Backed by the growth in the office and retail sectors, tier-II cities continue to play a vital role in the country’s growth story, according to a report by CBRE South Asia, a real estate consulting firm.
The widening economic base and access to a skilled talent pool are prime influencing factors for occupiers to consider expanding in tier-II cities, it said. The various business clusters across tier-II cities offer a mix of non-SEZ and SEZ establishments with average quoted rentals ranging from ₹30-40 per sq ft a month to about ₹60-80 per sq ft a month.
Additionally, malls, industrial hubs, and flexible space operators are becoming more prevalent in most cities. Additionally, this report indicates that the relatively low cost of living in these cities compared to tier-I cities, as well as the growing number of healthcare facilities and educational institutions, contribute to their high quality of life.
‘Focused policy reforms’
“The implementation of focused policy reforms and strategic infrastructure initiatives by the State/Central government has resulted in consumer preference leaning towards suburbs/smaller cities. This is evidenced by the entry and expansion of flex operators and the increasing footprint of industrial establishments,” said Anshuman Magazine, chairman and CEO-India, South-East Asia, Middle East and Africa, CBRE.
The report is based on the analysis of ten key cities which includes Chandigarh, Jaipur, Ahmedabad, Kochi, Thiruvananthapuram, Lucknow, Indore, Bhubaneshwar, Vishakhapatnam, and Coimbatore.