Académique Documents
Professionnel Documents
Culture Documents
November 2013
OFFICE
112
8%
Average Annual Rental Appreciation (2012 -13):
40,336
33,988
RESIDENTIAL
0 - 8%
Grown at a CAGR of
26,620
18,076
31%
5% - 25%
RETAIL
7.7
0.78
Grown at a CAGR of
12%
5% - 20%
HOSPITALITY
9,585
total number of existing hotel rooms
5,190
rooms likely to enter by 2017
56% - 59%
EXECUTIVE SUMMARY
The city is poised for large supply in retail sector in the coming
years. The rentals have registered an annual appreciation of 5 %
- 20% in shopping malls and 4% - 13% in high street locations.
Most of the operational space is concentrated in SBD and PBD
locations. With 5.65 million sqft of mall space under-construction,
the city will have 13.30 million sqft of operational mall space by
2016. The city lacks specialty malls focusing exclusively on sale
of themed merchandise. The most promising locations for future
development are ORR-Sarjapur stretch, Old Madras Road and
Kanakapura Road.
projects like the Metro Rail, Elevated Road to the Airport and the
Signal-free ORR. Planned projects namely PRR, High Speed
Rail to the airport and Monorail are further expected to ease the
transport within the city. Despite the above mentioned
improvements, Bangalore faces two prominent challenges provision of infrastructure to match the pace of population growth
and provision of adequate water & electricity.
The modern metropolis Bangalore scores over many other Indian cities for various reasons: salubrious
climate, cosmopolitanism and growing knowledge economy.
741
1,2761
8.5 million
2
9.6 million
47%
700
8
600
Area (sqkm)
500
400
5
4
300
3
200
100
0
1950
1963
1969
Area (sqkm)
1979
1995
2007
2013
10
in millions
16
ECONOMY
Currently Bangalores economy is driven by the IT/ITeS sector. Other major sectors that contribute to the
citys economy include biotechnology, automobile, aviation and textile industries.
Apart from the IT/ITeS sector, Bangalore also accounts for close
With multiple economic activities, the city has grown from a uni-nuclear structure with a Central Business
District (CBD) to a multi-nuclear structure with several Suburban Business Districts and Peripheral
Business Districts (PBD).
Table: IT/ITeS Micro-markets in Bangalore
IT/ITeS Hubs
PBD
Whitefield
Board Jn.)
Type / Sector
Corporate offices,
BFSI, IT / ITeS
IT / ITeS
IT / ITeS
IT / ITeS, Electronics,
Manufacturing
IT / ITeS, Aerospace
39.6
29.5
29
10.41
3.67
Working population
400,000
250,000
275,000
175,000
35,000
Projected Growth
10%
27%
10%
5%
5%
Infosys, Wipro,
Siemens, Mahindra
Satyam, TCS
Microsoft, Dell,
Goldman Sachs, IBM,
Target, Google, Yahoo,
Amazon
The city being an important industrial town has significant presence of manufacturing, automobile and
textile companies.
Table: Industrial Areas of Bangalore
Industrial Area
Type of Industry
Total Area
(acres)
Key Industries
Growth Plans
IT / Manufacturing, Biotech
1,874
Peenya Industrial
Area
1,485
1,602
Doddaballapur Industrial
Area
Textile, Beverages
799
Kumbalgodu Industrial
Area
250
1,192
1,102
Source: Karnataka Industrial Areas Development Board (KIADB) and Vestian Research
Favourable Government regulations and improving infrastructure are expected to promote development in
medium to long term towards Bangalore North.
Government of Karnataka (GoK) has announced the following projects within Bangalore Metropolitan Region in order to promote economic
development in the city.
Particulars
Location
Devanahalli
Business Park
Devanahalli Adjacent to BIA
Aerospace
Park
South of BIA
Hardware Park
Bagalur Village
IT / BT Park
Bagalur Village
ITIR
Logistics Park
Integrated
Textile Park
Muddenhall,
Kaniverayanapura,
Chikkaballapur
Balepura (near
Devanahalli)
Doddaballapur
Road
1,000
941
1,028
12,000
150
469
Agency
Karnataka State
Industrial &
Infrastructure
Development
Corporation
(KSIIDC).
Department of
Commerce &
Industries, GoK
GoK - Hardware
Park,
IFCI - Financial
City
Karnataka
Industrial Areas
Development
Board (KIADB)
Karnataka State
Electronics
Development
Corporation
Limited
(KEONICS)
KSIIDC
KIADB
Status
Application
received from
various
companies to
develop IT/ITeS
SEZs. Land yet
to be alloted.
Currently 41 units
are operational
across 48-acres
of land. Nearly
60-acres of land
under
development
BEML, AIMIL,
Dynamatic
Technologies,
Sunshine
Aerospace,
Starrag Seckert
Machine Tools,
Centum
Electronics
Bangalore BioSunlux
Tech labs, Shell
Technology
Technology, Moser
Baer
55 companies
including Infosys,
Wipro, TCS and
Cognizant have
signed up MOUs
Gokuldas
Images, Madura
Garments,
Raymonds,
Bombay Rayon
Fashion
Companies
that have
been alloted
land
Vestian Research
Do
Towards
Doddaballapur
Industrial Area
dd
NH 7: To Hyderabad
ab
a lla
pu
ain
rM
Ro
ad
Be
ll
ar
yR
oa
Rajanukunte
ed
Pe
rip
he
ra
lR
in
Ro
ad
Yelahanka
os
Pr
Pr
op
op
os
ed
NH 4: To Mumbai
Pe
rip
Jalahalli
Tum
kur
BIEC
Ro
ad
he
Sahakara
Nagar
ra
Thannisandra
lR
in
Ro
Budigere
ad
HMT Township
Hennur
Hebbal
Hesaraghatta
Cross
ing Roa
Avalahalli
NICE R
IISC
HBR Layout
Nagawara
RMV
Extension
Out
er R
ing
Palace
Grounds
Roa
d
Roa
ras
Seegehalli
gR
ITI
Rin
Banaswadi
Krishnarajapuram
Ou
ter
efield
Main
Roa
Whit
Rajaji Nagar
Byppanahalli
M
M
MG Road
M
Majestic
C.V.Raman Nagar
Indiranagar
Bangalore City
Railway Station
Vijayanagar
ai
enn
Ch
Mad
Old
Magadi Road
oa
NH
o
4: T
Old Airport
Brookefield
Road
Varthur Road
Marathahalli
Varthur
Mysore Road
Jayanagar
Koramangala
r
ute
re
yso
ng
Ri
Ro
Bellandur
J.P. Nagar
d
oa
Proposed Peripheral
Ring Road
ad
Bangalore
University
HSR Layout
Silk Board
Kengeri
Puttenahalli
Sa
rja
Haralur
Jaraganahalli
IIMB
pu
rR
Hosa Road
oa
Begur
CE
NI
Dommasandra
Arkere
Kothnur
ng
Ri
M
Thalagattapura
M
Gottigere
ad
Bommasandra
Bannerghatta Road
NICE Ring Ro
Kanak
a
pura R
oad
oa
Electronics City
ur
os
ad
Ro
SH 17:
To Mysore
NH 7: To Salem
NH 209: To Coimbatore
Major Roads
Proposed Monorail
INFRASTRUCTURE PROJECTS
The development of urban infrastructure in Bangalore has not been able to keep pace with the rapid
population growth and economic development of the city.
Table: On-going & proposed infrastructure projects in Bangalore
Project
The proposed mass rapid system
for Bangalore 41 km of elevated
Phase 1 and underground rail network with
36 stations in Phase I
Bangalore
Metroa
Details
Timeline
Status
Phase I
to be fully
operation
al by
2015.
Under
construction
(Phase I under
construction
& Reach 1
operational)
Phase II: Extension of Phase 1 lines connecting Whitefield (in the East), JP Nagar
Phase 2 (in the South), Kengeri (to the West) and Nelamangala (to the North).
In addition, two new lines, one connecting Nagawara to Gottigere and the other
connecting BTM Layout to Bommasandra has been proposed.
Monorailb
Peripheral Ring
Roadd
Bellary Elevated
Expressway
Proposed
(Geo-technical
survey is under
progress)
Impact
Better connectivity
from all parts of the
city to the CBD
Travel time
reduction
Formal
approval for
the project is
awaited
Better access to
Metrorail network
Better connectivity
from peripheral
areas to the city
Proposed
Improved
connectivity
between CBD and
International Airport
Proposed Tenders
invited for
(30
Phase 2
months
from the
start of
construction)
Diversion of truck
traffic from the city
roads will ease
traffic situation on
ORR and within the
city. Second, will
open up new areas
for development
2014 (E)
Under
Construction
The existing Outer Ring Road will be Hosur to Silk Board Junction
made signal free with the construction
of 7 more flyovers and an underpass
2014 (E)
Under
Construction
Traffic
decongestion and
reduced travel time
to key IT hubs
Expansion of
Bangalore
International
Airporte
2014 (E)
Under
Construction
To increase
passenger and
aircraft handling
capacity
BMRDA Satellite
Townshipsf
Proposed
Expansion of
Bangalore city and
formation of new
peripheral locations
Proposed
Proposed
Ease traffic
congestion in
Greater Bangalore
Region and spur
Real Estate
activities
Satellite Town Ring 8 lane road connecting the proposal BMRDA satellite townships. Will connect the
satellite towns of Doddaballapur, Devanahalli, Hoskote, Anekal, Kanakapura,
Road(STRR)g
Ramanagaram and Magadi with each other and also to the Bangalore International
Airports
Intermediate Ring
Road(ITRR)h
8 lane road around the Bangalore Metropolitan region. Will come up in-between
Peripheral Ring Road and Satellite Town Ring Road. Will pass through
Nelamangala, the southern parts of Dobbspet, Doddaballapur and Devanahalli,
areas about 6 km from International Airport, the eastern parts of Hoskote and
Anekal, besides Harohalli, Bidadi and Magadi.
www.bengaluruairport.com
www.bmrda.kar.nic.in
www.timesofindia.com
f-g
10
The real estate sector in Bangalore, one of the 8 largest Technology Innovation Clusters , will continue its
growth trajectory in future as well.
OFFICE
RESIDENTIAL
RETAIL
HOSPITALITY
12
Bangalore continues to witness steady office space demand since 2009 and absorption exceeded supply
for the third consecutive year since 2010.
16
16
14
10
Vestian Estimate
12
million sqft
8
6
4
2
0
2009
2010
2011
Fresh supply
2012
2013(E)
2014(E)
Absorption
14
Non SEZ
Grade A
SEZ
Grade A
Non SEZ
Grade B
Non SEZ
Total
SEZ
CBD
Operational Space
7.52
4.35
11.87
0.70
0.70
Under-Construction Space
134
0.1
1.44
0.00
Pre-committed Space
Available Space
0.70
0.92
1.62
Planned Space
0.10
0.10
SBD
Operational Space
22.2
5.56
27.76
1.3
1.3
Under-Construction Space
1.68
1.68
Pre-committed Space
0.03
0.03
Available Space
1.20
1.3
2.50
Planned Space
0.70
0.70
1.7
1.7
ORR
Operational Space
12.84
16.40
0.25
29.49
2.25
2.25
Under-Construction Space
8.94
5.50
14.44
0.45
0.45
Pre-committed Space
0.24
0.84
1.08
Available Space
2.51
0.78
0.06
3.35
Planned Space
37.33
10.36
47.69
1.0
2.5
3.5
Operational Space
17.77
4.66
6.61
29.04
10.5
0.2
10.7
0.71
0.96
1.67
4.1
4.1
PBD
Whitefield
Under-Construction Space
Pre-committed Space
0.20
0.20
Available Space
4.46
1.04
1.89
7.39
Planned Space
5.41
15.22
20.63
2.5
1.1
3.6
8.00
2.41
10.41
13.1
5.1
18.2
Under-Construction Space
1.70
1.70
Available Space
2.37
1.09
3.46
Planned Space
0.40
3.0
3.40
1.1
5.1
3.20
0.08
3.28
Pre-committed Space
Mysore Road
Operational Space
Under-Construction Space
Pre-committed Space
Available Space
0.13
0.05
0.18
Planned Space
3.50
3.50
Bangalore North
Operational Space
0.35
0.04
0.39
Under-Construction Space
2.04
2.04
Pre-committed Space
0.10
0.10
Available Space
0.02
0.09
0.11
Planned Space
19.20
3.80
23.03
ORR, for the next 3 - 5 years is expected to remain a preferred destination among IT / ITeS occupiers while
Bangalore North is anticipated to gain momentum by 2015.
50
30%
45
26%
16
16
40
35
25%
20%
30
million sqft
PBD locations account for a high vacancy level of 26%. This may
be attributed to the presence of large number of Grade B / B+
developments in these micro-markets with limited amenities as
compared to Grade A developments.
15%
25
14%
20
11%
10%
9%
15
Vacancy (%)
10
5%
5
0
0
CBD
SBD
Stock
ORR
Absorption
PBD
Vacancy
16
The city continued to witness sustained traction for IT SEZ spaces mainly along ORR and Whitefield in PBD.
35
30
million sqft
16
40
25
24.26
35.88
20
15
22.31
10
Some of the major occupiers that leased out space in last two
years are Honeywell Technologies (1.0 million sqft),
Accenture (0.5 million sqft), TCS (0.3 million sqft), Societe
General (0.07), Cognizant Technologies (0.75 million sqft)
and Mu Sigma (0.33 million sqft).
6.46
Operational Space
Annual Supplement 2013 14 to the Foreign Trade Policy 2009 14, released on March 18, 2013
Refers to Delhi NCR, Mumbai, Bangalore, Chennai, Kolkata, Hyderabad and Pune
3.83
Planned Space
Supply
Minimum Land
Requirement
10 Hectares
None
Minimum
Built-up Area
100,000 sqm
10
1.04
Under-Construction
Space
None
14%
10%
9%
67%
Consolidation
Relocation
Expansion
New Entry
Tenant
Micro Location
Year of Transaction
Pritech Park
400,000
ORR
2012
Intel Technology
RMZ Ecospace
204,000
ORR
2012
In Mobi
121,000
ORR
2012
Atos Origin
125,000
Whitefield
2012
Infosys
JP IT Park
175,000
Eletronics city
2012
Honeywell
RMZ Ecoworld
1,000,000
ORR
2013
Cerner India
356,000
ORR
2013
Alti Source
Pritech Park
120,000
ORR
2013
Amazon
Brigade WTC
294,000
SBD
2013
Texas Instruments
100,000
SBD
2013
NDS
18
Bangalore witnessed limited investments by Private Equity (PE) funds for office space compared to
Mumbai and Delhi NCR since land for development of commercial spaces in the city is allotted by KIADB at
low prices and the availability of pre-commitment loans at low interest rates.
Table: Key PE deals for office space in Bangalore during 2012 - YTD
Fund
Amount
(INR Cr)
Project
Owner
Blackstone
Embassy
Group
Manyata Embassy
Business Park SEZ
875
Blackstone, GIC
Singapore and
HDFC Property
Fund
Vikas
Telecom
1,951
Baring Private
Equity Partners
RMZ Corp
500
Source: www.vccircle.com
Office rental values remained unchanged in most micro-markets during 2012 - H1 2013 owing to controlled
supply and healthy absorption levels. Investors are capitalizing Grade A office spaces between 11% and
13% whereas developers are capitalizing it at 8% to 10%.
Grade A
Grade B
Grade A
Non SEZ
SEZ
Non SEZ
80 - 100
60 - 70
9,000 - 12,000
Koranmangala
Indiranagar
Bannerghatta Road
Intermediate Ring Road
Old Airport
50 - 55
45 - 50
35 - 45
70 - 80
6,500 - 8,000
45 - 50
40 - 45
40 - 45
30 - 35
50 - 60
32 - 36
Electronics city
Whitefield
Mysore Road
Bangalore North
26 - 28
26 - 30
24 - 26
32 - 34
18 - 20
20 - 25
25 - 26
45 - 55
35 - 38
3,200 - 3,700
4,500 - 5,000
-
46 - 48
50
38 - 40
5,000 - 6,200
CBD
SBD
PBD
ORR
OUTLOOK - OFFICE
20
40,336 units
33,988 units
absorbed in 2012
31% CAGR
of residential absorption
18,076
units absorbed in H1 2013
26,620
units launched
during H1 2013
Annual average rental yield in Bangalore ranges between 3% 7% with Bangalore North and Whitefield offering the best
returns of upto 7% and 6% respectively.
16
25,000
Number of Units
Unit sizes ranged between 3,000 - 6,000 sqft in Central and Offcentral locations. In peripheral locations like Whitefield, ORRSarjapur Road, Bangalore North and Bannerghatta Road- the
average unit size ranges between 1,250 - 2,500 sqft for
apartments and 2,500 - 4,500 sqft for villas. In micro-locations
like Tumkur Road and Hosur Road where target audience is
predominantly industrial workers, the unit size range between
900 - 1,800 sqft for apartments and 1,500 - 3,000 sqft for villas.
20,000
15,000
10,000
5,000
0
< 25L
25L-50L
50L-1Cr
1Cr-5Cr
>5Cr
Segments in INR
Supply
Absorption
Supply includes fresh supply for H1 2013. Absorption includes sale of fresh and unsold stock of
previous years.
22
PE funds have invested close to INR 1,386 Cr in Bangalores residential market during 2012.
PE Firm
Developer
Madison India
RE Fund Ltd.
Shriram Land
Developers India Ltd.
GIC (Singapore
Soveriegn Fund)
Brigade Enterprises
Shriram Properties
Building
Residential Plotted
Development
Location
Amount
(in million USD)
Sarjapur and
Meesaganahalli
5.5
Whitefield
19
Land Acquisition
Bangalore
18.2
Mantri Developers
Residential
Redfort Capital
Prestige Estates
Residential
36
Godrej Properties
138
Portman Holdings
Tata Housing
Promont
Banashankari
12
Sun Apollo
Sobha Developers
Residential
Bangalore East
9.2
Pragnya
Habitat Ventures
Residential
Bannerghatta Road
Source: www.vccircle.com
14
Towards
Doddaballapur
Industrial Area
dd
NH 7: To Hyderabad
ab
a lla
pu
ain
rM
Ro
ad
ar
yR
oa
Rajanukunte
Be
ll
BANGALORE NORTH
ed
Pe
rip
he
ra
lR
in
Ro
ad
Yelahanka
Pr
os
TUMKUR
ROAD
Pr
op
op
os
ed
Pe
rip
NH 4: To Mumbai
Jalahalli
Tum
kur
BIEC
Ro
ad
he
Sahakara
Nagar
lR
in
Ro
d
ing Roa
i
nna
Che
: To s Road
4
H
a
Avalahalli
IISC
HBR Layout
Nagawara
RMV
Extension
OLD MADRAS
ROAD
Hennur
Hebbal
Hesaraghatta
Cross
Budigere
ad
HMT Township
Manyata Embassy
Business Park
NICE R
ra
Thannisandra
er R
ing
Palace
Grounds
Roa
Seegehalli
ITI
gR
oa
Mad
Old
Out
Magadi Road
WHITEFIELD
d
Roa
Rin
Banaswadi
Krishnarajapuram
Ou
ter
efield
Main
Whit
Rajaji Nagar
Byppanahalli
M
M
MG Road
M
Majestic
C.V.Raman Nagar
ITPB
Indiranagar
Bagmane Tech Park
Bangalore City
Railway Station
Vijayanagar
CBD
Old Airport
Brookefield
Road
Varthur Road
Marathahalli
OFF-CENTRAL
Mysore Road
Jayanagar
ore
s
My
Global Village
Technology Park
i
rR
Wipro
HSR Layout
Silk Board
Kengeri
Kumbalgodu
Industrail Area
SARJAPUR ROAD
Haralur
Puttenahalli
Bellandur
te
Ou
J.P. Nagar
a
Ro
Ro
Jaraganahalli
IIMB
Sa
rja
pu
rR
Hosa Road
oa
Begur
Dommasandra
CE
NI
Arkere
Kothnur
ng
Ri
a
Ro
d
Thalagattapura
M
Gottigere
Kanak
a
KANAKAPURA
ROAD
NICE Ring Ro
ad
Bannerghatta Road
pura R
oad
oa
rR
Electronic City
u
os
SH 17:
To Mysore
Proposed Peripheral
Ring Road
ng
ad
Bangalore
University
MYSORE
ROAD
Varthur
Koramangala
BANNERGHATTA
ROAD
Bommasandra
NH 7: To Salem
HOSUR
ROAD
NH 209: To Coimbatore
Major Roads
Proposed Monorail
IT/ITeS Clusters
24
Central
19
units launched in H1 2013
33
units absorbed in H1 2013
190
units available as on H1 2013
INR 7,000 - 25,000
per sqft Capital value for each class A apartments
11%
Average Annual price Appreciation
3% - 4%
Average Annual Rental Yield
Off Central
1,505
units launched in H1 2013
1,116
units absorbed in H1 2013
3,340
units available as on H1 2013
4,485
launched in H1 2013
2,841
units absorbed in H1 2013
11,011
units available as on H1 2013
due to its proximity to Outer Ring Road (ORR) one of the most
sought after IT/ITeS hubs in India.
and
first ring suburbs with industrial areas that are now open for
redevelopment thereby making large land parcels available for
mixed use development.
11%
Average Annual price Appreciation
3% - 4%
Average Annual Rental Yield
Whitefield
5,338
units launched in H1 2013
2,479
units absorbed in H1 2013
9,886
units available as on H1 2013
INR 4,200 - 8,000
per sqft Capital value for class A apartments
INR 7,500 - 11,300
per sqft Capital value for class A villas / row-houses
11% - 21%
Average Annual price Appreciation
4% - 6%
Average Annual Rental Yield
3,281
units launched in H1 2013
1,387
units absorbed in H1 2013
3,940
units available as on H1 2013
INR 3,300 - 5,950
per sqft Capital value for class A apartments
INR 4,000 - 5,250
per sqft Capital value for class A villas / row-houses
11% - 21%
Average Annual price Appreciation
4% - 6%
Average Annual Rental Yield
26
Bangalore North
4,730
units launched in H1 2013
5,170
units absorbed in H1 2013
14,011
units available as on H1 2013
INR 3,800 - 11,500
per sqft Capital value for class A apartments
INR 4,800 - 9,000
per sqft Capital value for class A villas / row-houses
11% - 18%
Average Annual price Appreciation
4% - 7%
Average Annual Rental Yield
Bannerghatta Road
No
units launched in H1 2013
552
units absorbed in H1 2013
800
units available as on H1 2013
INR 2,100 - 6,300
per sqft Capital value for Class A apartments
INR 8,500
per sqft Capital value for class A villas / row-houses
6% - 8%
Average Annual price Appreciation
3% - 4%
Average Annual Rental Yield
Hosur Road
3,875
units launched in H1 2013
2,367
units absorbed in H1 2013
7,494
units available as on H1 2013
15% - 18%
Average Annual price Appreciation
4% - 5%
Average Annual Rental Yield
Kanakapura Road
728
units launched in H1 2013
610
units absorbed in H1 2013
4,523
units available as on H1 2013
INR 8,500
Phase I.
10% - 11%
Average Annual price Appreciation
3% - 4%
Average Annual Rental Yield
28
Mysore Road
2,385
units launched in H1 2013
1,768
units available as on H1 2013
INR 2,900 - 4,300
per sqft Capital value for class A apartments
INR 4,200 - 6,600
per sqft Capital value for class A villas / row-houses
1,079
units absorbed in H1 2013
will improve
5% - 6%
Average Annual price Appreciation
3% - 4%
Average Annual Rental Yield
Tumkur Road
274
units launched in H1 2013
442
units absorbed in H1 2013
INR 8,000
per sqft Capital value for class A villas / row-houses
20% - 25%
Average Annual price Appreciation
3% - 5%
Average Annual Rental Yield
Majority of the projects launched in 2012 were in the midsegment. However, this location also witnessed the launch of its
first luxury villa project by Godrej Properties.
4,111
units available as on H1 2013
New project launches are likely to be in the range of 40,000 45,000 units whereas absorption is likely to be in the range of
33,000 - 35,000 units.
OUTLOOK - RESIDENTIAL
30
Bangalore will add of 5.65 million sqft of shopping mall space by 2016
Between 2004 and 2008, shopping mall space in the city grew at a
CAGR of 8%; however, last four years 2009 - 12 witnessed
significant mall completions and the citys mall space grew at a
CAGR of 20%.
Favourable demographics, opening-up of FDI in single and multibrand retail and availability of large land parcels have not only led
to increase in mall space over the years but have also facilitated
development of larger malls. Until 2008, the malls were
predominantly neighbourhood and community malls with sizes
restricted between 0.35 and 0.60 million sqft while today the city
has witnessed completion of regional malls ranging between 0.75
and 0.90 million sqft.
3.00
Vestian Estimate
GLA in million sqft
2.50
2.30
2.00
1.50
1.30
0.93
1.00
0.50
1.19
1.35
0.78
0.55
0.46
0.40
0.36
0.35
0.30
2004
2005
2006
2007
2008
2009
2010
2011
2012
0.00
11
Mall space statistics in the report are indicated in Gross Leasable Area (GLA) unless mentioned otherwise
32
SBD and PBD locations are likely to be focus areas for developments of shopping malls in next three to five
years.
million sqft) at Magrath Road and Sigma Mall (0.18 million sqft) at
Cunningham Road are situated in Central Business District
(CBD)12 and Secondary Business District (SBD)13 locations.
Bangalore North and Old Madras Road have high potential for
mall development in long term due to proposed developments in
commercial and residential sectors.
12
CBD covers areas around MG Road, Brigade Road, Magrath Road, Richmond Road, Lavelle Road, Vittal Mallya Road, Cunningham Road, Langford Town, Brunton Road and Residency Road.
SBD Locations include areas of Indiranagar, CMH Road, Old Madras Road (till KR Puram), Banaswadi, Bellary Road, Koramangala, Kanakapura Road (till ORR), Jayanagar, JP Nagar,
VijaynagarSadashivnagar, New BEL Road, Sanjaynagar, Malleshwaram and few locations of Bannerghatta Road, Hosur Road Rajajinagar and Yeshwantpur.
14
Locations of Whitefield, ORR-Sarjapur, Electronics City and Hosur Road, Bannerghatta Road, Kanakapura Road, Mysore Road, Old Madras Road, Tumkur Road and Bangalore North.
13
Bangalore mainly has shopping malls anchored around a department store / hyper-market chain and / or a
multiplex. The city offers an opportunity for development of specialty shopping malls revolving around a
theme.
(HNI) population in the country, next only to Delhi and Mumbai, the
city has limited luxury mall space. The Collection Mall in UB City
and Leela Galleria in Hotel Leela Palace are the only available
luxury mall spaces in the city. The upcoming Galaxy Mall on
Residency Road, the luxury mall in West Courts City View on
Bellary Road and luxury retail space within Ritz Carlton on
Residency Road are likely to add some luxury mall space in the
coming years.
High-street locations currently face traffic congestion, crunch in availability of parking space and lack of
unobstructed pedestrian walkways.
34
Under Construction
G Corp 1 MG Road
EVA Mall
Garuda Mall
The Collection
Sigma Mall
Planned
Malls in SBD
Operational
Under Construction
Planned
17
Vega Mall
21
The Forum
18
City View
22
Karle Mall
10
Swagath Garuda
19
Orion Mall - 2
23
Nitesh Mall
11
20
World GT Mall
12
Mantri Junction
13
Mantri Square
14
Orion Mall
15
16
Leela Galleria
Malls in PBD
Operational
Under Construction
Planned
35
44
36
45
Prestige Technostar
26 Inorbit Mall
37
46
MBD Zephyr
27 Park Square
38
47
28
39
Neo Mall
48
29
Cosmos Mall
40
Gardens Galleria
49
Perk In Mall
41
Vaishnavi Sapphire
50
42
51
43
RMZ Galleria
52
Puravankara Mall
53
Lotus Mall
34 Esteem Mall
54
55
Monarch Celestial
56
Towards
Doddaballapur
Industrial Area
dd
NH 7: To Hyderabad
ab
56
a lla
pu
ain
rM
Ro
ad
Be
ll
ar
yR
oa
55
in
Ro
ad
Yelahanka
ed
Pe
rip
he
ra
lR
43
os
Pr
Pr
op
op
os
ed
NH 4: To Mumbai
Pe
rip
Jalahalli
Tum
kur
BIEC
Ro
ad
he
Sahakara
Nagar
in
Ro
Budigere
34
42
Hebbal
54
Hesaraghatta
Cross
ing Roa
lR
ad
HMT Township
ra
Thannisandra
Hennur
Avalahalli
22
HBR Layout
NICE R
41
Nagawara
Out
er R
18
gR
oa
RMV
Extension
ing
Roa
13
Krishnarajapuram
36
M
25
Rin
Ou
ter
19
37
Byppanahalli
20
M
Bangalore City
Railway Station
MG Road
M
Majestic
4
44
15
Indiranagar
ras
efield
Main
Roa
Whit
27
45
24
23
d
Roa
38
ITI
Banaswadi
Rajaji Nagar
21
Vijayanagar
Palace
Grounds
ai
enn
Ch
Mad
Old
14
Magadi Road
NH
o
4: T
46
26
35
3
Old Airport
29
Road
Brookefield
28
Varthur Road
re
yso
30
10
12
HSR Layout
Silk Board
11
M
Puttenahalli
40
CE
NI
Sa
rja
Haralur
Jaraganahalli 17
50
IIMB
pu
rR
Hosa Road
oa
Begur
Dommasandra
51
Arkere
Kothnur
ng
Ri
31
52
M
49
Thalagattapura
M
os
ad
Ro
SH 17:
To Mysore
Bellandur
48
M
Kengeri
Varthur
47
J.P. Nagar
d
oa
16
Koramangala
Proposed Peripheral
Ring Road
Bangalore
University
53
32
Jayanagar
r Rin
g Ro
8
Mysore Road
Oute
33
ad
Marathahalli
ur
Gottigere
ad
39
Bannerghatta Road
NICE Ring Ro
Kanak
a
pura R
oad
oa
Electronics City
Bommasandra
NH 7: To Salem
NH 209: To Coimbatore
Major Roads
Proposed Monorail
36
Since last year, shopping mall rentals have appreciated between 5% and 20% while high-street rentals have
appreciated between 5% and 12%.
Micro-Location
Mall Rentals
Rentals on UCA
H1 2012
H2 2013
Rentals on SBA
H1 2012
% Change
H2 2013
CBD
Magrath Road
300
350
195
228
17%
Cunningham Road
165
185
107
120
12%
330
395
215
260
20%
SBD
Koramangala
400
450
260
292
13%
Malleshwaram
210
225
137
146
7%
13%
PBD
Whitefield
150
170
98
110
Bannerghatta Road
180
200
117
130
11%
Mysore Road
100
105
65
68
5%
Rajarajeshwari Nagar
110
115
72
75
5%
High-Street Locations
CBD
Brigade Road
450
480
360
384
7%
Commercial Street
300
320
240
256
7%
Church Street
160
175
128
140
9%
200
225
160
180
13%
M. G. Road
300
330
240
264
10%
130
130
104
104
0%
210
225
168
180
7%
245
255
196
204
4%
120
125
96
100
4%
130
140
104
112
8%
125
140
100
112
12%
SBD
PBD
100
100
80
80
0%
Bannerghatta Road
95
100
76
80
5%
90
90
72
72
0%
15
Shopping Mall rentals indicated on UCA are for a 1,000 sqft vanilla store on Ground Floor with an efficiency of 65%. High-street rentals indicated on UCA are for 1,000 sqft store on Ground Floor with an
efficiency of 85%.
The city is slated to add 0.78 million sqft of mall space by the
end of 2013. Total operational mall space shall account to 8.45
million sqft by the year end.
OUTLOOK - RETAIL
38
557 rooms
added in Bangalore in 2012
9,585 rooms
at the end of 2012
5,190 rooms
under-construction
The citys hospitality market is dominated by upscale hotels; 42% of the existing room inventory is under 5
Star Category. In medium term, the city will continue to see addition of 5 Star category hotels over other
formats.
Bangalores hospitality sector is driven by business travelers that contributes close to 75 - 80% of the citys hospitality demand. Leisure travelers
and Meetings, Incentives, Conferencing & Exhibitions (MICE) travelers contribute to a mere 20% - 25% of the citys hospitality demand.
Figure: Distribution of
Under-construction Inventory
6%
7%
10%
6%
18%
23%
42%
17%
0%
69%
82%
29%
Serviced Apartment
3 Star
Serviced Apartment
3 Star
Serviced Apartment
3 Star
5 Star
4 Star
5 Star
4 Star
5 Star
4 Star
Existing Inventory:
Location
Micro-market
No. of Rooms
Category
Fairfield by Marriott
Rajaji Nagar
SBD
140
Business
Hilton Residences
SBD
251
Taj Gateway
Bannerghatta Road
SBD
210
4 Star
Marriott
Devanahalli
PBD
307
5 Star
ORR - Sarjapur
PBD
172
40
PBD locations account for nearly 48% of the total room inventory. Currently of the total 5,190 rooms underconstruction, PBD is expected to see an entry of 3,471 rooms.
PBD tops the chart with 5,144 operational hotel rooms. Proximity
to IT micro-markets of ORR, Whitefield and Electronics City has
led to development of branded 3 Star category / business hotels
and branded serviced apartments as compared to CBD or SBD
locations. Some of the prominent national and international
operators with presence in this area include Novotel and IBIS by
Accor, Marriott by Marriott Group, Lemon Tree Hotel by Lemon
Tree Group of Hotels, Premier Inn by Premier Inn Group and Aloft
by Starwood Group of Hotels. With 3,471 rooms in various stages
of construction, PBD is likely to have the highest inventory in the
city in the near future.
SBD locations account for a mere 1,923 rooms. This location has
witnessed development of a hotel as a part of mixed-use
development having an office, residential and / or a shopping
mall within a development. Key illustrations being Sheraton in
Brigade World Trade Center, upcoming serviced apartments Hilton Residences by Hilton Group in Embassy Golf Links and
upcoming 5 Star hotel in Mantri Groups proposed integrated
township at Agara.
SBD
PBD
Total
Existing
U/C
Planned
Existing
U/C
Planned
Existing
U/C
Planned
3 Star
807
30
179
140
1,455
194
125
2,930
4 Star
1,192
186
1,734
988
4,100
5 Star
1,289
1,068
1,404
230
1,727
2,117
1,412
9,246
294
154
251
228
172
175
1,274
3,582
1,098
1,923
621
5,144
3,471
1,712
17,551
Serviced Apartment
Total
Among the PBD locations, ORR-Sarjapur Stretch and Whitefield are preferred locations by hotel operators
mainly due to its proximity to IT clusters while Tumkur Road and Bangalore North have gained prominence
owing to its proximity to Bangalore International Airport.
3,471
1,712
Whitefield
2,129
1,160
502
ORR-Sarjapur
1,058
984
700
215
Tumkur Road
662
Bangalore North
31
1,112
510
1,264
Planned
5,144
Hosur Road
U/C
PBD
Bannerghatta Road
Existing
42
29
30
Marriott
The Hilton
31
Hyatt
32
Howard Johnson
Taj Vivanta
33
Hyatt Place
The Oberoi
34
Swissotel
Royal Orchid
35
Zuri
36
MBD Zephyr
Matthan
37
Keys Hotel
10
Hilton Residences
38
Ginger
11
Ginger
39
Sheraton
12
Ritz Carlton
40
Aloft
13
JW Marriott
41
Marriott
14
ITC Gardenia
42
Taj Vivanta
15
43
Royal Orchid
16
The Atria
44
Alila
17
45
Park Plaza
18
Viceroys
46
Aloft
19
Shangri-La
47
20
Le Meridien
48
Citrus
21
ITC Windsor
49
22
50
23
Sarovar Portico
51
24
Fairfield by Marriott
52
Courtyard by Marriott
25
Sheraton
53
26
Movenpick
54
Keys Hotel
27
Taj Vivanta
55
Crowne Plaza
28
Ascott
56
Operational Hotels
Under-Construction Hotels
Planned Hotels
Do
Towards
Doddaballapur
Industrial Area
dd
NH 7: To Hyderabad
ab
a lla
pu
ain
rM
Ro
ad
31
Be
llar
yR
oa
Rajanukunte
29
Ro
ad
Yelahanka
ed
Pe
rip
he
ra
lR
in
28
os
Pr
Pr
op
op
os
ed
NH 4: To Mumbai
Pe
rip
Tum
kur
BIEC
he
Sahakara
Nagar
Jalahalli
ra
Thannisandra
lR
in
32
Ro
ad
Ro
Budigere
ad
HMT Township
Hennur
Hebbal
Hesaraghatta
Cross
ing Roa
26
Avalahalli
IISC
HBR Layout
NICE R
27
Nagawara
RMV
Extension
25
Magadi Road
er R
d
oa
gR
ing
20 Palace
Grounds
19
22
Roa
Rin
ter
Ou
Rajaji Nagar
18
17
35
Bangalore City
Railway Station
efield
39
33
5 Byppanahalli
M
4
C.V.Raman Nagar
MG
Road
8
13
M
Indiranagar
Majestic
12
14
15
9 Old Airport Ro
11
ad
6
24
Vijayanagar
Krishnarajapuram
16
ras
40
34
d
Roa
Seegehalli
ITI
Banaswadi
23
ai
enn
Ch
Mad
Old
Out
21
NH
o
4: T
37
Main
Roa
Whit
42
41
43
36
38
Brookefield
Varthur Road
Marathahalli 44
10
45
Varthur
Mysore Road
Jayanagar
51
r
ute
J.P. Nagar
Ro
ad
48
Ro
Silk Board
Sa
rja
Haralur
Puttenahalli
Bellandur
49
HSR Layout
53
Kengeri
ng
Ri
52 O
ad
47
50
Proposed Peripheral
Ring Road
Bangalore
University
re
yso
46
Koramangala
Begur
Jaraganahalli
pu
rR
Hosa Road
IIMB
oa
54
CE
NI
Dommasandra
Arkere
Kothnur
ng
Ri
M
Thalagattapura
M
os
ad
Ro
SH 17:
To Mysore
ur
Gottigere
d
oa
Electronics City
56
ad
Bannerghatta Road
Kanak
a
pura R
oad
55
NICE Ring Ro
Bommasandra
NH 7: To Salem
NH 209: To Coimbatore
Major Roads
Proposed Monorail
Operational Hotels
Under-Construction Hotels
Major Landmarks
Key Residential Areas
Planned Hotels
M
44
Average occupancy rate in branded hotels across Bangalore ranges between 56% and 59%.
Figure: Average Occupancy Levels and Room Rates (INR/night) in Bangalore
75%
10,000
70%
16
16
8,000
65%
6,000
60%
4,000
59%
58%
56%
2,000
7,867
4,883
3,833
5 Star
4 Star
3 Star
55%
50%
Room Rate
Occupancy Levels
12,000
Rack Rate
SBD
Discount Offered
PBD
Discount Offered
Rack Rate
Rack Rate
Discount Offered
3 Star
4,200
28%
3,700
36%
3,600
25%
4 Star
5,000
20%
5,650
20%
4,000
24%
5 Star
7,900
11%
8,000
14%
7,700
20%
Serviced Apartment
4,000
16%
5,350
14%
2,000
30%
Management Contract is the most preferred model by International and National Hotel Operators.
OUTLOOK - HOSPITALITY
Occupancy levels and average room rates are likely to fall with
an addition of 1,157 rooms by Q1 2014. However, in the long
run economic growth is likely to increase demand for hotel
rooms.
46
OFFICE
RESIDENTIAL
RETAIL
HOSPITALITY
ORR being one of the most preferred micro-market will remain a promising
location for development of office space in short to medium term. Further,
with availability of land for redevelopment in CBD and SBD locations, there is
a scope for development of office spaces in these locations.
Bangalore has witnessed significant launches in the ticket size of INR 1 crore
and above. Demand for mid segment (ticket size of INR 25L - INR 50L)
continues to remain buoyant across the city. Some of the locations that have
an opportunity for development of this product type include Kanakapura
Road, Sarjapur Road (after Railway Crossing), Hosur Road and
Bannerghatta Road.
OPPORTUNITIES
With most of the malls being anchored around a department store and / or a
hyper-market / super-market chain, the city has opportunity for development
of a specialty mall focusing exclusively on sale of home & furnishing products,
cars & auto-accessories, jewelry, electronics & white goods.
48
LOCATION MASTER
Micro-Markets
OFFICE
CBD
M.G. Road, Kasturba Road, Lavelle Road, V.M. Road, Ulsoor Road, Residency Road, Infantry Road.
SBD
Indiranagar, Koramangala, Inner Ring Road, Old Airport Road, Bannerghatta Road.
ORR
PBD
Bangalore North
RESIDENTIAL
Central
MG Road, Kasturba Road, Brunton Road, Lavelle Road, Richmond Road, Residency Road, Frazer
Road, Cox Town and Hanes Road.
Off-Central
ORR
HSR Layout, ORR (Marathalli - Silk Board Junction), Sarjapur Road, Haralur Main Road,
Kasavanahalli Main Road.
Whitefield
K.R. Puram, Ramamurthy Nagar, Battarahalli, Sonnenahalli, Hirandahalli, Budigere, DevanahalliHoskote Road
Bangalore North
Banaswadi, HRBR Layout, Hennur Road, Thanisandra Main Road, Bellary Road, Yelahanka, Kogilu,
Chokkanahalli, Bagalur Road, Doddaballapur Road, New Town Yelahanka, Jakkur
Hosur Road
Bannerghatta
Road
Mysore Road
Kanakapura Road
Tumkur Road
M.G. Road, Brigade Road, Magrath Road, Richmond Road, Lavelle Road, Cunningham Road,
Langford Town, Brunton Road and Residency Road.
SBD
Indiranagar, CMH Road, Old Madras Road (till K.R.Puram Bridge), Banaswadi, Bellary Road (till
ORR), Koramangala, few locations on Bannerghatta Road and Hosur Road (till Silk Board Junction),
Kanakapura Road (till ORR), Jayanagar, JP Nagar, Vijayanagar, Sadashiv Nagar, New BEL Road,
Sanjay Nagar, Malleswaram, Rajajinagar and Yeshwanthpur.
PBD
Peripheral locations of Whitefield, ORR - Sarjapur, Electronics City and Hosur Road, Bannerghatta
Road, Kanakapura Road, Mysore Road, Old Madras Road, Tumkur Road and Bangalore North.
ABOUT VESTIAN
Vestian Global Workplace Services, an ISO 9001:2008 certified workplace services firm, specializes in providing
occupier-focused solutions for commercial, residential, industrial, retail and hospitality sectors. Our service portfolio
includes Strategic Advisory, Retail Business Solutions, Transaction Advisory, Integrated Service Delivery, Project
Services and Facilities Management Services.
We measure key deliverables of our business and align it to the clients strategic business goals. Our commitment to
achieve excellence and consistency in our service delivery models has helped us attain high standards of quality and
raised the bar for the industry.
Our experienced team has the required expertise and exposure in different sectors. Combining global best practices and
local knowledge, the team provides an integrated solution for all real estate requirements. Moreover, the belief in our
corporate philosophy - Delivering Measurable Results - helps us in providing solutions in keeping with global delivery
standard.
Strategic Advisory
Vestian Global Workplace Services Strategic Advisory Group is the Research arm of Vestian. They align business
strategies of corporate clients with their real estate portfolio strategy. Property market intelligence, economic, urban &
space planning principles and analytical methods all come together to provide strategic insights to real estate
occupiers. This approach guarantees recommendations that are thorough and meets not only the needs of today, but
of the future as well. We primarily cater to Developers, Builders, Investors and Occupiers.
Our studies span a spectrum of sectors:
Commercial, Residential, Industrial, Institutional, Hospitality.
50
MANAGEMENT
Michael Silver
Chairman, Vestian
Michael serves as Chairman and is responsible for strategic oversight. He is a recognized
leader in the field of workplace services. He has established and led the growth of a large
occupier focused services corporation.
In 2006, he received the Ernst & Young "Entrepreneur of the Year" Award. He is also an
active member of the YPO (Young Presidents' Organization) and WPO (World
Presidents' Organization).
AUTHORS
Shwetha H Pai
Associate Director, Strategic Advisory Group
shwetha @ vestianglobal.com +91 80 40620100
Shwetha has over 8 years of experience in real estate research and consultancy. As an
account manager for key residential focus clients at Vestian, she is responsible for
developing and implementing customized research, corporate strategy and project
conceptualization. A qualified urban planner from the School of Planning & Architecture
(SPA), New Delhi, she has worked in both Indian and US markets.
Dhara Dalal
Sr. Manager, Strategic Advisory Group
dhara@ vestianglobal.com +91 80 40620100
As a part of Strategic Advisory Group, Dhara contributes to property market reports,
research papers as well as client assignments. She has 6 years of experience and has
worked on investments and consultancy assignments across commercial, residential,
hospitality, retail and industrial sector. She holds an engineering degree with M. Tech in
planning from CEPT University, Ahmedabad.
Acknowledgment
The Vestian Strategic Advisory team would like to take this opportunity to extend our
gratitude towards all those who have helped us in our endeavor to produce this report.
We would like to especially thank the developers in Bangalore who have extended their
valuable support and market information to help us ensure authenticity of this report. A
special mention for our Corporate Communications Team, as well as Shailendra H C,
Sneha Sharma, Chandra Mohan Reddy and Manoj Joseph for their continued support &
cooperation. Our sincere thanks to Ramalekshman - Asst.Manager, Corporate
Communications for designing the report.
52
USA
India
China
UAE
Srilanka
OFFICES
INDIA
Bangalore (Corporate Office)
First Floor, West Wing,
DuParc Trinty,
#17, MG Road,
Bangalore 560 001
T: +91 80 4062 0100
Mumbai
Acme Plaza
Unit No.501, 5th floor
Andheri Kurla Road
Andheri (East)
Mumbai - 400059
T: 022 42153060
Chennai
Suite No # 403
MLS Business Center
Kuppu Arcade
4, Venkatanarayana Road
T. Nagar, Chennai- 600017
T: +91 44 39159351/ 66659351
Hyderabad
2nd Floor, N.N.R Arcade,
Plot 13, Road No. 10, Banjara Hills
Hyderabad - 500034
Telephone: +91 40 33782100
USA
Chicago (Head Office)
300 N. LaSalle Street
Suite 1850
Chicago, IL 60654
Telephone: +1 312 920 0290
Telephone: +86 21 3255 6366
CHINA
CHINA (Regional Office)
Unit 1207, No.546
Changning Road,
Changning District,
Shanghai 200 042
Telephone: +86 21 3255 6366
54
DISCLAIMER: This report contains information available to the public and has been relied upon by Vestian Global Workplace Services on the basis that it is accurate. Vestian
accepts no responsibility if this should prove not to be the case. No warranty or representation, expressed or implied, is made to the accuracy or completeness of the information
contained herein, and same is submitted subject to errors, omissions, change of price, rental or other conditions and withdrawal without notice.