BANGALORE: The Outer Ring Road (ORR) is a veritable example of the kind of realty development that can take place if access and infrastructure are put in place. The ORR has not only become the most favoured address for IT Special Economic Zones (SEZ) and large retail brands, it is also the destination of residential units catering to the workforce employed in these IT companies.
“In 2012, the ORR being a predominant IT growth corridor benefited from the controlled nature of office space supply, which ensured low vacancy levels, healthy absorption rate and rental appreciation. Also, corporates continued to prefer ORR for its accessibility to employee residential catchments and its connectivity to the various SEZs and IT parks along this stretch. Moreover, pre-commitments are very prevalent on the ORR owing to the lack of ready-to-move-in supply. The ORR continued to be the location of choice for new entrants as well as existing occupiers looking at expansions,” explains Santhosh Kumar, CEO – Operations, Jones Lang LaSalle India.
Outlook this year
Through this year too, the realty growth sentiment remains buoyant. This is due to the fact that the move to make the ORR seamless with the introduction of flyovers and underpasses at prominent junctions is now a reality. This development has not only eased traffic flow around these bottlenecks, it has also led to the entire stretch becoming signal-free.
“By the end of 2013, the peripheral micro-market, consisting of the ORR and the adjoining areas, is expected to witness about five million sq ft of supply. This forms more than half of the total supply expected in the city, all of which will be Grade A office spaces and 71 percent of the expected supply in the peripheral micro-market will be in IT SEZs. In the wake of the demand existing in this location, the vacancy levels are expected to remain stable despite the large quantum of supply coming in as some of the anticipated supply may be delayed by developers depending on the interest levels of occupiers,” says Naveen Nandwani, Director – South India, Cushman and Wakefield.
Residential catchments push demand
What makes the ORR a success story is the scale of realty development, especially in the residential and retail segments. This has changed the lifestyle of people staying around the ORR. They do not find the need to commute to the city’s central commercial areas, and find the sustainability of their micro-market viable. This saves them a lot of time and money too.
“In terms of commercial property absorption in 2013, the ORR will continue to work exceedingly well. Thanks to its proximity to employee catchments, the enhanced connectivity via signal free flyovers and availability of SEZ as well as non-SEZ office spaces will ensure the ORR continues to build up its already dense corporate presence in 2013,” adds Santhosh.
Regions like Whitefield, Sarjapur Road, Yelahanka, Old Madras Road, and Mysore Road have become successful realty hubs and are growing further, due to the fact that they are strategically located near the ORR.
According to Shrinivas Rao, CEO – Asia Pacific, Vestian Global Workplace Solutions, “The ORR is ably supported by signal free connectivity, proximity to talent pool, a progressive social infrastructure and also has reliable office space providers owning vast land parcels here. The recent office spaces leased by two IT giants evidently indicate that unless the supply of SEZ and non-SEZ spaces is exhausted on this stretch, the ORR will continue to remain the city’s most favoured office space destination for tenants and developers.”