Sumadhura Group to invest Rs 500 cr to develop commercial project in Bengaluru

With demand for quality office space rising, Bengaluru-based realty firm Sumadhura Group said it will invest about Rs 500 crore over the next three years to develop a commercial complex with a leasable area of one million sq ft. The group, which has developed about 30 projects in Hyderabad and Bengaluru over the last 16 years, has bought 8 over the last 16 years, has bought 8 group for this project, its Chairman and MD Madhusudhan G said. "There is a great demand for Grade-A office space. We want to focus on creating commercial assets for rental income. We did a small commercial complex in Hyderabad long back. Now, we are entering into commercial real estate in a big way," he told Sumadhura Group will develop a commercial at Whitefield comprising 1.5 million sq ft of built-up area and one million sq ft of leasable area. Asked about the investment, Madhusudhan said the project cost would be around Rs 500 crore, including land and construction cost. The investments would be met through internal accruals and construction finance from non-banking financial companies (NBFCs) and banks. "We do construction on our own. It's our core competence," Madhusudhan said. Unlike housing sector, the commercial segment especially office space is doing extremely well. About 40 million sq ft of office space gets leased annually in major cities. The new trend of co-working space is also driving demand for office space. Many real estate developers are planning to monetise their rent-yielding office assets through the Real Estate Investment Trusts (REITs) which has been allowed by the government.