned non-Se2 spaces A Residential Locations © 1170 convention Centre © campus @ siRiark © Divpasree Tech Park (St2) © Tota Xylem ® Shailendra Tech Park © John Welch Technology Centre © brigade Metropolis © Neil Ra0 Towers G tesco campus © Bhoruka rrPare @ sartads @ Tseampus © anapriyaPride @ awzwe @ First Technology Park © Aata ets ® ac centennrial @ Fortune Softech Park © Prestige Shantinketan @ Infinite Computer Solution campus €® Subramanya Tech Park Umiyasuntech @ Gvatech Park @ 18 © DivjasroenrEnctave © Kalyani Platina @ raiser) @ Embassy Crest ® ‘cate Giobal solution campus @ Brigade tech Park @ 6 Raheja Whitefield Palms @ Adarsh Eeo Place @ Solorpuria GR Tech Park ® Gopalan Global axis (Sez) @ Netra ech Park @ tira Tech park ® Windmills of your mind @ Mar Siverlne Tech Park @ Hindustan Unilever R&D Contre © Renaissance Fes Face @ Dal (formerly Perot systems) campus @B Sigma Soft Tech Park © Prestige Featherite TechPark @ ce @ Embassy Paragon @ Ler inforecnearpus @ Sobha Renaissance campus VESTIANFigure 4: Electronics City-IT Growth Hub Bio Technology Park t Neelad Road reveewow Non - captive Spaces Captive Spaces FE fesidental Locations © Operational Non-SEzZ spaces. @ Operationainon-Sez spaces Cecoming als busting Hotels/ Serviced Apartments @ Under-construction Non-SE2 spaces | @® operational sé2 spaces SS CHER SEE Uecoming Hotels/ Serviced Apartments @ aca © %sysys Technologie @ Surya Sapphire (HCL) ® vcom © Venkatadhri tr city @ Hct technologies @ Harita 1 Park Orr @ «ci @ Wipro © synova @ vest coac @® Majestic Towers © infosys © Hiranandani upscale © omni systems © oKegwa @® nites Telecom © Aishwarya Hitech Park @ Velankanirt Park ® sverortune © Confident Octanes Salarpuria infozone ® Venkateshwara Techno Park Global Tech Park © sKREquinox @® Genpact @® semicon Park @ Surya Wave (HP) @® Parthik Tech Park © Sri Ranga IT Park @® Equinox (Wellman Fargo) @ Surya! (HP) @ ics @ siemens @ Cyber Park @ Mabindra Satyam ® Prestige Alecto @® s7P1 units @® arour @® serrark @ Fortunerech Park @ Ficeity VESTIANFigure 5: Hosur Road ~ IT Growth Hub ene To ORR (Sarapue) arm Layout PE SR Layout Bommanahalli Devarachikanahalli # kudtu Gate AE HAL Layout To Mosur (NH) Non - captive Spaces FF Residential Locations © Operational Non 2 spaces @ Upcoming Malls aR settee noe seca BG wistng Hotels Serviced Apartments (SS Uecoming Hots Serviced Apartments © Maruthi chambers @ chamundi Towers ® span centre @ Champak Pragathi © snr suiding @® Prestige Alpha © Ave Building © ozone Manay Tech Park @ commercial Complex © Gola ti square @ ‘ssp tech Park @ Armed Plaza © Ave tech park © anirrark @ Ave tech Park @ salarpuria symphony VESTIANWhitefield and Electronics City micro-markets account for 45% of Bangalore's total non-captive IToperational office space + Whitefield has over 25 million sqft operational IT office space, of which 10 million saft is vacant; in ‘comparison, Electronics City has over 8.2 milion ‘sqft operational IT office space and 3.3 million sqft isvacant. « Persistent high vacancy rate over the last 3 years in Whitefield region for Non-SEZ space resulted in drop in construction activity. As of Q3 2010, 2.9 mmllion sqft & 2.2 million sqft of Non- SEZ and SEZ office space respectively is under construction; ‘whereas Electronics City has 3.4 million sqft of office space under construction. ‘= Planned supply is pegged at 20.6 million sqft and. 4.3 million sqft in Whitefield and Electronics City respectively. Figure 6: Whitefield ~ Nom-captive Office Space Summary 2 f Operational we Panned (20:0 +12) @0t2 are beyond) onl steck mocap Figure 7 Electronics Gy -Nor-aptve Office Space Summary es ue Panes (2010-12) por2end beyond) etealsck mom Operational Table 3: Whitfield & Electronics City ~ Supply Summary (in milion soft) I Whitefield & EPIP Zone Electronics City & Hosur Road Space Details Non sez | sez tora, | Nonsez | sez | TOTAL Non-aptve Space Opertional space m0 as) se] a Under consrion Spee 29 2) BA = a Preconited pice — re = Van Space 99 Ls] 3 3 33 Penne pace 35 mime oa ae carve Space esting Caplve Oc Space 8) 1a a2 Ba sa) isa Ofie Spee ow 02 a sa | M0 Manuactig and theses 8) 2 a ~ a ed Captive Space 25 a ao usa VESTIANBoth the micro-markets have shown significant variation in occupancy levels across different building types. + The only Grade A (Premium) Class building — ITPB located in Whitefield registered 100% ‘occupancy levels. ITPB has always witnessed high ‘occupancy levels on account of compliance with International standards for building design and park management, superior common amenities and elite tenancy profile. + Operational Grade A buildings across both the icro markets registered 70% occupancy levels. In Whitefield, the vacancy levels for Grade A buildings have touched 5 million sqft after commissioning of 3.1 million sqft Prestige Shantiniketan Parkin Q3, 2010. ‘= But, Grade 8+ buildings typically small sized developments with limited common amenities are witnessing high vacancy rates across both the icro-markets. Table 4: Whitefield & Electronics Cty ~ Operational ‘8 Under construction Non - captive If Parks lerodcation Name ofthe Park (ton eft) internation Teh Pak Songziore 2a Prestige Shantinketan a Operations Bene Summit oe Diasec Technopark a Phase (52) ‘opal Global As te ‘Whiteeld Phase (SZ) Prase ai aa ‘evn Techoark os ‘Copslon Global ae 10 consrecton|_?hate (SEZ) DpsteeTechopork 06 ase (2) ineratona Tee Parke Sangolore (2) = ‘Sapa fonone os ‘anton Tecnology Park | 08 eration ‘yper Park os tectonics a a ‘ty Hiranandani pscle os co met | Watan Fre os arta ark os “Table 5: Whitefield & Electronics Gy - Space Distribution ding oe Sulngryper | aleperatonal Trl vacant space Ocrupany] Haine Type" | space (milion sat) (rill sgh) | _tavels ‘ren al on te * oe: The despre cc Whiteland Elector Cy aca inter dies ~ Grade [Premian, Gade Aad Grade Br bsed onthe reputation ofthe VESTIANWhitefield has 20% of Bangalore's total operational non-captive IT/ITeS SEZ space. It is likely to retain the same share in short term but is expected to witness a drop in percentage in medium. term. * Whitefield has 3.6 milion sqft of operational IT/TeS SEZ space in Divyasree Technopark, Gopalan Global Axis and ITPB. Another, 2.2 million saft ITATeS SEZ space is under construction in existing SEZs. * Whitefield has potential of additional 17.1 million saft of I7/1TeS SEZ office space. Planned non-captive IT/MTeS SEZ developments include Fortune Cty (a V between Salarpuria and Adarsh), Chaitanya Infrastructure and Brooke Bond Real Estate Private Limited. * In comparison, Electronics City currently has only captive IT/TeS SEZs. n future, Patel Realty has plans to develop a non-captive IT/ITeS SEZ in its integrated township-Neo Town, Hosur Road. * Gopalan Biopolis in Whitefield and Biotech SEZ promoted by KIADB in Electronics City are the planned biotech SEZs. “abe whe & cri cy - Nov cethe SZ micemaret] Name ot Pak vecin [4H] sa = oder het ey ee Tears men: ih fee eine 73 sqft is operational space | total development potential Goumamana | womwmmana | ae [tistwaesen |i0stee tote satt of operational space_| construction Current O58 millon sgt is mateo: | ewninont | 27 |ramst copra | errant = er ety Simttonsaft Galvan wnsocre | wired aned| st [oman [ Feed Sesh e Eate | TPB Man Rov | — seperate — & ase Fea TE Masicrionsaia | woiete | 9 [romatapronea | panes Group) son | alread ud Tiere ity ‘Thirupatya (Electronics City) (Electronics City) * aa pia VESTIANFor 2010, expected gross absorption for non- captive IT office space in Whitefield and Electronics City micro- markets is 2.3 million sqft and 0.8 million sqft respectively + Till 3 2010, Whitefield and Electronics City micro- markets registered annual office space absorption of 1.7 million sqft and 0.46 million sqft respectively. In both the micro-markets, 80% of the absorption is driven by expansion of existing operations or new set- ups; only balance 20% supported relocation and consolidation of operations. « Estimated fresh supply for 2010 in Whitefield and Electronics City is $.7 million sqft and 1.2 million sqft respectively. + Major projects completed in 2010 include Prestige Shantiniketan (3.1 milion sqft) and Kalyani Platina ~ (0.42 million saft) in Whitefield; and, E City Tower—Il (0.36 million sqft), Confident Octanes (0.15 milion saft) & SIR Equinox (0.15 milion sqft) in Electronics city. Table 7: Whitefield & Electronics City ~2010 Key Lease Transactions Area leased Location Tenant Name Building Category Type of Space Infite Computer Soltons | GopslanGlobalaes | st fare shell vari |) somonchiaiaie | se | 300000 | Asha Wield | Sonus Networks | Prestige Shantintetan | nonsez | 280000 | Fullyfurishea us | copalonstobataus | sez | 00000 | bareshetl etidsTecmnolages | -SHiGanesn Complex | Wonsez | 40055 | Fullyfunished tectonics City & Hosur Hp | PratikeTech Park Non sez 72,000 ‘Warm Shell Road a 7 svnromina | wonsez_| 50000) wormshet VESTIAN‘Average office space rentals are comparable for Whitefield and Electronics City micro-markets for Grade B+ buildings but Grade A buildings in Whitefield command 25% higher rentals compared to similar buildings located in Electronics + For the last decade, TPB [Grade A (Premium)] has Table Whitefield & Electronics Cy~ Average Retalst been consistently charging 50% higher rentals (INR /af/month compared to other Grade A bullngs locted in ———————— Building Type | _ EPIPZone ty + Grade A (Premium) and Grade A buildings have ‘sez_| Non Sez on not only witnessed high occupancy levels but also arr ria fens Yor the some hae been Yes wste as [aay | | compared to other buildings. During the economic eee slowdown phase (Q4 2008 ~ Q4 2008) the rentals across both the micro markets witnessed drop of Grice yom | sem | 17-20 10%, 20% and 30% for Grade A Premium, Grade A ‘and Grade B+ properties respectively VESTIANBangalore: Whitefield and Electronic Cty Tift Growth Corridor Series Institutional investors and retail investors (HNIs) are capitalizing Grade A buildings at 11-12% and 9- 10% respectively. * In recent period, both the micro-markets wit- nessed limited sale activity in office space segment. The reason isthe wide gap between the developer's expectation and investor’s expectation. Currently, the institutional investors and retail investors (HNIs) are capitalizing Grade A buildings at 11% -12% and 99%-10% respectively. Grade B+ bulldings are capped ateven higher rates. mn tym soba Type | Expectation | expectation | Expectation = a Not: * For Warm Shllapace + Inshort term, the capitalization rate is expected to remain at the current levels if not going up further. Primarily reason behind modest future is the prevailing high vacancy rates and investor's interest inother emerging micro-markets. + Average quoted rates for Grade A building across both the micro-markets is INR 3800 per sqft. But, buildings such as Tata Xylem (LEED Certified), Whitefield and Hiranandani Upscale, Electronics ity are quoting capital rate as high as INR 4,800 per VESTIAN 18In Whitefield, 1/4th of the total operational office space is captive whereas in Electronics City captive space share is 2/3rd of the total operational office space. ‘* Whitefield and Electronics City account for 85% of the total captive IT office space of the city. * In Electronics City, land allotment to companies led to limited land availability for non-captive developments; whereas in Whitefield EPIP Zone, KIADB allotted land to companies but abundant land was available in EPIP and outside EPIP Zone for non-captive developments. ‘+ In Whitefield, NetApp and Huawei Technologies are planning to start construction for their captive unitsin near future. ‘In addition, Whitefield and Electronics City have 2.8 million sqft and 4.2 million sqft under manufac- turingand other industrial spaces. ig aft. inion) ited “= Operational pace Manulotring ndenpnering omnis) ' Operon spece (ce spe) ‘anes Supt Electronics Cty ‘Table 10: Whitefield & Electronics ity Captive Spaces = ae aa cee |_ atte aware ona ay Sr ee a eer aoe! ee sae ete = _and Global Services & Support ees ey essa ees fz om ee lene! a fetes | | Satnmtetaeese™ er = Cemecemirar i a =| | Sues ee eet = ‘phase | of Electronics City Sammy | «| ite Sn =o | Technologies = ‘construction Sources Vestn Resaorch a araata nasil eas Developmen Sond VESTIANWhitefield is dominated by IT and ITeS companies whereas, Electronics City houses sizeable electronics manufacturing companies also. * In Whitefield region, 82% of the space is occupied by IT/ITeS companies. Balance 18% of the space is occupied by Gems & Jewellery, FMCG, Biotechnology, Pharmaceutical, multidisciplinary R&D organizations involved in automobile, aviation, healthcare, manufacturing and other sectors. * In Electronics City, only 56% of the space is ‘occupied by I7/TeS companies, 22% by biotechnol- ‘ogy companies, 15% by electronics & allied manu- facturing units (cables, power electronics & industrial electronics, circuit boards, electron guns, ‘engineering instruments, aerospace components, tool & die casts, high precision components, ete) and balance 8% is occupied by Engineering and services companies. In Whitefield, more than 90% companies are MNCs; in comparison, 65% of the companies ‘operating in Electronics City are India based firms. Figure 9: Whitefield — Occupier Profile GBD. mT oes othere on) 1% l = i | % — % i g 3 anéTeecom BFSI—Heatheare gary tes it, egigendieonsere ontaenoe) Meda ntrament VESTIAN0% 20% 20% Figure 10: Electroni City ~ Occupier Profile 1% 20% \ ar ms se Manufacturing Electronics = Ergnceing Compares se ioteeh ss omnere ee a | oe [ o Se ee eee obey poe aye TS VESTIANBangalore: Whitefield and Electronic Cty IT/es Growth Corridor Series Growth in Whitefield & Electronics City is witnessing stagnation due to rise of alternate IT/ITeS Corridors ~ Outer Ring Road and Bangalore North. * In the medium term, both Whitefield and Electronics City micro-markets are expected to witness lower growth rate compared to thelr early 2000 levels due to high activity in ORR and emer- gence of Bangalore North. = Even though, many developers have notified IT/MTeS SEZs in Whitefield, few of them are yet not confident to start the development works on account of occupier’s preference for ORR and Bangalore North. ‘© As per market intelligence, many companies in IT and ITeS sectors have plans for expansion in the year 2011. Therefore, rate of annual absorption in 2011 is expected to be maintained atleast at 2010 levels ‘In both the micro-markets, rentals for Grade B+ buildings are likely to remain under downward pressure owing to high vacancy rate, while rentals for SEZ space in Whitefield is expected to witness a rise, + Vacancy levels for Grade A buildings in Whitefield & Electronies City are expected to drop in next 12 months and as a result rental levels will strengthen inshort term Electronics City has limited land for future development and the growth may spill over to Electronics City - Sarjapur Road, where Infosys and Wipro have acquired land for their future develop- ments. As per market sources, Infosys s planning to ‘commence second software development centre in this region. ‘= The next major development in Whitefield region. is expected along proposed PRR towards Hoskote. Beary’s Group has already developed Global Research Triangle Park Phase 1 in Whitefield Ashram, Road and Ittina Properties has a notified IT/ITeS SEZ in Hoskote. However, the anticipated growth along this region islikely to happenat aslower pace. VESTIANBangalore: Whitefield and Electronic City ACRONYMS ORR -Ovter Ring Rood INR Indian National Rupees Jn, Junetion MINES Multinational Companies 1 Information Technology {Mes Information Technology Enabled Services (CRD Cental Business District 8D Suburban Susiness Distt PD Peripheral Business Distriet {7 International Tech Park, Bongalore (Formerly known as eu) IADB. Karnataka Industrial Areas Development Board LEIA. Electonics City industries Association PIP Export Promotion Industral Park 1M Indian Telephone industries ITTF Nettur Technica Training Foundation SSIDC karnataka State Small Industries Developm Corporation {TPO Karnataka Trade Promotion Organization PRR Peripheral Ring Road 'BOA Bangalore Development Authority ETL Bangalore Elevated Tlluay Limited [|MRCL Bangalore Metro Ral Corporation Limited LEED Leadership in Enerey and Environmental Design NICE Nand! infrastructure Corridor Enterprises BY Joint Venture ‘8A Supor Built-up rea SEZ Special Economie Zone 'STPI Software Technology Parks fina DIC Direct Tox Code PSU_ Public Sector Undertakings BIA. angaore International Airport {Qt Quarter 1 Janwary March) (a2 quarter 2(Apri— lune) 3 quarter [uly September) 51S, Buitto Suit BFSI_ Banking Financial Services and insurance RED Research and Development MCS. Fast Moving Consumer Goods NI igh Net worth ineividual FSI Floor Space index VESTIAN 2Authors iA Dhara Dalal Shailendra Chandrasekar Gorakh Jhunjhunwala MRICS, [As apart of Strategie Advisory Group, ‘Dhara contributes to property market reports, research papers as wellas client assignments. She has over 4 years of experience and has worked on consultancy assignments across commercial, residential, hospitality, retailand Industrial sectors. she holds n engineer degree with MTech in panning rom CEPT University, Ahmedabad, ‘Manager Strategie Advicory Group ‘dhars@vestangisbal om, 9180 40520108 Shallendra contributes to property market ‘reports, research papers as wellas client assignments. Shallendra has over 4 years of ‘experience in realestate and has worked on consultancy assignments across varied sectors namely commercial residential, hospitality, fetal and industrial He san engineer and hold MBA degree from Ohio Univesity, USA. Manager strategie Advisory Group shallenara@vettanglobal com, 1 80 40620121 Gorakh serves a Assistant Vie President and Ineads the Strategie Advisory Group, He guides ‘the team and is responsible for research ‘output as well as cent assignments. With over years of work experience in consulting and ‘advisory domain, he has executed and Selivered assignments across aset asses for {developers and global clients. Gorakh pursued his masters degree from Incian Instute of Technology, Delhi and holds a bachelor’s degree in Architecture, ‘orakh@vestangobelcom +91 8 49620100 VESTIANAbout Us Vestian Global Workplace Services, a subsidiary of the US- headquartered Vestian Group and an international property consulting firm providing integrated end-to- end real estate solutions to occupiers. Vestian Global offers Strategic Advisory, Transaction Advisory and Project Management services, (Our client base comprises blue chip multinational and private Indian corporations across. sectors, and our primary value proposition is our corporate philosophy of. "Delivering Measurable Results’, by which we deliver metrics-driven, accountable, high standard conflic-free Services with exclusive focus on tenant representation. Currently, our service platform covers key Asian markets viz. India and China; and we are in the process of planning to expand our presence to other countries in Asia Pacificand the Middle East. Strategic Advisory Group Vestian Global Workplace Services’ Strategic Advisory Group aligns the business strategies of corporate clients with their real estate portfolio strategy. Property ‘market intelligence; economic, urban and space planning principles; and analyti- cal methods all come together to provide strategic insights to occupiers of real estate. Comprehensive market knowledge and extensive databases help us analyze prevailing market trends and foresee the impact of economic, social and govern- ‘ment policies on real estate, especially their impact on end-users. Experienced application of analytical tools and methods allows us to develop innovative solutions that combine business, sectoral and geographical requirements. ur studies span industrial, office, residential, retail and hospitality sectors to include: + Portfolio assessments, = Strategic location studies. + Market research and assessment. + Roperty valuations, = Development feasibilties. VESTIANBangalore: Whitefield and Electronic Cty TI/es Growth Corridor Series Contacts India Management Shrinivas Rao (CEO Asia Pacific shrini@vestianglobal.com 491.80 40620102 Strategic Advisory Group GGorakn Jhunjhunwala AVP. Strategic Advisory Group ‘orakh@vestianglobalcom +9180 40620111 Transaction Advisory Balamurall K Director Chennai Operations bbalamurali@vestianglobalcam 91-44 66659251, ‘Anthony Ravindran VP. Transaction Advisory tony@vestianglobal.com +9180 40620105 Sanjay Purbey ‘AVP Business Development ‘sanjay@vestianglobal.com +9144 39159351 Project Management Ramaprasad Pormavill, SVP- Project Services ramaprasad@ vestianglobal +91 80 40520118, ‘Ashok Gandhi VP- Project Services ashok@vestianglobal.com 919867754537, Offices INDIA Bangalore 318, Raheja Chambers, 32 Museum Road, Bangalore-560001 Chennai Suite No 702, MIS Business Center Kuppu Arcade No.4, Venkatanarayana Road Nagar, Chennai-600 017 Hyderabad Vata business center 3d loos NSL Icon Rano 1 ana ls Hyderabae-500 034 USA 200N Lasalle Street, Suite 2830 ‘Chicago, I 60602, CHINA Unit 1207, No.S46, ‘Changning Road Changoing District, Shangha-200 042 VESTIAN‘Acknowledgement Tre estonstteyc Advisory tear woul ie oak ths opportuntytoexterdoutgrottude towards al those who hee helped inaurendeworto produce ths resort We woud Het expec tank the Develapsren fangs wha nave esendether vals support and mart ncrmaton yen as los Uninensiringauthentety of he report We would abot ie a spel mention tou Farsacton Aso Tam and Workplace Supp Tear embers Ingrdelar=Kran Kurt Chanara Mohan Red 2nd Man) esep fr ther supper VESTIANVESTIAN DISCLAIMER: Tis report contains information aval tothe publi ane has bee eed upon by Vestn Workplace Servis on the bss that Mis acer Vestn accepts no responiay ih shuld prove otto be the cave. No warraky or representation, exresed or ped sade to the aceray OF completeness ofthe infomation contained heen andsamessubmitea sujet to eres, omissions charge of pee revtalor other cngtons nd wither ‘wwwivestianglobal.com