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Bangalore Market Overview May 2011
Bangalore Market Overview May 2011
Business Districts
Growth Corridors
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
Emerging Growth Corridor Growth Horizon : 3 5 Years Current Growth Corridor Upcoming Location
Maintenance
( INR/ Sq.ft / Month)
Car Parking Charges ( INR/ Slot / Month) 4,000 6,000 2,500 3,000 2,000 2,500
70 90 40 60 25 38
57 57 57
Note: ITPB in Whitefield (PBD) is quoting maintenance charges as high as INR 7.40 per sq ft per month Two Wheelers to be accommodated in Car Parking SEZ : Special Economic Zone STPI : Software Technology Parks of India * Manyata Embassy Business Park SEZ (PBD) is quoting rentals as high as INR 53 per sq.ft. per month **ITPB SEZ (PBD) is quoting rentals as high as INR 48 per sq.ft per month
RT Nagar
OLD MADRAS ROAD INR 3,000 4,500 WHITEFIELD INR 2,200 3,600
Vijay Nagar
Indiranagar Domlur
OUTER RING ROAD (Marathalli to Sarjapur) INR 4,500 6,500 HOSUR ROAD INR 2,000 3,500
Banashankari
JP Nagar
2Q 08
2Q 09
GROWTH SLOWING
VALUE DECLINING
VALUE RISING
DECLINE SLOWING
Bangalore
3Q 11F
2Q 10
Market Bangalore
2009
2010
2011
2012
2013
Tenant Market
Neutral
Landlord Market
*Source : On Point
CUMULATIVE STOCK
30.24
32.57
30
26.96
23.86
5.15
5 2009
2011F
Note: Only Grade A buildings once they receive their Occupancy Certificates (OC) are included in the stock. The stock addition indicated above is our estimate from the market and is likely to change in the event of the OC not being received by the expected timeline.
Vacancy Levels CBD and SBD Vacancy Levels decreased slightly owing to absorption. High vacancy levels in Whitefield and Electronic City owing to fresh supply. Vacancy level in Whitefield is expected to diminish by Q4, 2011 owing to spillover demand from Outer Ring Road
Q4,2011F
6,000,000
Absorption Levels
Absorption levels in Whitefield are expected to increase since the micro market has a strong supply of ready to occupy office space at
Absorption in Sq.ft
5,000,000
4,000,000
economic rentals. Absorption levels in Electronic city is expected to remain stable due to competition from Whitefield Availability of large floor plates suitable for IT / ITES occupiers at Whitefield Whitefield is in closer proximity to residential catchments and to upcoming Metro project
3,000,000
2,000,000
1,000,000
2009 (1,000,000) CBD 2010 SBD Whitefield Q1,2011 Electronic City Q4,2011F
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Rental Values
Capital Values
7,000 6,000 5,000 4,000 3,000 2,000 1,000 2009 CBD 2010 SBD Q1,2011 Whitefield Q4,2011F Electronic City
Gross rents and capital values across all the micro-markets increased in 1Q11. This trend is expected to continue in the near term, with rental and capital values appreciating more in the CBD and SBD micro-markets than in other micro-markets as these areas continue to see growing demand and limited ready-to-occupy office space.
11
Lock in Period
12
Infrastructure Initiatives
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Infrastructure Initiatives
Bangalore International Airport
Peripheral Ring Road 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.
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 Metro Rail : Under Construction. Phase 1 : Mysore Road to Byappanahalli and from Hesarghatta Cross to Puttenahalli. Ensuring Enhanced Connectivity across the City Proposed High Speed Rail link Signal free south to north Outer Ring Road : Under Construction
Bidadi
*Source: www.nicelimited.com Note: Peripheral Ring Road and Mysore road alignments to be confirmed
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Bangalore Metro
METRO STATIONS - PHASE I
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
YELAHANKA
40 39
38
37
36
35 34
33 32 31
30
29 28 2 8 7 6 5 4 3 1 WHITEFIELD
23 22 24 25 26
21 10 9 11 12 13
27
14
15 16 18 17 19 20
Bangalore Metro Phase 1 ELECTRONIC CITY Proposed Metro Phase 2 : Planning Stage Under Consideration
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Infrastructure Initiatives
Project Features
110-km peripheral ring road to circumnavigate the city linking the major highways Tumkur Road, Mysore Road, Old Madras Road, and the Hosur Road 6-lane bi-directional divided carriageway location 14 to 22 km from city centre, 2.8 to 11.5 km radial distance from the existing Outer Ring Road Involves land acquisition of about 2,050 Acres and is Expected to Cost INR 550 Crores Status Currently in alignment stage Major Impacts Enhanced Connectivity
Project Features
Implemented by Nandi Infrastructure Corridor Enterprise Limited [NICEL]. Phase 1 construction of the project includes: 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 Initial 4 lane structure with provision for expansion to 6 lanes Status Construction ongoing. Major Impacts Substantial traffic is expected to get diverted to this facility due to alternate route available for trucks bypassing Bangalore city
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Infrastructure Initiatives
Project Features
Metro Rail
To be developed in two phases covering a total area of 33 km across the city. First phase : Ttwo corridors of double lines East West corridor and North South corridor. Two stages: An 18.1-km stretch - Mysore Road to Byappanahalli and Hesarghatta Cross to Puttenahalli both via the Kempegowda bus terminus. 6.76 km. Stretch : Underground near City Railway Station, Vidhana Soudha, Majestic and City Market Rest of the tracks will be elevated. Status The full network in Phase I is expected to be commissioned by December 2011. Phase 2 Connecting Yelahanka to Electronic City and Whitefield to Kanakpura Road under planning stage Major Impacts The East West corridor could lead to a pick up in the development activity in the Western region. Reduce the pressure of vehicular traffic to a large extent Reduction in Commuting Time Project Features
Dedicated High-speed rail link between the city centre (BRV Grounds on M G Road) and the Bengaluru International Airport (BIA) at Devanahalli 28-km Elevated rail track from BRV Grounds and pass through Police Thimmaiah Circle, Raj Bhavan Road-Sankey Road, Windsor Manor junction, Mehkri Circle-Hebbal flyover. From the Hebbal flyover, the track will be laid at the ground level along the NH 7. Status 40 hectares of land to be acquired, Notification has been issued and bidding is under process. The project is scheduled for completion in 2012. Major Impacts 25 minutes to reach BIAL with the facility of Check-In at the Center of the City (Cubbon Road) and at Hebbal
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Infrastructure Initiatives
Signal Free South to North Outer Ring Road
Project Features Seven new flyovers and an underpass has been planned by BDA from Central Silk Board to Hebbal flyover along the 31 km stretch Outer Ring Road INR 350 Crores has been allocated for the project 14th Main HSR Layout, Bellandur, Devarabeesanahalli junction, Mahadevapura, Kadubeesanahalli, Kalyan Nagar, Hennur flyover and underpass and Veeranapalya are the seven junctions that have been identified for the new grade separators Dedicated bus lanes and grade level roads are also part of the project. Status Scheduled to be completed in 2011 Major Impacts To enable Signal free commuting Quicker commuting time to Bangalore International Airport (from South Bangalore) Enhanced connectivity to localities along the stretch
Airport City
Project Features Airport commercial complex : Office space development of approx 8 Mn sq.ft supporting aeronautical and non-aeronautical activities Retail component : Approx 0.75 Mn sq.ft within the terminal The Trident Hilton hotel to be located approx 600 meters from the airport terminal comprising of 321 rooms Major Impacts The Airport City is expected to bring in commercial, retail and hospitality developments.
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Infrastructure Initiatives
Bangalore Nelamangala Expressway
Project Features A 4.3 km long flyover and six more flyovers. The 4.3 km flyover will be a four-lane drive while the remaining portion of the 19.5 km stretch will be a six-lane one with additional two-lane service roads on either side. Major Impacts Reduced travel time between Nelamangala and Goraguntepalya (Ring Road junction) - 15 minutes. Signal-free drive from the Outer Ring Road to Jass Toll Plaza (outside Nelamangala, on the highway). Signal-free drive from Bangalore to Tumkur Besides connecting two-thirds of Karnataka, the project will act as a gateway to western India.
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20
Tenant Profile
IT / ITES Sector
Others
MAJOR PROJECTS
Recent Transactions
Lease Acquisition 127,403 sq.ft Prestige Dynasty Lease Acquisition 154,043 sq.ft Cosmo Lavelle Lease Renewal 122,838 sq.ft Purva Premier
Prestige Towers
UB City
Prestige Meridian
The Millennia
Raheja Towers
Prestige Oblisk
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Tenant Profile
IT / ITES Sector
Others
MAJOR PROJECTS
Recent Transactions
Lease Acquisition 6,500 sq.ft SJR Balavana Lease Acquisition 31,752 sq.ft HM Vibha Towers Lease Acquisition 23,900 sq.ft Subrmanya Arcade
SJR Primus
Commerce @ Mantri
Kalyani Magnum
Divyasree Towers
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SBD
INNER RING ROAD , OLD AIRPORT ROAD , C. V. RAMAN NAGAR, OLD MADRAS ROAD BRIEF OVERVIEW Inner Ring Road : Close proximity to CBD and boasts of ~6 Mn sq.ft of operational IT space C.V Raman Nagar : Predominantly residential area; Bagmane Tech Park is the only major commercial project. Limited Supply of ready to occupy space along Inner Ring Road and C.V. Raman Nagar Availability of Sublease and Second generation space. Old Madras Road : No major IT Parks/ IT SEZs (Other than RMZ Infinity). Upcoming METRO terminal ( Byappanahalli) is in close proximity DivyaSree Technopolis, off old airport road is a prominent project which has seen recent leasing activity MAJOR PROJECTS
Tenant Profile
IT / ITES Sector
Others
Recent Transactions
Lease Acquisition 112,029 sq.ft Embassy Golf Links Lease Acquisition 110,456 sq.ft DivyaSree Technopolis Lease Acquisition 63,000 sq.ft DivyaSree Technopolis
Embassy Golflinks
RMZ Titanium
RMZ Infinity
Diamond District
DivyaSree Technopolis
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Tenant Profile
IT / ITES Sector
Others
MAJOR PROJECTS
Recent Transactions
Lease Acquisition 424,310 sq.ft Pritech Lease Acquisition 40,835 sq.ft RMZ Ecospace Lease Acquisition 113,000 sq.ft Bagmane WTC
Salarpuria Touchstone
Salarpuria Hallmark
Bagmane WTC
Prestige Cessna
RMZ Ecospace
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Tenant Profile
IT / ITES Sector
Others
MAJOR PROJECTS
Recent Transactions
Lease Acquisition 37,779 sq.ft Manyata Embassy Lease Acquisition 33,140 sq.ft Manyata Embassy Lease Acquisition 45,466 sq.ft Manyata Embassy
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PBD: Whitefield
BRIEF OVERVIEW Preferred Destination for Clients looking at economic rentals Presence of Corporate campuses of some of the large multinational companies Availability of large Grade A Commercial spaces Spill over demand from ORR* due to supply crunch in ORR*. High Vacancy levels Grade A & Grade B Prominent builders have launched townships in the region that would provide the much needed social infrastructure support
Tenant Profile
IT / ITES Sector
Others
MAJOR PROJECTS
Recent Transactions
Lease Acquisition 93,480 sq.ft SJR I Park Lease Acquisition 37,500 sq.ft Kalyani Platina Lease Acquisition 39,000 sq.ft Kalyani Platina
Prestige Shantiniketan
Kalyani Platina
ITPL
Brigade Metropolis
RMZ NXT
Tenant Profile
IT / ITES Sector
Others
MAJOR PROJECTS
Recent Transactions
Lease Acquisition 19,979 sq.ft E City Software Park Lease Renewal 107,746 sq.ft Velankani Tech Park Lease Acquisition 90,000 sq.ft SVR Fortune
Velankani Park
Salarpuria Infozone
Surya Wave
Ozone Manay
SemiCon Park
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City Overview
28
City Overview
Highly Evolved Real Estate Market Developing Infrastructure Well Developed Virtual Connectivity
Largest urban metropolis in Karnataka Population : 95,88,910 Gross State Domestic Product (GSDP) : USD 59.1 Billion in 2008 09 Software Exports *: USD 16.0 Billion ( 2009 10) BPO Exports* : USD 3.2 Billion Strong academic and R&D base Higher Educational Institutions (State) : 1,528 Well drafted Sector Specific Industrial Policy ( 2009 2014 ) Key Industries : IT / ITES, Telecom and Electronics, Engineering, BioTech, Automotive, Textiles and Apparel
Leader in Information Technology Set to be the Prime Mover by providing a platform for global Nano- technology community Emerging as one of the best places to do business in the world, joining the league of cities like London, Shanghai and Singapore ; named in the Best places to do business in the wired world list*
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Social Infrastructure
Hotels
Presence of numerous luxury hotels and serviced apartments (90+ Hotels and over 3,500 rooms) Major Hotels under various stages of construction includes J.W Marriot, Radisson , Ritz - Carlton etc.
Hotels
Bangalore
5 Star Hotels 7
4 Star Hotels 17
3 Star Hotels 41
Budget Hotels 22
Number
Malls
Quality recreational Facilities : Numerous Multiplexes, Shopping malls and pubs Presence of all major global brands, Presence of World leaders in Retail Consumer Segment Cost of living - Bangalore is ranked at 118th in the world; lower than Mumbai, Delhi and Chennai Currently have an existing retail mall space of 4 Mn sq.ft spread over 20 major malls
Malls
30
Social Infrastructure
Hospitals
Well equipped with super specialty and specialty hospitals 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)
Hospitals
Education
Over 209 Schools offering Senior Secondary Education in Bangalore Over 26 Engineering Colleges,27 Medical & Dental Colleges, 13 Law Colleges and numerous Graduate Colleges 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.
Educational Institutions
31
Disclaimer: Although all information furnished 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 price, rental or other conditions prior sale, lease or financing, or withdrawal notice. Jones Lang LaSalle, its officers, employees, subcontractors and agents shall not be liable (to the extent permitted by law) for any loss, liability or damage arising directly or indirectly from any use or disclosure of or reliance on such information, including, without limitation, any reliance on lease summaries or reports without reference to the relevant lease or without seeking legal or other advice as appropriate before committing to any agreement.
Copyright Jones Lang LaSalle IP, Inc. 2008