Five HOTTEST real estate cities to watch out for in India

Siddhesh Joglekar, founder of Estatelister.com lists out reasons why these five cities could emerge as the best real estate investments in the New Year.

Real estate in India is perhaps one of the most vibrant and ever growing sectors of the country with seemingly limitless opportunities.

India figures in the list of one of the real estate markets every global consultant of repute recommends to invest.

The traditional favourite real estate hotspots like the tier 1 cities of Mumbai, Delhi NCR and Bangalore have seen huge influx of money in the recent years. However, are these cities still hotspots with potential for astronomical rates of returns? We think there are better investment options in India that are unexplored and can turn out to be the top tier Indian real estate hotspots of this decade as well.

We looked at the following factors while including a city in this list -- (note that the list is indicative and not exhaustive). Note that non-inclusion in this list does not imply lower the importance of any city or town anywhere in the country.

• Availability of resources -- (Water, electricity etc.)
• Infrastructure development
• Connectivity with key economic centres
• Pace of growth & overall growth potential
• Presence of established players in strategic sectors
• Quality of projects
• Governmental support (State and National)

1. Vadodara

Vadodara ranks highly for most factors from among those listed before. With the key infrastructure projects happening in the region, the water and electricity supply in the region is going to improve year on year. Electricity is a bit of an issue, but a lot of efforts are being put into overcoming this particular concern.

Connectivity-wise, Vadodara is extremely well connected with both Mumbai and Ahmedabad with direct flights and excellent roads.

The Vadodara-Ahmedabad expressway is rated by many as among the best roads in the country and has considerably reduced travel time.

Vadodara is also part of the Golden Quadrilateral project and is definitely going to see a lot of investment in infrastructure over the next decade. Investor interest in Gujarat is pretty high and Vadodara's biggest advantage is its connectivity to both Mumbai and Ahmedabad.

2. Coimbatore

Coimbatore, earlier known mainly for its textile industry has now become an important centre in the South due to its connectivity with three key cities -- Kochi, Bengaluru and Chennai.

The road connectivity is excellent and there are multiple direct flights from Coimbatore even to Mumbai daily. Coimbatore's rapid rise as an information technology hub has further helped its cause to stake claim as one of the fastest rising real estate hotspots of the country.

Companies from the technology sector like Tata Consultancy Services, Cognizant Technology Solutions, IBM, Robert Bosch, Dell, Aditi Technologies etc already have a presence in the city.

Expect a huge influx of capital into the real estate sector of Coimbatore in this decade.

3. Indore

Currently in India, one of the fastest developing states has to be Madhya Pradesh. Indore, being the nerve centre of Madhya Pradesh in many aspects, comes in the list of real estate hotspots.

Indore is emerging as an educational hub and is currently the only city in India with both an IIT (Indian Institute of Technology) and an IIM (Indian Institute of Management) within or very close to city limits. This is also an automobile and steel industry hub.

One of the biggest reasons why Indore will grow very quickly in the coming years is its location though. It is almost equidistant from both Mumbai and Delhi. Connectivity with these metros is strong and that gives Indore many additional advantages.

In June 2011, Tata Consultancy Services decided to open a campus here -- which signals the IT sector establishing a presence in Indore. The national real estate players like DLF, Ansal, Parsvnath, Emaar MGF have all set up residential projects here, apart from the local players like Milan Heights, Kalindi etc.

4. Jaipur -- especially Tonk Road

That Jaipur is a hotspot is old news now. However, considering the development in the main city of Jaipur, it would be perfectly significant to take the Jaipur-Tonk road as the next hotspot for development in the region.

Firstly, the proximity to airport and proposed metro line makes it very well connected. The road itself has seen huge interest from a lot of sectors considering the excellent connectivity to Delhi and Gurgaon. Also, Gurgaon and Noida have already seen tremendous appreciation in 2011 and the next big growth is expected to come in Jaipur and particularly the Tonk Road.

Connectivity, strategic location, pace of development are all factors that are going to play in favour of Jaipur-Tonk Road as a real estate hotspot in the near future.

Tonk road as an agriculture base is strong with soil requiring less water for irrigation. Tonk road and Sitapura are both emerging as educational hubs with a lot of excellent educational institutes coming up. One concern currently would be the availability of water, but as development continues unabated, this concern would hopefully be taken care of, as has been the case in many other growing Indian cities.

5. Bhubaneshwar / Cuttack

Bhubaneshwar and Cuttack are twin cities and are the most important cities of Orissa. They figure in our list of real estate hotspots to watch out for.

According to us, the initiatives taken by the Government of Orissa and the strategic importance of Cuttack in the economy of Orissa makes it a hotspot. Bhubaneshwar and Cuttack are emerging as educational hubs and IT industry is setting up shop in a big way here. Institutes like IIT Bhubaneshwar, Xavier Institute of Management are making Bhubaneshwar an important educational centre of the region.

The IT sector is present in a major way here already with Infosys and Satyam present here for more than 15 years now. Now, Bhubaneshwar has continually improving connectivity and infrastructure.

Bhubaneshwar will be even better connected to all major cities in India by air in the near future than it is now considering the increasing importance of the city. Also extremely important to note is the mineral industry of Orissa and the presence of companies like Indian Oil, TATA group, ESSAR, NALCO, Jindal etc in the two cities.