The World Bank has raised its growth projection for India to 7% for the current fiscal year, up from its earlier estimate of 6.6%. In fact, India is solidifying its position as the fastest-growing major economy – the country’s real GDP grew 8.2% in FY 2023-24, exceeding all expectations. 

With such economic growth and high urbanization, India's Tier-I cities will likely experience saturation, leading to commercial centres moving to Tier-II and III cities. 

Related reading: Tier-2 Cities: The New Frontier for GCC Expansion in India

Consequently, Tier-II cities in India are witnessing a commercial real estate boom, attracting businesses worldwide to set up operations here, reaping the multiple advantages at much lower costs. 

Trivandrum, Kerala’s capital stands out among the top Tier-II cities in India, displaying great potential as the next big business hub that international companies are already taking up space in or looking to explore. Let’s check out this development to learn more. 

Real Estate Growth in Trivandrum

In a recent report by Cushman and Wakefield India Research, Trivandrum, the capital of Kerala, was identified as one of the 10 most emerging Tier-II markets from the perspective of real estate market momentum.

More and more large private sector developers are setting up quality Grade-A projects in both commercial offices and retail segments. From Grade-A office spaces to swanky malls, Trivandrum has embraced large occupiers and retailers to set shop here and thrive like never before!

The state of Kerala has recorded high levels of urbanization – according to the 2011 census, 47.7% of Kerala’s population lived in urban areas, making it one of India’s most urbanized states in the country. By 2035, more than 90% of the population is projected to be urban. 

Naturally, Trivandrum has emerged as one of the key representative urban centres in Kerala, flourishing into an engine of growth. 

Factors Favouring Real Estate Growth in Tier-II Cities

A confluence of factors is driving real estate growth in Tier-II cities. Firstly, the rising cost of real estate is pushing investors to Tier-II cities. Secondly, improved infrastructure development in these cities, including better connectivity, transportation, and amenities, has enhanced their livability and business growth. In addition, since COVID-19, several professionals have moved back to their hometowns due to flexible work arrangements and continue to prefer working out of smaller cities – this makes them available for new opportunities in Tier-II cities. Let’s look at some other reasons why real estate growth in Tier-II cities is at an all-time high: 

• The cost of doing business per sq ft is much lower in Tier-II and III cities in India.

• The smaller cities are emerging as hubs for IT, Tech, Logistics, Warehousing, and more. 

• Their connectivity to Tier-I cities and international destinations is being enhanced YoY. 

• Quality housing at affordable rates is available easily for the new workforce. 

• The quality of life is better in terms of expenses, environment, education, healthcare, governance, etc. 

• Supportive incentives from state governments enable businesses to set up or step up easily. 

…And Trivandrum Stands Out

because it has everything a Tier-II city can offer. 

From lower costs, a skilled talent pool, and improved infrastructure to robust and business-friendly policies, global connectivity, and increased support for hybrid/remote working options, Trivandrum is truly becoming a top-notch business hub. 

Trivandrum stands out as a city with an exceptional quality of life, supported by high literacy levels, low crime rates, and strong performance in health, well-being, and education.

It also excels in sustainability, with notable achievements in climate action, air quality, sustainable consumption, clean energy, and production practices. Moreover, the city is making significant progress in industrial growth, innovation, and economic development.

The city’s economic and social vitality has spurred a surge in commercial real estate investments, as businesses seek to capitalize on the city's growth trajectory.

A CRISL survey indicates that nearly 75% of respondents anticipate a moderate increase in demand for commercial properties in Kerala over the next 2-3 years, underscoring the positive outlook for Trivandrum's commercial real estate sector.

The Technopark Advantage 

Technopark, India’s first and greenest IT park, has a 35-year-old legacy of attracting global companies to God’s own country. Spread across five phases, the IT hub has demonstrated a remarkable capacity to enable global companies to establish their operations, scale their businesses, and innovate effectively. 

Related reading: Technopark’s Strategic Location Supports Global Connectivity

With state-of-the-art infrastructure, cutting-edge technology, and strong support from academia and the state government, Technopark provides a robust ecosystem for growth and collaboration.

Today, the IT park has flourished tremendously from its humble beginnings in the 1990s. Phase I has 18 buildings with more expansion in the pipeline, particularly the establishment of the World Trade Center by the Brigade Group. Phase II hosts the software giants, UST Global and Infosys. 

Phase III has four buildings, of which Niagra, by the leading real estate developer Embassy-Taurus TechZone, is a game-changer that integrates cutting-edge technology and sustainable design. 

Niagra is envisioned as a home for premier corporate and Fortune 100 companies, but what truly stands out is its exciting role in the ‘DownTown Trivandrum’ project. It is anticipated to transform the face of the Kerala IT landscape and fuel growth and innovation, unlike anything until now! 

Phase IV, known better as Technocity, is still under development but already houses IT buildings as well as the Digital University Kerala (DUK). 

To summarise

Trivandrum's high quality of life, sustainable practices, economic growth, and infrastructural advancements collectively contribute to the flourishing commercial real estate market, making it an attractive destination for investors and businesses alike.

If you would like to leverage the ‘Trivandrum Edge,’ reach out to us at marketing@technopark.org. Invest in India’s first and largest IT park, Technopark Trivandrum. Make the best of the Tier-II cities’ commercial real estate boom – now is the right time!