Effects of Infrastructure Development on Real Estate in Bengaluru, known as India’s Silicon Valley, has experienced fantastic growth in recent years. The main drivers of this massive transition are the development of significant infrastructure, the IT sector, and technological advances. The city’s infrastructure progression, especially the Namma Metro expansion, the Peripheral Ring Road project, and the Suburban Railway is crucial in shaping real estate in North Bengaluru. 

The development of Bengaluru’s infrastructure has substantially boosted its real estate market. Bengaluru has proliferated in recent years, becoming famous among people and businesses. The Bengaluru real estate division has been vital in supporting this expansion. 

How is Developing Infrastructure Impacting Bengaluru Real Estate?

The constant development of Infrastructure projects in Bengaluru is largely impacting the real estate in the city. Here are some major infrastructural developments that are impacting the real estate landscape in Bengaluru. 

Bengaluru Infrastructure: A Motivation for Growth 

Bengaluru’s infrastructure is being improved to make it a more attractive place for businesses and residents. This includes improving transportation, reducing traffic, and improving living conditions. These changes are expected to increase property prices and make the city more desirable for businesses and homebuyers.

Namma Metro Expansion

The metro connectivity in Bengaluru is being expanded to improve transportation and reduce traffic congestion. This expansion has increased property prices near Metro stations, making these areas more attractive to businesses and residents. Whitefield, once a rural area, is now a major urban centre and financial hub due to Metro accessibility.

The expansion of the Metro system has also increased property prices in areas near Metro stations, such as Whitefield, Electronic City, and Yelahanka. This is because it’s easier to get to and from these areas by Metro. As a result, more businesses and people have invested in these areas, making them important real estate markets. For example, Whitefield, which was once a rural area, is now a major urban center and financial hub.

Peripheral Ring Road (PRR)

The Peripheral Ring Road (PRR) project is a major infrastructure project in Bengaluru that will connect several major highways around Bengaluru. This will help to reduce traffic congestion in the city centre by diverting heavy vehicles and long-distance traffic. The PRR is expected to have a significant impact on the city’s real estate market.

Bengaluru Suburban Railway

The Bengaluru Suburban Railway project is another major development that will improve transportation in the city and its surrounding areas. By building a new rail network, the project aims to reduce travel times and make it easier to get to and from the suburbs.

Impact on Real Estate Prices and Demand 

The continued infrastructure development of the city is remodelling the Bengaluru real estate market in multiple ways: 

Increased Property Prices

Areas with better transportation and shorter travel times are seeing a big increase in property prices. This is because more people are interested in buying homes in these areas. For example, areas near the Metro and the Peripheral Ring Road are becoming more expensive.

Commercial Real Estate Demand

Businesses are moving to areas with better infrastructure, which is the increase in commercial real estate demand. These areas are also becoming more popular places to live, which is increasing the demand for housing. This is because it’s easier to get to work and there are more job opportunities in these areas.

Development of Suburbs

The Bengaluru Suburban Railway project is helping to make areas outside of the city center more accessible. This is making these areas more attractive to people who want to buy homes or invest in property. This project can help to reduce traffic congestion in the city center and promote balanced growth.

A shift in Investment Patterns

Investors are now more interested in areas with new infrastructure projects in Bengaluru. They believe that these areas will grow and become more valuable in the future. Public transportation, less traffic, and better connections are important for a good quality of life. Many professionals choose to work in Bengaluru, which has increased the demand for housing. Bengaluru’s growing tech industry and expanding infrastructure have contributed to the thriving real estate market.

How Infrastructure Projects are Impacting Real Estate in North Bengaluru?

Since the opening of Kempegowda International Airport in 2008, the real estate in North Bengaluru has become a popular area for investors. Improved metro connectivity in Bengaluru and proximity to the airport are expected to increase property prices and rental rates in this region. Experts suggest that it’s better to buy a home in North Bengaluru than rent one, especially if you have enough money saved for a down payment.

As per Hindustan Times, local real estate agents say that two-bedroom apartments in high-quality projects in North Bengaluru are currently priced between ₹70 lakh and ₹1 crore. Three-bedroom apartments cost between ₹1 crore and ₹1.25 crore. Luxury properties are priced at over ₹1.5 crore. Experts predict that property prices in this area will increase by 10-15% each year for the next five years.

Two-bedroom apartments in high-quality projects are currently priced between ₹70 lakh and ₹1 crore. Whereas, three-bedroom apartments cost between ₹1 crore and ₹1.25 crore. Luxury properties are priced at over ₹1.5 crore.

Key Reasons for Rising Property Prices and Rents in North Bengaluru:

• Upcoming Metro Connectivity: Phase 3 of the Bengaluru Metro Rail Project is expected to significantly boost property prices in certain localities.
• Increasing Commercial Real Estate Projects: The development of IT parks, retail spaces, and offices by major companies is driving demand for residential properties.
• Proximity to the Airport: The proximity to Kempegowda International Airport makes North Bengaluru an attractive location for residents and businesses.

Established Localities in North Bengaluru:

• Hebbal
• Jakkur
• Yelahanka
• Thanisandra Main Road
• Hennur Road

According to data sourced from PropEquity, “A 5-km radius of Devanahalli alone, which is on the outskirts of real estate in North Bengaluru, about 37,000 residential units have sprung over in the last 3 years. This is inclusive of 36 apartment projects, 134 plotted development undertakings and 26 villa projects”.

Why is Commercial Real Estate Surging in Bengaluru?

A report by the Confederation of Indian Industry and CBRE predicts that Bengaluru will continue to be the leading city for commercial real estate in India. By 2030, it is expected to have around 330-340 million square feet of office space.

The report, released in July 2024, shows that Bengaluru’s office space has doubled since 2013, reaching over 223 million square feet by June 2024. This makes it the largest office market in India.

In June 2024, India had a total of 880.7 million square feet of office space. Bengaluru accounted for 25% of this total, with an average annual absorption of 15-16 million square feet over the past few years.

Here are a few reasons which have resulted to the surge of commercial real estate demand in Bengaluru;

Rise of Coworking Spaces

Coworking spaces have become popular in Bengaluru, a city known for its many startups and entrepreneurs. These shared office spaces offer flexible and affordable options for businesses of all sizes. 

BHIVE Workspace and WeWork are two examples of popular coworking spaces in Bengaluru. Many businesses, including startups, freelancers, and large corporations, are using coworking spaces because of the networking opportunities, collaborative environment, and amenities they offer.

Also read: Enterprise Coworking Spaces for Global Expansion

Bengaluru’s Thriving Startup Ecosystem

Bengaluru is a popular city for startups because of its innovative culture and supportive environment. Investors, mentors, and venture capitalists are attracted to Bengaluru to find new and exciting startups. This supportive environment helps startups to grow and succeed. Bengaluru’s thriving startup ecosystem shows the city’s commitment to innovation and progress.

IT parks and special economic zones (SEZs)

Bengaluru has many IT parks and special economic zones (SEZs), such as Electronic City, Whitefield, and Manyata Tech Park. These technology hubs have attracted many businesses, which has helped the economy grow and increased demand for commercial real estate in these areas.

The Role of Metro Connectivity in Boosting Office Spaces Demand in Bengaluru

Bengaluru, known as India’s Silicon Valley, has grown rapidly in recent years. This growth has led to a significant increase in real estate development in the city. There has been a 45% increase in new real estate projects in Bengaluru in recent times, which shows a major change in the Indian property market.

According to The Hindu, Central Business Districts and traditionally popular areas mostly saturated for homeowners, new real estate hotspots are emerging in the city, with metro connectivity in Bengaluru being the big deciding factor. In fact, Green light for Phase 3 of the Bengaluru Metro Rail Project is likely to boost property prices by over 30%. 

With Byappanahalli-Whitefield metro project likely to be fully operational by mid-year, rentals of office spaces in Whitefield are likely to go up by about 8-10% over the next two years, as per Colliers’ latest report “Bengaluru Metro Rail: Key office market impact”.

Whitefield is a major business district in Bengaluru, with many offices located there. About 17.2% of office space in Whitefield is currently empty. However, the upcoming Metro project is expected to increase demand for office space in this area, as it will be easier for people to get to and from work.

The report shows that the amount of office space available in Whitefield increased by 10% from 2011 to 2022, especially after the construction of the Metro project began in 2017. The amount of office space leased in Whitefield also increased by 18% during the construction of the Metro project compared to the period before construction began.

Conclusion
The development of infrastructure in Bengaluru has played a crucial role in driving real estate growth and attracting businesses and residents to the city. The expansion of the Metro connectivity in Bengaluru, the construction of the Peripheral Ring Road, and the development of suburban railway networks have all contributed to the increased demand for both residential and commercial properties. The managed offices are adding up to the growing infrastructure projects in Bengaluru.

For more information on coworking spaces in Bengaluru, check out BHIVE Workspace. BHIVE Workspace offers flexible and affordable office space solutions for businesses of all sizes.

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