India Major Report – Resurrecting Chennai – Insights into City’s Housing Dynamics August 2016
Chennai, often considered to be the Gateway to Southern India, is known for its robust economy, traditional culture, spectacular temple complexes, and a long coastline
Chennai was one of the early movers to realize the potential of the technology sector; the IT/ITeS sector took off in Chennai with the completion of TIDEL Park in the year 2000. A period of formidable growth followed, when the total available commercial office space in Chennai grew at a CAGR of approximately 19%, to reach more than 58 million sq. ft. in 2016.
The growth of the IT sector and expansion of the manufacturing base drove demand for residential real estate, especially in the suburban and peripheral locations of South and West Chennai. Over the past decade (2005–2015), the city has witnessed the launch of over 170,000 apartment units, resulting in an organized residential space stock in the city, growing from about 17,000 units in 2005 to more than 180,000 units by 2015.
The Central and East micro markets are most preferred due to excellent social and physical infrastructure; however, affordability and organised development is very limited when compared to other micro-markets. South Chennai remains the most sought after residential location due to availability of quality residential options, affordability, ease of access to workplace and emerging social and physical infrastructure.
Locations such as Pallavaram–Thoraipakkam road and Perumbakkam in South Chennai, Mt Poonamallee Road in West Chennai, and Perambur in North Chennai are likely to emerge as favoured destinations - factors such as developer profile, location dynamics, product mix, presence of adequate infrastructure, project specifications along with optimal pricing will be crucial in attracting demand.