South tops North in realty development

South India has outscored the northern part of the country in terms of emergence of new growth centres in the fast-growing real estate sector with Thiruvananthapuram and Mangalore being named as the top two tier-III cities by global realty consultant Knight Frank.

The two coastal towns are followed by Nashik in Maharashtra at the third position, while Rishikesh-Haridwar in Uttarakhand and Raipur in Chhattisgarh have been named at the bottom of the list of top ten tier-III cities in terms of real estate development.

Thiruvananthapuram and Mangalore have scored high on all five parameters "" real estate, people, business environment, physical and social infrastructure, Knight Frank said in its report on Emerging Growth Centres in India.

"Presence of the expanding IT/ITeS sector, conducive business environment coupled with good physical and social infrastructure provide these cities the required edge," it noted.

Nashik with high scores on social infrastructure, people (important attributes of a city for retail success) and improving business environment gets third rank in the list. The city is followed by Bhopal, Jalandhar, Amritsar, Dehra Dun, Rudrapur, Raipur and Rishikesh-Haridwar in the list.

Knight Frank said that its study revealed that while the southern cities of Thiruvananthapuram and Mangalore have some degree of IT penetration owing to the spill-over of demand for IT/ITeS space emanating from neighbouring established markets, other cities did not have much organised office development.

About Thiruvananthapuram in Kerala it said, "With potential of 150,000 IT professionals working in the four phases of Technopark, the impact on the economy of the city and its suburbs will be substantial.

Besides, the influx of high-income IT professionals in Thiruvananthapuram has also resulted in demand for high-end apartments, retail chains, star category hotels and multiplexes.

Knight Frank said Mangalore in Karnataka also offers great competitive edge to the investors through low cost of real estate and manpower. "Rapidly improving infrastructure, widening of national highways and the growth in the IT/ITeS sector are factors contributing to the boom of real estate in and around Mangalore."

However, the cities in the states formed in the last decade, such as Rudrapur in Uttarakhand and Raipur in Chhattisgarh, and cities with religious significance "" Haridwar and Rishikesh "" lack commercial space, the UK-headquartered realty consultant said.

Average scores on real estate availability and outlook have resulted in pulling Amritsar and Dehra Dun to the sixth and seventh rank in the list. These cities, however, scored higher on the social and business environment parameters on account of lower cost of living, presence of good educational institutes and improving investment environment.

Though Rudrapur has comparatively better business environment mostly due to the presence of the industrial sector, the city's physical and social infrastructure needs considerable improvement to rise from its current eight rank.

Low or average scores on all parameters, particularly on the ready availability of real estate and quality physical infrastructure front, have lowered the holy cities of Haridwar-Rishikesh as well as the capital city of Raipur to the last positions amongst the 10 cities.

Residential sector emerged as the most active real estate segment in the 10 cities studied.