Proposed Hosur Airport Fuels Business Growth and Boosts Real Estate Prospects

 Hosur's Greenfield Airport: A Catalyst for Growth

The ongoing trend of greenfield airports is reshaping the landscape of major Indian cities, with both Bengaluru and Chennai experiencing significant developments. Recently, Karnataka’s capital announced plans for a second airport, followed by Tamil Nadu revealing a new greenfield airport project at Hosur. The proposed Hosur airport, sprawling over 2,000 acres, has already started to stir excitement among businesses and residents in Bengaluru and Chennai. This airport, along with the one planned at Parandur in Chennai, is set to significantly boost business activity and real estate development in the surrounding areas.

 Bridging Bengaluru and Hosur: A Strategic Connection

Hosur’s strategic location on the Bengaluru-Chennai corridor positions it as a critical link between the two cities. For instance, HSR Layout, a well-known Bengaluru neighborhood, is actually an acronym for Hosur-Sarjapur Road. This area acts as a bridge between Hosur and Bengaluru, with Sarjapur being a key locality in the city’s southeastern part. As Hosur gears up for its greenfield airport, this connection is expected to become even more significant, driving economic growth and urban development along this vital corridor.

 Chennai's Dual Airport Advantage

Chennai is set to benefit from not one, but two greenfield airports: the proposed Hosur airport and another at Parandur. The Hosur airport alone is expected to handle up to three crore passengers annually, which is likely to catalyze rapid development in its vicinity. This dual-airport strategy is poised to enhance Chennai’s status as a major hub for both domestic and international travel, while also spurring real estate growth in the regions surrounding these new infrastructure projects.

 The Hosur-Bengaluru Growth Corridor

Drawing comparisons to the transformative impact of Bengaluru’s Kempegowda International Airport (KIA), experts anticipate a similar pattern of growth along the Hosur-Bengaluru corridor. According to Gorakh Jhunjhunwala, Managing Director of Meraqi Advisors, KIA sparked rapid development along Bellary Road, influencing areas such as Thanisandra, Yelahanka, Doddaballapura, and Nandi Hills. Similarly, the Hosur airport is expected to drive growth from Electronics City, extending towards Bommasandra, Attibele, and further south towards Hosur.

Jhunjhunwala identifies key growth corridors that are poised to benefit from this development, including Attibele-Bommasandra-Electronics City, Thalli-Anekal-Jigani, Bagalur-Sarjapur-Malur, and the Hosur-Krishnagiri-Dharmapuri (HKD) area. The proposed airport is seen as a major driver for development, not only in Hosur but also in the surrounding regions of Krishnagiri and Dharmapuri districts in Tamil Nadu, as well as parts of South Bengaluru. The commercial and residential real estate markets in these areas are expected to flourish, further supported by the existing industrial activity in Hosur.

 Hosur’s Potential as a Satellite Town

As Bengaluru continues to expand, Hosur is emerging as a potential satellite town, offering a mix of industrial and residential developments. With relatively lower property prices, the area is likely to attract mid and affordable housing projects, catering to a broad demographic spectrum. This development is expected to draw multinational companies (MNCs), leveraging the skilled talent pool available in the region. Real estate investments, particularly in land, are projected to yield higher-than-average returns, making Hosur an attractive option for investors.

 Real Estate Hotspots Around Hosur

The Hosur airport is expected to trigger several key developments in its catchment areas. Shrinivas Rao, CEO of Vestian, notes that Hosur, an industrial city in Tamil Nadu, will reap significant benefits from the new airport. Additionally, neighboring districts such as Bengaluru Urban District, Krishnagiri, and micro-markets like Electronics City, Sarjapur Road, and Kothnur are poised to experience a surge in real estate development due to improved connectivity.

The tourism industry in Mysuru, located just 150 kilometers from Hosur, could also see a boost, potentially leading to real estate growth in and around Mysuru. The proximity of the airport is likely to make Mysuru a more attractive destination for both tourists and investors, further contributing to the region’s economic development.

 Infrastructure and Connectivity: A Game Changer

The proposed airport at Hosur, approximately 35 kilometers from Electronics City, offers a significant advantage over the current 50-kilometer commute to KIA. The shorter travel time, combined with less congestion, is expected to make the Hosur airport a preferred option for residents of South Bengaluru. Areas like Bannerghatta, Electronics City, Kothnur, Sarjapur, and Chandapura are likely to benefit from this improved connectivity.

The upcoming Bengaluru Metro's Yellow Line, expected to be operational by the end of 2024, will further enhance mass transit in South Bengaluru, accelerating real estate growth across various asset classes. The potential extension of the Metro to Hosur, coupled with the new airport, is likely to spur economic activities and create new employment opportunities in the region.

 Policy Challenges: Navigating the Concession Agreement

Despite the enthusiasm surrounding the Hosur airport, a clause in the Concession Agreement between the Central government and Bangalore International Airport Ltd (BIAL) could delay its development. The agreement prohibits the construction or upgrade of any airport within a 150-kilometer aerial distance of KIA until 2033, with the exception of Mysuru and Hassan airports. Since Hosur is only 74 kilometers away from KIA, this could mean a delay of at least nine years before the Hosur airport becomes fully operational.

However, this delay also provides the Tamil Nadu government with ample time to complete necessary legal formalities, including land acquisition, environmental clearances, and the preparation of detailed project reports. Once operational, the Hosur airport is expected to bring Chennai and Bengaluru closer together, further solidifying their roles as twin cities.

 Future Growth Corridors and Development Clusters

The Hosur airport is poised to create new business clusters and real estate opportunities in and around the region. The 288-kilometer-long Satellite Town Ring Road, which will intersect key areas such as Dharmapuri Road in Hosur and Thalli Road in Anekal, is expected to be a major driver of this growth.

 Prominent Growth Clusters:

·        Attibele-Bommasandra-Electronics City: This corridor is expected to see significant commercial, residential, and hospitality development, driven by the airport and the existing IT hub in Electronics City.

·        Thalli-Anekal-Jigani: Already known for its industrial estates, this area is likely to attract more manufacturing units, logistics parks, and warehousing facilities, leading to increased housing demand in Anekal and Thalli.

·        Bagalur-Sarjapur-Malur: These rapidly growing residential areas, located near Bengaluru’s IT hubs, are expected to experience further real estate developments, including new tech parks, business centers, and social infrastructure.

·        Hosur-Krishnagiri-Dharmapuri (HKD) Area: The proposed 500-acre ‘Tech City’ in Hosur is expected to host IT/ITES firms and Global Capability Centers (GCCs). The improved air connectivity is likely to make Dharmapuri and Krishnagiri key logistics and warehousing hubs, contributing to diversified economic growth in the region.