Thoothukudi formerly known as Tuticorin is an industrial city in Tamil Nadu. It is popularly known as the “Pearl City of India” due to its ample availability of the Pearl fish. It is one of the oldest fishing and port commerce areas in the state with large-scale acquisition and export of marine fisheries and salt.
Thoothukudi produces around 1.2 million tonnes of salt annually accounting for 90% of the total salt production of the entire Tamil Nadu. It contributes to 50% of the total salt required by the state’s chemical industries.
In addition to its salt and marine businesses, this city also has a major energy industry. There are several large-scale thermal power plants in Thoothukudi. There’s also a flourishing fishery industry in Thoothukudi, with several small-scale industries for seafood products.
This city is rich in natural resources like crystalline, granite, and limestone among a few others. Commercial gains from these resources make it a contributing industry for the city’s economy as well.
There is a vast commercial opportunity for warehousing and logistics business in Thoothukudi due to the presence of multiple types of industries here. This presents great scope for commercial real estate investments in this city. Check the following sections to learn about the best commercial real estate investments in Thoothukudi.
Top Reasons to Invest in Thoothukudi Real Estate
Thoothukudi is a commercially flourishing city in Tamil Nadu. It is one of the highest contributors to the economy of the state and has several active industries. Follow the points below to understand the commercial industry in this city and why it is beneficial to invest in commercial property here.
- Fishing and Exports
Thoothukudi is one of the oldest and largest fishing hubs in Tamil Nadu. Its abundant supply of pearl-fish and other types of seafood gives it the name “pearl city of India”. The most popular port in action here is the Tuticorin Port which is used to catch and export several types of marine fish to the rest of India and abroad.
The fishery business in this city creates an opportunity for commercial real estate investment as there is a demand for storage and retail spaces.
- Power and Chemical Industries
Another well-performing sector that contributes to the commercial activities of Thoothukudi is the power and chemical industries. Thoothukudi has multiple active power plants, including the Tuticorin Thermal Power Station and several private power plants such as the Coastal Energen MTPP and Sterlite Industries Captive Power Plant. In addition, Thoothukudi is a mass producer of several in-demand chemicals, petrochemicals, and other related products.
The need for rental spaces, warehouses, etc., is always high in Thoothukudi for such industries. Hence, it presents a good opportunity for commercial real estate investment.
- Other Industries and Agriculture
Several small and medium-scale industries collectively contribute significantly to the city’s economy. Seafood products and packaging, oil mills, and several other small businesses are active in this locality. In addition, agricultural production on small scale for crops like cholum, cotton, and different pulses is done in Thoothukudi.
These commercial activities are driving the economy of this city and promoting development and demand significantly.
Commercial Real Estate Investment Opportunities in Thoothukudi
To invest in commercial real estate, you should look for locations that are in demand and can support multiple commercial activities compared to the rest of the city. Before buying a commercial property in Thoothukudi, you should look into these places for an opportunity to invest and gain returns.
This locality in Thoothukudi is a busy commercial zone with multiple operational industries. This is one of the oldest commercially active areas in south India with citations of a few government offices dating back to 1911.
This area is most popular for matchstick and fireworks production. It has the 2nd largest firecracker industry and largest matchstick industry in India. Hence, it is evident that commercial real estate investment in this locality will be a profitable venture. The average price range for commercial properties in this locality is between ₹50 lakh to ₹1.5 crore.
Kayatharu is a marketplace in Thoothukudi. It hosts a popular market where the primary commodities are agricultural produce and livestock. Besides, it has several windmills and a prominent industry for mats. Thus, you can consider investing your capital in a commercial property in this locality. Commercial properties in this locality cost between ₹50 lakh and ₹1 crore.
Things to Consider before Buying a Commercial Property in Thoothukudi
While buying a commercial property, you should look into several factors that may affect your return on investment. Refer to the points given below before investing in a commercial property in Thoothukudi.
Demand is an important point when it comes to commercial real estate. Prime localities in a city will always have better chances of earning high returns from commercial real estate. Thus, always plan and buy a property in a location with high demand.
- Builder’s Reputation
You should buy a commercial property that is built by a reputable builder. An experienced property developer has higher goodwill and more expertise. Hence, your property’s quality and demand will be high due to the builder’s influence.
- Property’s Connectivity
Businesses look for properties that have good connectivity to the rest of the city. Buy a property near an area with a good transport network and connectivity via road, rail, and airways. Accessibility is a desired option for commercial real estate; hence choose a property that is in close proximity to an airport, railway station, and bus stop.
- Access to Essential Infrastructure
As an investor, you should pay importance to the availability of modern infrastructure and high quality amenities around your selected property. Proximity to hospitals and education centres, etc., is a desired feature for real estate. This increases the value of your investment and ensures the best returns in the future.
- RERA Verification
One of the most crucial factors to examine is the authenticity of the details of ownership of a property. The Real Estate Regulatory Authority (RERA) is a real estate governing body in each state formed under the Real Estate (Regulation and Development) Act, 2016.
It mandates all builders to register their properties under RERA and regularly update their progress. Hence, you should always check and verify the details of your shortlisted properties in Thoothukudi from the official website of RERA Tamil Nadu.
Stamp Duty in Thoothukudi
Buying a commercial property involves several types of costs in addition to your property value. As an investment, you need to take into consideration all of these additional costs to estimate the total investment value for your real estate purchase. Hence, the applicable stamp duty charges in Thoothukudi are given below.
|Type of Deed||Stamp Duty Charges|
|Conveyance/ Sale||7% on property market value|
|Mortgage with Possession||4% on the loan value|
|Simple Mortgage||1% on loan value (Maximum: ₹40,000)|
|Agreement for Building Construction||1% of consideration specified in the agreement or on the market value of a property. (Whichever is higher)|
|Partnership Deed (for other cases)||₹300|
|Power of Attorney for selling Immovable assets (non-family members)||₹100|
|Power of Attorney for Consideration||4% of the consideration|
Registration Charges in Thoothukudi
Registration charges are another set of additional costs that are applicable while buying a property. Carefully refer to the registration charges for different types of deeds while buying a commercial property in Thoothukudi.
|Type of Deed||Registration Charges|
|Conveyance/ Sale||4% on property market value|
|Mortgage with Possession||1% on loan value (upto ₹2 lakh)|
|Simple Mortgage||1% on loan value (Maximum: ₹10,000)|
|Sales Agreement||1% of Advance amount (1% of total value, if possession is allowed)|
|Agreement for Building Construction||1% of consideration specified in agreement or on market value of a property. (Whichever is higher)|
|Partnership Deed (for other cases)||1% of invested capital|
|Power of Attorney for selling Immovable assets (non-family members)||₹10,000|
|Power of Attorney for Consideration||1% of ₹10,000 or on consideration. (Whichever is higher)|
Thoothukudi Commercial Real Estate Sector: What’s the Forecast?
Thoothukudi is one of the fastest-developing smart cities in Tamil Nadu. It has incorporated several infrastructural development projects in recent years under the aid and support of the Central Government.
In the upcoming years, this city will witness the development of its public infrastructure like public transit corridor improvement, multi-level car parking, and smart roads. In addition, the local government is working on smart schools and the improvement of recreation centres for the public.
The State Government and local administrative body of Thoothukudi have announced a project to develop a water treatment plant in this city worth ₹35.8 crore. The water from this plant will be used for industrial and other purposes commercially after using 25% for the corporation. In addition, projects have been announced to build Traffic Park, Science Park, a planetarium, and Anthropology Park in the city for the public.
This city is advancing commercially and is among the most modern cities in Tamil Nadu. The commercial real estate sector is also booming in this city as there is high demand for rental spaces, warehouses, and other commercial spaces to accommodate the growing workforce in this city. Thus, if you invest in a commercial property in Thoothukudi now, you can expect high demand in the future.
Commercial Real Estate vs Other Asset Classes
Different types of assets offer different types of returns and have individual risk factors. Based on your investment goals, you should decide which investment option is best for you. Check the comparisons between commercial real estate and other asset classes.
- Commercial Real Estate vs Stocks & Mutual Funds
Shares and mutual funds are a type of market securities that offer high returns at high risks. These are equity-based assets and are highly volatile due to market influence. Commercial real estate on the other hand offers moderately high returns at comparatively lower risks than stocks. Shares and funds offer diversification in portfolios, unlike commercial properties.
- Commercial Real Estate vs Bonds
Bonds offer low to moderate returns at moderate risks and fixed interest rates. Commercial real estate offers higher returns in comparison while carrying moderate risks. However, the initial investment is higher for commercial real estate compared to bonds. If you want to invest in bonds with good returns, check the list of high-rated bonds on our homepage.
- Commercial Real Estate vs Gold
Gold investments offer moderate returns at low risk to investors. Commercial real estate offers much higher returns compared to gold and also offers the benefit of passive income. However gold investments do not offer additional income and the returns are earned only from appreciation value of the asset.
- Commercial Real Estate vs Residential Real estate
Residential real estate offers lower returns in comparison to commercial real estate at moderate risk levels. However, residential real estate investments are considered slightly safer than commercial properties. Commercial properties have higher demand and have higher scope for additional income.
The table below compares commercial real estate with the above assets based on returns, liquidity, risk, volatility, and ticket price.
|Parameters||Commercial Real Estate||Stocks & Mutual Funds||Residential Real Estate||Bonds||Gold|
Steps to Invest in Commercial Real Estate in Thoothukudi
You can easily buy a commercial property in Thoothukudi by following the simple steps given below.
Step 1: First plan a budget for your investment. It will help you search faster based on the price limit.
Step 2: Find a broker who has a good market reputation. An experienced broker can help you to find the best available property in the market.
Step 3: Do your research and list down a few properties based on your preferences.
Step 4: Go to the shortlisted spaces and check all the facilities and other factors.
Step 5: Finalise a commercial property that suits your requirements and budget.
Step 6: Check the property details on the RERA website and verify the developer details.
Step 7: Submit documents and complete legal formalities.
Step 8: Make your payment to the builder and pay your broker’s commission.
Step 9: Complete the registration and stamp duty procedure along with respective charges.
Step 10: Buy an insurance policy for your commercial real estate.
The commercial real estate sector in Thoothukudi has high potential and will likely experience growth in the near future as the city’s economy grows. Hence, it is an investable opportunity for early investors who can carefully select the right type of commercial property in this city. However, as an investment, you should always consider the important factors mentioned above, before investing your precious capital.
Frequently Asked Questions
What is the other name for Thoothukudi?
Another name for Thoothukudi is Tuticorin. It is a second name for this city which was used by the Portuguese people, who had come to this region.
What food is popular in Thoothukudi?
Thoothukudi is rich in its culture and has several food items that are part of the cuisine of this region in South India. However, the most popular item here is Thoothukudi Macaroons. It is a delicacy made of cashew and ground almonds and has a unique taste.
What language is spoken in Thoothukudi?
The majority of Thoothukudi communicate in Tamil. However, the people in this city also speak English and other Indian languages like Hindi.
Which hill station is in Thoothukudi?
Thoothukudi is popular for its beaches and ports. Kalugumalai is a hill station that belongs to the Western Ghats and is located near Thoothukudi.