Personal Finance

Durgapur, an emerging realty hub of the East

Abhishek Law | Updated on April 02, 2011

The IT park in Durgapur. Photo:Sushanta Patronobish.   -  The Hindu

The industrial township of Durgapur 171 km from Kolkata, is emerging the new real estate hub of the East. Big brands from Kolkata such as the Shrachi Group jostle for space to get a foothold here.

Market sources point out that on an average, investment in the region that includes IT parks, housing and commercial projects is expected to exceed Rs 10,000 crore.

Says Mr Rahul Todi, Managing Director, Shrachi: “It is beyond doubt that Durgapur holds a big potential. After Kolkata, Durgapur should be that Tier II town that should benefit the most from urbanisation.

Situated on the bank of the Damodar, it is surrounded by Asansol and Burdwab sub divisions in the west and the east while the districts of Bankura and Birbhum border it on the southern and the northern sides.

SPREE OF DEVELOPMENT

Promoted earlier as an industrial township, the region saw the first phase of developmentduring the last decade. In 2001, City Plaza was one of the first malls that came up in the township. It paved the way for a spurt in shopping malls.

This was followed by a private- public partnership project in the City Centre area by Bengal Shristi Infrastructure Development Ltd, a joint venture between the Asansol Durgapur Development Authority (ADDA) and Shristi Infrastructure Development Corporation Ltd. The project comprised a business centre, residential complex and a retail centre. The project brought in the Inox multiplex brand along with Big Bazaar. Major brands such as Reebok and One Dollar Shop followed. Several companies also set up their south Bengal regional offices in the complex.

“In a sense this was the first step towards the development of the region. We were confident of the area's potential,” Mr Sunil Jha, CEO, Bengal Shristi Infrastructure Development Ltd, told Business Line.

Following this there was a flurry of activities in the City Centre area that included the setting up of Suhatto mall and several hotels such as Ginger and Peerless' Sarovar Portico. However, the real thrust came after the State government announced the setting up of the country's first airport city – Aerotropolis – near Durgapur. Aerotropolis, a Rs 10,000-crore project, is being developed by the Bengal Aerotropolis Projects Limited (BAPL).

The recent inauguration (of Shrachi's Junction Mall and its decision to set up a sports complex-oriented township has only cemented the area's reputation as the emerging real estate hotspot. Shrachi is scouting for additional land to set up residential and other commercial projects.

Developments relating to information technology too have been on the cards with the State government setting up an additional 56,000 sq feet facility for IT companies.

Says Mr Suparno Moitra, Regional Manager, National Association of Software and Services Companies (Nasscom-East): “In another decade or so, we expect sustained IT development in the region. We look to some of the smaller companies to move ahead with BPO projects in the region.”

Interestingly, this phenomenon of big Kolkata-based developers going for land here has led to the skyrocketing of land prices in the township. In a span of five years, land prices in some of the areas have doubled.

Spiralling land prices

City Centreemerging as the business centre of the region, has seen commercial plot prices move up to Rs 10 lakh a cottah (720 sq.ft). Five years back, the cost was anywhere between Rs 2.5 to three lakh per cottah.

From Rs three to four lakh per cottah to Rs eight lakh a cottah, land prices in Beniachitti – another preferred area for developers - have gone up by manifold. In the Bidhannagar area, price of one cottah of land stands at Rs five/six lakh.

Industry sources, however, say that the demand for land has been an inflated or artificial one. According to them, middlemen and land brokers have been pushing up land prices by deliberately delaying its availability.

Mr Santosh Rungta, of Confederation of Real Estate Developers Association of India (Credai), however, said: “Speculation of land is bound to happen once big projects start taking shape. This happens everywhere. In Rajarhat too, land prices went up overnight following speculation. However, it has to be seen that the land prices do not become unaffordable.”

Critics, however, point out to the fact that some of the hotels that came up in the City Centre area “during its heydays” have changed hands and commercial property developers are bound to feel the pinch later.

Mr Mayank Saksena, Managing Director- Kolkata, at real estate consultancy firm Jones Lang LaSalle India, points out that the area has the potential to develop as one of the major cities in the coming years, especially, considering its proximity to Bengal's coal belt.Moreover, improved connectivity between Durgapur and Kolkata is an added advantage.

Mr Saksena, however, refutes there being any artificial demand for land. “There is obviously a shortage of quality land in Durgapur. This is the reason for the spiralling of land prices there,” he added.

Published on April 02, 2011

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