Construction Industry News
Real estate development in India has undergone a significant transformation, with a rise in commercial real estate development taking center stage not only in major cities but also in the second and third tier. This flourishing growth can be attributed to several key factors that have reshaped the landscape of these cities and created unprecedented opportunities for investors.
One of the main drivers of the rise of commercial real estate in 'tier 2' cities is the substantial improvement in infrastructure and connectivity. Government initiatives to build new roads, rail networks and rapid transit systems have significantly improved the accessibility of these cities. Improved connectivity has not only made commuting easier for residents but has also attracted businesses seeking cost-effective alternatives to metropolitan cities.
The rapid rise in real estate prices in major cities has made them less attractive to companies and entrepreneurs seeking affordable commercial spaces. This has resulted in a shift towards tier 2 and 3 cities where real estate costs are more reasonable, providing an ideal environment for budding entrepreneurs to establish and expand their businesses.
The recent announcement of the Urban Infrastructure Development Fund (UIDF), administered by the National Housing Bank, has further boosted the growth prospects of second and third cities. The UIDF will be used by government agencies to develop urban infrastructure in these cities, encouraging private investment and driving overall development.An estimated 40% of startups in India are now based in smaller towns and cities. This influx of innovative companies has not only brought dynamism to these urban centers, but has also transformed their commercial spaces. The growing presence of startups has attracted more attention from investors and has led to the rapid development of the commercial real estate sector in these regions.
Large corporations and industrial houses recognize the potential of tier 2 and 3 cities and are investing heavily in these areas. The availability of affordable infrastructure, office spaces, warehouses, coworking spaces and shopping malls prompts companies to expand their operations to these regions. The government's efforts to boost manufacturing through initiatives like Make in India are further encouraging these developments.
The Urban Square Mall in Udaipur is an exemplary example of the changing landscape in Tier 2 cities. Covering an area of no less than 8.54 million square meters, this shopping and lifestyle center has become the most large and prominent in the region. With over 75 lifestyle brands from India and abroad, a six-screen multiplex and recreational facilities, Urban Square Mall exemplifies the growing desire for better retail and recreational complexes in Tier 2 cities.
In addition, a play area has also been developed with various fun activities for both adults and children. Furthermore, Urban Square Mall also has a huge food court with a wide variety of dishes from major local, national and international food chains and brands.
The changing landscape of 'tier 2' cities has opened up enormous potential for high returns on investments in the commercial real estate sector. The rise of commercial real estate in Tier 2 cities has created significant opportunities for 'Grade A' developers. It is the right time for investors and end-users to seize this opportunity and reap the benefits of the immense business potential of these cities.
