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I.T. Makes India Look Good
The boom of i.T. In india has not just made a mark in the field of technology but is also on its way to make india look good. Efforts are being made towards creating it parks, which are not just a campus of buildings but a lot more. They serve a variety of needs in order to attract and retain talent. The "built to suit (bts) campus format" used to create these it parks is increasingly being preferred, with organizations competing to gain maximum business.
As the demand for IT and Tech parks in India continues, the learning curve has increased substantially, with buildings being more efficiently designed with energy saving devices, security devices, good planning and servicing.

In short, the ever-increasing needs of customers are being met with creating intelligent buildings, which are world class.

The "Built to Suit (BTS) Campus format" is increasingly being preferred, with organizations competing to attract and retain talent, the key driver of their business.

Indian as well as MNCs are therefore very focused in creating the right work environment, which has its impact in terms of creating an identity, intelligent facility, scoring high on recreation, entertainment and health.

Moreover, different State Governments have earmarked IT corridors in different locations of the city. The objective is to make land available for long lease or purchase on low cost so that Corporates can take a decision in favour of those States. Andhra Pradesh, Karnataka, Kerala, Maharashtra, West Bengal, Uttar Pradesh (Noida) are some of the States, which have played an active part in promoting this trend.

Smaller companies requiring an area of about 30,000 to 50,000 sq.ft., prefer to occupy the integrated IT Park spaces, which provide all their requirements in terms of food courts, banks etc.

Global players like Singapore-based Ascendas joining in the fray to construct tech parks and IT Parks has also meant good technology on offer. These companies are looking for joint ventures with local partners.

Speedy delivery and state of the art technology would be the main advantages one can look forward to. Local developers will, of course have their brand and the advantage of being local. Hitendra Choudhary, Senior Manager Corporate Solutions with Pune-based Kolte Patil Group says trends set in IT buildings would apply to commercial buildings too.

Multinationals in any segment want good quality building designs, service areas, open areas etc, hence the design for commercial buildings follows the same international standards/rules. This has also impacted the residential market, wherein you have good quality conceptual homes for the employees, who having worked in the United States, come back to India where they expect similar quality spaces.

The local authorities too are getting smarter and incorporating these guide- lines in their building development. To that extent, tech parks have redefined the concept of quality business space for the other sectors.

India continues to attract IT, ITES companies comprising software companies, call centers, third party call centers, BPOs, finance companies, analysts etc, who come here because of the reasonably priced educated manpower pool, English speaking population and cheap real estate.

It is however important for the country and the developer to under-stand the requirements of the multinationals coming to India. The demand for spaces in IT parks is based on scientific analysis, where real estate is only one component. The other determining factors are the type of work to be carried out. Human resource components in that area, geo-political issues, potential for expansion, the landlord, the commitment to delivery... these together with factors that will help the company sustain and grow in the long term will drive the decision for the IT spaces.

Real estate available at even half the prices in some locations will not be picked by the company or MNCs if it does not suit the long term plans of the client. These companies are making much larger investments in technology and human resources.

For instance, BPOs doing business on phones and computers would require manpower having a good English accent. These prefer the Northern and Western areas.However for software processing, accounting, financial analyses, Chennai is the first preference. For BPOs, Delhi and Mumbai get full marks.

Earlier, tier 1 cities, were getting the maximum share, today tier 2 cities are also getting a maximum share of business, as real estate is not a constraint here. We are seeing this trend in the peripheral areas of the existing IT Cities and increasingly in emerging destinations i.e. Kochi, Mysore, Vishakapatnam, Chandigarh, Jaipur, Greater Noida (UP), Kolkatta etc. Says Rajesh Pandit, Head-Western Region C B Richard Ellis: "Different state governments have different attitudes on IT/ITES. Individual state governments have different policies which give a different footing for different corporates.

"For instance proactive state governments have managed to attract more IT, ITES companies. Presently Infosys, Wipro are planning IT parks in Calcutta." Adds Pandit, "We have worked with 17 different state governments in advising them as to the requirements of the MNCs and IT/ITES companies, and the activity these governments should undertake, to bring these companies to their states." Leading IT and software companies also negotiate for cheaper lands with state governments who are ready to provide these, to attract these companies to their state.

Other sops like rebate in stamp duty, higher FSI, rebate in property tax are provided to bring down costs. The presence of leading companies like Infosys and Wipro would help generate employment not just in the software parks, but also a lot of indirect employment. While developers are building these huge IT Parks and campuses, big clients realize that managing such large IT parks need professional expertise. Property consultants like CB Richard Ellis, for instance, manage large parks for these companies.

Vinod N Rohira, Director-Sales and Marketing, K Raheja Corp, says the immediate future is good for IT Parks. However the long term growth depends on the infrastructure provided to support the IT growth. The airports, roads, geopolitical support, the favoured treatment for IT would help it to be a big factor in our economy and match the growth in advanced countries. Adequate support to the IT sector would help us grow to be one of the best economies in the world. IT Parks are probably one of the most complex mix, where if you have to thrive, you have to provide the ecosystems, infrastructure, research, residential spaces, security spaces, support systems, relationship management services with the client etc. It is not just about creating buildings and getting away.

On some of the best models available in the country, which answer these requirements, Rohira says the Mind Space IT park in Mumbai and Hyderabad with 8-10 million square feet is an example of a good IT Park. Chaudhary says currently, the requirement is around 1 million sq. ft. more in Pune while in the next year there is demand for around 4 to 5 million sq.ft. and in the subsequent four to five years, demand is there for about 15 to 20 million sq ft. Business is going away to other places, because of the non availability of tech spaces in Pune. The future of IT is great in India and Pune. People are looking out for spaces here even from Bangalore. Pune is the preferred destination.

IT business is opportunistic and one has to work for a model which offers good lease space to keep them engaged in Pune itself. The IT parks lease rents are 22- 25 Rs./sqft. for the bare shells, plus taxes and maintenance. Outright purchases would be roughly Rs.2200/sqft. (Empty Sale) -built to suit requirements of the client. Mumbai, being the financial capital of India, MNCs who require presence in Mumbai will have their offices here. These companies will go out to bigger spaces available in Pune as they prefer multiple locations and outlets of business.

Pandit says the future is great. The cost factor would play an important role. Today, India is cheaper; if tomorrow, China becomes cheaper, then it would attract all the companies. Currently, the demand for IT Parks is good. There is a mismatch between demand and supply, with demand being more and supply less, especially in metro cities. This is so because there are not too many options available that are suitable to the clients requirements. According to Sanjay Dutt-Director, Transaction Services, Cushman & Wakefield India, tech parks have become an important part of the landscape of every city in India.

To summarize, a suitable mix of appropriate governmental policies, good consistent infrastructure (water, uninterrupted power, roads, connectivity through international airports, schools, colleges, hotels, well maintained surroundings), manpower are factors that are imperative to make IT Parks a success in the long term. A case in point-the shifting of major IT companies from Bangalore to other locations.
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Posted on : 29/10/2005
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