Dotcoms Leave Prime Areas For Space Crunch

The dotcom mania has gripped the real estate sector of Delhi as dotcom companies are shifting from prime inner-city areas to southern micro-markets and suburbs in search of more space and low rental value.

According to a report prepared by India Property Research, "The increasing demand for large contiguous spaces (more than 7,000 square feet) from various companies, specially the dotcoms have contributed to this phenomenon."

Real estate experts said in the manpower-oriented dotcom business, space becomes very important and, hence, the need to shift to accommodate staff.

Being manpower-driven companies, dotcoms need better work environment, easy accessibility, larger space and good infrastructure at a reasonable price, they said.

 

Some lease transactions, including one by Satyam Infosystems, substantiate the view, the report says, adding that the inner city still lacks in the provision of functional space for emerging dotcom companies.

Cyber companies like egurucool.com and zipahead.com that started operations from main city centres are also moving south.

The two dotcom companies are planning to shift to Okhla and the Qutab Institutional Area, respectively. "We are shifting to the new premise in next 20 days," an official of zipahead.com said. The company's existing office is in Hansalya Building at Connaught Place. "The decision to shift to a new venue is out of necessity. We never imagined that the workforce of the company would grow at such a fast pace," he said.

About a year old, the cyber company currently employs more than 100 people.

The other company, egurucool.com, is shifting to Okhla from Greater Kailash. The company has rented about 14,000 square feet of space in Okhla.

However, finding an appropriate location is not always easy for these companies. "It is difficult. After carefully studying the prevailing conditions in Noida, Gurgaon, Pushp Vihar and Qutab and our requirements that included more space per person, better connectivity and rentals we decided to move to Okhla," egurucool.com chief executive officer Vivek Aggarwal said.

However, some companies such as Module One India Ltd, that runs the portal alltimejobs.com, are not planning to move from its current office in Nehru Place.

"All the necessary infrastructure is there. The rent is quite genuine and we have enough space for our staff, hence we do not feel the need to move to a suburb," says company president & chief executive officer Saumya Meattle.

According to real estate experts, the dotcom phenomenon has potential to revolutionise the property market.

However, the impact will be gradual, depending on the success of such companies.

"Most of these companies can be traced back to brick and mortar business foundations. Most of them are not yet a core business for the entrepreneur. Gradually, the dotcom business will evolve to have major impact on property market," experts said.