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Bangalore , Sept. 30

DEVELOPERS today not only focus on aesthetics of the building but are also taking significant measures to improve efficiencies, size of floor plates, car parking requirements and reliability of infrastructure.

From the days when artificially high prices of real estate drove the industry to produce huge stocks, the real estate industry has evolved itself, in the last five years, into a highly professional entity with emphasis on quality and reducing project completion time to offer reasonably priced products to highly discerning customers.Talking to Business Line on the general trend and evolution of the industry in the last five years, Mr Bhasker N. Raju, Executive Director of Divyasree Developers Pvt. Ltd, said the period witnessed a correction in the market on the rental and capital values compared to the boom of 1994-95.

Though the demand for commercial properties was due to Bangalore emerging as a major attraction for setting up ITES establishments, it is the quality standards and shorter lead time for completion of projects adopted by the competing companies that has lent weight to the stability in the construction industry.

Falling interest rates gave rise to demand for residential complexes attracting investors in self contained apartment complexes.

With the continuing growth in the IT & ITES sector and nearly 70 per cent of the software professionals in Bangalore having migrated from various parts of the country, the demand for quality residential apartments is likely to remain strong for the next few years, Mr Raju said.

Tracing the trends in the next five years, he said with nearly 2.8 million sq ft of office space being leased out in the first and second quarter of 2003 there has been a great confidence boost among the developers in Bangalore.

Corporates are today looking at the concept of campuses and are asking for space to be blocked for future expansion for a period of three to five years in order to avoid multi-location sites.

Developers are focusing on developing multi-user business parks. Efforts are also on to provide central infrastructure and amenities resource that can be shared by multiple companies. These campuses typically will consist of low and mid-rise developments with open landscape spaces being nearly 65 to 70 per cent of the total developed area. Currently, there is about 12 million sq ft of office space under planning and execution, which is likely to be ready for occupation within the next 24 months.

With interest rates declining, investing in real estate has become a profitable option with rental yields in the region of 12 to 14 per cent.

About 3,000 apartments are currently under planning and various stages of construction. They are likely to be ready in 24 months. Developers have invested Rs 100 to Rs150 crore per commercial project as IT / ITES / BPO will continue to remain the largest demand driver for Bangalore. The total investment into these projects in the city is likely to be in the region of Rs 1,750 - 2,000 crore over the next couple of yeas, Mr Raju said.

The residential sector is slated for an investment of Rs 500 crore, with mass housing apartment complexes being planned in the city.

The retail sector is also likely to expand significantly with nearly seven mall projects in the city nearing completion and already receiving substantial commitments. Other developers are also likely to follow suit to develop malls to cash in on the demand.

After having built the city's first large floor space plates of 50,000 sq ft with captive power generation and dedicated optic fibre connectivity, DivyaSree Developers is now focusing on the project, DivyaSree Greens, a total of 550,000 sft of office space currently under construction on the intermediate ring road connecting Indiranagar & Koramangala.

Phase I of the project will be completed by October 2003 offering 270,000 sq ft of office space.

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