Focus on infrastructure, strong economic growth, development of world class office and residential assets and progressive State-level reforms have positively impacted the preference of investors and occupiers for Hyderabad. As a result, Hyderabad real estate has secured about Rs.10,100 crore in investments since Telangana came into being.
This is more than five times of the Rs.1,800 crore the city got from 2008 to 2014. Within this, office space segment attracted 70 per cent of the investments, according to Ramesh Nair, CEO and Country Head, JLL India.
“There is a growing preference among global as well as domestic occupier companies toward quality assets. Expansion is led by co-working operators, BFSI, IT, ITeS companies. Our outlook of the city remains positive,” he said.
Hyderabad is ranked second on dynamism and rapid growth on the JLL’s City Momentum index, placing it next to Bengaluru.
“Till June this year, Hyderabad has already surpassed Bengaluru in office space transactions. Going ahead, Hyderabad is likely to be the front runner in the office segment with 13.2 million sq.ft, constituting 28 per cent of the overall new completions in India in 2019,” Nair said about the six-fold transformation of Hyderabad from being a two-million sqft a year market not so long ago.
Nearly 6 million sq.ft office space was transacted in in 2016, a 31% rise from 4.6 million sq.ft achieved in 2015.
Madinaguda, Puppalguda, Gopanpally, Manokonda, Narsingi, Nallagandla, Kukatpally, Manikonda, Gachibowli, Kondapur, Rajendranagar, Bandlaguda, Shamshabad, Shamirpet, Qutbullapur, Kompally, Nacharam, LB Nagar, Uppal and other micro markets have seen a heightened activity.
The 17 percent growth of IT exports from Hyderabad also has had an impact. The sector employs about 5.5 lakh personnel now, against 4.85 lakh the previous year. This is likely to touch 10 lakh in four years. In real estate terms, each job implies a demand creation for 100 sq.ft office.
About 50 million sqft commercial space will be available in five years. The indirect jobs will be three to four fold, said Software Technology Parks of India Hyderabad Director Ram Prasad.
G Shrawan Kumar, Director, K Raheja Corp, said rentals have risen from Rs.45 per sqft to Rs.70 per sqft in Madhapur and from Rs.40 per sqft to Rs.55 per sqft per month in Raidurg and Financial District.
“We have almost reached the peak in terms of commercial rentals – $ 1 per sqft per month, the advantage we had over other cities. From now on, the trend will be more of consolidation and maintaining current scenario,” Kumar said.