Kolkata playing catch-up

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: that West Bengal has is that both IT and non-IT sectors, including telecom and hospitality, are propping real estate up in the time of a slowdown. “There is currently around 40-50 million sq ft of IT/ITes space. Growth will continue as the action on the services sector has shifted from Tier 1 to Tier 2 and Tier 3 cities,” points out Avrajit Kar, VP, marketing and business development, South City Projects.

“The IT sector works on a ratio of 1:10—100 sq ft of IT space creates requirement for 1,000 sq ft of residential space,” says Sushil Mohta, MD, Merlin Projects. “The requirement for IT space will continue its upsurge and we will not be seeing any overheating except for some pockets. Services sectors like hospitality and healthcare will drive growth for real estate,” he adds. As a result, Todi says office space will witness an aggressive growth in the next two-three years “because there was less supply in the last few years”. For Mohta, housing for lower middle-income group and lower-income group will be the next growth area.

According to Jones Lang LaSalle, IT is the largest consumer of real estate in Kolkata currently. “The IT space consumption in 2007 was around 2.5 million sq ft excluding land allotments made to IT companies for captive consumption. It is projected that in 2008 consumption of IT space will be around 4 million sq ft. Kolkata has more than 20 million sqft (cumulative) of IT/ITes office space which will be completed and ready for consumption by 2010.”

Pan-Indian presence

Not surprisingly, many of the major national players, including DLF, Shapoorji Pallonji, Emaar MGF, Godrej Properties, Tata Housing and Sriram Properties, and international players like Keppelland and Salim Group, have a presence in Kolkata. “This is the only metro where all the major players have a presence,” says Harsh Neotia, chairman, Ambuja Realty Development. Besides, there are strong local players like Bengal Ambuja, Bengal Peerless, Bengal Greenfields, Bengal Park Chambers, Bengal Shrachi, Bengal United Credit Belani, South City Projects and so forth.

With office space, home and retail driving real estate, most of the players are “doing a mix of all three”. A senior executive at Bengal Unitech Universal says office space drives residential and the retail industry drives the commercial space.