Brigade Group to invest INR 400 crores to develop a Grade A office complex in Chennai

Bengaluru-based listed real estate company Brigade Group has announced plans to invest INR 400 crores to develop an office complex in Chennai. In a statement released to the press, the Bengaluru-based real estate firm said it has entered into a Joint Development Agreement (JDA) with Agni Estates & Foundations Pvt Ltd to construct 'Brigade Tech Boulevard'.
Brigade Tech Boulevard will be a Grade A office space located on Pallavaram-Thoraipakkam Radial Road in Chennai. Spread across two towers, the project will have a leasable area of 8.36 lakh square feet. This will be Brigade Group's next commercial launch in Chennai after the successful completion of World Trade Center on Old Mahabalipuram Road (OMR).
Given past pre-leasing commitments on Radial Road, the company is confident that leasing momentum will increase further with this development. Nirupa Shankar, Joint Managing Director of Brigade Enterprises Limited, said Chennai is a diverse office market with demand from IT/ITeS as well as other sectors like engineering, automotive and banking. Brigade Tech Boulevard will be of world-class quality with strong sustainability features, similar to the company's other commercial projects across cities.
N Jayaprakash, Chairman of Agni Estates & foundations Pvt Ltd, said they have partnered with Brigade for this project owing to the company's track record of delivering good returns on investments.
As per a report by realty consulting firm CBRE, Chennai has emerged as a favourite office market for global firms and it has seen half of its overall office leasing grabbed by multinational companies. Global Capability Centres (GCCs) in engineering & manufacturing and banking, financial services and insurance (BFSI) sectors dominated annual office leasing activity in 2023. Chennai has emerged as the third-largest market in terms of office absorption in 2023.
Chennai recorded its highest-ever leasing and decadal high supply with a total absorption of 10.0 million sq ft and supply stood at 6.4 million sq ft in 2023.
Chennai represents 10% of India’s overall commercial office stock. The office stock in 2023 was at 87 million sq ft in 2023. It is interesting to note that 38% of overall office stock is green-certified in the market. This shift is attributed to a confluence of factors that have bolstered the city’s appeal and competitiveness.
Recently, Brigade Enterprises Limited signed a Joint Development Agreement (JDA) with United Oxygen Company Private Limited to develop an office space in Bengaluru worth INR 340 crore.
Additionally, Brigade Group signed an agreement to construct a premium Grade A office complex in Bengaluru's central business district, with a developable area of 0.2 million square feet and gross value of INR 500 crores. During this fiscal year, capex for office developments is budgeted at INR 2,300 crores while targeted launches total around 5 million square feet, including two future projects in Bengaluru's Whitefield IT cluster.
Brigade currently manages a sizable operational commercial portfolio of over 8.5 million square feet, generating annual rentals of approximately INR 750 crores. The IT sector represents the largest share followed by BFSI and GCC tenants.
Brigade's successful projects like Holiday Inn Hotel and Brigade Xanadu Residential township exemplify its commitment to high-quality sustainable projects.
On the residential front, In December 2023, Brigade Enterprises Ltd announced the launch of several new residential projects across multiple cities. In Bengaluru, Brigade launched Brigade Sanctuary, a large housing project spread over 2 million square feet under a joint development model. Comprising 1,275 units, this new project adds to the company's existing portfolio of 4 million square feet launched in various submarkets of Bengaluru.
The company also unveiled plans to enter the Hyderabad and Chennai markets in addition to further developments in Bengaluru. Total planned residential launches are expected to exceed 5.5 million square feet, with an investment of around INR 2,700 crore. In Mysuru, Brigade has partnered to develop a luxury housing project estimated at INR 300 crore and spread over 4 acres in a prime locality.
Brigade Group is one of India's leading property developers. Instituted in 1986, the company has developed many projects across South India, namely 'Bengaluru, Chennai, Hyderabad, Mysuru, Kochi, Thiruvananthapuram, Mangalore and Chikmagalur. It is into the development of projects across all segments- residential, office, retail, hospitality, and education. Brigade Group has a healthy pipeline of new launches of around 12.61 million square feet in residential, 6.33 million square feet in commercial and 1.06 million square feet in hospitality.
Since its inception, Brigade has completed more than 280 buildings amounting to over 83 million square feet of developed space across a diverse real estate portfolio.
Brigade Enterprises Ltd recently reported a significant 46% year-on-year rise in its residential sales bookings for the financial year 2023-24. Total pre-sales reservations stood at a record INR 6,013 crore compared to INR 4,109 crore in the previous fiscal, driven by stronger demand for its housing projects. In a statement, Brigade Enterprises said it has achieved pre-sales of INR 6,013 crore in FY24 and INR 2,243 crore in the fourth quarter of FY24- the highest ever for both in terms of a quarter as well as financial year. Average sales realisation rose 23% annually last fiscal year.