Bangalore, the capital city of Karnataka is one of the most happening metropolises in India today. Bangalore also called the ‘Silicon Valley of India’ has been empowered as the IT hub of India, with world-class IT infrastructure, quality research and development institutions producing technological breakthroughs, skilled human resources and supportive State government which have made it a favorite destination for global investors.

As more and more companies in the IT and ITES have started operating from Bangalore, the city in the recent years has seen an increase in migrant population in terms of workforce who have shifted base here. This has created a saturation of residential spaces in the city. And with large companies setting up operational bases in the city, new commercial ventures in the form of high-tech office buildings, entertainment multiplexes to malls providing customized shopping experience have come up in the city. This has not only created shortage of developmental space in the city but is also threatening the green zone of Bangalore.

In a recent development, the government of Karnataka has taken a stringent decision of not being in a position to sanction any more land to industries in Bangalore due to a shortage of land and that IT companies should be encouraged to move out of Bangalore to Tier II cities of Karnataka like Mysore, Dharwad and Hubli. The promotion of Bangalore as an IT city has brought about unexpected upsurge in the real estate prices of the city. Land prices in the city have gone up by more than three times, especially in the IT-corridor of Whitefield where prices have gone up from Rs 1,000 to Rs 3,500 per sq foot in the last two years.

The government has also further clarified that moving away from Bangalore doesn’t mean ignoring the IT sector, but would be a welcome move to the development of the adjoining cities and if the IT companies take up their expansion plans in the Tier II cities, the cost would be approximately 30 per cent lower than in Tier I cities. So if this plan rolls out, it would be far more profitable for investors to expand beyond Bangalore. This will not only improve the real estate sector of Bangalore by saving it from being a congested city, but would promote real estate beyond it and accelerate the economy of those areas.