CHENNAI: The South and West Chennai will continue to be the hot spots of real estate growth due to rise in IT professionals and emerging good social and physical infrastructure, according to a report by CBRE, one of the global commercial real estate services and investment firm.
The report, ‘Resurgence of Chennai A Real Estate Perspective’ which was released by Confederation of Real Estate Developers’ Association of India (CREDAI) Tamil Nadu president Ajit Kumar Chordia and president of CREDAI’s Chennai Chapter during the launch of CBRE PropFair states that South Chennai, which has about 60% of residential supply, remains the most sought after location due to availability of quality residential options, affordability, and ease of access to workplace.
According to the report, the second half of 2017 witnessed a decline in realty sector due to the implementation of Real Estate Regulatory Authority and Goods and Service Tax. It is said that most launches during the second half of 2017 were concentrated in the south and west Chennai markets and in parts of Old Mahabalipuram and GST Roads.
To improve housing sales most of the developers gave discounts and special offers to prospective home buyers, resulting in marked improvement in sales. Many developers claimed that they are clocking double digit sales each month.The report stated that south and west Chennai micro-markets continued to dominate housing sales during the second half of 2017. North Chennai, too, has witnessed an increased real estate activity because of the launch of a few new projects.
On the preferences of the buyers, 2BHK (800 to 1,100 sq ft) units continue to be most sought-after among the home buyers.
The city also witnessed an increase in demand for budget apartments in the range of 600 sq ft to 800 sq ft especially in the peripheral locations of south and west Chennai. The report stated that 68% of new launches are happening in South Chennai on Old Mahabalipuram and GST Road with 74% of them concentrated on the mid-segment. Pallavaram-Thoraipakkam Road and Perumbakkam in south Chennai, Mt Poonamallee Road in west Chennai and Perambur in north Chennai are likely to emerge as favoured destinations owing to close proximity to central Chennai.
The completion of the first phase of Chennai Metro Rail and the implementation of the second phase, the proposed bus station in Kelambakkam and Bengaluru-Chennai Expressway is likely to fuel the growth of Chennai’s residential market, the report noted.
South Chennai
● It contributes to 60% of residential supply and demand of the city
● The capital value per square feet for prominent residential development is H4,000 to H6,800 per square feet
● An increase in residential apartment launches in ECR due to relaxation of CRZ norms
West Chennai
● More than 85 % office space and 90 % retail space is occupied
● The demand in the region is driven by IT professionals who are looking for mid-segment residential apartments in close proximity to IT parks and manufacturing units
● Price of prominent residential developments: H3,850 per square feet to H13,900 per square feet
North Chennai
● The region witnessed limited infrastructure development in the last decade resulting in sluggish real estate growth
● The economic activity is driven by ports, ICF and the presence of southern railway headquarters
● The cost of prominent residential development is `5,200 to `7,200
Central & East Chennai
● A majority of real estate shifted from the Central to suburban areas
● The region preferred to be excellent social and physical infrastructure has affordability concerns
● Prominent residential developments is priced `5,999 to `7,200