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what could be the purpose of buying a house 70 kms away from city? I believe you have no idea to live there.. Even OMR has no infrastructure, what could be there after 70 kms? You want that property to raise in value and get lot of profit?CommentQuote0Flag
- Marg is building their own SEZ's inside their township. The situation is similar to Mahindra World City which is some 50 odd kms from the city but has insane land prices only due to its presence. One can never predict how much the distance barrier will shrink in 5-6 years from now. ECR is said to be broadened to a 4-lane highway in 3 years or so. Yes, I don't have any plans of moving over to Chennai for another 6 years to start with.
- Actually not a bad idea...
I've done some research on Marg Swarnabhoomi, and am considering buying a 2- or 3-bedroom house there. I've yet to visit their site, however, so am waiting to do that before I commit to purchase. I found this thread, and wanted to share my views.
First, I believe that the distance is a major issue for people immediately looking to move there. However, for people like me who have at least 3-4 years left before moving, it's definitely worth considering.
Second, as neosphere pointed out, Mahindra World City is the only reason NH-45 has boomed to what it is today. Similarly, several SEZs are planned in Swarnabhoomi. Undoubtedly, several IT/ITES companies will set up shop there once the basic infrastructure is in place. There's a huge catchment area for talent (Chennai, Kanchipuram district and Pondicherry engineering colleges, polytechnic institutes etc.). The demand will increase exponentially once the companies begin operations there and employment increases.
Third, government planned infrastructure is set to extend upto their area. ECR widening is under proposal ( http://www.hindu.com/2008/06/17/stories/2008061757770100.htm ), and a railway line linking Chennai to Cuddalore directly has been approved by Southern Railways ( http://timesofindia.indiatimes.com/Cities/Blueprint_for_E_Coast_rail_link_to_Cuddalore_ready/articleshow/3150506.cms ). Additionally, Marg has planned very sound basic infrastructure for their project (uninterrupted power supply, desalination plant, sewer and waste management, and road connectivity).
Finally, the plan is to minimise the need to travel outside the community because it is meant to be self-sustaining. Apart from a school, a hospital and a mall, other reasons exist that will guarantee rapid price appreciation: a port in Cheyyur to be developed by Marg, for handling coal and power generation, and great lifestyle additions like a club, a mall, a golf course etc.
All in all, I think this is an excellent opportunity for sound investment, and if you're willing to wait a few years, a great new choice of residence away from the hustle and bustle of a large Metro. I'm sure that the value will appreciate tremendously in a few years. What's more, I think this place won't be affected by price fall/correction, if any, on OMR because unlike the unchecked rapid rise of prices all along OMR, prices for this project will rise solely based on the response to the SEZs within the community. I believe that the response from the IT sector at least will be very enthusiastic, and thus buoy prices only upward.
So my suggestion to any of you considering this project is, go for it. Any comments/corrections/suggestions are very welcome; sooner the better, coz I'm almost convinced... !
- Prasanna, thanks for the update. Did you manage to visit the site recently? How are the developments around that place? Will the promised infrastructure developments would happen in that place? What is the rate per sft for 2 BR flat?CommentQuote0Flag
- May be good idea for holiday homeOriginally Posted by neosphereHi,
I had recently visited Marg's site in Seekinankuppam which is nearly 70 kms from their office at OMR. The place looks good; clean air; open and unpolluted environment; close to the sea face however, the distance from the city is the main concern here. The Marg reps claim the need for going out as minimal after the whole township which will contain everyting from grocery stores to hospitals; is built. The price(10 lacs for a 1bhk) looks mouth-watering but at the same time I'm also doubtful about the appreciation of the land value solely attributing to it's distance from the city. They also said that the MRTS is eventually gonna expand to that neighborhood which clearly is a marketing gimmick.
What would you guys suggest me to do? Go for it or pass?
Hi Fellow citizen,
It may be a good idea for a holiday home.
If you want a home for living, This may be not the best time to buy.
Just invest those funds in Liquid cash funds and get tax free 10% or more when the interest rates go up every 2 moths.
Inflation is big issue now and the RE market is the brink of a big fall.
Mid 2009 you will be able to buy a flat for same price much closer than 70 kms.
Just spend some time and check out the Indian & global economic situation.
Everything is pointing on a global economic crisis and drastic rise in interest rate, Credit issues.
Don’t waste your hard earned money now - You can choose your investment timing now.CommentQuote0Flag
- Swarnaboomi depends on potential SEZ and IT office space
Here is toady artcile in hindu property plus about the over supply of IT Office space as SEZ.
If I was an IT company I have way too may choice,locations and oversupply of office space.
MOTHER OF ALL OVER SUPPLY.
Please read HINDU property plus 09/08/08
Nearly four million sq.ft of IT space is unused and many dedicated IT parks are vacant, writes Suresh Kuppuswamy.
The Government of Tamil Nadu recently announced new ICT (Information and Communication Technology )policy 2008.
Assuming that all the IT parks so far cleared by ELCOT would be completed in the next three years, 55 million s.ft of space will soon be available.
Then the additional built up area required would be 28 million s.ft. This seems possible to build. However all is not well with IT dependent real estate.
There is a yawning gap between what is projected and what the city can actually absorb.
Recently, the government entered into an agreement with a private developer, DLF to develop the Tidel Park II at Taramani in 26.64 acres of land at an investment of Rs.1500 crores. About 4.5 million sft. of IT space is to be built in two phases and the first phase with 2.5 million sft. is expected to be ready by 2009.
The third Tidel Park is to come up at Taramani in a land of 25.27 acres at an estimated cost of Rs. 3000 crores which is a joint venture of TIDCO and Tata Realty. In this project, the total space would be 3.5 million sq.ft and the first phase with 2.1 million is expected to be ready by 2009. ELCOT is planning to set up a second IT park at Sholinganallur, Perumbakkam (IT corridor) through a private partner on a 199 acre site with 10 million sft accommodating 250 mid-size and 50 large companies.
If all these developments are realised there will be an additional 18 million sft. of built space in Chennai Metropolis alone. As per a recent report, CMDA plans to develop 1 lakh s.ft of commercial space for IT offices over the airspace at MRTS Stations at Taramani, Velachery and Perungundi.
How much of built space can Chennai absorb?
IT parks vacant
In the last eight months, there have been many less enthusiastic reports regarding IT built spaces. A recent report reveals that nearly 4 million s.ft of IT space worth Rs. 1600 crores remain unused and many dedicated IT parks are vacant. It was also predicted that the vacancy level would soon reach 6 million sq.ft. Over supply and slow development of infrastructure are the reasons cited for this phenomenon. In addition, as the last quarter results of most IT majors have shown, the net profit margins are down confirming the predictions that IT-ITES sector will face a slow down on account of slump in US economy. Nasscom had forecast a drop in orders and profits as a short-term phenomenon whereas IT majors feel that only by early 2009 the upward trend may be discernable. IT companies now prefer to move to IT-SEZ to avail tax benefits. It is observed that of the total 59 SEZs cleared by the Central Government in Tamil Nadu, 37 relate to IT-SEZ and 12 are already operational. As of March 2009, the STPI incentive policy for IT parks and the associated tax benefits would cease to operate and IT_SEZ would then be the preferred option. Would a shift to IT-SEZs to avail tax benefits for the next 15 years create further vacancy? The developers who have invested in IT parks look at this scenario with gloom.
To add to the situation, the government is proactively promoting IT related developments in tier II cities. An IT – SEZ is being established at Coimbatore in a 29.08 acres plot. In Madurai an IT park is being planned in a 29 acres plot and the government plans to construct 1 million s.ft. Similarly in Tiruchi, about 135 acres has been alienated to ELCOT for developing an IT tower measuring 1 million sq.ft. In Salem also about 164.26 acres has been allotted in SIPCOT Industrial Estate for establishing an IT park.
The existing vacancy in IT buildings raises serious doubts about the projection as well as the continuation of incentives.CommentQuote0Flag
- Please chech the fate of Navi Mumbai
Navi Mumabai is a new city (Yes Whole new city) about 100 kms away from Mumbai.
There are 100's of SEZ and townships created like the Swarnaboomi.
My friends bought appartments in similar township like Swarnaboomi which depends on future IT SEZ.
He now lost 30% in Value (In the past 3-4 months),Unrented for 10 months,now he finaly tenented it out and he pays 80% of his rental income for Maintenece fees.
Please find out how many thousands they want in monthly maintence fees.CommentQuote0Flag
- Ricky, Is Swarnabhoomi dependent only on IT? I understand there are few auto ancillary units coming up in the SEZ. The MOUs have been signed already.CommentQuote0Flag
- Multi Purpose SEZ
Swarnaboomi is planning for multi use SEZ Includeing IT & Auto components,However it will have to compete with a lareg oversupply of SEZ's through out the country.
Every state goverment (Allover India) is creating economic Zones.
This will have to compete with many SEZ's in Sriperamputhur,Chennai,Coiambutur,Madurai,Hosur,Nanguneri etc.
How has investments performed in Mahindra City & Navi Mumbai(Invest in the last 12 months)
Atleast Navi Mumbai has an new International Airport,Over sea Bridges,Current running Railway line to Mumbai.
There is forecast of glut & Oversupply in far south Chennai due to Hirandhani,L&T,DLF& India Bulls - All expected to Flood the appartment market of Far south Chennai in the next 2-3 years.
When every developer in the country wants to build SEZ and IT parks we end up with mother of all over supply and hangover for years.
There is a saying in share market "When taxi drivers give share buying tips - you sell out of the market" Meaning the market is over valued.
Same goes with property,when every one you know is a property broker and every builder is building SEZ you sell your RE portfolio.CommentQuote0Flag
- No of SEZ in India as of now
According to SEZ Units Director General L B Singhal - There has been 462 SEZs approved as of early 2008.
Only god knows how many more are on the way.
He signed off one recently In Tada between Chennai and Thirupathi.CommentQuote0Flag
- Originally Posted by rickyofsnowIT companies now prefer to move to IT-SEZ to avail tax benefits. It is observed that of the total 59 SEZs cleared by the Central Government in Tamil Nadu, 37 relate to IT-SEZ and 12 are already operational. As of March 2009, the STPI incentive policy for IT parks and the associated tax benefits would cease to operate and IT_SEZ would then be the preferred option. Would a shift to IT-SEZs to avail tax benefits for the next 15 years create further vacancy? The developers who have invested in IT parks look at this scenario with gloom.
rickyofsnow, I too read this article yesterday, and as Suresh Kuppuswamy (author) describes it, the demand/supply ratio is tilting towards SEZs. While this article points out important concerns for investors in general, those interested in SEZ-based townships like Swarnabhoomi should take heart because the trend is definitely pro-SEZ.
Besides, the problem in Tamil Nadu is not the abundance of SEZs like in Navi Mumbai, but instead the overall demand/supply ratio which includes SEZs and all other IT parks. Given the choice, companies prefer SEZs, and at least as of today the demand for SEZs in Tamil Nadu is pretty strong.
Finally, as crvenky2006 pointed out, Swarnabhoomi also includes a non-IT SEZ which is intended to attract several other industries to the area.
However, you make a valid point about the monthly maintenance fees. I'll find out asap and post it here.
crvenky2006, my parents visited the site last week. The first thing they noticed was the sheer distance from the city! But I believe that an integrated township should eliminate the need for frequent travel to and from the city unless our workplace is within the Chennai metro area.
Construction is underway for Phase I and Phase II of the residential units as well as in the SEZ. The current price for their Phase II is Rs. 1600/sq.ft regardless of the square footage of the apartment and the floor it's situated on. Their launch price for Phase I was 1475/sq.ft, so there is already some appreciation (may be an artefact, though). However, the lady who contacted me said their tentative pricing for Phase III was going to be 2000/sq.ft.... That's a good sign, right?! Anyway, they have ~250 apartments left out of 400 from Phase II (launced last month), and they are sold out of all except 1BHK apartments from Phase I (~20 out of 300).
As for developments outside of Swarnabhoomi, there is apparently nothing yet, but it's probably too early to see that (they just launched a few months ago). I believe that Marg will provide all the infrastructure they promise. As for the government's promise of widening ECR and providing a railway line, your guess is as good as mine . Since Southern Railways has approved the railway line, I have good hopes for that project... but it may well turn out to be another 'Parakkum Rayil' fiasco! Let's keep our fingers crossed...
- Self sustainable township
Friends, Self sustained townships(with schools hospitals and some work opportunities) are good provided they are close by to main city as an employee does not want to limit his or her employment growth to the limited opportunities available with in the township (SEZ).
Say you are a professional, you would like to jump jobs every couple of years to further your carrier, this will be limited if you live in a pocket 70 kms away from the city.
If this Swarnaboomi is around 30 Kms to Adayar than there is better future capital gains as all type of workers from South Chennai would be interested to buy from you.
It will end up like Jamnagar (Gujarath),Neyvali (NLC) Thermal City (Tuticorin)etc, at least they are built by Government bodies and maintenance responsibility falls on the Municipal corporation and government bodies.
What I hear from Navi Mumbai is, the builders build beautiful features that aid the sales process, but the costly maintenance falls on the hands of the owners after the developer has made his money and walked away.
There are no rules preventing deception of low maintenance levy at the sales time and then hefty increase in the levy at later stage (as happened to My friend at Navi Mumbai)
- 5 year tax holiday at SEZ and after life.
I hear lot of organizations (IT and others) keep moving every 5 years from one SEZ to the another.
The reason: They get 5 years 100% tax holiday (Exports only) at a new SEZ,
Export Tax holiday for SEZ:
SEZ units (100 per cent for the first five years, 50 per cent for the next five years, and up to 50 per cent for further five years, subject to creation of reserves),"
So once the five years is finished they end there lease with the unfortunate owner and then move on to another new SEZ for a new 5 (100%) year tax holiday.
This is already happening in many part of India (Gujarath, Maharastra ,Delhi, NOIDA,Gurgong)
What happens to the old SEZ (No tax holiday), Well if they are close to other facility they will survive if they are in an isolated location, bad luck – Concrete jungle with no value.
- township v Boutique complex
The sale gimmick followed by developers all over the world,
· This phase is Rs 1500 per sqft, but the next phase come up for sale in 3 months is priced at Rs2,000
· We have sold 80% of the units already and only 20% remaining, they will be sold in 1 month, then you will have to go to Phase 2 and pay Rs2000 per sq ft.
If your buying real estate please do not restrict potential resale/rental to set group of people.
You will pay for swimming pools, lifts, Gyms, water futures, huge generators etc.
Boutique apartment complex (12 to 50 unit complex) closer to large city, would be the best.
- Marg Swarnabhoomi is not just 70 kms from Chennai. It is 90+kms from Chennai. The querist has stated that it is 70 kms from the office of Marg Swarnabhoomi in OMR, which already is 20 kms from Chennai!
Mamallapuram is 60 kms from Chennai. Kalpakkam (Pudupattinam) is 12 kms from Mamallapuram or 72 kms from Chennai. Marg is 20 kms from Pudupattinam.
The IT sector when they first wanted to extablish, were shown the ECR (the new Mamallapuram Road) for consideration by the authorities. The studies revealed that the sea wind speed is more because of which the communication towers would not perform at their best. Therefore, the OMR which is about 5 kms away from the sea coast was selected. Therefore, at the Marg locations or the ECR, IT sector will not grow as projected.
The Cheyyur, Marakkanam, creeks, salt pans, reserve forests and Buckingham canal are all within 10 kms near the Marg site. Thus the site is ecologically sensitive. When the ECR project was first proposed the environmentalists opposed and PILs were filed upto the Supreme Court level. The SC constituted the Justice Natarajan Committee and Coastal Zone Management regulations were framed and are in force. There are District, State and Central Coastal Zone Management Authority considering every proposal for development. Thus the approvals for new projects on the coastal areas may not be as fast as it had been in OMR or GST Road, resulting in stunted growth. Moreover in the coastal areas only certain types of projects are permitted.
The road widening beyond present levels will meet fresh opposition from environmentalists. Moreover, the road as of now has curves that are not generally permitted on National Highways. Because the Supreme Court banned relocation of villages, disturbance of the waterways and reduction of greenery by cutting of trees, the curves stay as they are. The NHAI is unable to straighten the road.
The scrapping of the Cheyyur power project was because of environment reasons.
The area around Marg location has many scenic spots. The villages around are ancient - from the Tamil Sangam days. The villages carry ancient Tamil names like Othiyur, Pudupattinam, Then Pattinam, Vada Pattinam, Idaikkazhinadu, Panaiyur, Sikkinankuppam and what not. The places like Mudaliarkuppam Boating camp site, Alamparai Fort (dilapidated) Beach site, Marakkanam Creek, Othiyur Creek are all very scenic and beautiful. The fishermen's villages in this area (32 kuppams) are all considered very ancient. Thus any development of the kind that happened in OMR will be a far-cry.
The Marg property will be a good holiday home or a retirement residence. It may not bloom like the OMR as a commercial hub or Besant Nagar or Annanagar as a residential locale. It may emerge as a holiday destination.CommentQuote0Flag