– by Anil Pharande
Widely called the lifeblood of any urban ecosystem, infrastructure is the very foundation of city functioning and plays a crucial role in shaping its future. Infrastructure like transportation, power, telecommunications, electricity, water, sanitation and proper disposal of waste, are all central to urban growth.
Studies also prove that countries with better infrastructure facilities – such as Singapore or Hong Kong – enjoy higher economic growth, more employment opportunities, and better living standards. Infrastructure projects not only act as a driver for real estate development but also directly influence real estate prices. In fact, infrastructure is one of the prime influencers for property appreciation.
Research by international property consultants Knight Frank Research shows that between 2008 and 2015, residential prices within a 10-minute walking radius of London’s ongoing Crossrail stations (approved in 2007) saw more than 57% price growth. By comparison, the prime central London areas saw only 40% price growth in the same period. The values will go up further in 2022 when the central section of the project becomes operational.
We have seen similar trends in key markets in cities across India. According to a study by JLL India, property prices in some projects on Gurgaon’s Mehrauli-Gurgaon Road increased 80% in the 2006-2010 period – from around INR 5,000/sq. ft. in 2006 (when the Delhi metro was announced) to almost INR 9,000/sq. ft. in 2010 when a phase became operational. In the same period, other areas outside the metro’s ‘influence zone’ saw a 40-50% rise.