Ascendas buys 12-acre plot in Chennai for Rs 250 crore to develop IT park
Two blockbuster land deals, one for an integrated IT park and second a luxury hotel, has catalysed real estate deal making in the city in recent weeks.
Singapore-based Ascendas purchased 12.74 acres for nearly Rs 250 crore on Pallavaram Radial Road and a city hotelier picked up GokulKalyanaMantap in Alwarpet for nearly Rs 150 crore.
This is the fifth investment of Ascendas in Chennai. The group, it is learnt, is going to promote a 2.3 million sqft IT park which upon completion would suck in Rs 1,500 crore investment.
The Indian arm of the Singapore firm has taken over G Square Zamin Private Ltd., which owns the land parcel. G Square group is a prominent land aggregator and has worked with companies including CEAT, Murugappa group, TVS and other leading corporates helping them acquire lands for their projects. The company that Ascendas acquired aggregated and acquired the lands, partly bank rolled by Piramal group for nearly Rs 140 crore.
“We are not in a position to comment,” anAscendas spokesperson told media a few days ago, while G Square could not be reached for a comment.
Ascendas already manages an IT park in Taramani, a logistics hub in Oragadam, an integrated township near Mahabalipuram and another IT park in Mahindra City.
GokulKalyanaMantap on CP Ramaswamy Road in Alwarpet has been acquired by hotelier Vikram Aggarwal for nearly Rs 150 crore. The land parcel, nearly 30 grounds, (one ground is 2,400 square feet) will pave way for a hotel. Aggarwal owns Radisson Blu hotel in Egmore and a beach resort, Fortune Select Palms, on the East Coast Road.
When asked about the deal, Aggarwal, who is out of the country, texted, “please allow us some time, we will get in touch with you”. He did not elaborate.
Lack of quality office space for both IT and commercial sectors has been a cause of concern for the industry in Chennai. For example, while Bangalore consumed 11.7 million sqft of office space in 2017, Chennai touched just 4.5 million sqft, according to a Knight Frank report.
“There is a shortfall in quality IT space supply in key micro markets including those within city limits. The resultant impact is reduced absorption. For example, this year, the industry absorbed just 3.4 million sqft of space as against 4.5 million last year,” said S Ramaswamy, senior consultant Asset Advise. The demand for large-sized quality tech space is high but supply is very few, he added. Fresh supply is expected in Chennai only by mid-2020.