Southern Metros Power India’s Real Estate Boom, Tier-II Cities Catching Up: CBRE-CII Report

The latest report released by CBRE and CII states that the four most developed cities of southern India – Bengaluru, Chennai, and Hyderabad – have come under the scanner of real estate development in the country with a backbone of sound infrastructure, diversification of sectors, and increasing global investor interest.

The release of the report touched off the CII Karnataka Real Estate Conference 2025 and was titled Shaping The Future: The Real Estate Vision 2030 for Karnataka and Beyond. This report talks about how these cities are setting the pace for particular types of real estate growth, such as strong demand for office space, interest in premium housing, and investments in data centers and warehousing.

Each city has developed its unique strengths. For example, there is R&D and tech help from Bengaluru, Hyderabad is an expert in life sciences and aerospace, whereas Chennai boasts EV and electronics manufacturing. “Institutional capital is responding,” said Ram Chandnani, Managing Director, Leasing, CBRE India.

Karnataka, Tamil Nadu, and Telangana are on their way to synchronizing their destinies with India’s vision of a $30 trillion economy by 2047. Karnataka has set its target of a $1 trillion economy by 2032 and is pursuing the creation of economic hubs beyond Bengaluru.

Urban Development Department Additional Chief Secretary Tushar Giri Nath emphasized the need for inclusive growth. “We must strengthen infrastructure and plan responsibly as Tier-II and Tier-III cities become new growth engines,” he said.

The report flags growing promise in cities like Mysuru, Coimbatore, Visakhapatnam, and Kochi, where infrastructure push and policy reforms are creating fresh real estate opportunities.

Sector-wise, IT/ITeS remains dominant in office leasing, while life sciences, biotech, and data centres are expanding. Chennai is seeing a surge in EV manufacturing and electronics, supported by a strong industrial base.

Gaurav Kumar, MD, Capital Markets & Land, CBRE India, summed up the trend: “Southern India is diversifying rapidly, from Grade A offices to industrial and digital infrastructure. Both foreign and Indian capital are backing this transformation.”