Following a glut in supply of office space in the city, builders are taking a second look at their commercial projects.

With the demand shooting up in the residential segment, most builders are keen to convert their erstwhile commercial ventures into housing projects.

A completed commercial IT park on LB Road in Thiruvanmiyur was razed down recently to pave way for residential units by Ramaniyam Real Estate Pvt Ltd.

And the latest to take the alternative route is the Olympia Group that has decided to covert its former IT park venue into residential complexes.

“We had planned an IT park in Pallavaram. But following a slowdown in the segment we decided to convert about 7.5 acres of the land into residential units,” said Mr Ajit Kumar Chordia, MD of Olympia Group.

While the office space supply in Chennai is close to 18 million square feet, the annual offtake has been as low as 4 million square feet for the last two years.

The high vacancy levels in IT office space owing to recession had inhibited builders who have delayed or dropped new proposals.

But this slowdown is a positive trend that could help stabilize the supply to demand equation in the segment, analysts say.

“Also, the Second Master Plan of CMDA allows high-rise building constructions outside Chennai and this impelled us to go ahead with an 11-storey residential complex in the area,” Mr Chordia said. Olympia has unveiled a 780-unit gated community comprising two and three bedroom apartments.

Olympia Grande, a Rs 300-crore project, has been registered for green building certification with Indian Green Building Council and aims at delivery in next three years.

Announcing the company’s future plans, Mr Chordia said the company was also planning a 400-unit premium luxury villa project next week and the launch of its second phase of Opaline apartments in OMR in March.