Here's why, you and I can't afford property in Bangalore

NRIs invest in Bangalore's property boom:
India Abroad News Service

[Business India]: Bangalore, March 2 : Indians living in the US and Britain are making a beeline to Bangalore for lapping up luxury property as India's IT capital sees a property boom.

Alliance Housing Ltd, a subsidiary of the US-based Magma Consulting Inc, has hooked several NRIs (Non-Resident Indians) in the US to book duplex villas in the upmarket Whitefield here.

Within weeks of launching its Rs.1.5-billion ($34 million) housing project titled "10 Downing", about 90 of the 175 villas have been snapped up by prospective owners - a majorty of them being tech-savvy NRIs from the US and a few from Britain.

"There is a great demand for luxury housing in Bangalore and other boom cities from the NRIs in the US and elsewhere because India has emerged as an attractive destination for investments and outsourcing," Alliance managing director Manoj Namburu told IANS.

"With residential property prices in the sub-continent still much lower than in the western cities, NRIs find owning a luxurious house or villa a value proposition and a lifetime guarantee to return home some day," he said.

Though Alliance has priced its upcoming villas, modelled on European architecture, between Rs.6.2 million and Rs.1.5 billion per unit - depending on the plot size and designer configuration - the tremendous response has made the subsidiary expand its luxury housing activity to other cities like Pune and Hyderabad.

"Based on the initial response, we are upbeat on booking the rest of villas (85 units) at 10 Downing in the coming weeks. The entire project would be completed by April 2007.

"We also plan to launch similar projects in Pune and Hyderabad to meet the growing demand for luxury housing from the upmarket segment," Namburu said.

Located over 20.5 acres of developed land, the 175 villas would occupy only 25 per cent of the built-up area. The remaining space has been earmarked for landscaped gardens, jogging tracks, granite-clad cement roads, tennis and badminton courts, swimming pool, clubhouse with gym, and playground.

"For the first time in the Indian housing market, we are introducing an upfront warranty to guarantee each duplex villa high quality construction, engineering and vastu. The one-year warranty represents a paradigm shift in the housing sector," Namburu said.

Buoyed by the impressive response, Alliance is embarking on a 50-acre deal in the city's IT corridor to build duplex villas, mainly for NRIs and CEOs of multinationals setting shop in Bangalore.

"We are also foraying into commercial property to build a five-acre tech park in Whitefield with a 12-storey tower for the knowledge industry. Since it is being located in the bustling IT corridor, we are confident of booking the entire space for taking up the construction soon," Namburu said.

The Rs.2.5-billion Magma Consulting, based in California, with diverse interests in chemicals, software systems integration and seafood businesses, has forayed into property development in India to capitalise on the booming realty sector.

With the Indian government allowing 100 percent FDI (foreign direct investment) in the construction sector, Namburu said the prospects of overseas firms making inroads into the real estate business were bright.

"Though all our projects are being financed from internal accruals currently, we may look for tie-ups with overseas firms or institutions showing interest in investing in our future projects through FDI," he said.