CHENNAI: Guindy, Pallikaranai and Poonamallee are emerging as the top three residential hotspots of Chennai with the localities witnessing stable sales in the last four years despite a slowdown in the city's residential market, says a Jones Lang LaSalle report.
Close to 6000 units were launched in these hotspots. Good demand, limited supply, announcement of Chennai Metro Rail's Phase-II project and other infrastructure projects led to appreciation of prices in these areas in 2018 and since then prices remain stable, says the report.
Siva Krishnan, managing director, Chennai and Coimbatore, and Head Residential Services, JLL, told Express that Guindy, Pallikaranai and Poonamallee have emerged as hotspots compared to East Coast Road or areas around Kilambakkam. The hotspots are likely to benefit from the adjacent business parks, he added.
"Increased job creation in IT and manufacturing along with improving connectivity driven by Chennai Metro Rail is likely to drive the demand for residential units in these hotspots. Benefits of good social infrastructure with improved quality of life also attract more home buyers in these hotspots," he said.
He said the demand for Guindy-Mount Poonamallee High Road is driven by the business park developments and stand-alone commercial office buildings in and around this location with a total office stock of 16 million sq feet. The region has emerged as the second IT highway in Chennai as 4-5 million sq ft of Grade A office space is expected to be added to the existing supply in the next two to three years thereby creating 50,000 jobs.
This micro market is located in proximity to the airport and enjoys good connectivity due to the operational metro rail. It also is well connected with industrial hubs such as Ambattur and Avadi. All the aforementioned factors drive the residential demand in this submarket. This micro market recorded the highest appreciation of property prices in the city since the announcement of the metro rail. The strong residential demand backed by good commercial supply and improving infrastructure is expected to push the prices further up in the coming years, he said.
Sriram Iyer, president and chief executive officer of TVS Emerald, told Express that Mount Poonamallee Road is emerging as the next commercial hub with three million square feet of IT space now being available. The third and fourth quarters of 2020 have seen 30-40 per cent growth in the sales volume compared to the last two quarters of 2019. This clearly established a trend in line with comparable cities like Hyderabad and Bangalore.
Similarly, Pallikaranai - Medavakkam and Pallavaram-Thoraipakkam Road (PTR), located in proximity to the Old Mahabalipuram Road IT hub as well as the GST road, is also emerging as a hotspot for residential projects. Large business parks set up by reputed national and international developers along with many standalone office buildings on the OMR are easily accessible from Pallikaranai - Medavakkam - PTR Road.
"PTR micro market is gaining prominence as an office market with 13 million sq ft of good quality supply in the pipeline by reputed national and international developers, thus creating 130,000 jobs in the next three to four years," says the JLL report.
Poonamallee, located in the west of Chennai, is fast emerging as an affordable residential location due to good connectivity with the core city through Mount Poonamallee Road. It is well connected with industrial hubs such as Ambattur and Avadi and the IT cluster at Manapakkam. Therefore, most of the residential demand for Poonamallee is driven by employees of these business hubs, says Siva Krishnan.
Siva says that new launches in 2020 bounced back to 92 per cent of the launches that happened in 2019, while sales reached 50 per cent of the pre-Covid era. This growth momentum is expected to continue in 2021 backed by historic low interest rates, flexibility of developers in terms of payment schemes and price negotiations, strong growth in commercial real estate and industrial sector and various stimulus packages offered by the government, he adds.
But realty sector projects are now on go-slow mode due to a rise in prices of raw materials. Builders Association of India (BAI) state treasurer S Ramaprabhu said work on most of the projects is likely to begin only from next year as developers are hoping for some announcement from the government during the budget session of parliament.