₹2.5 Lakh Crore IT Investments Fuel 60% Rise in VMRDA Plot Prices in Visakhapatnam

The real estate sector in Visakhapatnam is undergoing a major revival due to massive investment in information technology, data centers, and digital infrastructure. It can be seen that the land and plot auctions recently conducted by the Visakhapatnam Metropolitan Region Development Authority (VMRDA) have shown significant price appreciation.

As per ET Realty sources, the prices in key VMRDA sites have escalated as high as 60 percent relative to their base price or upset price. The auctioning took place on December 17th and 18th, where plots in some Middle-Income Group (MIG) as well as some general sites in the Visakhapatnam area were sold. The high demand is a reversal in fortunes for some previous auctions where demand had been less, as a result of market uncertainties.

The reason for the rising interest is mainly due to investment announcements of close to ₹2.5 lakh crores in the past few months in sectors such as Anandapuram, Kapuluppada, and Rushikonda. These investments range from IT park developments, global data centres, to digital infrastructure initiatives, which make Visakhapatnam one of the quickest-emerging tech destination locations in eastern India.

One of the most prominent cases is that of Palavalasa MIG Layout, which is approximately three kilometers ahead of Tarluwada village, near a proposed Google data centre. Seven plots were put up for sale, which had an upset price of ₹14,500 per square yard, while the highest bid was for ₹23,700 per square yard, an escalation of a staggering 64 percent. In fact, even the lowest bid was at ₹18,800 per square yard, which is a substantial 29 percent escalation.

VMRDA had already started the development of the Palavalasa layout around the national highway almost three years ago. However, the demand was modest until major investments in the IT sector, especially the announcement of the Google data center project, altered the market mood.

Kapuluppada, another crucial area, also saw intense bidding. This planned IT hub has seen investments from major players such as Cognizant, TCS, Accenture, Infosys, Sify Communication, Adani Data Centre, and Raheja IT Space. For the same project, the reverse auction was set at ₹23,500 per sq. yard. The lots are designed to be sold at a rate between ₹32,000 to ₹34,500 per sq. yard, reflecting a 36 to 47 percent surcharge on the base charge.

According to industry watchers, the price rise isn’t driven solely by investment in the IT sector. There are several projects in the region that have increased the potential of the area in the long run. Some of these projects are the upmarket hotels being constructed between Bheemili and Bhogapuram, the Bhogapuram International Airport scheduled to be completed by June 2026, and the project ‘EduCity’ in Bheemili mandal that would be linked with the new airport. A significant number of plots that have gone on sale in the recent auction remain unsold in the earlier phases due to the dull market conditions.

VMRDA chairman MV Pranav Gopal stated that the authority is functioning as per the vision of Chief Minister N. Chandrababu Naidu for proper urbanization and provision of affordable housing. He stated that the VMRDA layouts provide litigation-free land along with necessary infrastructure like internal roads, parks, and open space, often at prices less than the market rate, and this remains the attraction for genuine end-users and long-term investors.

The private developers monitor the results of VMRDA auctions in order to understand market sentiment and make necessary adjustments in their pricing models. Traditionally, the auctions held by the VMRDA have set the benchmark in the region.

In the present scenario, plots in private colonies in and around Kapuluppada are being sold at ₹25,000 to ₹30,000 per square yard, but the auctions in the VMRDA have reached almost ₹35,000 per square yard. This renewed push has also extended to other parts of Visakhapatnam.

The sale of all 25 plots in the Jiyyannavalasa and Raghumanda MIG layout in the Vizianagaram region, as well as in the Tummapala region in the Anakapalli district, was realized. With the right investment in technology, infrastructure development, and policies, Visakhapatnam seems to be at the cusp of another phase of development, which will further help the city achieve its goal of turning into a major metropolitan and technology destination in the years to come.