MANGALURU: The proposed ₹135 crore IT Park in Mangaluru has encountered further challenges, as it remains unable to attract bidders, prompting the government to extend the tender deadline from May 29 to June 19. Sources from the Karnataka State Electronics Development Corporation Limited (Keonics) indicate that there may be further extensions, as there are currently no prospective bidders for the project.
During the second round of bidding, Keonics and Credai Mangaluru noted that three interested stakeholders initially engaged but ultimately withdrew, citing several constraints within the tender conditions. This second bidding opportunity was reopened after the first round saw no favorable responses.
Poor site connectivity has emerged as a significant barrier. The planned IT Park, set on 3.2 acres of land near Blueberry Hills Road in Derebail, is less than a kilometer from NH-66. However, stakeholders have highlighted that the narrow approach from Bejai-Kavoor Road presents challenges for sustained commercial traffic, compromising the site’s suitability for large-scale office and tech developments.
Keonics has recognized this access issue in their official correspondence. In a letter dated May 11, 2026, to the urban development department, they requested ₹22 crore in funding to enhance and widen the access road to the proposed site. The letter addressed concerns raised during a pre-bid meeting on April 29 about the difficulties posed by the narrow access road, following the call for proposals issued on April 10, 2026, for the ‘Development of a Commercial Office Tech Park in Mangalore.’
Potential bidders have also cited the tender structure as a significant obstacle, arguing that the financial and participation criteria do not align with Mangaluru’s tier-2 market dynamics. Concerns have been raised about the high deposit requirement of ₹13 crore and challenging rental expectations, which could hinder the attraction of IT tenants. Additionally, restrictions on consortium formations, allowing only three participants with one entity required to hold at least 60% of shares, limit investment pooling and risk-sharing opportunities.
One stakeholder noted that many interested parties had explored the possibility of pooling smaller contributions and taking out loans, but the current consortium requirements made these models unviable. They emphasized that the project should focus on creating an ecosystem that encourages companies to settle on the campus rather than merely prioritizing immediate revenue.
Another stakeholder remarked that the stalled tender should not be viewed as a failure of the region’s IT ecosystem, asserting that the overall sentiment in the coastal district’s IT sector remains optimistic.
