ASCENDAS india trust ANNUAL REPORT 2014/15
2 Chennai City Real Estate – Key Demand Drivers
Chennai has registered significant growth in terms of real estate. The expanding city limits and growing population have
been key drivers of the city’s growth. As a result, the real estate sector also registered expansion towards the suburban and
peripheral locations in order to meet the rising housing demand. Chennai has a diversified economic base anchored by the
automobile, software services and electronics hardware sectors. These are the predominant sectors driving the economic
and real estate growth in the city.
Software and Software Services
Software development and business process outsourcing are sectors that have been imperative for the growth of real estate
in Chennai. Major software and software services companies like Accenture, CTS, HCL, HP, IBM, Infosys, WIPRO, TCS, and
Microsoft have development centres in the city. The city is now the second largest exporter of IT/ITES in the country behind
Bangalore. IT/ITES sector has been the major driver of office space and residential space in Chennai, particularly along the
Old Mahabalipuram Road (“OMR”) and Pour micro-markets.
Electronics Hardware
Chennai has emerged as an electronic manufacturing hub with multinational corporations like Dell, Nokia, Motorola, Cisco,
Samsung, Siemens, Sony-Ericsson, Flextronics and Foxconn setting up electronics/hardware manufacturing plants, particularly
in the Sriperumbudur Electronics SEZ. Ericsson and Alcatel have research and development facilities in the city while Texas
Instruments’ R&D facility is in the pipeline. The development of electronics hardware manufacturing sector has in turn resulted
in the development of Sriperumbudur and other such neighbouring hubs as an affordable residential destination sought
after by both end-users and investors.
Automobiles
According to Invest India, Chennai accounts for 60% of India’s automotive exports, which leads it to be called as ‘The Detroit
of Asia’. Chennai has a market share of around 30%
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of India’s automobile industry and 35%
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of its auto components
industry. A large number of automotive companies such as BMW, Hyundai, Ford, Renault Nissan, Mitsubishi, TVS Group
companies, Ashok Leyland, TI Cycles, TAFE, Dunlop, and MRF have manufacturing plants in and around Chennai. Daimler
and Apollo Tyres have also started production in their plants. The growth of the automobile sector has resulted in the
creation of industrial clusters along Oragadam, Sriperumbudur and several parts of Grand Southern Trunk (“GST”) Road.
This, in turn, translated to an increase in support infrastructure, especially in terms of housing.
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GIREM
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Tamil Nadu Industrial Guidance & Export Promotion Bureau
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C h e n n a i C omm e r c i a l M a r k e t O v e r v i e w
