An investment boom is shaking the city of oranges, with IT majors acknowledging it as one of the "probables", and the ambitious multi-modal international project at Nagpur fuelling speculation.
Five multiplexes, several retail stores in various formats from groups such as Piramyd and Reliance, five star hotels, and the $100 million maintenance, repair and overhaul base proposed by Boeing Inc, are set to come here in the next few years.
A realty boom has happened and there are already talks of a bubble waiting for a pinprick.
"It could be Nagpur's destiny in the making that we are watching. Something we will tell our children and grandchildren about. Or it could be just another bubble," says chairman of Shewalkar Developers, Ashutosh Shewalkar.
Shewalkar has a string of complexes, both residential and commercial, to his credit.
He agrees that the boom is the biggest in his two decades in the business. "This is the biggest boom so far. Prices of both land and construction materials are up. But people don't seem to be complaining," he said.
Realty prices have touched the peak in the city. Now land outside the city municipal limits, on all major highways criss-crossing this centrally located once-sleepy town, are on the rise.
"What was available a few years ago in acres is now being sold on square feet basis," said Shabbir Vali of Vali Construction, whose firm has constructed some major colonies in the city and also several government buildings.
Prices in areas like Civil Lines, Byramji Town, Ramdaspeth and Dharampeth have not really gone up tremendously, but not much residential space is available for sale in these areas. In many places the prices of a constructed house and an open plot of the same area are the same.
"This is an inconsistency and a correction should take place," said Shewalkar. On the outskirts, prices have gone up three to five times. Wardha Road, on which the Butibori industrial estate is located and next to which the MIHAN project and the SEZ are to come up, has seen land prices scurry up like never before.
What could have been had for Rs 200,000 an acre is now quoting anything between Rs 30 lakh (Rs 3 million) to Rs 80 lakh (Rs 8 million), say builders. A number of "modern townships" are also coming up on Wardha Road.
These include the Sahara City project, Satyam's township and that being built by the Nagarjuna Group. The Krishna group project on the erstwhile Empress Mill has been stalled by Supreme Court.
Looking at the success of these projects where the cost of duplex row houses is as much as Rs 45 to Rs 65 lakh (Rs 4.5-6.5 million), several local builders have proposed their own townships.
Full-page advertisements in local newspapers get a guaranteed response for apartments, and independent bungalows in proposed townships are being promoted in what is today complete wilderness. Indeed some places are miles from anything.
There are no motorable roads, municipal water supply, or even electricity. Yet, townships have been proposed and bookings are on.
Some of these builders are advertising the very fact that the townships are away from the city. One such advertisement also available on the Internet goes "A little away from the busy and growing city of Nagpur, on the Wardha road highway, you will come across a hut, shaded by trees and against a backdrop of the serene blue waters of Wakeshwar lake and the endless rural landscape".
The promotion is good and the website of the company also shows that several bookings have been made. "It's a nationwide phenomenon. All because of the SEZs that the government has cleared. You'll find land prices up from outside Delhi to the Wagha border," said Shewalkar.
Vice-chairman and managing director of Maharashtra Airport Development Company, R C Sinha lists out all IT companies which have show interest in setting up a base at the MIHAN project Satyam, Patni, L&T, and now TCS showing interest in the SEZ.
Shapoorji Pallonji have asked for 100 acres for setting up their own IT city within the SEZ area. A lot of land has been acquired for the 1,400 hectares SEZ project and work has started on building internal roads, Sinha said.
"These are all at a nascent stage, mere proposals that have been forwarded to the authorities and leaked to the media. Nothing concrete has come, except perhaps Satyam's memorandum of understanding for the special economic zone," said Sheel Venkatesh, energy expert and regional manager for Asian Electronics. Venkatesh said the increase in land prices was also in tandem with other development indices of the city.
"Look at major consumer companies. ITC had only one dealer for Nagpur, now it has two; HLL had three dealers now it has five; Tata Motors had one and now has two, besides a separate dealer for Ace. Wockhardt and Care Group are building health complexes; the Dr D Y Patil group has proposed an international school; Reatox Constructions is building a township in the SEZ. All these are bound to hit land prices in the city," he said.
Venkatesh said the entry of big public schools and the expansion of existing ones also indicated that the city had arrived.
"None of the existing schools have shut down in fact. CBSE-affiliated Bharatiya Vidya Bhawan and Centre Point Schools have opened two more branches each; Maharashtra Board of Secondary and Higher Secondary Education-affiliated Sandipani School has opened one more branch. New schools such as the Delhi Public School and Jain International have also come to the city," he said.
Venkatesh said all expansions of schools and the new schools had been undertaken on the outskirts of the city.
"All those who have bought acres of land, now have their own bus services to ferry thousands of students to and from the city. Education in these schools easily costs as much as that in any professional course. Yet admissions are difficult," he said, adding that this indicated that there was surplus money coming into the city.
Venkatesh said the money was not basically being generated in the city, but was coming from children of people who had migrated outside. "A good number of youngsters have gone abroad. They are sending money and their parents are investing," he noted.
As far as the IT sector goes, infrastructure is being put in place, but job opportunities are yet to open up. Several local IT start-ups have diversified into providing IT parks and at least four major complexes are coming up in and around the city. This is besides the three IT parks built by the MIDC, which are already full. For the IT sector, Nagpur is waiting to happen.
"Big money will flow into the city if the IT sector takes off. The infrastructure is being created and if companies come the way they are supposed to, Nagpur will be hard to recognize a few years from now," said CEO of Metaphors Advertising Bhanu Rajagopalan.
He points out that five star chains and showrooms of companies such as Swarovsky Lighting don't open up in places with no potential. "Swarovsky came a few months ago and it doesn't exactly showcase your roadside chandeliers," he said.
Nagpur is poised for the big leap, he maintained. He quoted a recent Jones Lang LaSalle report which puts Nagpur along with Ahmedabad, Chandigarh, Indore and Kolkata as the best Tier III cities in India, which are positioned to emerge as major centres for offshoring activities by IT companies over the next five years.
"When this happens, Nagpur will see some real work and yes, wealth," he said.