The Hindu Business Line : In a constructive mood...

NOT so long ago, a multinational real estate consultant complained that there wasn't much quality space available in Kerala for information technology (IT) and business process outsourcing (BPO) companies.

Whatever was available, those buildings lacked the quality and styling required to house India's hotshot companies, he had said.

He should visit Kerala one year down the line.

Across Thiruvananthapuram and Kochi, the two major IT hubs in the State, a flurry of construction activities is about to start to meet the burgeoning demand for space by the country's sunrise industry.

What is more significant for Kerala is most of the real estate for the IT sector will now be created by the private sector.

With software and BPO companies increasingly looking at moving out of established centres such as Bangalore, the demand for quality space is rising fast in cities such as Kochi.

As of now, the two premier IT parks in the State, the Technopark in Thiruvananthapuram and Infopark in Kochi, are completely occupied.

Even a 2.5-lakh sq.ft new facility at Infopark, `Vismaya', which was inaugurated only on January 31 this year, is already full.For a State that once languished without any major investment in IT, this is a remarkable turnaround. Today, all major software companies such as Tata Consultancy Services (TCS), Infosys and Wipro have set up development centres in the State.

Kerala's home-grown firms such as IBS Software and US Technologies, are also ramping up fast. The latest to join this bandwagon is the BPO sector where companies such as Outsource Partners International (OPI) and Sutherland Global Services have set up shop.

This rapid growth of the IT industry - Kerala's software exports will double to Rs 600 crore in the current fiscal - has given rise to an unprecedented demand for real estate. To cash in on this trend, a number of private sector companies are now readying their facilities.

One of the first among them is the Leela Group, famous for its chain of luxury hotels. The Leela Group's `Leelainfopark' is located adjacent to the Infopark in Kochi and will be developed in three phases. It has now built 1.36 lakh sq.ft space, which is taken up by OPI and IBS.

The second phase, which will see the Leela Group adding 3.5 lakh sq ft, is expected to be ready in the next 16-18 months. The group is also planning to set up a 4.5 lakh sq.ft facility in Thiruvananthapuram.

L&T Tech Park, the arm of engineering and construction major Larsen & Toubro, is the latest entrant to Kerala's IT infrastructure scene. L&T Tech Park is setting up a 3.6 lakh sq.ft building, named `Tejomaya' in Kochi.

Company officials say the facility will be ready by January next year. In the second phase, L&T will create another 2.9 lakh sq.ft of smart space. These facilities are coming up on a four-acre plot taken on 66-year lease. In addition to this, the Kerala-based Muthoot Pappachan Group is also ready with its `Technopolis', a 3.5 lakh sq.ft facility in a special economic zone in Kochi.

The mother of all this investment in real estate could come in the form of the `Smart City' proposed by the Dubai Internet City (DIC).

Though controversies have dogged the Smart City, it is expected that a formal agreement between the Kerala Government and DIC will be signed soon.

The Smart City envisages an investment of Rs 1,500 crore to create state-of-the-art IT facilities on 300 acres in the outskirts of Kochi.

In addition to these developments, the State Government is also chipping in.

The Technopark is being expanded by adding 100 acres in the third phase. A 500-acre `Technocity' is also being planned in a nearby area. Land acquisition for the Technocity may start in the near future.

To piggyback on the present boom of IT in the state, apartments and housing projects are coming up everywhere in Kochi and Thiruvananthapuram, targeted mainly at highly paid software engineers. Surely, Kerala has never been in such a constructive mood.

vipin@thehindu.co.in

Picture by K.K. Mustafah

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