Development of IT space gathers momentum in Coimbatore

Development of Information Technology (IT) space in Coimbatore is gaining momentum with demand increasing mainly from Global Capability Centres (GCCs) and start ups.

Though there is no data on the actual IT/ITES area under development, the approximate estimate is that projects under development or in the pipeline will add close to four million sq. ft. in the next few years, according to sources.

“We should look at development of IT in Coimbatore for both, short term and long term. For the short term, there is a demand for space. The long term outlook is linked to recruitments that will happen in the IT sector. There are many changes that are happening. Technology change is rapid and there is a need to reskill people. Currently, GCCs are driving recruitment and growth. So, the demand for space will be linked to these changes,” said Prashanth Subramanian, former chairman of the Confederation of Indian Industry (CII), Coimbatore.

According to Ashok Bakthavathsalam, Managing Director of the KGiSL group of Companies and Institutions, the KG Group will add 1.1 million sq.ft of IT space in three phases. “The demand is for quality infrastructure. People want wellness and Leed certification. Such space should be available. There are start ups, companies shifting to Coimbatore from other cities, and the GCC players,” he says.

For the GCCs, offering end-to-end solution will be attractive rather than just space. The cost for space is almost the same as tier-one cities now. The operation cost will be lesser in Coimbatore compared with larger cities, making it attractive for companies to set shop here, he said.

Companies will want to shift to Coimbatore only if the rates are lower than that of tier-one cities. When the developers quote high rates, there are no takers, points out former president of Coimbatore Association of Realtors Jude Alex.