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Real Estate Summary - Nov 2004

Market Summary

SAP Labs is setting up another facility in the city as a part of its expansion plans to cater to a larger market in India. SAP is also planning to expand its workforce by approximately 1300 in 2005. It already has a significant presence in the eastern peripheral location in Whitefield.
Samsung's Indian arm is planning to increase headcount in their Bangalore R & D facility by 1400 employees. It is also planning on increasing its product line & extending its retail presence, especially in IT hardware.
Power & automation major, ABB has plans of investing US$ 100 million, over a period of 3 years (2004 - 2006), to ramp up it existing R & D Facility and set up an engineering design center.
In an effort to strengthen its commitment to India, Swedish engineering major, SKF has set up a INR 700 crores R & D facility in the city. The center is to undertake designing, testing & simulation. SKF has a fully operational manufacturing plant with a work force of 450 employees, located on Hosur.

Prime & Grade A Office Rents

District	Average Base Rent (Quoted)
District	US$/Sq-F/Yr	Rs./Sq-F/Mth
CBD - MG Road	$10.98	42
Off- CBD	$10.19	39
Suburban	$7.84	30
Peripheral (Others)	$5.75	22
Peripheral (ITPL)	$11.76	45

Grade A Office Capital Values

District	Average Price (Quoted)
District	US $/ Sq-F	INR/ Sq-F
CBD - MG Road	$91.48	4,200
Off - CBD	$82.77	3,800
Suburban	$65.35	3,000
Peripheral (Others)	$47.92	2,200
Peripheral (ITPL)	$87.13	4000

Conversion Rate US$1= Rs.45.91
Source : Cushman & Wakefield Research

The city apart from being an IT destination is also gradually attracting interests for R & D operations. Companies from diverse manufacturing background are looking at setting up their research and development centers in the city with a view to strengthen their presence in the region and also utilize the the human resource pool available. But the key demand driver still continues to be the IT / ITES sectors. Apart from the Built-to-Suit options, speculative developments are also readily absorbed..