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In recent times, India, though still rated as a developing nation, has become an attractive destination for overseas investments. With more and more foreign companies setting up offices in India, the BPO boom, recognition of Indian IT talent, development of expressways, metro rail projects etc. on the cards, Indian economy has seen a surge like never before. Consequently, real estate is also booming. The overall Indian real estate market is said to be growing at a rate of over 7% annually. Experts believe that even though the 2006 financial budget does not contain any direct benefits for the real estate business, yet real estate prices are expected to shoot up by 30% due to the current strong economic state. .
 Initially the advantages of a growing economy and subsequent real estate boom was localized to Class “A” cities like Delhi, Bombay, Bangalore and Chennai. However, the congestion in these cities and the general shortage of infrastructure facilities in them has driven the real estate traffic to Class “B” cities like Hyderabad. The state government’s pro- industry attitude has further encouraged many top companies to regard Hyderabad as their favorite destination for their offices.
 Real estate prices in the city have doubled and tripled in past few months. Still no one is complaining. According to Kishore Goeti, Director, Investments, ICICI Venture, “Hyderabad is emerging as a key market in India’s growth story and land is worth the price we are paying.” Hyderabad realestate market offers distinct cost advantages to companies. Most IT companies prefer to keep the cost of their office rentals to less than $1/ sq. ft. or Rs.50/sq. ft. In cities like Mumbai, rentals are available approximately at a cost of Rs.115/ sq. ft, while total occupation does not cost less that Rs.153/sq. ft. and this is not necessarily the rate for prime locations like Nariman point. Compared to this, prime rentals in Hyderabad are a mere Rs.34/ sq. ft. with total occupation costing around Rs.64/sq.ft. These rates are nearly 30% less than what Bangalore offers and 10% to 15% less than Chennai. Apart from the low rental cost, the city also has numerous other advantages such as low labor costs and abundance of skilled and semi skilled labor. Simultaneously, low living costs in the city have attracted labor from all over India to make Hyderabad their second home.
 Efforts of the Andhra Pradesh State government in developing the city infrastructure need to be appreciated as these were the main driving force in development of Hyderabad and consequently in the development of real estate market of Hyderabad.
Work on a new International Airport at Shamsabad is already underway and the airport is due to be ready by the end of year 2008. Development of a 12,000 acre Fab city, building of an eight lane expressway, i.e. the outer ring road aimed at connecting satellite townships
The Hyderabad realestate market has never been so good in Hyderabad for real estate investors. Private companies, foreign investors, domestic investors and even the state government are all realizing the immense potential in Hyderabad’s real estate market. Thanks to the state government, the city has become a favored destination for foreign investors and large corporate houses. Even though the real estate market is at an all time high in Hyderabad, land in Hyderabad is still cheaper than other metros such as Mumbai, Delhi and Chennai. Unfortunately, in an effort to acquire more and more land in and around Hyderabad, many companies are resorting to fraud and unethical means. The state government must step in to check such cases so that the benefits of the real estate market can be shared by all. |
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