Kolkata IT Sector looks for commercial space

As the real estate market has started showing signs of stability, several IT and telecom companies have already started actively looking at space in the city, especially in Rajarhat and Salt Lake Sector V areas, for setting up operations. According to Mayank Saksena, head – transactions, Kolkata, Jones Lang LaSalle Meghraj, “From January onwards, we have been tackling an increase in live enquiries in Kolkata. The rate of enquiries is significantly higher than in cities such as Hyderabad. Chennai, Pune and Bangalore, primarily because Kolkata has a large number of old business houses that have been occupying prime spaces in the central business district (CBD). These entities are now in the process of shifting to suburban locations such as Rajarhat and Sector V in Salt Lake because of the huge difference in the cost of occupancy as well as the quality of buildings there. Typically, these clients have been occupying B-grade projects in the CBD, due to a dearth of A-grade buildings. However, these suburbs now offer A-grade buildings, which are available at reasonable occupancy costs in the suburbs.”

“While Kolkata has not, so far, witnessed the rate of company consolidation evident in cities like Bangalore, Mumbai and Delhi, we expect a step-up in consolidation in the coming quarter. This is because occupancy costs are now becoming a primary criterion even in Kolkata,” Saksena said. Real estate developers Srijan and P S Group have jointly built what is Bengal’s first telecom park to house telecom and ITeS companies. According to Shyam Agarwal, chairman of Srijan, “Srijan and P S Group have jointly invested Rs 100 crore into the 5 lakh sq ft telecom park. Already Tata Teleservices and Idea Cellular have taken possession within the building.”

Tech Mahindra too is looking at acquiring prime space in Kolkata to set up its fifth BPO centre here for outsourced telecom client servicing. According to a spokesperson of the company, “We are talking to several developers in Kolkata for a 500-seater BPO to begin with.” Currently Tech Mahindra operates two centres in Kolkata offering IT services. It has close to 1,000 employees delivering IT services to clients like British Telecom and others. HDFC Bank is also in the process of setting up an integrated operation hub in Kolkata to undertake the bank’s entire back office operation in Eastern India. This will be the fourth facility after Mumbai, Delhi and Chennai. The bank has already committed 100,000 sq ft to undertake various processing operation such as account management, fixed deposit and loan monitoring of 125 retail branches across eastern India. The facility aims at centralising bank operations in one place. The facility will start with 300 employees, which is likely to go up to 900 later on.

By the end of 2009, West Bengal’s ‘Data Centre’ is also expected to take off at Sector V, Salt Lake, informed Debesh Das, state IT minister. The facility will be a one-stop repository for key information which the government departments may use for data storage and retrieval. According to Jones Lang Lasalle Meghraj, rentals in Kolkata CBD is Rs 75-130 per sq ft, while at Rajarhat it is at Rs 30-32 per sq ft, and at Sector V rentals are around Rs 40-45 per sq ft. “In these suburbs, companies with larger space requirements are currently in a position to get positively revised quotes even on the prevailing rates. Occupancy rates in the CBD have seen some moderate correction over the last quarter, since developers there have begun waking up to the challenge posed by locations such as Rajarhat and Sector V. However, the fact that they are becoming open to reconsidering rental figures can do nothing about the overall quality of buildings in the CBD,” said Saksena.

News Published Under:   Kolkata, Real Estate Trends |

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