Bangalore has come a long way in its transformation from a pensioner’s haven to its current state as one of India’s best cities. It is currently designated as the IT capital of the country . The IT industry has pumped in thousands of jobs and given enormous buying power to the software programmers and developers in Bangalore.
As a result of this enormous change in its economic profile, Bangalore’s real estate market has grown by leaps and bounds in the last 25 years. The best real estate developers in the country have invested heavily in this city, creating a huge supply of apartments, villas and row houses in the city.
The journey has been a long one, with many twists and turns. In this article, we try to chart out the history of the city’s real estate development and developers associated with it.
The birth if IT industry in Bangalore started around 1980s, and along with it were sown the seeds of the city’s real estate explosion. Companies like Infosys, Wipro and IBM providing IT services set up their operations in the city. Initially, the growth was concentrated around the central part of the city and was largely driven by BDA (Bangalore Development Authority).
However, only a small percentage of the population could afford to buy their own house in Bangalore because of non-availability of land and lack of loan options at affordable interest rates. Most constructions were of independent houses in Bangalore and there were not too many apartments.
Some of the best developers operating during this time were Embassy Group, Prestige Group and Unitech.
After the economic liberalization, government of India began encouraging the IT industry with access to infrastructure tax and tarriff breaks, broadband technology. The concept of Software Technology Parks, which were hundred percent export orient units (EOU), was introduced to attract global IT powerhouses. Electronic City was the premier Software Technology Park started in south Bangalore.
A large number of IT and Telecom companies, both global and local, set up their shop in Electronic City. Other IT parks soon followed, like the ITPL in Whitefield.
Also, the Outer Ring Road project boosted development in outer areas of Bangalore, and connected Electronic City with ITPL. Smaller IT companies set up base in Koramangala, Jayanagar and Indiranagar.
The growth of IT companies meant an explosion of IT jobs, and with it the buying power of Bangalore residents. The citizens of the city started investing in residential properties in Jayanagar, Koramangala, JP Nagar, BTM Layout because they were close to Electronics City. large mobile operators like Aircel and Airtel have set up operations here
The arrival of Software Technology Parks in Whitefield and Sarjapur road meant that there was a spurt in investment in areas like Varthur, Marthahalli, HSR Layout, Sarjapur Road,Bannerghatta Road and Hosur Road.
The concept of apartments, villas, row houses and gated communited began to emerge. Developers like Purvankara , Salarpuria, Sobha, Adarsh, Mantri established their presence.
In early 90s, the average land rate was around rupees 900 to 1200 per sq. ft. In late 90s, it shot up to 2000-2500 per sq. ft
The introduction on FDI and SEZ concept in 2000s by the government of India brought in even greater growth. Developers like DLF, Hiranandani, Godrej, Mahindra Lifespaces started projects in Bangalore.
Many SEZs like Manyata Business Park, Divyasree Tech Park, Vrindavan Tech Village, Pritech Park, Bagmane Technology Park and Cessna Business Park were announced.
Once can imagine the explosion this caused in terms of real estate in Bangalore. Areas like , Nagawara, Malleshwaram e Hennur Road, Old Madras Road, and Yeshwantpur saw explosive growth.
The concept of Integrated townships like Prestige Shantiniketan and Brigade Metropolis was introduced.Finally, with the arrival of the Bengaluru International Airport, Bangalore North jumped on the growth bandwagon.
Close to 100,000 IT jobs are introduced in Bangalore each year. Along with IT a number of engineering corporations are making the garden city their home. Given these promising growth projections, the city will remain strong in terms of real estate growth.
Government of Karnataka has announced several business technology parks in North Bangalore and it definitely the hottest locality for growth. Hence residential property projects will see a growth in the north eastern quadrant like Hennur Road, Thanisandra Road, Old Madras Road, and Bellary Road in the near future.
However the IT industry is under immense pressure to maintain low billing rates, and hence salaries will not grow exponentially like in the past. , thereby keeping a check on salary levels. As a result, the city will see more supply in the affordable price range of rupees 25 to 50 lakhs.
Supply of drinking water has always been a major issue in most peripheral locations of Bangalore. The government needs to step in and introduce policies to make developers and builders in Bangalore build sustainable housing.