On 15 July 2025, the Karnataka state cabinet officially withdrew its plan to acquire 1,777 acres of agricultural land spread across 13 villages in Channarayapatna hobli, Devanahalli taluk. This land parcel,“Aerocity Phase II” was supposed to be the next extension of the state-run Defence & Aerospace Park, situated northeast of Kempegowda International Airport.
The decision comes after more than three years of sustained protests by local farmers who opposed the acquisition of fertile, actively cultivated land. With this move, all land titles revert to the original owners and the state has announced it will now rely only on voluntary sales.
But what does this mean for the booming Bagalur KIADB Aerospace Park?
That’s the most asked question and the answer is more reassuring than you might expect.
What Exactly Has Been Withdrawn?
Let’s clear the air: the government has only cancelled proposed Aerocity Phase II, planned northeast of the airport and east of Devanahalli. This is a completely separate corridor from the Bagalur KIADB Aerospace Park, which lies northwest of the airport and already has infrastructure, industries and residential activity in place.
The withdrawn plan involved the compulsory acquisition of 1,777 acres of farmland, near Channarayapatna, around 6-8 km east of Bagalur KIADB limits. Crucially, this land had no active industries or housing projects, it was intended as a future expansion zone.
What Remains Unchanged?
While headlines focused on what was cancelled, it’s equally important to understand what hasn’t changed and that’s where Bagalur’s KIADB Aerospace & Hardware Park stands out.
This park remains one of Karnataka’s most active industrial-residential growth corridors. The already notified Phase I (950 acres), along with the 250-acre aerospace SEZ is fully operational. Over half the industrial plots have been allotted, anchored by marquee global tenants:
Dynamatic Technologies | Boeing | Collins Aerospace
- Boeing: Inaugurated its 43-acre India Engineering & Technology Centre in January 2024, its largest facility outside the U.S.
- Collins Aerospace (RTX): Launched a state-of-the-art Engineering Development & Test Centre in March 2025 to support local aircraft certification.
- Dynamatic Technologies: Continues to expand production of aerostructures for Airbus, Boeing and Bell Helicopters from its campus within the park.
Ongoing Infrastructure Push
The state government’s investment in infrastructure is actively keeping pace:
- Spine roads (multi-lane) are complete.
- A 220/66 kV dedicated sub-station is operational.
- A common effluent treatment plant has been commissioned.
- Most notably, the 2025 Karnataka Budget cleared the Namma Metro Phase 2B spur toward Devanahalli with a Bagalur Cross station now under construction.
Residential Boom Mirrors Industrial Growth
The industrial momentum is clearly spilling over into residential absorption:
New launches in the past 12 months include:
- Provident Ecopolitan (10 acres, 1,000+ units, launched July 2025)
- Assetz Sora & Saki (eco-luxury 3/4 BHK, July 2025)
- MJR North Park (launched July 2025)
- And earlier flagships like Brigade El Dorado and Godrej Ananda
The larger North Bengaluru micro-market is booming too:
In 2024, North Bengaluru accounted for nearly one-third of all residential launches in the city, up from 23% in 2023 with Bagalur KIADB emerging as a key growth node.
The submarket recorded an average 17-20% year-on-year increase in per square foot prices during FY 2024-25. Industry reports further project a 20-25% rise in rental demand in 2025, which shows sustained end-user and investor interest.
Bottom line:The 15 July 2025 withdrawal of land acquisition near Channarayapatna has zero impact on the legal status, momentum or growth trajectory of the Bagalur KIADB cluster. The park is operational, expanding and fully backed by state-led infrastructure initiatives.
Why the Two Should Not Be Conflated
It’s important to separate facts from speculation. The cancelled Aerocity expansion and the Bagalur KIADB Aerospace Park are fundamentally different on three key fronts:
- Different GeographiesThe withdrawn acquisition lies in Channarayapatna hobli, to the east and northeast of the airport runway. In contrast, the Bagalur Aerospace Park is located to the northwest with direct access to the airport via NH-44 and STRR.
- Different Legal StatusThe 1,777 acres in question were never formally acquired and the final notification was withdrawn before possession. Meanwhile, Bagalur lands are already vested with KIADB with plotted developments, industrial units and infrastructure partially built out.
- Separate Policy TracksThe cabinet’s July 15 rollback applies solely to the specific 13 villages named in the notification. All previous KIADB acquisitions for Bagalur Aerospace Park, the SEZ and the surrounding residential zones remain valid and unaffected.
Message for Stakeholders
The state’s decision is a targeted course correction, limited to the 1,777 acres in Channarayapatna hobli. It does not impact the operational Bagalur Aerospace Park, its SEZ, or the wave of ongoing residential launches in the area.
This clarification should help dispel any market rumours suggesting a wider policy retreat from aerospace-led development near Kempegowda International Airport. The employment outlook and housing demand in Bagalur remain strong, driven by infrastructure, industry and proximity to North Bengaluru’s growth corridor.
