Chennai - ANAROCK
Chennai:From Resilience to GrowthReal estate growth led by Infrastructure,Investments and IndustriesFebruary 2019In Association with
2Chennai: From Resilience to Growth
Chennai: From Resilience to GrowthTable of contents04Foreword06Chennai: An Overview10Chennai: l Real Estate OverviewZone-Wise AnalysisChennai Consumer Survey Analysis26Chennai on the cusp ofrecovery30State government confident onIT-ITeS & Auto sectors’ progressIT-ITeS to drive southern suburbsMajor investments in the Automobileindustry to fuel Chennai growth34Chennai to convertopportunities to strengthsSWOT Analysis35Outlook3
4Chennai: From Resilience to GrowthForeword1The growing threat of trade war between USAand China has caused the central banks ofmany countries to protect their currenciesat the cost of their growth. Amidst this globalapprehension, India, remains relatively insulatedfrom such external shocks. India also stands tobenefit and emerge as a major beneficiary througha comparative advantage. Exports across thesectors from India have been on the rise whilemanufacturing and services sectors continue to bethe key economic growth drivers.Anuj PuriChairmanANAROCK GroupChennai – a major metropolitan city with historicalimportance and significance has been tough andresilient to combat the impact of natural calamitiesand emerge as a strong contender to becomean outstanding contributor to the growth anddevelopment of the nation. The city’s economy hasbeen driven by services and manufacturing sectorsand maintains a perfect balance of overall growth.Its strategic position which enjoys a large networkof major roads, railways, ports and airports havebeen instrumental in enabling trade from the city.
Chennai: From Resilience to GrowthThe major infrastructure projects such as themonorail, metro connectivity and the newinternational airport are likely to catalyse futuregrowth of the city. Already home to major nationaland international automobile manufacturers, theupcoming Aerospace park at Sriperumbuduris going to metamorphose the economiclandscape of the region. This will not only createan opportunity for increased investments andrevenues but will also help generate tremendousemployment opportunities, leading to rapidurbanisation.Chennai has been the second largest exporter ofIT-ITeS services in the country valued at nearlyUSD 17.10 Billion during 2017-18. It also employsover 4 lakh people and is home to several largeIT parks and SEZs. The state government aims toattract investments in the IT-ITeS sector to the tuneof INR 15,000 Crores during the Global InvestorsMeet (GIM) 2019. The automobile and autocomponent sectors are growing at a favourablerate with an installed capacity of over 6 millionunits across all segments. The city is home to over4,000 SMEs and 350 suppliers to the automobilesector and have been instrumental in supplyingto the major players such as Ford, Hyundai,Mitsubishi, Ashok Leyland, TVS and Caterpillar. Thesector recorded exports of USD 6.76 Billion during2017-18 recording a growth of nearly 18% over theprevious year.Chennai’s residential real estate market has beenwitnessing a continuous fall in prices. While thesales have been more than supply till 2017, themarket reversed in 2018, pushing the unsoldinventory to 30,000 units. However, the market isexpected to be back on the growth trajectory withcontrolled supply and bottomed-out prices.The report unravels the growth potential of the cityamidst the existing and upcoming infrastructurefacilities, residential real estate dynamics,the impact of IT-ITeS and the automobilemanufacturing sectors that are likely to impact thegrowth in the future.Chennai International Airport5
Chennai: From Resilience to Growth2Chennai:An OverviewChennai, known as the Gatewayto southern India, is known for itsport-centric business as well asengineering, manufacturing,IT-ITeS sector, and other flourishingindustries.City Wise Source : Census of India, 2011ChennaiSource : ANAROCK Research2011Hyderabad
Chennai: From Resilience to GrowthPer Capita 00060,0002014-15KarnatakaTamil Nadu2015-162016-172017-18TelanganaGrowth Percentage of GSDPGSDP Growth Rate2,00,00015%13%11%9%7%5%Pan India2015-16Karnataka2016-17Tamil Nadu2017-18TelanganaSource: RBISource: IBEFCas compared to its neighbouring two states in theregion. The state’s per capita NSDP is growingat a similar pace as that of PAN India, but slowercompared to Karnataka and Telangana. Tamil Naduhas registered an absolute growth of 30% in its percapita NSDP when compared to Telangana andKarnataka at 46% and 40% respectively, during2014-15 to 2017-18. However, the annual growthof per capita NSDP from 2016-17 to 2017-18 is 11%which is close to Karnataka and Telangana at 12%and 13%, respectively. A rising per capita NSDPclearly indicates that the state is on the cusp of arecovery.hennai Metropolitan Area (CMA), is spreadover 1,189 sq. km. and consists of parts ofThiruvallur and Kancheepuram districts, apartfrom Chennai city. The extent of Chennai MunicipalCorporation Area is 176 sq. km and comprises of55 revenue villages.Chennai has the lowest population growthacross the southern cities. The decadal growthof population has been only 23% compared toBengaluru and Hyderabad which grew at 47% and76% respectively. The decadal population densityof Chennai grew by 6% reaching 26,553 per sq.km in 2011 whereas, Bengaluru has grown by 47%.These parameters act as a growth inhibitor toChennai’s residential real estate as population andpopulation density growth is expected to directlyimpact the city’s economy.Not only in terms of population but also interms of per capita Net State Domestic Product(NSDP), Tamil Nadu is growing at a slower paceGSDP (Gross State Domestic Product) is akey measure which represents the goods andservices produced in the state and Tamil Nadu haswitnessed a steep dip in its GSDP during 2016-17.This dip is due to the floods during late 2015 whichimpacted its economy. However, the state hasbounced back with a healthy growth rate of 12% in2016 due to its thriving manufacturing and servicessector.Chennai Metropolitan Region (CMA) at a glanceCapital of Tamil NaduChennaiLiteracy Rate90.18%Sex Ratio1,000 M 989 FPopulation86 lakhs (Chennai Metropolitan Region)Population Density26,553 / km2.Reputed Educational InstitutionsIIT, Madras Medical College, IFMR, AnnamalaiUniversityTamil Nadu’s Contribution to India’s GDP8.5% at current prices (2017-18)7
8Chennai: From Resilience to GrowthMASTER PLAN FORCMA 2026The allocation of land withinthe city, for the developmentof residential use, is 33.58%and 13.78% for mixedresidential use. This is astrong contrast from theprevious master plan whichlacked the focus on thehousing need.The development of the CMA is entrustedto the Chennai Metropolitan DevelopmentAuthority (CMDA) - a nodal planning agencythat prepares the master plans for the region.The CMDA prepared the Second Master Planfor Chennai Metropolitan Area, 2026, outliningthe detailed development plan, along with landuse, transportation, housing and other importantaspects of the CMA.Proposed Land Use 2026Extent in HectaresChennai CityChennai CityChennai 682,426.913.7813,503.113.34Commercial Use Zone714.244.05880.350.86Institutional Use Zone2,868.9716.283,888.853.83Industrial Use Zone691.833.937,274.337.18Special and Hazardous Industrial Use 295.817.22,332.922.32,075.892.05Primary Residential Use ZoneMixed Residential Use ZoneOpen space & Recreational use zoneAgriculture use zoneNon Urban113.310.64UrbanisableOther (Roads, water bodies, hills, Redhills Catchments area, forests ,01,298.42100
Chennai: From Resilience to GrowthThe second master plan for Chennai metropolitanarea has proposed a separate land use plan forthe city specifically. The total area of the city’surban agglomeration as per the new master planis projected to be 1,18,916 hectares of which theshare of the city will be only 15%. The allocationof land within the city, for the development ofresidential use, is 33.58% and 13.78% for mixedresidential use. This is a strong contrast from theprevious master plan which lacked the focus onthe housing need. Increasing population amidstrising employment opportunities in the IT-ITeSand industrial sector necessitated a laser focus onhousing developments.Thus, it implies that more emphasis has been givento residential which supports the urban planners’concern to provide housing to all citizens. Theauthorities are also equally interested to create ahealthy and sustainable environment as evidentfrom the allocation of 21.31% for roads, waterbodies hills and ecological developments withinthe city and a 27.79% allocation was given to therest of the CMA.Chennai Master Plan 2026 was approvedin 2008 by estimating that the city’spopulation will reach 126 lakhs. Hence, toincrease the overall density by allowingFSI to 2 for non-multi-storeyed residentialdevelopments along the MRTS influenceareas (Thirumayila to Velachery) forresidential developments. The master planalso encourages high-rise developmentsalong the wider roads and larger plotsto allow multi-storeyed buildings in therest of CMA area. Master Plan 2026boosted for LIG housing developmentsby providing an additional FSI of 0.25.Overall the plan has been designedto encourage residential real estatedevelopments across the city.Chennai’s economy is driven by automobile, manufacturing and IT-ITeS sectors with anestimated GDP of USD78.6 billion in 2018. The city contributes 14% to the country’s IT servicesmaking it the second largest exporter. Chennai is also home to 40% of the automobile productionin the country which earned it the tag of ‘Detroit of India’.The decadal growth rate of population and population density is slower in comparison to othersouth Indian cities such as Bengaluru and Hyderabad, due to which the nature of residential realestate developments here is significantly different. To support the population growth of the city,CMA has drafted a master plan to accommodate and facilitate the rising residential real estatedevelopments.9
10Chennai: From Resilience to Growth3Chennai:InfrastructureSnapshotEXISTING INFRASTRUCTURECROADhennai’s total length of the road network is2,780 km consisting of ring roads and radialroads. The city is also a major node of theGolden Quadrilateral of National Highways. Thecity is connected to other Indian cities by fourNational Highways leading to Kolkata (NH 5),Bengaluru (NH 4), Trichy (NH 45) and Tiruvallur(NH 205) along with several prime radials listedbelow:NameConnectivityDescriptionAnna Salai-GSTRoad (NH 45)Fort St. George to the southwest viathe airport to Mahindra World City.It provides connectivity from city Centre tosouthern Chennai.Bypass RoadFrom Krishna Nagar on GST Road toMettupalayam on NH 5.It connects southern Chennai to NorthernChennai.Chennai Bengaluru From Chennai Central railway stationHighway (NH 4)via Sriperumbudur to Bengaluru.It connects western areas viz; Poonamalleeand Sriperumbudur with the city center.Chennai-KolkataHighway (NH 5)From Basin Bridge to Kottur.It connects Chennai Port with the Northernparts of Chennai.East Coast Road(ECR)From Thiruvanmiyur via Uthandi toMahabalipuramIt is running parallel to the OMR, it connectsthe coastal locations of South ChennaiInner Ring RoadConnects SH 94A (OMR/Rajiv Gandhi Salai) in Thiruvanmiyur and joinsSH 104 near ManaliIt runs close to Central Chennai throughlocations viz. Koyambedu, Villivakkam, AnnaNagarOld Mahabalipuram Road (OMR)From Madhya Kailash junction to thesouth via Sholinganallur to MahabalipuramAlso known as the IT Corridor, it connects thecity center with southern suburbs, such asPerungudi, Siruseri, and KelambakkamOuter Ring RoadFrom Vandalur to NemilicheryThe six-lane highway connects GST Road withthe Chennai-Bengaluru Highway and NH 205
Chennai: From Resilience to GrowthChennai’s total length of the road network is 2,780 km consisting ofring roads and radial roads.MAJOR ROADS OF CHENNAITo KolkataPonneri TalukORR Phase 2To ArakonamAmbattur TalukNemilicheryNH-205AyadiChennai CityORR Phase 1NH-4NazarathpethTo BengaluruSriperumbudurNH-45VandalurMinjur11
12Chennai: From Resilience to GrowthChennai hosts the headquarters of theSouthern Railways. The city has two mainrailway terminals -Chennai Central Stationand Chennai Egmore - which provide access toother major cities and other small towns across thecountry.RAILSullurpettaChennai Subarban Rail NetworkVelacherry - Chennai BeachGummidipundiChennai Central - TiruttaniTirumalpur - Chennai BeachSullurpetta - Chennai dyTambaramChengalpetVelacherryParkTown
Chennai: From Resilience to GrowthCHENNAI SUBURBAN RAILWAYNameConnectivityDescriptionMRTSChennai Beach - Thiruvanmiyur VelacheryIt connects Velachery via TIDEL Park to thecentral part of ChennaiSuburban Rail:West LineChennai Central - Avadi - TiruvallurArakkonamIt connects the North-western areas ofAmbattur and Avadi with Central ChennaiSuburban Rail:North LineChennai Central - Ennore Gummidipoondi-SullurpetaIt connects northern Chennai with CentralChennai via TondiarpetSuburban Rail:South LineChennai Beach- ChengalpattuVillupuramIt connects southern Chennai with CentralChennai via St. Thomas MountSuburban Rail:South-West LineChennai Beach - Tambaram ChengalpattuThis line runs parallel to GST Road, connectingthe Central Chennai with Mahindra World Cityvia TambaramSuburban Rail:West-North LineChennai Central- TiruvallurArakkonam- TiruttaniIt connects the central part of Chennai withthe west-northern parts via VillivakkamSuburban Rail:West-South LineChennai Beach- RoyapuramWashermanpet- PeramburArakkonamIt is the longest line running in the west-southdirection from Central Chennai.Outer Ring RoadFrom Vandalur to NemilicheryThe six-lane highway connects GST Road withthe Chennai-Bengaluru Highway and NH 205TPORTShe city is served by two major ports. TheChennai and Ennore Ports are in the Northernarea of Chennai.Chennai Port is one of the largest and oldestartificial ports in India and ranked among thegrowth generating major ports, despite the threatsand perceptions on diversion of cargo to emergingprivate ports. During the financial year 2017-18,Chennai Port handled 51.88 MMT (million metrictonnes) of cargo compared to 50.21 MMT handledin 2016-17 registering a growth of 3.33% and thetrend is likely to continue during the current fiscal.Ennore Port located on the Coromandel Coast,about 24 km north of Chennai is another majorport of the country. The port handled nearly 800vessels during 2017-18 and over 500 vessels tillOct 2018. The total cargo handled has increasedsignificantly from 14.96 (MMT) in 2011-12 to 30.45MMT in 2017-18 registering a compounded growthof nearly 13%.13
14Chennai: From Resilience to GrowthCAIRPORThennai airport is the third busiest airport afterNew Delhi and Mumbai airports. It is a majorairport in Southern India and has the facilityof domestic and international terminals adjacentto each other connecting with common canopy. Atpresent, the passenger capacity of Chennai airportis close to 14 million annually, which is expectedto rise after a few modifications. There has beena substantial increase in the number of flights tosmall towns and metros which has further led to anincrease in domestic passengers in the city.UPCOMING INFRASTRUCTUREChennai has grown significantly over the lastfew years. Employment opportunities, alongwith a decent lifestyle are the two majorfactors that have attracted people to the city.With increasing population, the city’s real estatelandscape has also grown by leaps and boundsand is now spread across various zones.ROADOuter Ring Road Phase II:While the first phase of 29.2 km of the project fromVandalur to Nemilichery has been completed andopened for traffic, the second phase of 33.10 kmfrom Nemilichery to Minjur is under constructionand at the final stages. The project is expected tocommence by H1 2019.While realty development in Chennai pausedmomentarily due to massive floods of 2015, thefundamental demand drivers remain unbroken andthe city is likely to remain on its growth trajectoryin the future periods, reinforced by upcomingnew infrastructure. The Government’s focus oninfrastructure improvement will surely boostChennai’s realty sector in the years to come.East Coast Road (ECR) Expansion:The National Highways Authority of India (NHAI)is currently working on road widening of a 690km stretch connecting Chennai with other citiesof Tamil Nadu. The entire cost of road extensionis approximately INR 10,000 Crore and is clubbedunder the Bharatmala project. In 2018, the stategovernment has given in-principle approval toupgrade ECR and it is to be renamed as NH 332 A.Maduravoyal Expressway:This 19-km elevated expressway proposed betweenMaduravoyal in the west and the Chennai Portalong the Cooum River. While it has been delayed,NHAI has prepared a revised detailed projectreport and plans to resume the execution soon.The elevated expressway will connect Maduravoyalto the port through Koyembedu. The corridor oncecompleted is expected to de-congest traffic inAmbattur Estate Road and Ponamallee High Road.
Chennai: From Resilience to GrowthMRTSRAILPROJECTSChennai Mono Rail:The State Government has premeditated threecorridors in Phase I of the monorail system. Thetotal length of the corridors foreseen under PhaseI of the system will be approximately 111 km. Thedevelopment of the system is currently under initialstages of implementation viz. feasibility study andbidding process for pre-qualification is currentlyunder NandambakkamMaduravoyalValasaravakkamVadapalani DPTAlapakkamKathiparaVelacherryMadipakkamCoot RoadCamp RdEast ameConnectivityDescriptionTentative commissioningMonorail Corridor I Vandalur - Kathipara2020-21Connects Vandalur andTambaram with central Chennaivia VelacheryMonorail CorridorIIPoonamallee KathiparaConnects West Chennai viaPorur2020-21Monorail CorridorIIIPorur - VadapalaniIt will increase connectivity between Porur and Vadapalani2020-21BAY OF BENGALVelapanchavadi15
16Chennai: From Resilience to GrowthThe three corridors include Madhavaram to Siruseri(41 km), Nerkundram to Light House (14 km) andMadhavaram to Perumbakkam (33 km). Of around88 km stretch under the second phase, 54 kmwould be underground while the rest would beelevated that are currently under development.CHENNAI METRO RAILChennai’s metro rail network comprises twophases and integrates all important locationsalong the three arterial roads of Chennainamely Anna Salai (Mount Road), E.V.R. PeriyarSalai (P.H. road) and Jawaharlal Nehru Salai (100Ft. Road).The entire project is scheduled to be completedby 2019. On execution, the metro rail networkis likely to significantly improve intra-cityconnectivity as well as reduce traffic congestionalong the main arterial corridors of Chennai andgood connectivity for the commercial zone atGeorge Town. Construction work on the extensionof Phase-I of the metro rail network fromWashermenpet to Thiruvottiyour has been initiatedin the first half of 2018.Chennai Metro idor 1Little MountCIDCOUndergroundElevatedUnder StudyAlandurCorridor 2ElevatedChennai AirportUnder Ground
Chennai: From Resilience to GrowthConnectivityMetro Corridor IWashermenpet - Chennai Central Connects Chennai InternationalAirport and central Chennai viastation - Chennai InternationalGuindyAirportExpected tocommence byFeb 2019
Chennai on the cusp of recovery 26 35 Outlook State government confident on IT-ITeS & Auto sectors’ progress IT-ITeS to drive southern suburbs Major investments in the Automobile industry to fuel Chennai growth 30 Chennai to convert opportunities to strengths SWOT Analysis 34 Residential Real Estate Overview Zone-Wise Analysis Chennai .
MSME DEVELOPMENT INSTITUTE, CHENNAI. E-NEWS LETTER E-NEWS LETTER FEBRUARY - 2020 GOVERNMENT OF INDIA MINISTRY OF MICRO SMALL AND MEDIUM ENTERPRISES MSME DEVELOPMENT INSTITUTE No.65/1 GST Road, Guindy, Chennai-600032 Ph: 044-22501011, 12 Fax: 044-22501014 Website: www.msmedi-chennai.gov.in E-mail: dcdi-chennai @dcmsme.gov.in . MSME DEVELOPMENT INSTITUTE, CHENNAI. E-NEWS LETTER Micro & Small .
Tamil Nadu Slum Clearance Board, Chennai-5/ Tamil Nadu Housing Board, Chennai-35/ Tamil Nadu Police Housing Corporation, Chennai. All District Collectors. The Registrar of Co-operative Societies (Housing), Chennai. Copy to: Law/Finance/Public (SC/Special-A) Department, Chennai-9. The Secretary to Chief Minister, Chennai-9.
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chennai@dcmsme.gov.in Web: www.msmedi-chennai.gov.in 2 Khadi and Village Industries Commission (KVIC) 326, Awai Shanmugam Road, Gopalapuram, Chennai-600 086 Phone: 044- 044-2835 1019 Email: sochennai.kvic@gov.in 3 COIR BOARD Regional Extension Centre Coir Board, Pillaiyarpatti Via Vallam Thanjavur-613403 Tamil Nadu, India. Tel /Fax: 91-04362-264655 Em: cbrectnjcoirboard@gmail.com 4 National .
2. TRENDS OF IT INDUSTRIAL DEVELOPMENT IN CHENNAI 2.1 IT firms in Chennai Chennai metropolis is located in the north eastern part of Tamil Nadu in India. It has an area of 170 sq. km. with a registered population of about five million as of 2001. Chennai Metropolitan Area (CMA), which is delineated for the purpose of planning and development
Chennai city, the fourth largest metropolitan city of the country, finds 157th rank in the list of urban areas categorized by developed land area i.e. urban foot print. As per the study titled ‘Demography - World Urban Areas and Population Projections’(2009) Chennai (comprising the Chennai City Corporation and the
Chennai – Bangaluru Industrial Corridor Project - Ponneri Industrial Node Opportunities associated with development of Ponneri Node . Need for high quality industrial park near Chennai for potential investors Availability of abundant and skilled work force from Chennai Growing interest of foreign investors in India
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