Commercial growth drives Chandigarh realty boom

REALTY BITES PART II

Chandigarh is no more a city of the tired and the retired. The town, known for its pristine locations, has now become a hub of the service sector north of Delhi. Almost all big firms have opened regional offices in Chandigarh.

The buoyant banking sector and the IT sector have given a boost to demand for retail outlets in various parts of the town. The growth of retail services has contributed to lucrative returns on the transactions of commercial properties despite a slowdown in the prices of residential properties.

According to property consultants, in the last three years commercial property prices and rent have risen by more than 70 per cent.

At present, in Chandigarh the prices of showrooms in prime locations like Sector 17 cost anywhere between Rs 23 crore and Rs 30 crore. "This is higher than what we get in Gurgaon," said Mangat Rai of Shubash-Mangat Property Consultants.

In Mohali, Phase 7 properties are going at around Rs 4-5 crore; similar is the case of Panchkula. Though property prices have risen by more than 70 per cent, the prices of showrooms located in the interiors have failed to catch up with those of the prime location, says Mahesh Buddhiraja of Goodwill Property Consultants.

The city witnessed the entry of a number of big brands like Nautica, Espirit, Satya Paul, and Artdinox. At the same time, sharebrokers, private insurance companies, and eating outlets have boosted the demand for retail showrooms in the city.

It is believed that the high disposable incomes of residents have encouraged the big brands to open retail outlets in the prime locations.

The auction of a five-star hotel site measuring 2.63 acres for Rs 101.37 crore, bagged by the Uppal Group, has proved to many players that small players in hospitality cannot afford to invest in Chandigarh.

But some of the property consultants say showrooms in the city might go downhill when the tricity's impending mall boom becomes a reality. More than a dozen malls/multiplexes are expected to be operational in two years.

At present, only one multiplex, Fun Republic, is running. It is expected by June Uppal's Centra Mall would be opened for the public. Similarly, Taneja Developers & Infrastructure Ltd has plans to get up a multiplex in the City Centre, Sector 17.

More international brands are likely to be launched in the upcoming shopping malls.

Property consultants do not anticipate any fluctuations in the prices of commercial properties in the near future.

"The growing urbanisation and boom in the service sector are expected maintain the price trend in the commercial segment," said Buddhiraja.