Full Description

Below report from Rediff about the growing demand for office space in Bangalore, the IT hub and the Silicon valley of India.

Bluevalley properties is building a state of the art office complex in the middle of Hitech city in south Bangalore and the project which is to be launched in June-09 is now available at a very attractive and reduced price of Rs.3750.00 PSQFT and when completed will be launched at Rs.4250 which is the current rate in Bangalore for Office Space. 

As much as 8 million square feet of office space is under construction in Bangalore's suburban and peripheral areas. Out of this 3.5 million square feet is pre-committed. This indicates good opportunity for high net worth individuals and housing finance companies looking at investments in the city.

The existing private information technology parks have also begun to add new blocks in their campuses to cater to the rising demand of IT/IT-enabled services companies in the city.

According to Knight Frank's 'India property investment review,' IT and ITeS companies continue to dominate all major commercial space transactions.

Backed by technology sector, the demand for 20,000 to 50,000 square feet floor plate has characterised major transactions in the city. In addition to this, built-to-suit developments have also kept pace in the office space real estate market.

At present, properties are being sold on current yields basis which varies from 9-11 per cent per annum. As a result, about 20-35 per cent premium to the actual prices is being charged. This has significantly increased the risk-exposure and we caution investors to exercise discretion, the report adds.

In addition to corporates, the city has witnessed few HNI investment transactions between 2500 to 10,000 square feet and the returns are in the range of 9-12 per annum