A detailed breakdown of costs and rental yields across Bangalore's commercial micromarkets:
CBD (MG Road - Brigade Road):
Investment Cost: ₹18,000-22,000/sq ft
• Rental Yield: 6-7%
• Typical Unit Size: 1,000-2,500 sq ft
• Monthly Rental: ₹150-190/sq ft
• Annual Return Potential: ₹18-23 lakhs on 1,000 sq ft
• Maintenance: ₹12-15/sq ft
• Break-even Period: ~12-14 years
SBD (Indiranagar-Koramangala):
Investment Cost: ₹14,000-18,000/sq ft
• Rental Yield: 7-8%
• Typical Unit Size: 2,000-5,000 sq ft
• Monthly Rental: ₹90-130/sq ft
• Annual Return Potential: ₹21.6-31.2 lakhs on 2,000 sq ft
• Maintenance: ₹8-12/sq ft
• Break-even Period: ~10-12 years
Outer Ring Road (Premium IT Corridor):
Investment Cost: ₹12,000-15,000/sq ft
• Rental Yield: 8-9%
• Typical Unit Size: 5,000-25,000 sq ft
• Monthly Rental: ₹80-110/sq ft
• Annual Return Potential: ₹48-66 lakhs on 5,000 sq ft
• Maintenance: ₹7-10/sq ft
• Break-even Period: ~9-11 years
Whitefield:
Investment Cost: ₹8,000-11,000/sq ft
• Rental Yield: 8-9.5%
• Typical Unit Size: 3,000-10,000 sq ft
• Monthly Rental: ₹55-75/sq ft
• Annual Return Potential: ₹19.8-27 lakhs on 3,000 sq ft
• Maintenance: ₹6-8/sq ft
• Break-even Period: ~8-10 years
Electronic City:
Investment Cost: ₹7,000-9,000/sq ft
• Rental Yield: 7.5-9%
• Typical Unit Size: 2,500-10,000 sq ft
• Monthly Rental: ₹45-65/sq ft
• Annual Return Potential: ₹13.5-19.5 lakhs on 2,500 sq ft
• Maintenance: ₹5-7/sq ft
• Break-even Period: ~9-11 years
North Bangalore (Emerging Market):
Investment Cost: ₹6,500-8,500/sq ft
• Rental Yield: 6-7.5%
• Typical Unit Size: 2,000-5,000 sq ft
• Monthly Rental: ₹45-60/sq ft
• Annual Return Potential: ₹10.8-14.4 lakhs on 2,000 sq ft
• Maintenance: ₹5-7/sq ft
• Break-even Period: ~11-13 years
Additional Cost Considerations:
1. One-time Costs:
- Stamp Duty: 5.6%
- Registration: 1%
- Legal Due Diligence: ₹50,000-1.5 lakhs
- Brokerage: 2% typical
2. Recurring Costs:
- Property Tax: 20-25% of rental income
- Insurance: 0.1-0.15% of property value
- Maintenance Reserve: 5% of rental income
- Vacancy Provision: Calculate 1-month vacancy per year
Investment Strategy Tips:
1. Higher yields in IT corridors due to:
- Stable long-term tenants
- Triple net lease structures
- Lower maintenance costs
- Better appreciation potential
2. CBD properties offer:
- Prestigious address value
- Multiple tenant options
- Higher rental escalations
- Redevelopment upside
3. Emerging Markets provide:
- Lower entry costs
- Higher appreciation potential
- Infrastructure-led growth
- Larger unit sizes available
Sales Enabler | Pursuit Strategist | Program Manager | APMP India Exec Council Member | Quizzer | Quizmaster | CAP.APMP, PMP, SσGB
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