Bangalore real estate market has recovered over the past few years after the economic slowdown and has recorded an overall GDP growth rate of 8.6 percent during the last financial year. The Indian real estate market is already on an encouraging upswing. Demand for commercial and residential properties in India has already doubled from 20 million sqft to 40 million sqft in 2011 and expected to increase to 45 million sqft by this year. Apart from growth in GDP, the other major factors for good performance by commercial real estate are a proactive government, strong economic fundamentals of the region, competitive pricing, availability of quality human capital and favourable statutory regulations.
It is the good time to invest in commercial and Residential property in Bangalore as vacancy levels are dropping and rentals are firming up across the city. As developers have a good options to offer investors in this category as investors have been keeping away from this segment for the last few years. Expected yield is also reasonable and in the current climate where the economy is witnessing high inflation rate, an investment in real estate is favourable.
As today the Outer Ring Road (ORR) will continue to witness demand in growth for office space due to the availability of Grade A SEZ space. The peripheral micro-market of ORR (Sarjapur-Hebbal stretch) holds immense potential. This belt has been witness to significant demand on account of easy accessibility, superior infrastructure and connectivity to various parts of the city.
North Bangalore has high potential for office space demand and is expected to be the next commercial corridor owning to good connectivity to the city, proximity to the airport, supporting residential catchments, availability of land parcels and impetus by the government to promote commercial and residentials property.
Year 2011 has seen some interesting patterns of growth and improvement in real estate market of Bangalore over the previous year.
The Non IT absorption has registered a 30% growth adding to the positive demand it may be noted that despite the impending uncertainty on the back of weak global cues the growth in emerging real estate economies is still expected to be 7% or more, which continues to drive the absorption in difficult times.