Kerala Real Estate Trends - Developments and Property in Kochi, Trivandrum and Kozhikode

Some of our customers have been requesting us to write about the prevailing trends in the Kerala Real Estate market. So we thought we will discuss about it in this article. Since Real Estate is an area where trends of price, developments could change not only at a macro level but also at a micro market level, it is quite a difficult task to pick one amongst these developments as a trend.

By definition, "Trend is a change or a general direction in which something is moving for a given period of time". To summarize trends in the Kerala Real Estate market, let us take a look at the major markets of Kochi, Trivandrum and Calicut. As you might know, most realty developments in Kerala follow a hub and spoke model with these three cities, getting the major share of attention when it comes to real estate investments and new developments.

Kochi: 

Kochi really was the real estate hotspot in 2007-2008, with developers like DLF, Sobha Developers, Ansals, Purvankara, Confident Group, Oceanus, Unitech, Nitesh Estates, Housing Development and Infrastructure (HDIL), Prestige Group, Emaar MGF descending and announcing projects worth over $2.5 billion. Sobha announced the Hi-Tech city in Maraadu, DLF purchased close to 4 acres from the State Government and HDIL purchased a 70 acre plot for developing an IT park. The result - Property prices shot up by over 60% during this period and developers had the last laugh as bookings were plenty, especially from investors. A look at the RESIDEX of Kochi  clearly tells the story wherein with a base of 100, property prices shot up over 2010-2011 but crashed in the following quarters. We have analyzed the speculative nature and the bubble formation in our earlier article on Kochi.

Today after many quarters of decline, property prices in Kochi seem to have achieved some degree of stability. If announcements in Emerging Kerala go as planned, and Kochi metro is delivered within 4 years, there is scope for some happiness and real appreciation in a few years time. With a total length of 25 kilometres from Aluva to Pettah, the Kochi Metro would not only be the smallest of the metro-rail networks, but would also relieve the congestion in the city and pave the way for developments along the metro corridor. The other big development here is the Lulu shopping mall coming up with an area of 25 lakh sq.ft.

As far as micro market developments in Kochi are concerned, you need to divide the city into various zones and look at new project annoncements which are being made to get a pulse of the market. For further information, please contact our team at Nandanam and we will be happy to assist you with the same.

Kozhikode:

Kozhikode is not only the third largest city in Kerala but also the state’s second largest urban agglomeration with a metropolitan population of 20 lakh plus people. The major population of the city is employed in the Middle Eastern countries. Their remittances are the major source of economy of the region. The city has around 40 IT companies operating at the moment which is quite small compared to the number of companies in Kochi or Trivandrum. Given the proximity to Bangalore & Mysore (which are just 6 hours and 4 hours away respectively) and the presence of educational institutes like IIM Kozhikode, the city could prove to be a major IT hub in the coming decade.

Some interesting projects on the anvil at Calicut are the  HiLite City, a first of its kind urban integrated township with 32 lakh sq. ft. of residential, commercial and retail spaces awaiting completion by 2013. The total project cost of HiLite City is put at Rs.900 crore.  The other one is the mono rail project. As reported in the Hindu " The monorail project, envisaged by the Kerala Road Fund Board, has two components — the development of monorail for 12.60 km from Government Medical College Hospital to Meenchantha and the operation of exclusive buses to the Calicut International Airport. The estimated cost is Rs.1,018 crore." The Lulu group is also planning a convention center in Calicut once existing projects are completed.

Trivandrum:

As far as Trivandrum is concerned, majority of the developments have been happening in pockets like Vattiyoorkavu, Vazhuthacaud, Vellayambalam, Technopark etc. The influx of IT professionals to the city at Technopark, has given a major boost to the real estate developments in the city. You can read more about these developments here.

Trivandrum is also looking towards the monorail development to augment the growth in its micro markets, which might be located far away from the CBD or the IT hub. The development of international stadiums at Kazhakootam and Vattiyoorkavu have also increased real estate interest in these areas. When the 32 projects to be implemented in Thiruvananthapuram district were presented before the investors at the Emerging Kerala-2012 summit, only five project proposals were received by the government.The biggest project is the Engine Assembly Unit of Volkswagen at an estimated cost of Rs 2,000 crore which might be coming up at Trivandrum. Ravi Pillai, founder of the RP group plans to invest Rs.1,000 crore in Trivandrum to set up a world class convention center.