KOLKATA: Year 2006. West Bengal’s Tier-II towns had their brush with the realty boom. It covered smaller towns such as Burdwan, Durgapur, Assansol, Shantiniketan, Bolpur, Prantik and Katwa.
In North Bengal, it was Siliguri. It was propelled by the Tata Motors’ small car project.
Investments in the sector across the State, between 2005 and 2010, ran into an estimated Rs 20,000 crore.
Cut to 2013.
Mamata Banerjee’s Trinamool Congress is in power. Many investment plans are yet to materialise.
Real estate projects have, of course, seen the light of the day. But, as market sources put it, demand is slow and developers are seeking more time for delivery.
Burdwan, Durgapur, Assansol and Siliguri seem to be the only growth areas. Others township projects such as Shantiniketan, Bolpur, Katwa and Krishnagar are slow-moving.
“Tier-II and Tier-III towns have failed to live up to expectations. Except say Durgapur, Bardhaman and Siliguri, others have failed to take off,” says Abhijit Das, Office Director, East India, Cushman & Wakefield, a real estate consultancy. Sluggish economic activity is the reason for this.
In South Bengal, Durgapur and Asansol were considered as industrial townships. Burdwan, a flourishing agro-economy and Haldia, with its manufacturing facilities, had the potential. Hence, development was but natural, Das maintains.
As political uncertainty and sluggishness gripped the State economy, projects and investment were impacted. There was lack of job creation and demand dipped across smaller centres.
As a result, consumption was non-existent. Obviously, it led to developers going slow, because of which projects are behind schedule even in Durgapur, Burdwan and Assansol.
“Any micro-market is industry and employment driven. And the slow growth of the Bengal economy saw Tier-II and Tier-III towns suffer,” Das adds.
In North Bengal, it’s a bit different. Siliguri, considered as the gateway to North-East and Sikkim came up as the only probable destination.
“Except Siliguri’s development as a trading hub, there haven’t been many positives. But again its optimum potential could have been understood had Darjeeling been developed. And its (Siliguri’s) connectivity with Sikkim improved,” he maintains.
It was in the early 2000s, when the potential of Tier-II towns came to the forefront. Big ticket township projects started taking shape.
Shristi Infrastructure’s Durgapur City Centre – urban plaza with commercial, retail, residential and entertainment amenities – was operational, a first of its kind then. Construction had started on Shristinagar, an 88-acre township project in Durgapur, some 180 km from Kolkata.
Kolkata developers had woken up to the potential of joint development. Developers having high, mid and mass-scale housing within the same complex were not uncommon.
“I don’t think there has been any issue with development of Tier-II and Tier-III towns in West Bengal. In the last 10 years, these locations have grown fairly well centring around economic activity,” Harsh Neotia, Chairman, Ambuja Neotia, said.
Neotia’s flagship projects in Tier-II and Tier-III towns include township projects in Durgapur, Burdwan, Burdwan and Siliguri and commercial space in Haldia.
According to him, a flourishing rural economy in the recent past has led to town-centric development.
Tatas’ exit from West Bengal and failure of industry threw-up challenges of land acquisition. Developers started feeling the pinch from 2008, when the real estate growth curve, till then moving upwards, nose-dived.
To top it all, there was a change in Government in 2011. Mamata Banerjee’s Trinamool Congress came to power. There was a perception that it was against large-scale township projects.
But, there is still hope. Towns such as Shantiniketan, Sriniketan, Bolpur, Prantik, which missed the bus earlier, are seeing some activity. Major Kolkata-based developers such as Ambuja, DC Pal, Bengal Peerless and Bengal Shelter have projects in these areas.
Market sources indicate that freehold land prices near the National Highway have appreciated 6-8 times from Rs 30 lakh an acre to Rs 1.8-2.4 crore an acre, since 2008.
During the same period land price in interior areas of Shantiniketan, Sriniketan and Bolpur have moved up five times to around Rs 30 lakh an acre.