The affordable housing segment has been witnessing constant demand on the outskirts of Bengaluru. Availability of large land parcels at lower price points and the rapid expansion of the city in all directions have encouraged real estate development even in the outlying areas. Also, the rapid infrastructural developments such as planned Metro Rail and Peripheral Ring Road have increased the demand on the outskirts of Bengaluru.
Compared to other parts of the city, the Mysore Road sub-market has had a slow start in terms of real estate activity, as there are no strong economic drivers for the area and a major portion of the sub-market features dense and old developments on small parcels of land. Global Tech Village, an information technology (IT) special economic zone by Tanglin Development, along the Mysore Road has resulted in the launch of many residential apartments at this location.
This location gained importance in the residential and retail real estate market owing to the proximity of various educational institutions and industrial developments, and good connectivity from Outer Ring Road, and Nandi Infrastructure Corridor Enterprises, or NICE Road.
The ongoing infrastructure developments such as Peripheral Ring Road, Metro line and widening of roads improved the real estate profile of this market. As a result, many leading developers such as Salarpuria Group, Jain Housing & Constructions, ERA Group, Provident Housing, Gopalan Developers and Prestige Group have entered the market. Some of the landmark projects here include Provident Sunworth, Salarpuria Melody, Century Indus, ERA Arena Luxurious, and Prestige Temple Bells.
The western extension of the metro line from Mysore Road Terminal to Kengeri (6.5 km) will have stations at Nayandahalli, Rajarajeshwari Arch, Bangalore University Gate and R V College of Engineering. This will have notable impact on residential demand in the vicinity in the future. The existing residential catchments in this sub-market include Nayandahalli, Rajarajeshwari Nagar, Deepanjali Nagar and Kengeri, and the upcoming catchments include Ramasandra, Anchepalya, Kodipalya, Kenchenhalli, Kommaghatta and Kumbalgodu.
The residential sector in this location is mostly dominated by low- and mid-end apartment projects. The high-end residential market is still at a nascent stage. Mysore Road is known for its low to mid-end projects, and has around 5,500 units of marketable residential stock from different developments. Capital values for residential projects are currently in the range of Rs 3,000-4,000 a sq ft. The typical buyers for residential projects in this area are from the government services sector, employees from small-scale industries and to some extent from the IT sector.
The outlook for the residential sector on Mysore Road and surroundings is healthy, as there is not much pressure from a supply perspective. This results in stable and sustained growth. The land values are comparatively low in this part of the city. An added advantage is that there are many infrastructure projects towards this area, which will lead to improved connectivity and increase residential value in the coming future, which makes Mysore Road an attractive investment proposition over the mid-to-long term.
The housing sector is expected to perform well as residential projects in this region are primarily viewed as assets for end-use rather than investments. This location has many prominent educational institutions, hospitals and leisure and entertainment centres, including Wonder La Amusement Park, Innovative Film City, and Eagleton Golf Club. The population base in the vicinity is increasing due to increased commercial and residential activities. This offers improved feasibility for residential developments in the near future.
The writer is an associate director - research & real estate intelligence services, JLL India
