The Hindu Business Line : TN approves DLF bid for Tidel-II

Chennai, Feb. 8 The Tamil Nadu Government has cleared the IT and ITES SEZ to come up as a joint venture between DLF and the State-run Tamil Nadu Industrial Development Corporation (Tidco) in Chennai.

According to sources in the know, the State Government approved DLF’s bid for the IT and ITES SEZ, at Taramani. DLF bid over Rs 660 crore to emerge the highest bidder last September in the tender put out by Tidco for leasing the 26.63-acre land owned by it to set up a 2.5 million sq. ft. facility.

DLF will soon sign a joint venture agreement with Tidco for the special purpose vehicle to be floated to implement the project.

DLF had bid Rs 26.07 crore for an acre — Rs 5,757 a sq. ft. — to take the 26-acre property at Taramani on a 99-year lease. The property is adjacent to the American International School off the IT corridor, the stretch of road being promoted by the State Government as a destination for investment by IT companies.

This will be the second Tidel software park being promoted by the State Government through Tidco in joint venture with the private sector.

An official press release said the Government has approved the the Tidel-III, for which Tata Realty was the lone bidder last December. This is on the IT corridor and is an IT and IT-SEZ with an international convention centre to come up on 25 acres land. This is expected to be a Rs 3,500 crore project with a total built up space of 2.1 million sq. ft. for IT, a convention centre and commercial space.

Despite the perception of a glut in IT space, property developers are optimistic on the prospects for additional IT space. Projects close to the city and those within the city limits continue to command lucrative lease rents, they said.

For instance, on the IT corridor itself, the first edition of Tidel, the software park set up by Tidco in joint venture with another public sector company, Electronics Corporation of Tamil Nadu, commands over Rs 50-55 a sq. ft. Developers say that SEZs and non-SEZ IT space within city limits continue to command higher rates than IT space outside the city.

At Taramani IT space continues to fetch more than Rs 50 a sq ft. At other major centre for IT space, in the southern part of Chennai on the Mount Poonamallee Road at Guindy, the lease rent is around Rs 52-53, at Ambattur, an industrial suburb it is about Rs 40. It is only further down the IT corridor that lease rents drop to below Rs 30.

According to estimates by international property consultants, on the IT corridor, over seven million sq. ft. of IT space entered the market last year. This is likely to swell by 12.5-13 million in the current year.

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