The
focus of Tamil Nadu government over the last decade in promoting OMR as an IT /
ITeS destination along with the setting up of Mahindra World City on GST road
has created immense employment opportunities in South Chennai.
Additionally,
the proximity to Chennai airport, presence of arterial roads and availability
of vast vacant land parcels has enabled this zone to rapidly grow into an
emerging residential market.
Since 2000,
a large number of IT / ITeS companies
have
set up their operations in the numerous IT Parks & IT SEZs on OMR and GST
road. The growth in IT / ITeS based employment, gradually sowed the seeds of a
bustling residential market in this zone. Preference of employees in staying
close to their work place and affordable pricing as compared to Central Chennai sustained the
development of a healthy market in this zone.
Growth
of the residential market in South Chennai has been primarily along the three
arterial roads of OMR, GST road & ECR. However, in the last few years a lot
of development has taken place within the destinations located between OMR and
GST road. The advantage of being centrally located with easy access to both
these roads has led to many home buyers preferring these
destinations.
South
Chennai has witnessed the launch of 68,914 residential units since 2007. Of
these, a total of 50,666 units of this have been absorbed as of Q3 2012, with
26% remaining unsold. There has been a steady rise in the percentage of
unsold
units over the years, as the pace of absorption has not been able to keep up
with the pace of new launches. A total of 29,245 units were launched in South
Chennai during 2010 and 2011, of which only 19,550 units were absorbed.
Taking
a cue from the market, developers have become cautious before launching any new
project and only 61 new projects have been launched in 2012 as compared to 147
during the previous year. Although the number of new
launches
has reduced drastically, the excess supply from the previous years is impacting
the unsold units’ percentage.
Additionally,
absorption during the first nine month of the 2012
has
been abysmally low.
Knight Frank - Chennai
No.3, Gitex Building,
IIIrd Floor,
Khader Nawaz Khan
Road, Chennai 600 006.
Phone: + 91 44 4296
9000
Source: Knight
Frank Research
