Bengaluru landlords face rental losses amid IT sector exodus

Bengaluru, once the undisputed hub of India’s IT industry, is witnessing a significant decline in rental occupancy as the sector undergoes a slowdown. The city, which has long attracted professionals from across the country, particularly from the Telugu states, is now experiencing an exodus due to increasing congestion, high living costs, and dwindling job opportunities in the tech sector.

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With growing competition from cities like Hyderabad and Chennai, many IT companies and Global Capability Centers (GCCs) are shifting operations out of Bengaluru. Factors such as soaring rents, water shortages, and infrastructure concerns have made the city less attractive for both businesses and employees. Furthermore, the adoption of AI-driven automation and cost-cutting measures has led to mass layoffs, adding to the financial strain on the local rental market.

The impact is being felt most acutely by PG (paying guest) accommodations and rental property owners, particularly in the Outer Ring Road area, which houses several IT firms. As the influx of new IT employees dwindles, many PG hostels remain unoccupied, leaving owners struggling to sustain their businesses. Additionally, vacant three-bedroom apartments that once commanded monthly rents of Rs. 25,000 are now struggling to find tenants, resulting in severe income losses for landlords.

According to recent data, 87 companies laid off 23,504 employees in Bengaluru last year, a clear reflection of the economic downturn. The ongoing decline in IT sector employment has not only disrupted thousands of careers but also severely impacted Bengaluru’s rental economy.