OMR: Chennai’s Own Silicon Valley

Chennai has experienced significant urbanisation over the past few decades, particularly along the Old Mahabalipuram Road (OMR). This stretch, known for its rapid development, has transformed into a bustling IT corridor, attracting numerous tech companies and startups. The convergence of urban growth and the commercial IT sector has reshaped Chennai’s landscape, making it a focal point for economic activity.

Urbanisation Trends in Chennai

As of 2025, Chennai’s metropolitan population is projected to reach approximately 12.66 million (1.26 Crore), up from 8.65 million (86.5 Lakhs) in 2011, reflecting a substantial increase driven by migration and urban sprawl. This growth is not just in numbers; it represents a shift in land use patterns. Agricultural land around Chennai has decreased dramatically—from 40,991 hectares in 1991 to just 22,130 hectares by 2004—as urban areas expanded to accommodate the growing population. The city’s density is 26,553 people per square kilometre, making it one of India’s most densely populated cities.

The OMR has been at the forefront of this transformation. Initially a coastal road connecting Chennai to Mahabalipuram, it has evolved into a major artery for IT businesses and residential developments. The road’s proximity to the Bay of Bengal and its strategic location linking various parts of the city have made it an attractive site for both commercial and residential projects.

The IT Boom on OMR

The rise of the IT sector along OMR is remarkable. The area is home to numerous tech parks and coworking spaces that cater to a diverse range of companies, from multinational corporations like Cognizant, Wipro and Infosys to innovative startups such as Urban Company, Chargebee and Netmeds. This concentration of tech talent has positioned Chennai as a key player in India’s IT landscape, often referred to as the “SaaS capital” due to its flourishing Software as a Service (SaaS) industry.

With improved connectivity through public transport initiatives like the Chennai Metro Rail Phase II project—resuming construction along OMR—accessibility to these tech hubs is set to enhance further. This infrastructure development is crucial as it not only facilitates easier commutes for employees but also attracts new businesses looking for strategic locations with good transport links.

Commercial Real Estate Trends on OMR

Commercial real estate investments in OMR, Chennai, have shown significant growth, driven by its status as the city’s IT corridor. As of December 2023, OMR and the South-West region accounted for 80% of Chennai’s Grade A office space, with a total of 81 million square feet in the city. The area has seen steady rental growth at a CAGR of 5% over the past five years in key micro-markets like Perungudi and Tharamani.

In FY2024, Chennai recorded 1.2 million square feet of office space transactions in Q1 alone, reflecting a year-on-year growth of 45%. The region also saw a rental appreciation of 9%, with strong demand driven by Global Capability Centres and IT companies.

Economic Impact and Future Prospects

The economic implications of this urbanisation and IT sector growth are profound. As more companies establish their presence along OMR, job opportunities multiply, drawing skilled professionals from across the country. This influx boosts local economies and increases demand for housing, retail spaces, and services.

Moreover, the commercial value of land in this region has skyrocketed. As urban sprawl continues and more residential complexes emerge to accommodate workers, property prices are expected to rise further. The Chennai Metropolitan Development Authority (CMDA) anticipates that by 2031, the population could reach 15.11 million, necessitating ongoing development and infrastructure improvements.

OMR epitomises the synergy between urbanisation and economic growth in Chennai’s IT sector. With surging demand for office spaces from IT firms and startups, its strategic location and cutting-edge infrastructure have established it as a premier business hub.

As this corridor evolves, it is set to play a transformative role in shaping Chennai into a leading economic powerhouse. Backed by robust infrastructure investments and a rich talent pool, OMR is primed to become a beacon of innovation and a hotspot for commercial real estate opportunities.