Migration of IT companies to Mysore due to its proximity to Bangalore (150 km) is driving residential and retail real estate developments and pushing up prices in some parts of the city.
Mysore is to get heritage funding under the 'Jawaharlal Nehru National Urban Renewal Mission' and in addition to this, a number of other infrastructure projects like the completion of the Bangalore-Mysore expressway, upgradation of the existing airport and doubling of the Bangalore-Mysore railway track, are expected to boost the city's growth.
Once the commuting time between Bangalore and Mysore is reduced, the scope for office market development will increase in the city in the view of increasing number of corporates planning to expand their operations in Mysore.
As real estate cost is rising in Bangalore and its suburbs, many corporates have already begun to turn their attention to this tier II city. Here, Mysore fits in well for it provides a good alternative with easy availability of land and growth potential.
Due to demand for industrial land in the city, especially in the north-west, the Karnataka Industrial Area Development Board, the nodal agency to develop industrial layouts, is busy acquiring land to facilitate investments.
"Currently, due to numerous policy measures (to deflate the property bubble) by the central and state governments, land transactions have come down by 25 to 30 percent in Mysore," said Dhirendra Mehta, advocate, familiar with land registrations in Mysore.
"This is a temporary phase but in long term, the city is expected to emerge as an extension of Bangalore and may attract investors once the key infrastructure is in place," he added.
Due to the availability of land at relatively competitive rates, a number of Bangalore-based developers have entered the real estate market in Mysore, said Knight Frank, a international property consultant in its report on 'Emerging growth centres'.
Besides Brigade Group and Sankalp who already have ongoing projects in Mysore, other leading developers like Sobha and Purvankara are considering setting up their residential projects in the city.
But it is local players who are already working on strategies to promote Mysore as a second home to individuals and corporates in Bangalore. What helps is Mysore being an important educational, commercial and administrative centre with a high literacy rate of 84.5 percent, greater than the state average.
According to Knight Frank, "The city's growing attractiveness as a commercial and IT destination offers vast potential for development. Till now the city has not seen much development on the retail front, but with an increase in population, there exists significant potential for retailers. A number of mall developments are currently in the pipeline and private developers such as Sankalp, Brigade, Premier Properties and Mittal Builders are developing mall space of about 1.7 million square feet over the next two years."
As for the capital values in Mysore, prime residential property are in the range of Rs 2,000-3,000 per square feet, while residential projects in the suburban locations are quoted in the range of Rs 1,400-1,900 per square feet.
Developments of villas are being proposed in Koodanahalli and Nanjangud. The average prices quoted for villas are about Rs 3,000 per square feet and rentals for office space in the CBD of the city are charged at Rs 46-51 per square feet per month while capital values exist at Rs 4,500 per square feet.
In suburban locations, office space rentals are in the range of Rs 25-30 per square feet per month and capital values are quoting at around Rs 2,500 per square feet.
The city currently boasts of major IT and non-IT campuses like Infosys, L&T Infotech, Wipro and Software Paradigm India. In addition to this, Mysore houses many non-IT companies like Reid & Taylor, L&T Electronics, S Kumars, Kirloskar Gensets, Bharat Earth Movers, Venlon Polyster Automobile Axles and South India Paper Mills.
During the last few years, Mysore has been witnessing unprecedented growth in real estate, with a large number of housing co-operative societies having secured land for development of residential colonies. This has set the base for the city to propel on its own.