Ahmedabad’s IT SEZ, the city’s first IT/ITES special economic zone (SEZ), is all set to become operational in March 2011.

100 small companies planning to move
Already around 100 small companies functioning from different locations under Software Technology Park of India (STPI) scheme are planning to shift into the upcoming Rs 550 crore project. Another two city-based companies, Elitecore Technologies Limited and Hi-Tech Outsourcing Services are also moving part of their existing business into the SEZ.

Tallest building of Gujarat
“3rd Eye is developing 36 lakh sq-ft infrastructure near Science City. Of the 10 buildings designed inside the SEZ, construction work of two towers is almost completed, where companies will start moving from March next year,” said Bipin Shah, director of 3rd Eye SEZ. The company is also planning a 50-storey (200m) tower, which will be the tallest building of Gujarat inside any IT SEZ in India. Design of the proposed tower is ready, but implementation will depend on certain approvals from state and central governments, added Shah.

Nearly 5 million square feet of mall space will come up in Ahmedabad by the end of 2010. There are 11 new malls in the pipeline, which are under construction for over last one year.

Mall count will go up to 24
Once completed, this will be the biggest influx of malls in a single year in Ahmedabad’s history.
With this the total mall count in the city will go up to 24. SG road, Satellite, Wadaj, Sathadhar, Chandkheda and Gurukul are the target zones for the project.

57% increase in house price index
An interesting phenomenon seen since last year in Ahmedabad real estate, according to the NHB survey, there has been a 57% increase in housing price index (HPI) in the west and new west zones of Ahmedabad. An equally surprising market movement has been a 55% jump in HPI for areas in the north zone, such as with Saijpur Bhoga real estate, Buddh Nagar real estate and Vishnu Nagar real estate, in the same period. Areas like Bhadra, Dhudeshwar and Gaikwad Haveli also witnessed a 27% jump in HPI.

With a slowing real estate market in Mumbai, many city-based developers have set sights on the neighbouring state and real estate in Gujarat.

Two factors aiding this are the lower land costs and the virtually non-existent red-tape with Gujarat real estate.

“There is tremendous industrial activity in Gujarat, which has resulted in a growing demand for real estate in Gujarat,” said Anuj Puri, Country Head and Managing Director, Jones Lang LaSalle Meghraj (JLLM), a leading real estate consultancy firm.

Developers said that transparency was a big attraction. “Unlike Mumbai, land titles in Gujarat are usually clear and all details are available online. We do not need to visit government offices to verify such claims,” said Manish Veera, spokesperson, Ravi Group of Companies, which is planning to develop townships in Ahmedabad, Anand and Baroda.

Developers are also lured by the fast pace of granting permissions. “Our delivery mechanism is very fast as we want to speed up the development of the state,” said Narottam Patel, Rural Housing Minister, Gujarat state.

Pravin Doshi, President, Maharashtra Chambers of Housing Industry (MCHI) and chairman of Acme Group said: “The Gujarat government is very proactive. Small projects are cleared within a fortnight while bigger ones in three months.”

However, the Maharashtra government has dismissed allegations of lethargy. “Gujarat cannot be compared to Mumbai. There are lot of open plots there and development is easier,” said Sachin Ahir, Minister of State for Housing.

Vapi town of south Gujarat, has been a favourite location for industrialists from Mumbai who want to set up plants in Gujarat because they find the state more investor friendly.

Of late, enquiries from Mumbai have increased substantially for suitable land near Maharashtra’s border with Gujarat. People are upset with parochialism in and around Mumbai.

This, according to government officials, has pushed up realty prices by at least 10 to 15 per cent in just the last two weeks. “Normally, realty deals in Gujarat take place only after Uttarayan. But the trouble in Mumbai has only spurred interest here,” a collector of a south Gujarat district told TOI.

“Of late, investors from Mumbai and Hyderabad have come here due to political disturbances there,” said Jaxay Shah, president of Confederation of Real Estate Developers’ Associations of India (CREDAI), Gujarat chapter. That this should happen in a year when both states are celebrating their golden jubilee is also significant. The hype around Swarnim Gujarat is creating an air of positivity around the state at a time when its neighbour is trying to slam the doors on ‘outsiders’. So, be it a large infrastructure firm, which is planning to shift a substantial part of their operations from Mumbai to south Gujarat, or a leading company that is close to setting up a steel plant in the state instead of Maharashtra, the list is growing long.

“The number of inquiries from companies in Maharashtra has certainly gone up in the past one year ever since the Marathi ‘manoos’ thing started,” say senior state government officials. “Some of these investors are of course Gujaratis who are feeling increasingly uncomfortable in the neighbouring state,” he said.

Developers in the state of Gujarat are pressing for an industry status for realty sector. Issues like financial support from banks, transparency in functioning of revenue department and reforms in archaic concepts of development control regulations are now teething problems for the sector. Realtor and president of Confederation of Real Estate Developers’ Association of India Jaxay Shah says, “Realty industry is the only sector that is never given a deemed Non Agricultural (NA) permission status in Gujarat, while rest of the sectors – be it chemical, heavy industries and even small-scale industries are considered for it. This is hindering us from growing into an organized sector.”

Another realtor Rushabh Patel says that the emphasis on horizontal development should be curtailed to a greater extent. “Our concern is the growing middle class segment and their affordability for a home. Increased jantri rates and restriction on floor space index (FSI) are hampering their dream. Many town planning schemes dished out in the recent years need to take a reality check. I am sure that a large part of these schemes are yet to see any development.” Gujarat Realtors have even pressed for reforms in the upcoming township policy. “The condition that developers holding 100 acres or more can construct townships is restricting many small players. Besides, a township coming up 20 km away from the central business district will make life costlier for those living in budget homes in townships, the travel costs for instance,” says Shah.