How the Indian real estate sector drives the nation’s economy

3/24/2023 3:08:00 AM

While a lot of impetus is being given to developing India into a global manufacturing hub, the role of the domestic real estate sector in generating employment, adding real economic value, and its add-on effect on other industries is often overlooked. In fact, the real estate industry is the second-largest employment generator after agriculture and has been contributing about 11% to Gross Value Added (GVA) growth since 2011-12. A critical engine of growth and employment, with both forward and backward linkages, it is estimated that nearly 50% of India’s GDP is linked with the domestic real estate sector. Employing a large labour force in nation building Construction and allied activities absorb a large number of skilled and unskilled workforce, with many being employed from rural hinterlands where agriculture continues to remain the only source of employment. According to conservative estimates, nearly 70 million Indians are employed in the real estate sector as of 2022, with the overall sector slated to surpass the $1 trillion mark by 2030. What’s more, with the implementation of the RERA Act, sprucing up of labour laws, and a stark improvement in overall compliance, those engaged in the Indian real estate sector are benefiting from the large strides being made in recent years. Providing demand for key supplier and ancillary services industries With more than 270 allied industries being dependent on the real estate sector for business sustenance, this important sector has an important add-on effect along the entire supply chain. Key supplier industries like steel, cement, timber, and construction materials as well as ancillary services industries such as design, contracting, facility management, leasing & property consultancy are some prime examples. As activity in the real estate sector ramps up, there will be a wider positive multiplier effect on associated industries and those engaged in them. Driving rapid urbanization with critical housing and commercial infrastructure The rapid pace of urbanization has been a key driver of India’s economic growth over the past few decades, with urban centres such as Bengaluru, Mumbai, NCR, Pune, and Hyderabad attracting human and economic capital en masse. The real estate sector in conjunction with local governments, private developers, and infrastructure companies has played a key role in this transformation. With India slated to reap the benefits of its rich demographic dividend till at least 2050, the task of sustaining this rate of urbanization and creating the necessary infrastructure to support the country’s large young workforce will fall on the Indian real estate sector. Moreover, premiums, development and approval charges accruing from real estate related activity will continue to be a major revenue source for local government bodies and state governments, facilitating further socioeconomic development across the length and breadth of the country. Facilitating large foreign investment inflows that drive further growth With the real estate sector providing important infrastructure that remains pivotal to fuelling the Indian growth story, high-quality real estate projects and firms involved in their construction are attracting strategic and foreign investments in the country today. Capital inflows from marquee private equity (PE) firms and other foreign entities swelled to $24 billion between 2017 and 21, recording a 200% growth as compared to the preceding five-year period. Verticals such as warehousing, industrial parks, and data centres are also expected to give the Indian economy a much-needed boost as both domestic and international players rush to set up their distribution centres in the country today. An important asset class and source of wealth for millions of Indians As more Indians are deploying their savings into wealth creation avenues that can also significantly improve their lifestyle, both residential and commercial real estate are increasingly gaining precedence over other traditional asset classes like fixed deposits or gold. In fact, the real estate sector has traditionally been a major asset class and source of wealth creation for Indians, with new-age products such as REITs appealing to younger investors who are still not ready to buy their first home. The real estate sector remains a key source to channel savings for crores of Indian households, with recent improvements in the regulatory environment only adding to consumer confidence. Source: Financial Express INDIA

'Indian Real Estate Emerging As Preferred Investment Option Amid Market Volatility'

3/7/2023 12:45:00 PM

The real estate in India is currently rapidly emerging as an investment of choice by the increased number of investors, both Indian and NRI, in a background of market volatility and equity markets stagnating amidst increasing inflationary pressures. Due to the attractive rental yields and the potential for further price appreciation across India in both the metros and other cities, real estate is seen as a good bet. Rapid urbanisation and a rising population contribute to increased demand for affordable housing units in major Indian cities. Despite real estate prices already appreciating between 10 per cent and 30 per cent across India in 2022, India’s growth story is attracting venture capital (VC) interest across segments of the Indian real estate sector. In a recent survey conducted by the CII, 59 per cent of respondents are strongly inclined to invest in real estate, while only 28 per cent continue to prefer investing in Indian equity markets. Nagpur, Coimbatore and Indore have the highest year-over-year rental demand, propelling the growth of India’s commercial real estate sector. This expansion is also evident in the office leasing market, which is anticipated to increase by 10 per cent to 15 per cent in the coming fiscal year. Some of the factors impacting this trend include: Growing Social Infrastructure in Tier-II and Tier-III cities A significant trend has been the rising demand for modern office space and the emerging trend of urban and semi-urban housing. In addition, the expanding e-commerce sector in the country is driving up the demand for storage facilities, which is providing a boost to the market. In addition, the increasing use of telecommunication services, the implementation of 5G standards, and the localisation of data have increased the demand for data storage facilities. In turn, this positively affects the demand for resilient data centre infrastructure, bolstering the market growth. Increased acceptance of hybrid models in 2022 has resulted in a huge upsurge in major cities for office space. According to a survey, the office market’s net absorption in the top-7 cities, including Mumbai, Bengaluru and Hyderabad, reached a three-year high of 38.25 million square feet in 2022. Moreover, the net absorption for 2022 has exceeded the five-year pre-pandemic average (2015-2019) by 3.1 per cent, demonstrating the robustness of the Indian office markets. Increased acceptance of hybrid models in 2022 has resulted in a huge upsurge in major cities for office space. According to a survey, the office market’s net absorption in the top-7 cities, including Mumbai, Bengaluru and Hyderabad, reached a three-year high of 38.25 million square feet in 2022. Moreover, the net absorption for 2022 has exceeded the five-year pre-pandemic average (2015-2019) by 3.1 per cent, demonstrating the robustness of the Indian office markets. Increase in NRI Investment Foreign and domestic investors are capitalising on this growth, particularly in their own cities, with millennials comprising roughly half of these investors. Not only commercial real estate but also ultra-luxury apartments and vacation homes have seen an increase in investor interest. The strengthening of the dollar against the rupee incentivises investors to enter the domestic market with enhanced purchasing power. Newer proptech platforms have contributed to this growing interest by revolutionising the real estate industry and enabling the seamless onboarding of individuals regardless of their geographical location. This will continue to attract non-resident Indians to India’s real estate market. Changes in Policy Environment Aside from this, various initiatives undertaken by the Indian government, such as investments in smart city projects and tax exemptions for housing loan interest, are anticipated to create lucrative business opportunities for industry investors in the country. By 2030, the demand for Grade-A premium office assets in India is projected to reach 1.2 billion square feet. This expansion is fuelled by various factors, including a high return on investment, increased NRI and FDI investment, and strengthened government initiatives. Increased Demand for Ultra-Luxury Units and Vacation Homes With rising household incomes and an increase in the number of Indians among the world’s wealthiest individuals, the ultra-luxury residential real estate market has been booming, with demand frequently exceeding supply. Even in markets such as Mumbai, Delhi, Bengaluru, and Kolkata which have historically had a healthy pipeline of such units, consumers are increasingly opting for projects with amenities comparable to those provided by international developers. This shift in consumption habits has prompted Indian real estate developers to launch new luxury housing projects that cater to this expanding group of domestic investors. Other key factors, such as India’s emergence as a global IT power, the growth of the e-commerce industry, etc., would result in a significant increase in demand for spaces such as data centres and sophisticated warehouses. Commercial spaces will increase in Tier-II and Tier-III cities in 2023, acting as a significant employment-creating catalyst. In 2022, the office, warehouse, residential, and retail real estate sectors collectively attracted private equity investments totalling $5.1 billion. This demonstrates the industry’s optimism regarding the sector’s growth. However, the developer community must look to achieve the same construction and design standards as developed nations. Increased focus on raising capital through additional channels, such as real estate investment trusts (REITs), attracting more Indians to actively invest in the country’s real estate economy. With REITs providing proportional ownership of income-generating real estate assets, more Indian developers will need to establish their own REITs, educate investors on their potential for long-term value creation, and seek more investments via this route. This will attract more foreign investment and leverage the country’s large population to establish a sustainable financing model that will propel the Indian real estate industry to new heights in 2023. Source: News 18 INDIA

Key Indian property markets see 5-7% rise in housing prices in March quarter

3/4/2023 4:07:00 AM

Residential real estate has continued to witness firm growth in demand and conversion across India’s key property markets during the quarter ended March with a steady rise in prices. This also marks the fifth consecutive quarter of year-on-year growth in prices across all markets. Even in sequential terms, prices have either remained steady or grown across markets during the quarter. Prices have grown significantly across most markets led by Bengaluru, Mumbai, Chennai, and Hyderabad with 5-7% appreciation, showed data from Knight Frank India. The residential market has stepped into 2023 on a stable footing with the first quarter of the year registering sales of 79,126 units, up 1% from a year ago when home loan rates were at record low of 6.6% as against 9% now. Sales grew the most in the Hyderabad market at 19% from a year ago while slipping slightly in the larger markets of Mumbai and Bengaluru at 6% and 2%. “Given the cautious but optimistic sentiment in the market, we do not believe that home loan rates approaching 2019 levels (9.2%) will be enough to subdue market momentum significantly. The performance of the broader economy and homebuyer sentiment will have a greater bearing on market momentum in 2023 as it dictates homebuyer income levels and demands much more directly,” said Shishir Baijal, CMD, Knight Frank India. Consistent with the upward trend seen in the past three quarters, the share of sales in the Rs 1 crore and above ticket-size grew to 29% from 25% a year ago given the homebuyers’ need to upgrade to larger living spaces with better amenities. The share of home sales in the Rs 50 lakh to Rs 1 crore category also grew 38% from 35% a year ago. The share of the Rs 50 lakh and below ticket size, however, deteriorated from 41% a year ago to 32% during the quarter, as rising prices, higher interest rates and a comparatively more adverse impact of the pandemic on homebuyers in this segment continued to weigh on demand. “Rising interest rates have certainly impacted the sales of rate-sensitive segments of affordable and low-income group housing. The 2.5% increase in repo rate in a short span since last May has increased the homebuyers’ burden. Real estate industry has linkages with over 260 other sectors and therefore impacts the entire economy. We hope that the central bank will take cognizance of this in the upcoming policy meeting,” said Sandeep Runwal, President, NAREDCO – Maharashtra. Homebuyers have been more inclined to purchase ready or near-ready inventory to minimise completion risk earlier. However, the heightened demand over the past few quarters has depleted the inventory, and consumers are now increasingly willing to acquire newly launched properties at relatively lower prices. This is reflected in the average age of inventory decreasing to 16.7 quarters during the quarter from 16.9 quarters a year ago. The unsold inventory level has increased 6% from a year ago as fresh development activity has intensified. However, the Quarters to Sell (QTS) level has dropped to 7.2 quarters as of March end on the back of heightened sales, compared to 9.1 quarters a year ago. The QTS level represents the number of quarters required for the existing unsold inventory to be consumed at the current rate of sales. A reducing QTS level depicts a market where demand is gathering momentum. Mumbai recorded sales of 20,300 new homes during the quarter, highest among the top eight markets. While still robust, sales were lower 6% on-year when compared to a strong year ago period when impending metro cess implementation had also bolstered sales. Besides, Mumbai is the most unaffordable market in India and the recent spate of price increases and rate hikes will be felt more acutely here. However, launches have continued unabated with 9% rise. The prices rose 6% indicating the momentum in the market. The Delhi-NCR market witnessed stable demand as sales rose marginally 2% to 15,392 units, while launches rose 12% to 14,486 units. The prices have appreciated at a steady pace of 3%. In Bengaluru, average prices rose 7%, a testimonial to the underlying confidence of the market. The number of units sold reduced marginally by 2% to 13,390 units, while launches were second highest in the top 8 cities at 12,073 units, up 19%. The resilient Hyderabad market experienced substantial growth despite the rate hikes and concerns around economic slowdown as it saw 19% rise in sales at 8,300 units during the quarter. New launches rose 7% to 10,986 new units, while prices grew 5%. Source: The conomic Tmes

Aspiring millennials to drive the real estate market in 2023

3/3/2023 3:06:00 AM

Driven by the limitless ambitions of its youth, New India is shining brighter than ever before. This millennial generation is not shackled by the doubts and fears of its predecessors, but rather soars on the wings on determination and self-assurance. While previous generations believed in renting homes and buying a home after reaching a certain age, the millennial demographic refuse to compromise on buying the home of their dreams. Millennials contribute 34% of India’s population, which is close to 440 million people. Next generation of homebuyers that is driving the real estate growth in 2023 he pandemic has changed their mind set in more ways than one. Millennials are now keener than ever to invest in the real estate market. Even in the wake of geopolitical uncertainties, the demand for real estate has continued to rise due to the sanguine outlook of the millennial homebuyer. In the era of globalisation, this generation enjoys the highest purchasing power than any generation before. The aspirational millennial is more aware than ever before of the value of real estate as an investment. Indian millennials are a very important market. They are in their peak buying years and have easy access to home loans. This demographic contributed to over 50 percent of homes sold in 2020, and they were a major driver in the Indian real estate market crossing the mark 54% in 2022. Extrapolating these growth trends, the Indian real estate sector is forecasted to cross 1 trillion dollars by 2030, which will contribute to over 13 percent of the national GDP. Paradigm shift in the way residential properties are developed across India Unlike their previous generations, millennials have a quintessential approach to buying property. Unlike their predecessors, they see a house not just as a commodity but as an indulgent investment, and therefore they have specific needs and expectations when it comes to choosing a home. Discerning, demanding and determined, this generation expects the real estate properties that are integrated with modern and smart amenities at par with the global standards. Their hopes and dreams are bound only by their fearless audacity to aim higher than any generation that came before them. Millennials want smart spaces that allow them to work from home, while also offering expansive green open spaces, culturally vibrant entertainment zones, wide balcony areas, My spaces for mee time and secure and sophisticated digitally-enabled surveillance systems. Additionally, they seek homes that offer a complete integrated living experience, with diverse amenities that make daily life easier and entertaining. These include a plethora of facilities such as engaging clubhouses, children-friendly pool decks, gymnasiums, diverse fitness studios, state-of-art libraries, spacious community halls, and integrated sports complexes. Digitally-inspired generation Millennials are digitizing the home buying experience. From virtual tours to digital appraisal scheduling and from virtual inspections to remote notary services, millennials prefer to have digital closings of their prospective homes. As millennials are also twice as likely to shortlist their dream homes on their mobile phones than the past generations, all this is now a staple of the tech savvy generation. Proximity to workplace is no longer the first priority, but connectivity is the top criteria for buying a home now. The highly ambitious millennial generation is no longer ready to compromise on a certain level of comfort and lifestyle. This has created a specific demand for real estate properties that provide modern luxuries, while being intricately connected with social infrastructure facilities. Homebuyers today are looking for modern residential properties that provide them with logistical convenience by being located near their offices, are in close proximity to shopping high street /malls and entertainment venues. Leading real estate developers have pivoted in alignment with the needs of the millennial homebuyers and are developing premium residential properties to cater to the demand for the modern integrated lifestyle. In recent years, there have been a flurry of residential projects launched in highly posh localities, which include luxury and premium luxury gated communities. In terms of the millennials’ buying preference, the focus has shifted from compact homes to Smart Homes. Incorporating Internet-of-Things (IoT) and virtual home regulation systems, these new age smart homes are designed specifically for the requirements of the millennial homebuyers. These aspirational millennials place a high valuation on social connectivity and integration. This translates into young homebuyers preferring residential areas that provide a strong sense of community living. The best real estate developers are eager to meet this demand and are constructing residential complexes that are furnished with communal features like shared lounges, co-working spaces, clubhouses and dedicated community-gathering arenas. Millennials are prioritizing health and hygiene above all else They are looking for homes with open green spaces. The next generation of ambitious homebuyers are willing to pay a higher premium on living a sustainable and healthy lifestyle. Millennials do not consider environmental sustainability a premium luxury, but rather a basic necessity. While uncompromising on social amenities, they are equally unrelenting on environmentally conscious building practices. When it comes to ecological sustainability, millennials are willing to go the extra mile for their future. Asset classes that incorporate renewal energy through solar panels, conserve water through integrated rainwater harvesting systems, and safely dispose domestic waste through organic waste management systems are more preferred by millennials than other discounted properties. Millennials refuse to put a price tag on their futures. Modern real estate developers are now more sensitised than ever before in creating enhanced projects, which are certified by global environmental standards. Aesthetics of the property are meticulously intertwined with eco-friendly elements in order to appeal to a younger demographic of homebuyers. The real estate industry is undergoing a significant change driven by the aspirations of the millennial generation With a significant increase in purchasing power and an illimitable desire to achieve a modern holistic lifestyle, more and more millennials are investing in integrated real estate properties. While 66 percent of millennials have stated that investing in home ownership is a stable long-term investment, 30 percent have cited social status as another motivating factor that led them to invest in homes. The desire for deluxe housing reflects the millennial mind set. They do not rush into buying a home. They wait before taking the plunge and invest in premium quality product. The growth of the global real estate market depends on this shifting trend, which grew to 4000 billion dollars in the last year, which is a growth of 7 percent worldwide. Studies have shown that the millennial generation is the most confident generation when it comes to financial literacy and will push the global real estate market to 5200 billion dollars by 2027. Though buying a home is never an easy decision, the millennial generation are more than ready to invest in their luxury dream homes. They are now ready to plant their roots and more than happy to own real estate. Millennials are no longer the “rent generation”. As current market trends are extrapolated towards future horizons, it can be forecasted with reasonable certainty that this trend is highly likely to continue into the perceivable future. By understanding the needs and expectations of the millennial demographic, modern real estate developers in India are impeccably poised to lead the real estate growth in 2023 and beyond. Source:financial express INDIA

Centre begins process to modernise Mohali SCL

10/18/2022 2:03:00 PM

The Semiconductor Lab (SCL) at Mohali, the only government-owned semiconductor fabrication unit, will be one of the beneficiaries of the Central Government’s $10 billion semiconductor incentive package. The government plans to modernise and upgrade it for making semiconductors, which are used in display panels of smartphones, laptops, TV screens, weapon systems and automobiles. For the modernisation plan, the Ministry of Electronics and Information Technology (MeitY) has floated a request for proposal (RFP). The SCL was handed over to MeitY in February this year from the Department of Space. The SCL started production in 1984 but was devastated by a mysterious fire in 1989 and thereafter never recovered fully. It produces chips for strategic purposes. For instance, a 180- nanometre chip, along with other chips researched and fabricated at the SCL, have been used to power the country’s Mars Mission. According to the RFP, the selected bidder will act as an adviser and also be responsible for identification of business partner for modernisation and commercialisation of the SCL. As per the terms of the RFP, the bidders shall strategise the execution roadmap. Besides, the bidders also need onboard a commercial partner for the fabrication of chips developed by the SCL. “The bidders will also be responsible for development of business plan, go-to-market strategy and design of operating model, including identification and assessment of top list of potential partners (both Indian and global) across the semiconductor value chain,” said sources. “The SCL is responsible for design and development of very-large-scale integration (VLSI) devices and development of systems for the telecommunication and space sectors. The government is modernising the existing SCL as part of the effort to set up a latest manufacturing facility for making semiconductors,” said Rajya Sabha member Vikramjit Singh. On December 15, 2021, the Union Cabinet accorded approval for the modernisation and commercialisation of the SCL, which includes exploration of the possibility for a joint venture (JV) with a commercial fabrication partner(s) to modernise the brownfield fabrication facility. Semiconductor lab Timeline 1984: SCL starts production 1989: Unit consumed by mysterious fire 1997: Restarted again 2006: Converted to Semiconductor Laboratory under the Department of Space from Semiconductor Complex Ltd 2021: Cabinet accords approval for modernisation 2022: Handed over to MeitY from the Department of Space Source: The Tribune INDIA

Chandigarh international airport renamed after Bhagat Singh

9/29/2022 2:10:00 PM

The Ministry of Civil Aviation today renamed Chandigarh International airport as ‘Shaheed Bhagat Singh International Airport’. Finance and Corporate Affairs Minister Nirmala Sitharaman unveiled the plaque at Mohali and paid tributes to the national icon on his 115th birth anniversary. Punjab Governor and Chandigarh Administrator Banwari Lal Purohit, Haryana Governor Bandaru Dattatraya, Punjab CM Bhagwant Mann, Haryana Home Minister Anil Vij, Anandpur Sahib MP Manish Tewari, Chandigarh MP Kirron Kher and Minister of State for Civil Aviation Dr VK Singh were also present on the occasion. Haryana Deputy CM Dushyant Chautala says both Punjab and Haryana rose above all considerations to rename the airport after the freedom fighter’s name. Chautala proposed a bust of Shaheed Bhagat Singh to be installed here before the Martyrdom Day on March23. Punjab CM Bhagwant Mann sought permission from Civil Aviation ministry to increase international flights from the airport. With the renaming, the long pending demand to add Mohali, Chandigarh and Panchkula in the nomenclature has been laid to rest. Three days ago, in his Mann Ki Baat radio broadcast, PM Modi said the Chandigarh airport will now be named after Shaheed Bhagat Singh as a tribute to the great freedom fighter. Chandigarh International Airport Limited (CHIAL) is a joint venture company incorporated under the Companies Act, 2013 by Airports Authority of India (AAI) in association with governments of Punjab and Haryana. The airport runway is in Chandigarh while the international terminal is located on the south side of the runway in the village of Jhiurheri in Mohali. The AAI has a 51% share in the project. Punjab and Haryana have contributed 24.5% each. Source: The Tribune INDIA

Festive season, a big boost for residential real estate

9/24/2022 1:20:00 PM

The festive season beginning from Ganesh Chaturthi and culminating in Christmas, and the arrival of the new year is considered to be an auspicious time to invest in residential real estate. The season, which is a much awaited time of the year when home buyers opt for high-ticket purchases, gives a significant thrust to the real estate sector and is marked by the launch of new projects, combined with a spectrum of benefits to attract home buyers. This is a time when demand sees conversion as home buyers prefer going ahead with planned purchases. The need for stability and security emerging as high priority in the minds of people is also a factor that will pep-up residential real estate. A big booster to housing demand has been the increased importance of owning a property backed by consumer confidence in the overall economic scenario. The trend of the Indian festive season becoming the annual high point for residential real estate originates from traditional sentiment and is the right time to invest in wealth-creating assets. There is a healthy stock of ready-to-move-in and nearing-completion inventory that will be of high interest during the festive season. The current home loan interest rates are unlikely to compress the sustainable housing demand as the price band is still within a line of control. Rising home ownership amongst millennials supported by higher disposable income and willingness to upgrade to larger, luxurious spaces, equipped with better amenities have also sparked a sharp growth in housing demand. We are seeing a lot of home buyers who are eager to conclude deals in this auspicious season. The market continues to experience end user-driven demand and we are already witnessing a trend of more serious buyers closing sales. As per a recent report, the residential sector has recorded a 9-year high sales volume in January-June 2022. A defining feature of today’s housing demand is that even millennials are now in the market for home ownership as real estate has become the most sought-after asset class. With strengthened consumer sentiment and buoyancy in the market, the real estate sector has an optimistic outlook going forward. The sector has been riding strong for the last few months and is likely to maintain this momentum. The growth of the Indian real estate sector is well complemented by the growth of the corporate environment and the rising demand for improved lifestyles and better residences. Customers are also increasingly stepping ahead to invest in their dream properties offered by developers, which match their opulent lifestyle and needs. The biggest factor driving people to buy homes today is their experience during the Covid-19 pandemic and lockdown. It has made people rethink their priorities and hence owning a home has gained importance as it spells comfort and security. The end user-driven property market is experiencing a home buying rally and today, a rise in savings and market stability has encouraged home buyers to take the plunge. The past few months have been testament to the fact that home buyer optimism is at an all-time high as customers understand that they have various options and are able to make self-assured purchase decisions. In conclusion, it can be said that revival in market sentiment against the backdrop of vibrant economic activities makes this season more attractive. However, while investing in property, buyers should not only look at attractive deals, but also consider the reputation of the developer and other factors like location, execution capability, and amenities that the developer has to offer. As we march ahead, the industry is set to see a new phase of steady growth, which is a positive sentiment for those looking to invest this season. Real estate is always a wise asset class given that it sees consistent appreciation. Source: Times of India INDIA

Housing sale in tier 2 cities growing at rapid pace: Report

9/21/2022 10:27:00 AM

Ahmedabad, Vadodara, Nashik, Gandhi Nagar and Jaipur have emerged as the top five tier-II cities in growth of residential property market on the back of rapid urbanisation, industrialisation and growth of IT industry, according to recent report by real estate data analytics and consultancy company, PropEquity. The report highlights that there has been a remarkable jump in both absorption as well as supply of quality residential properties in various price brackets in these cities. The report has tracked performance of the residential segment of the real estate sector in various tier-II cities from FY 2017-18 to FY 2021-22. “The real estate activity in tier 2 cities is fast catching up with that of tier 1 cities. Interestingly, Ahmedabad’s residential real estate market size of Rs 83,390 crore has outshone some of the Tier 1 cities like Chennai and Kolkata with market sizes of Rs 52,554 crore and Rs 38,440 crore respectively at the end of fiscal year 2021-22. Although, it is also interesting to observe that the market share of Tier-I cities is about 4x times the share of Tier-II cities in the last five fiscal years . ,” said Samir Jasuja, Founder and Managing Director at PropEquity. This report tracked the current residential real estate scenario in India with focus on the top Tier II cities. The duties that were part of the study are Amritsar, Mohali, Chandigarh, Panipat, Dehradun, Bhwadi, Sonepat, Jaipur, Agra, Lucknow, Bhopal and Indore, Vishakapatnam, Vijaywada, Guntur, Goa, Manglore, Mysore, Coimbatore, Kochi, Trivandrum, Raipur, Bhubaneshwar, Ahmedabad, Gandhi Nagar, Vadodara, Surat, Nashik and Nagpur. “Post COVID lockdowns, tier 2 cities have been witnessing new job creation at a decent rate and many tech and other sector companies are encouraging work from home for their employees for at least next couple of years. This had led to scenario where tier 2 city housing projects are getting great traction due to their attractive pricing and potential for a higher upside in terms of investments,” Abhishiekh Andlay, Founder, Andlay Estates, said. The sales of homes in Ahmedabad stood at 39,046 units in fiscal year 2021-22, a growth of 26% as compared to financial year 2020-2021. When compared to fiscal 2017-18, a growth of 32% was witnessed in the city. The supply of homes in Ahmedabad stood at 39,195 units in financial year 2021-22, a growth of 14% as against fiscal year 2020-2021. Second ranked Vadodara witnessed a growth of 25% in sales of homes at 17,285 units in fiscal 2021-22 as compared to the previous fiscal. When compared to financial year 2017-18, a jump of 20% was seen. The supply of new homes stood at 15,046 units in fiscal 2021-22, an increase of 9% as against the previous financial year. Third ranked Nashik witnessed sales of 10,806 units in fiscal 2021-22, a growth of 15% on year-on-year basis. New supply of homes in Nashik stood at 13,037 units in 2021-22 fiscal, a whopping growth of 68% as compared to the previous fiscal. Fourth ranked Gandhi Nagar saw sales of 7,650 units in fiscal 2021-22, a growth of 10% as compared to the previous fiscal. New supply of homes in Gandhi Nagar stood at 6,361 units in the financial year 2021-22, a drop of 30% on a year-on-year basis. Fifth ranked Jaipur saw sales of 7,676 units in fiscal 2021-22, a whopping growth of 42% as compared to the previous fiscal. New supply of homes in Jaipur stood at 7,022 units in the financial year 2021-22, a massive increase of 78% on a year-on-year basis. The inventory of homes in Jaipur stood at 14,529 units at the end of fiscal 2021-22, a marginal dip of 4% when compared to the previous fiscal. It will take 23 months to clear at the current rate of sales. Source: Economic Times INDIA

Indian retail sector expected to get first Real Estate Investment Trust: Report

9/19/2022 10:58:00 AM

India is expected to get its first Real Estate Investment Trust (REIT) of retail assets soon as institutional investors and developers look to monetise their rent-yielding space in shopping malls, according to JLL India. REIT, a popular instrument globally, was introduced in India a few years ago to attract investment in the real estate sector by monetising rent-yielding assets. It helps unlock the massive value of real estate assets and enable retail participation. At present, there are three listed REITs - Embassy Office Parks REIT, Mindspace Business Parks REIT and Brookfield India Real Estate Trust - on Indian stock exchanges but all these are of leased office assets. Property consultant JLL in its latest report on retail real estate segment highlighted that institutional investment in the retail sector has been picking up since 2021. More than USD 862 million investments have come from 2021 (excluding portfolio deals). Many global investors are investing in the retail sector either by buying a stake in existing assets or through greenfield development platforms. "The retail market seems to benefit from favourable demographics, rapid urbanisation, and rising consumption," the consultant said. The report noted that investors are expecting healthy returns in the long run, considering the growth potential. Also Read | How Can You Save With Real Estate Express Coupon Code? "Investors are looking for quality Grade A assets by established developers having less vacancy. Investors prefer leased-based assets over strata-sold assets to ensure fair market rentals and timely returns," it said. The consultant also mentioned that investment in retail assets is not just limited to metros, as significant activities have been recorded in Tier 2 and Tier 3 cities as well. "Additionally, investments by these big institutional players help developers to exit the project partially or fully, reduce their debt, and focus on other developments. A lot of foreign funds are willing to acquire quality retail assets yielding good rental income," the report said. Investors are either buying or creating portfolios considering future public exit via REITs. "REITs are still relatively new in India and are prevalent in the office sector. India is expected to get its first retail REIT soon. With quality supply in the pipeline and new malls announced by established developers, the Indian retail sector is expected to attract more institutional investment," JLL India said. REITs in retail will be the next big move in the sector as institutional investors are building portfolios of superior-grade retail assets, it added. JLL India cited few examples of institutional investors creating large retail real estate portfolio. Nexus Malls acquired Forum Malls as part of a USD 1.2 billion deal between Blackstone and the Prestige Group to take over the income-generating retail assets of the latter. Abu Dhabi Investment Authority-backed Lake Shore India Advisory has acquired Viviana Mall in Thane from GIC and realty developer Ashwin Sheth Group for over ₹1,900 crore, the report said. That apart, Singapore sovereign wealth fund GIC and The Phoenix Mills Ltd have entered into a strategic partnership to establish an investment platform for retail-led mixed-use assets in India. The consultant expects leasing demand in malls to expand and surpass pre-pandemic levels by 2023. The inherent growth potential of the sector is quite robust, and institutional investment is expected to increase it further. This would bring more transparency and improvement in the operating environment of shopping malls, JLL India said. On the overall supply situation, JLL said that the stock of Grade A shopping malls in the top seven cities of India (Delhi, Mumbai, Pune, Bangalore, Kolkata, Chennai, and Hyderabad) is at 90.6 million sq ft in H1 2022. More than 50 per cent of the mall stock is in Delhi NCR (29 million sq ft) and Mumbai (19 million sq. ft). More than 70 shopping malls with a total retail space of 31.02 million sq ft are expected to become operational by 2025 across the top seven cities of India. Source: Hindustan Times INDIA

Leasehold to freehold conversion: SC gives MHA, Chandigarh admn 3 months to take decision

9/18/2022 1:31:00 PM

The Supreme Court has given three months to the Chandigarh administration and the ministry of home affairs (MHA) to decide on allowing conversion of commercial and industrial leasehold properties to freehold. On August 29, the Supreme Court had summoned Union home secretary Ajay Kumar Bhalla in court on September 16 if a decision on the issue was not taken. After Bhalla was summoned, UT administrator Banwarilal Purohit on September 6 had held a press conference, announcing that the decision lied in UT’s domain and will be arrived at soon. Later, Purohit sent UT adviser Dharam Pal to Delhi to discuss the issue, but a consensus could not be arrived at and MHA opted for seeking exemption from personal appearance of the home secretary at the September 16 hearing. “This being a major policy decision, the matter is being considered by MHA as per the established legal procedure and consultation with all stakeholders concerned,” the MHA said in court, seeking three more months to examine the matter, which was eventually allowed. Chandigarh has 6,621 commercial and 1,451 industrial plots on leasehold, which allows occupation for a limited period, mostly 99 years, with government agencies holding the ownership rights. Apart from legal complications, the allottees struggle with their sale and purchase, and raising a mortgage when needed, issues normally not associated with freehold properties where the allottee is the real owner. Earlier in July, the UT had put the onus on the Centre for delay in reaching a decision on the issue. The UT had first sent the conversion proposal to the MHA in April 2021 on the pattern of the residential policy of 1996. Subsequently, it even sent four reminders to MHA, but a decision was still pending, UT had told the court. In September last year, the apex court had directed the administration to constitute a committee to review and streamline the processes of sanction of mutation, grant of occupancy certificate, no-objection certificate and other citizen-centric requirements, including calculation of unearned profit under the 1973 or 2007 rules. The dispute before the SC was taken up by the Estate Office against a consumer court order in which it was penalised on the complaint of a city resident on an issue related to allowing conversion of leasehold property to freehold. The court had ordered that the committee would submit its report to the administrator and the UT administration. In compliance with the order, the administrator constituted the committee on October 5, 2021. The committee had made the first set of recommendations in February and submitted the second set of suggestions recently in July. Several amendments in property-related matters have been made since the first set of recommendations, and UT has submitted four action-taken reports in March, April, May and July before SC, while putting the onus on the Centre for delay in resolving some key issues. Source: Hindustan Times INDIA

India’s real estate sector to reach $1000 billion by 2030: Thriving and yielding consistent returns

8/31/2022 3:14:00 PM

The good times continue to roll in the real estate sector. According to a report by valuation and consulting firm, RBSA Advisors the country’s real estate sector is expected to grow by 15% from $ 60 billion in 2010 to $1,000 billion by 2030, and contribute 13% of India’s GDP by 2025. The organised retail real estate sector is expected to increase by 28% to 82 million square feet by 2023. Ansh Batra, Director, Buniyad Group, said that the momentum that had picked up post-pandemic seems only to be getting stronger. "Despite the slight increase in the prices and a marginal hike in home loan interest rates the real estate sector has been thriving on positive buyers’ sentiments,” Batra said. In Delhi-NCR, there is huge demand for housing spanning across all segments, the report said. Sanjay Sharma, director, SKA Group said that among the factors that have boosted real estate in NCR is the all-round improvement in connectivity both road and metro. "The construction of Jewar Airport has acted as a major catalyst. These have enabled the developers to announce new projects farther away from the city and for the buyers it has significantly cut down their commuting time." Besides, since these are newly launched projects, they offer benefits of superior construction and better much improved facilities,” he said. The sentiments are equally positive in the commercial segment. Big retail companies are expanding and looking for new spaces. New projects are getting launched. Projects which were stalled due to the pandemic are nearer to completion. The commercial realty segment, both office and retail is thriving. Shop-cum-Offices demand has also taken a big boost, the report said, adding that prices of commercial properties are showing good appreciation. "In fact, it has been estimated that on average commercial properties comprising both offices and retail spaces can post returns anywhere between six to nine percent,” Ajendra Singh, VP, Sales & Marketing, Spectrum Metro, said. According to a Knight Frank report, 25 million square feet have been leased between January and June this year, translating to a 107 per cent jump, year-on-year. Bengaluru and NCR have led the way, accounting for 7.7 million square feet and 4.1 million square feet of these transactions, respectively. An interesting aspect of the post-pandemic realty scene has been the surge in luxury apartments, plots, villas and independent floors. For the Indian retail market, the projections are equally positive and is estimated to reach $1.1-1.3 trillion by 2025, the report said. In 2019-20 it was valued at $0.7 trillion, which makes for a Compounded Annual Growth Rate (CAGR) of 9-11%. Factors like socio-demographic and boost in economic activities such as urbanisation, income growth and rise in nuclear families are driving the Indian retail market. The organised retail real estate sector is expected to increase by 28% to 82 million square feet by 2023. "At present an investment in retail make for the best choice as the rental value and price appreciation are high,” Amit Jain, Director, Mahagun Group, said. Source: Zee Business INDIA

Shorter route to Chandigarh airport: GMADA moves ahead with process to acquire land

8/25/2022 1:03:00 PM

Aiming to ready the shorter route to the Chandigarh International Airport via Sector 66-A by March next year, the Greater Mohali Area Development Authority (GMADA) has moved ahead with the process for land acquisition. The authority has issued a notification under Section 19 of the Land Acquisition Act, declaring its intention to acquire 18 acres in villages Kambala, Kambali and Rurka for the project and inviting objections within 30 days, before compensation is fixed. The around 5-km stretch will allow commuters from Chandigarh and Mohali to head to the airport via the road in front of Bawa White House, instead of taking the longer route via Airport Road. This will bring down the 18km distance from Tribune Chowk, Chandigarh, to the airport in Mohali by more than 5 km. At present, commuters have to head all the way to the T-junction near the Indian School of Business, after passing by Bawa White House, to turn left towards Airport Chowk, where they again have to turn left towards the airport. “The 164-foot-wide road is part of the Mohali Master Plan. We have issued a notice under Section 19 of the Land Acquisition Act and are hopeful that land will be acquired by December this year and project will be completed by March next year,” said a senior GMADA official, dealing with the project. “A shorter route from Chandigarh has been a long-pending demand. It will be a boon for commuters from Chandigarh and neighbouring areas, and industry close to the Airport road by providing faster access,” said Naveen Manglani, former president, Chamber of Chandigarh Industries. Source: Hindustan Times INDIA

PM Modi to inaugurate cancer hospital at Mullanpur in Mohali on Wednesday

8/24/2022 1:27:00 PM

Prime Minister Narendra Modi will dedicate the Homi Bhabha Cancer Hospital & Research Centre to the nation at Mullanpur, New Chandigarh, in Punjab. The hospital has been built by the Union Government at a cost of over Rs 660 crore. The cancer hospital is a tertiary care hospital of 300-bed capacity and is equipped with modern facilities to treat all types of cancers using every available treatment modalities like surgery, radiotherapy and medical oncology - chemotherapy, immunotherapy and bone marrow transplant. This project is significant since there have been numerous reports of increasing cancer prevalence in parts of Punjab and people are forced to go to other states for affordable cancer treatment. This issue was so rampant that a train from Bathinda carrying cancer patients to Bikaner was known as a cancer train. The hospital in New Chandigarh will act as a hub of cancer care. A 100-bedded cancer hospital by GoI is functional since 2018 in Sangrur, which will now act as a spoke of this hospital. It will also help patients from neighbouring states Cancer treatment made affordable Treatment of cancer under the Ayushman Bharat has been one of the prime focus areas to safeguard the beneficiaries from catastrophic expenditure of cancer treatment. Health insurance cover of Rs 5 lakh per family per year is provided for secondary or tertiary care hospitalisation. Chemotherapy and Radiotherapy packages, along with surgical oncology are covered as part of cancer treatment in the empanelled hospitals under the scheme. A total of 435 procedures have been defined for the treatment of cancer. Significant focus on oncology in its various aspects has been ensured in the new AIIMS that are being established under the aegis of Pradhan Mantri Swasthya Suraksha Yojana (PMSSY). Cancer care facilities are also being established in other medical colleges under PMSSY. The National Pharmaceutical Pricing Authority (NPPA), under the Ministry of Chemicals & Fertilisers, put out a list of 390 anti-cancer non-scheduled medicines with MRP reduction up to 87% in 2019. The functional Ayushman Bharat Health & Wellness Centres (AB-HWCs) have done more than 10.33 crore screenings for oral cancer, more than 3.41 crore screenings for cervical cancer in women and more than 5.06 crore screenings for breast cancer in women. (As on April, 2022). Source: The Tribune INDIA

Current and Future Sentiment In Residential Real Estate Remain Optimistic: Report

8/12/2022 3:52:00 PM

The sentiment in the residential real estate sector has slightly moderated compared to the previous quarter’s all-time high of 68. It has now dipped to 62 in Q2 2022, amid a rapidly changing economic scenario, the recent report of the Knight Frank-NAREDCO Real Estate Sentiment Index Q2 2022 (April - June 2022) has said. “The Current Sentiment Index score, while safely remaining in the positive zone, has dropped mainly due to the perceived impact of the two consecutive repo rate hikes in May and June 2022,” the report said. The report noted that the Future Sentiment Score, which captures the stakeholder sentiments for the next six months for the real estate sector, has shrunk from its historic high of 75 in H1 2022, to 62 in Q2 2022, as pressures of a rise in inflation and depreciating rupee against the dollar has cast a shadow on the sector. That said, both the current and future sentiment scores remain optimistic, despite the decline, the report said, adding that the impact of global economic headwinds on the Indian economy is yet to play out. “The real estate supply-side stakeholders remain watchful of the tripartite global risks - economic turmoil in the United States, Russia – Ukraine standoff, and economic slowdown in Europe,” the report reads. Shishir Baijal, chairman and managing director, Knight Frank India, said: “Over the last 8-10 quarters, it has been firmly established that there is a strong latent demand in the residential sector, which when supported by right prices and sops, will convert to sales. In the last few quarters, this has given the once beleaguered sector a strong comeback. While some headwinds face the residential market with the geo-political issues, high inflation leading to increased repo rate and higher prices, demand remains strong leading to a positive outlook for the sector.” The Knight Frank-NAREDCO Real Estate Sentiment Index report further highlighted that the residential market outlook in Q2 2022 reflects future caution, as stakeholders expect strong sales and launch momentum, but maintain a subdued outlook on pricing. “At a time when housing affordability has been adversely impacted, the majority of stakeholders opine that there may not be further room for a home price rise,” said the report. Rajan Bandelkar, president, NAREDCO and director of Raunak Group, said: “The Indian real estate sector is one of the few bright spots in the global economy. The sector has been performing well and has been stable for the past few quarters. While the overall economic scenario and world order still remain cautious, strong fundamentals of the Indian economy and the real estate sector continue to give strength to various stakeholders, including the developers, the development authorities, policymakers, and the end consumers. With the government’s focus on reforms to tighten the monetary policy and the economy, we can look forward to an even stronger real estate sector in the future. Source: outlook India INDIA

Mohali | Land acquisition complete for Airport Road-Kharar linkway

8/9/2022 11:06:00 AM

Moving ahead with the plan to construct a 6km long, 200-ft wide link road between Airport Road and Kharar-Landran road, the Greater Mohali Area Development Authority (GMADA) has completed the land acquisition process for the project. The road construction is expected to begin in October this year. As many as 73 acres have been acquired, for which a compensation of ₹198 crore is being paid by the Punjab government. The highest compensation of ₹4.23 crore per acre is being paid to landowners in Baliali village, which is the nearest to the Airport Road. At ₹2.80 crore per acre, the lowest compensation amount has gone to Tole Majra village, which is the near Landran-Kharar National Highway. Apart from this, the state government will also be paying ₹167 crore for trees and structures being razed on the stretch. The department of housing and urban development has approved the compensation amount. Will improve connectivity for Kharar residents The link road, which was proposed six years ago, will improve connectivity from Airport Road to Kharar. With major townships such as TDI, Ansal, Jubilee City Gardens and Gateway City adjoining the stretch, the road will divide Sectors 116 and 92, and Sectors 117 and 74A to pass through Chappar Chiri Khurd, Chappar Chiri Kalan, Chajju Majra, Baliali and Ballomajra before connecting to the Kharar-Landran road near Swaraj factory. The road is a part of the Mohali master plan. Jubilee Group director Sanyam Dudeja said, “The road will be directly connected with DPS School, Jubilee City Gardens, and other important areas nearby, and thus prove a boon for residents here. Most importantly, it will help ease out traffic flow.” GMADA chief engineer Balwinder Singh said, “We will float tenders for construction now as the land acquisition process is complete and work is expected to begin in October.” Source: Hindustan Times INDIA

India's Real Estate Market Transparency Among Most-Improved Globally: JLL

8/2/2022 11:25:00 AM

ndia’s real estate market transparency is among the top-10 most-improved markets globally, according to JLL’s 2022 Global Real Estate Transparency Index (GRETI). India’s improvement in transparency score from 2.82 to 2.73 between 2020 and 2022 is higher than some of the highly transparent markets such as Canada, Belgium and Spain. The improvement in India is on the back of digitisation and data availability for transaction processes in addition to overall market fundamentals, JLL said in a statement. It added, “India’s improvement in transparency is reinforced by increased institutional investment and the growing numbers of real estate investment trusts (REITs) helping to broaden market data and bring more professionalization to the sector to complement regulatory initiatives like the Model Tenancy Act, and digitisation of land registries and market data, such as through the Dharani and Maha RERA platforms." Radha Dhir, CEO and country head (India) at JLL, said the move towards greater transparency in India will intensify investor interest and bolster occupier confidence, and as a result, the country will see more capital deployment as it demonstrates consistent efforts to make accurate data available, enforce legal protections for property ownership, and enhance the regulatory environment to facilitate the transactions. Advertisement RELATED NEWS Rupee Rises 12 Paise to 78.94 Against US Dollar in Early Trade on Rising Foreign Inflows Petrol, Diesel Price Today Announced: Check Fuel Rates In Delhi, Mumbai, Other Cities “Regulatory changes in the Indian real estate sectors like RERA and digitization in all transaction processes have led to a more sanitized and transparent data availability helping the country make tremendous progress in the index," Dhir added. She also said sustainability continues to be the key focus for the world going ahead and India has taken great strides in sustainability in the past years. However, there is a need for a more concerted and congruent thought process and action plan to bring sustainability into the mainstream. Sustainability Needs Sustained Thinking JLL said that to be able to move to the coveted Transparent list, from the present Semi-Transparent list, the country needs to improve sustainability tracking. Sustainability has not been one of the major areas for change over the last couple of years for India, but investors and occupiers are driving this change. “Several initiatives are underway at either the national or local level including the National Guidelines on Responsible Business Conduct from 2021, with reporting for the largest 1,000 companies by market cap to be compulsory from 2022-23, and local plans such as Mumbai’s Climate Action Plan, released in 2022, which is expected to establish a system to conduct regular energy performance benchmarking of buildings by 2025, and mandate a building energy management system in all new buildings," it added. Making green certifications/ratings and adherence to ECBC a mandate would give a greater push to sustainability. The regulatory impetus for mandatory tracking and reporting is still lacking but should get a major push following India’s call for Net Zero by 2070. Sustainability has been the biggest driver of transparency improvements across markets according to JLL’s 2022 index. With increasing numbers of countries and cities setting mandatory energy efficiency and emissions standards for buildings and the more widespread adoption of green and healthy building certifications. However, sustainability measures remain among the least transparent globally, and the fractured regulatory landscape – with different standards being set at the municipal, state, region, and country levels, and a proliferating array of sustainability credentials, benchmarks, and standards – is making it increasingly difficult for investors and companies to navigate and understand their responsibilities. Improvement in Transaction Process This was the parameter on which India’s score improvement was the highest in GRETI 2022. Given the regulatory initiatives, and better and deeper data availability, access to asset information has improved to a great extent. With reforms also creating the push for better professional standards for property agents and an environment for weeding out illicit finance through stringent anti-money laundering regulations, the transaction process in India has become more transparent and meaningful. India’s improvement in this parameter was just behind Vietnam and Malaysia, among other APAC countries. Samantak Das, chief economist and head (research), REIS, India, at JLL, said: “India’s investment performance parameter has held steady with a conducive investment environment in place and healthy opportunities for investors. The last two years have also been marked by upheaval and a reset in investor strategies. Some countries have found increased favour from investors and have moved up the rankings. India has kept its ranking steady, though it has improved its composite score in this parameter." JLL’s GRETI is an index that offers an understanding of the transparency spectrum across real estate parameters, which is most useful for real estate investors globally. It offers countries a window of opportunity to identify lagging indicators and make a concerted push to improve global investment flows. Interest in Alternative Real Estate Assets Diversification remains a core theme for many investors in the Asia-Pacific. Institutional capital, such as that controlled by asset managers, pension funds and sovereign wealth funds, is active in alternative real estate sectors in nearly two-thirds of the markets tracked. That means expectations for transparency across niche property types like lab space, data centers, or student housing have grown. India has made rapid strides in the availability of high-frequency data across its big cities and core asset classes through the intervention of tech platforms and regulatory reforms. It needs to replicate for other cities and alternative sectors with the work already underway through a mix of both private sector participation and government push towards digitization of land and property records. As market transparency improves through access to data, better corporate governance practices, and more publicly listed REITs creating more publicly available datasets, the sustainability agenda needs a greater push for India to rapidly ascend to the Transparent tier. Looking Ahead JLL said transparency and sustainability are now colliding to create new, insightful, and game-changing trends for the real estate industry. Standardized sustainability measurement metrics will make it easier to benchmark assets globally. “Making such data reporting mandatory will be key to the built environment decarbonization and climate risk mitigation across countries. The increasing diffusion of technology is creating the push toward tracking and aggregating granular and high-frequency data. While this works best in countries with digitized data sources and governance, advanced infrastructure, and deeper capital markets, the converse of transparency improvement by the proliferation of such data aggregators who build market data from scattered sources also holds true," it added. The road from regulations to putting them into practice – across financial regulations, land-use planning, taxation, anti-money laundering and eminent domain – will be necessary to increase transparency levels and match heightened expectations, JLL said. Source: News INDIA

Institutional investors bullish on commercial real estate

7/28/2022 12:05:00 PM

India’s commercial real estate market is segmented across Offices, Retail, Industrial and Logistics, and Hospitality. According to a media research report, the commercial real estate market in India is expected to grow at a CAGR of approximately 13% during the forecast period FY 2022-2027. The short-term impact due to Covid pandemic-led remote work trend is waning with the reopening of campus, back to office, higher retail footfalls, economic activities resumed, pent-up demand for travel explorations etc. Demand for grade A asset has sharply increased post Covid in the commercial realty markets with hygiene and social distancing taking the centre stage. It is estimated that by FY 22, the absorption of Grade-A office space will exceed 700 million sq. ft in major metro cities. The demand from various sectors like Manufacturing, SMEs, Electronics, Auto ancillaries, E-commerce, 3PL, and Retail is bolstered on the back of Atmanirbhar Bharat mission. Revolutionary schemes like Make in India and policy reforms like GST, RERA, and IBC launched by the Government of India have augured well for strengthening the commercial real estate sector in India. It continues to attract the highest Foreign Direct Investments on the grounds of transparency, tax incentives, and competence of the sector. The large-scale investment by institutional investors is projected to fuel the accelerated growth of commercial realty. The positive economic growth rally fostered by robust infrastructure development will boost demand for commercial real estate. Developers are optimistic about a healthy rebound in office leasing activity with the rise in investors’ confidence due to swift economic resiliency. Increased transaction volumes signify strong consumer demand and higher occupancy levels. The modified office design concepts to befit new models like flex workspaces, co-living, student housing, and built-to-suit will be the future growth levers. Commercial real estate continues to offer better rental yields on the ground’s rapid urbanization and better job prospects. It is high in demand due to its recurrent earning potential with a high ROI of 6 to 10% yield on investment and capital returns. This is a highly location-centric sector driven by potential demographics and socioeconomic factors. Periodic global economic discords recently have nudged investors to assess the risk variance of investment assets in portfolio return analysis. The idea of a capital market approach toward real estate investment is picking up amongst portfolio management experts. The technique is to determine the time value of money, valuation of cash flows, and risk hedged against return forecast. The performance of newly-launched investment instruments REITs and InviTs is yet to be benchmarked. With a strong presence of commercial realty market in India, REITs stand to gain significantly as viable investment options. The share of REITs in overall market capitalization is substantial globally, where Indian REITs are yet to catch up. The Indian commercial real estate market is highly competitive. It is becoming a preferred destination for global institutional investors, driven by robust office space absorption, declining vacancy levels, and rising rentals. The sector is also witnessing a market consolidation trend post Covid as the need for capital funding increases multifold. However, despite all the ambiguity around the future of offices in the wake of the pandemic, office assets continue to hold strong investment prospects, as evidenced by the quantum of investment committed towards the sector in FY 2022. The commercial real estate market has matured along with the evolved corporate finance landscape in India. Source: Financial Express INDIA

Airport Ltd approves shorter route from Chandigarh; Punjab mum

7/26/2022 1:59:00 PM

The Chandigarh International Airport Limited (CHIAL) today gave its consent to a shorter route proposed by the UT Administration from Chandigarh to the airport. Following a meeting of officials from the UT, Punjab, Haryana, CHIAL and the Indian Air Force today, UT Adviser Dharam Pal stated: “CHIAL has agreed to the two options on the table for a shorter route. Punjab didn’t comment on the issue. Now, we will submit the two options on the IAF portal for approval. Following which, one route will be finalised.” The UT Administration had earlier asked all stakeholders to submit their comments regarding the two proposals for an alternative route for approaching the airport. The administration is in favour of developing a shorter route starting near Sector 48. The new road is planned to start from the T-point intersection of Vikas Marg (coming from Sector- 43 ISBT) and Purv Marg (coming from Tribune Chowk). Further, the administration has put forth two options — one comprises constructing an underpass, while the second suggests a road parallel to the airport boundary wall. The administration wants the underpass option as it is straighter and shorter. As of now, city residents have to travel 11 km to reach the airport. One of the proposed routes to the airport will reduce the distance to around 2.85 km, while the second one will be 3.32 km long. To start near Sec 48; cut distance by 8 km UT wants a shorter route starting near Sector 48 i.e. from the T-point intersection of Vikas Marg and Purv Marg It has put forth two options — constructing an underpass or a road parallel to airport boundary wall The admn wants the underpass option as it is straighter and shorter. Source: Tribune INDIA

Karnataka, Manipur, Chandigarh top NITI ranking for innovation, growth

7/22/2022 12:24:00 PM

Karnataka, Manipur and Chandigarh topped a NITI Aayog ranking of states and union territories on innovation in economic growth, promoting business and competitiveness, and other parameters. Karnataka topped the India Innovation Index 2021 in the major states category, Manipur came first among North East and Hill states, and Chandigarh led among Union Territories (UT), said NITI Aayog on Thursday. The index evaluated the performance of 28 states and 8 UT on seven broad parameters and 66 indicators. The seven parameters are classified as five “enabler” and two “performance” pillars. Five enablers--covering innovation within a state/union territory--include human capital, investment, knowledge workers, business environment, and safety and legal environment. Telangana and Haryana came second and third in the major states category. Chhattisgarh was last in the category. In North East and Hill states category, Uttarakhand and Meghalaya came in second and third. Delhi and Andaman and Nicobar Islands were second and third in the UT and city-states category. “I want to encourage all states to ensure that these innovations are also accessible to all and help in resolving societal challenges. Only when we all grow together, we can become a prosperous nation,” said V K Saraswat, a member of NITI Aayog. The index had new indicators this year, taking the total to 66. The last edition had 36 indicators. NITI Aayog said it has tried to match its indicators to the 80 in the global innovation index. NITI Aayog said that states have scored fairly high on some enablers but low on the two performing pillars. Achievement in 'enabler' pillars has not necessarily led to a similar accomplishment in indicators under the 'performance' pillar. It added that high human capital in some states has not translated into filing of patents by individuals, which is one of the indicators of 'performance' pillar. The report cited the example of Maharashtra where high enrolment in PhD has not been entirely reflected in the patents filed in that region.] The index rated India’s overall performance on the 66 indicators, noting that the performance as a whole is “low but we are ambitious to enter into the top 25 nations on the Global Innovation Index.” From the 60th position in 2017 in the global innovation index, India has reached 46th spot in 2021. India was ranked 1st among the Central and South Asian nations and 2nd among the lower-middle-income countries, the report said. Source: Business Standard INDIA

PE investment inflows into the Indian real estate stands at $704 million in Q2 2022

7/12/2022 1:48:00 PM

Private equity investment inflows into the Indian real estate sector stood at USD 704 million (INR 56 billion), according to the latest data by Savills India, a global property consulting firm. The current macro-economic situation influenced in part by the global tensions, commodity constraints, resultant inflationary pressures and monetary tightening are yet to impact the real estate investment markets. Due to the declining supply of structured credit into residential real estate, the mainstay of PE transactions has been leased office purchase which are high in volume and make the trend lumpier in certain quarters as is also evinced in the 32% QoQ decline. “Private equity investment inflows into the Indian real estate sector have been strong in the yield asset classes like office, warehousing and data centres. Life sciences is another sector which will emerge as a consolidated asset class in the coming years. The uptake in office leasing and steady performance of REITs further underpins the strength of this sector. We will also witness more global investor participation in the housing sector which will fill up the void created post the October 2018 crises,” said Diwakar Rana, Managing Director, Capital Markets, Savills India. As per the data, commercial office assets continued to claim the lion’s share, of the PE investment during Q2 2022. All the quarterly investment came from foreign institutional investors and was concentrated in core office assets across Mumbai, Chennai and the NCR. Additionally, India’s life sciences sector holds huge potential for attracting PE funds in the current decade. This is owing to the availability of a large talent pool at significantly competitive cost making India a compelling destination for global research & development (R&D) and manufacturing. Betting big on this trend, global investment firm called Actis has invested USD 200 million (USD 16 billion) in Rx Propellant which is involved in development and marketing of life sciences real estate projects across Hyderabad and Bengaluru. "Similar to Q1 2022, commercial office assets remain the front runner garnering a major share of the investment pie. PE investment in the life sciences research and development real estate has picked up momentum since 2021 and we expect this sector to continue to grow aided by government policies, competitive costs, and growing talent pool among other factors,” said Arvind Nandan, Managing Director, Research and Consulting, Savills India. Source: The Economic Times INDIA

GMADA reconsidering cancelled Sector-77 site for new bus stand in Mohali

7/8/2022 1:30:00 PM

Over six months after the Greater Mohali Area Development Authority (GMADA) cancelled the 14-acre site in Sector 77 for a new bus stand, it is now reconsidering it after failing to identify any other suitable land. On January 2, GMADA had cancelled the site after finding it unviable for a bus stand, just two days after former Punjab local bodies minister Brahm Mohindra laid the project’s foundation stone on December 31, 2021. Now, GMADA chief administrator Amandeep Bansal said, “We have yet to finalise any other site, so we are reconsidering the one in Sector 77. A proposal will be sent to the higher authorities for a final decision.” When cancelling the site in January, GMADA had stated that a bus stand in Sector 77 will cause traffic gridlocks near the Airport Road. On the other hand, during the foundation stone-laying ceremony of the bus stand, Brahm Mohindra had said due to its proximity to Airport Road, passengers will find it more convenient to travel to the Sector-43 Inter-State Bus Terminus (ISBT) in Chandigarh and to other cities from there. In November last year, the then Punjab chief minister, Charanjit Singh Channi, had directed GMADA to finalise a new site for the ISBT near Gurdwara Singh Shaheedan in Sohana, where around 14 acres of land is lying vacant. Notably, Mohali already has the region’s first air-conditioned ISBT along the Chandigarh-Kharar highway in Phase 6. But 12 years after its inception, the bus terminal, which also houses a commercial complex, has become only partially operational due to corporate insolvency resolution process. The demand for a new bus stand within the city was made by former Congress MLA Balbir Singh Sidhu, following which the CM had directed GMADA to finalise the site. Source: Hindustan Times INDIA

Soon, 2 over-bridges to cut travel time between Kalka, Zirakpur

7/7/2022 11:09:00 AM

NHAI has already floated tenders for the 60-m wide over-bridges, which will be constructed at a cost of ₹50 crore. It has invited bids for the “construction and site improvement of the four-lane national highway (NH-22) on the Zirakpur-Parwanoo junction. The National Highway Authority of India (NHAI) has approved two over-bridges, which are likely to reduce travel time between Kalka and Zirakpur and alleviate traffic jams on the stretch by next year. NHAI has already floated tenders for the 60-m wide over-bridges, which will be constructed at a cost of ₹50 crore. It has invited bids for the “construction and site improvement of the four-lane national highway (NH-22) on the Zirakpur-Parwanoo junction.” Panchkula MLA Gian Chand Gupta said, “The two over-bridges (exit and entry lanes) will connect Sectors 20 and 21 with Sectors 2 and 4. The structures will be built on the Kalka- Zirakpur national highway.” A 12-month timeline has been stipulated for completing the construction work, and the company that gets the tender will look after the maintenance of the over-bridges for 10 years. Underpass on Zirakpur-Kalka Expressway in pipeline An underpass on the Zirakpur-Kalka Expressway is also in the pipeline. The project, which was approved by NHAI in 2021, will help solve the traffic woes in Sector 20 and 21. “At present, all commuters have to cross the Sector 20-21 light-point to reach Zirakpur. However, once the underpass comes up between Sector 12A and the Industrial Area, residents will not have to take this congested route,” Gupta said, adding that the underpass will also provide a direct link to the highway for those travelling to Delhi and Patiala. The underpass, which will be built by the Haryana Shehri Vikas Pradhikaran (HSVP) at the cost of ₹25 crore, will reduce traffic congestion at the Sector 20 light point by around 40%. “It will take a year to complete construction work. Trees are being felled for the project,” Gupta said. The underpass was a long pending demand of those residing in Sectors 20, 21, and 12 as they have trouble crossing the highway. Traffic snarls are routinely witnessed on the stretch in peak hours, from 8am to 11am and around 5pm. Source: Hindustan Times INDIA

India’s real estate market transparency among most improved globally: JLL

7/6/2022 2:08:00 PM

India’s real estate market transparency is amongst the top ten most improved markets globally, according to JLL’s 2022 Global Real Estate Transparency Index (GRETI) released today. India’s improvement in its composite transparency score between 2020 and 2022 (from 2.82 to 2.73) is higher than some of the top ten transparent markets such as the UK, Australia, Canada, Ireland, Sweden, New Zealand, Belgium and Japan. According to JLL, India’s improvement in transparency is reinforced by increased institutional investment and the growing numbers of real estate investment trusts (REITs) helping to broaden market data and bring more professionalization to the sector to complement regulatory initiatives like the Model Tenancy Act, and digitization of land registries and market data, such as through the Dharani and Maha RERA platforms. “The move towards greater transparency in India will intensify investor interest and bolster occupier confidence. As a result, we will see more capital deployment into the country as it demonstrates consistent efforts to make accurate data available, enforce legal protections for property ownership, and enhance the regulatory environment to facilitate the transactions. Regulatory changes in the Indian real estate sectors like RERA and digitization in all transaction processes have led to a more sanitized and transparent data availability, helping the country make tremendous progress in the index,” said Radha Dhir, CEO and Country Head, India, JLL. “Sustainability continues to be the key focus for the world going ahead. We have seen India take great strides in sustainability in the past years, however, there is a need for a more concerted and congruent thought process and action plan to bring sustainability into the main,” she added. Sustainability needs sustained thinking To be able to move to the coveted Transparent list, from the present Semi-Transparent list, the country needs to improve sustainability tracking. Sustainability has not been one of the major areas for change over the last couple of years for India, but investors and occupiers are driving this change. Several initiatives are underway at either the national or local level including the National Guidelines on Responsible Business Conduct from 2021, with reporting for the largest 1,000 companies by market cap to be compulsory from 2022-23, and local plans such as Mumbai’s Climate Action Plan, released in 2022, which is expected to establish a system to conduct regular energy performance benchmarking of buildings by 2025, and mandate a building energy management system in all new buildings. Making green certifications/ratings and adherence to ECBC a mandate would give a greater push to sustainability. The regulatory impetus for mandatory tracking and reporting is still lacking but should get a major push following India’s call for Net Zero by 2070. Sustainability has been the biggest driver of transparency improvements across markets, according to JLL’s 2022 index. However, sustainability measures remain among the least transparent globally, and the fractured regulatory landscape – with different standards being set at the municipal, state, region, and country levels, and a proliferating array of sustainability credentials, benchmarks, and standards – is making it increasingly difficult for investors and companies to navigate and understand their responsibilities. Interest in alternative real estate assets Diversification remains a core theme for many investors in the Asia Pacific. Institutional capital, such as that controlled by asset managers, pension funds, and sovereign wealth funds, is active in alternative real estate sectors in nearly two-thirds of the markets tracked. That means expectations for transparency across niche property types like lab space, data centers, or student housing have grown. India has made rapid strides in the availability of high-frequency data across its big cities and core asset classes through the intervention of tech platforms and regulatory reforms. It needs to replicate for other cities and alternative sectors with the work already underway through a mix of both private sector participation and government push towards digitization of land and property records. As market transparency improves through access to data, better corporate governance practices, and more publicly listed REITs creating more publicly available datasets, the sustainability agenda needs a greater push for India to rapidly ascend to the Transparent tier. Looking ahead Transparency and sustainability are now colliding to create new, insightful, and game-changing trends for the real estate industry. Standardized sustainability measurement metrics will make it easier to benchmark assets globally. Making such data reporting mandatory will be key to the built environment decarbonization and climate risk mitigation across countries. Source: Financial Express INDIA

Punjab budget 2022-23: Mohali to get another medical institute

6/28/2022 11:58:00 AM

In a major health-infrastructure boost for Mohali, the AAP-led Punjab government in its maiden budget on Monday announced another super-specialty medical institute for the district. Finance minister Harpal Singh Cheema, while presenting the Punjab budget, also said the Punjab government aimed to make Mohali a hub of industry and information technology (IT). As announced, the Punjab government will set up the state-of-the-art “Punjab Institute of Liver and Biliary Sciences” at Mohali. The super-specialty hospital will be a dedicated centre of excellence for the diagnosis and management of liver and biliary diseases, and to provide advanced training and research in the field of hepato-biliary sciences. This will be the second government medical institute in Mohali after Dr BR Ambedkar State Institute of Medical Science in Phase 6. Affiliated with Baba Farid University of Health Sciences, Faridkot, the medical college was set up during the previous Congress government’s regime in the building of the existing Mohali civil hospital. The first MBBS batch with 100 seats started in May this year, but the AAP-led Punjab government is now working to relocate the medical college. To make the district an IT hub, the government proposed to set up a financial technology (Fintech) City near Mohali, where all facilities will be provided to encourage private participation in areas like financial technology, block-chain technology and artificial intelligence. Besides, to develop Punjab as an industrial hub, the government will be acquiring around 490 acres in Mohali to set up industries. The budget also focused on increasing security and safety of common people. To step up the surveillance, the government will install CCTV cameras across the district at a cost of ₹5 crore. The government has also identified 17.5 acres at Kurara village to construct a modern District Jail in Mohali. For this, initial funds of ₹10 crore will be proposed in the 2022-23 budget. For providing welfare services to the Scheduled Caste people, the government will set up Dr BR Ambdekar Bhawan at Mohali, which will house all offices under one roof. An old-age home will also be set up in the district for ex-servicemen. Apart from this, the government plans to set up a Jal Bhawan at a cost of ₹10 crore to strengthen the repair and maintenance of infrastructure of water supply schemes. Source: Hindustan Times INDIA

Uttar Pradesh govt waives stamp duty if property transferred within family

6/17/2022 11:30:00 AM

The Uttar Pradesh government has decided to do away with stamp registration duty in instances where property is being transferred to family members. A 7% stamp duty is being levied on such transactions currently. The registry will now be done for Rs 5,000 with an additional processing fee of Rs 1,000. The proposal states that if property is being transferred to parents, spouse, children, daughter in-law, son in-law, siblings and grandchildren, then a stamp registration duty of only Rs 6,000 has to be paid against 7% of the cost of the property. “Earlier, as the owner of a property, if I wanted to transfer it to my child or another close relative, I could only either transfer it or sell it. In case of transfer before my death, even as there was no exchange of money and the same people continued to reside in the house, a high rate of stamp duty was being charged which prohibited people from dividing property or settling ownership before one’s death. This new rule resolves that issue,” Minister for stamps and registration Ravindra Jaiswal told TOI. Because of the high cost of registration, families often use power of attorney to transfer properties, which was leading to a huge financial loss for the government, a senior government official told TOI. He explained, for transferring a property worth Rs 50 lakh, stamp registration would cost about Rs 4.20 lakh. The power of attorney, on the other hand, costs only about Rs 100. To avoid the cost of registry, families were resorting to cheaper power of attorney. Now, when registration is available at such a low cost, people would prefer to settle property issues properly rather than rely on power of attorney. This move would actually bring in revenue for the government, he added. Source: The Economic Times INDIA

Jaipur, Chandigarh to come closer: Here’s why it’s good news for delhi

6/14/2022 1:51:00 PM

From this week, the travel time between Jaipur and Chandigarh will reduce by at least three hours and travelling from southern parts of Haryana such as Mahendragarh, Jind and Narnaul to the state capital Chandigarh will take barely two-three hours as the NHAI is set to open a 227km new-alignment and greenfield link on this corridor. The new six-lane access-controlled highway will also reduce the burden of thousands of heavy and polluting vehicles on the arterial roads of Delhi and NCR, which otherwise pass through this region for inter-state travel. The new highway stretch also shows how the traffic coming from Jaipur side to Chandigarh and beyond can use it as a bypass for the entire NCR. Currently, vehicles need to either pass through Delhi or take the Western Peripheral Expressway to bypass the national capital. Similarly, , the traffic coming from Chandigarh side towards Jaipur and Mumbai can use this stretch for faster travel without entering the NCR. Officials said the 340km Trans-Haryana highway was planned to decongest the National Highways linking Delhi, which are getting clogged, and also to accelerate economic activities in relatively backward areas of Haryana. TOI travelled on the greenfield highway stretch on Sunday. “This greenfield link, which is a part of the Ambala-Kotputli Economic Corridor, has reduced the distance between Jaipur a and Chandigarh by 50km. The Trans-Haryana Highway project from Panchkula to Kotputli will open up economic activities across the backward districts of south Haryana. Currently, you see all developments only along the Delhi- Chandigarh and and Delhi-Jaipur stretches,” said a senior central government official. The economic corridor comprises four road projects. While the first stretch of 39km of existing NH from Ambala to Ismailabad has been upgraded, the NHAI has built the 227 km greenfield link between Ismailabad and Narnaul Bypass. The last leg of 44km of the existing NH between Narnaul Bypass and Paniyala Mod near Kotputli has been upgraded. Officials said all the works have been completed without time overrun and the stretch has got the best facilities for commuters. The NHAI has bid out six wayside amenities for commuters and these complexes on both sides of the NH will have restaurants, fuel stations, vehicle charging points and immediate trauma care facilities. “We have used anti-glare in the median of the road to in the median of the road to prevent high-beam light impacting vehicles coming from other directions. For every 30km, we have a crane, ambulance and patrolling vehicle. The video incident detection system is already operational to deal with any emergency,” said an official involved in the project. Source: Times of India INDIA

Punjab CM Bhagwant Mann approves Aerotropolis township in Mohali

6/8/2022 11:08:00 AM

Punjab chief minister (CM) Bhagwant Mann on Monday gave a go-ahead for setting up an ultra-modern township “Aerotropolis”, the seventh independent township in the Mohali master plan. A decision to this effect was taken in a meeting of the housing and urban development department, chaired by the CM here. The 1,653-acre township is an extension of GMADA’s Aerocity and will comprise both residential and commercial spaces. Situated in the vicinity of Chandigarh International Airport, it will come up on both sides of the Zirakpur-Banur road. There are around 8,500 residential plots, ranging from 100 square yards to 2,000 square yards. GMADA will be developing four pockets, A, B, C, and D. According to the CM, the proposed township will provide affordable housing facilities to the people tricity. He asked the officers of urban development department and Greater Mohali Area Development Authority (GMADA) to give their proposal. He added that Mohali has the best road network, air and rail connectivity, so a proposed township in its vicinity has a huge potential of growth and progress. He also asked the officers to explore the feasibility of shifting the upcoming medical college in Mohali on a new stretch of land. A senior GMADA official, who is associated with the project, said, “We are launching the scheme in May this year at a cost of ₹33,000 per square yard,” he said. The official further said, “GMADA has already floated tenders for construction of outer roads and even the process of cutting the trees is on.” GMADA had started the process of land acquisition for Aerotropolis in May 2017. Of 1,653 acres, owners of 1,456 acres have applied for land pooling. Through the land pooling scheme, owners will be provided residential or commercial plots instead of monetary compensation in lieu of their land. Source: Hindustan Times INDIA

Rentals in major Indian cities go up by 10%–20%

6/1/2022 1:46:00 PM

Rentals in major Indian cities have gone up by 10%–20% as companies have started pushing hybrid work arrangements and schools have opened up in most urban centers, say industry experts. Since January, the rental housing market in big cities has started to get back on its feet. This is because companies are starting to use hybrid work arrangements and schools are opening in big cities. "The residential rental market has, however, shown a steady increase in demand over the last two quarters as work from home culture is returning to near normal. The real estate industry witnessed a sharp rise in sales and is now showing amazing signs of recovery in the rental segment too," said Samir Arora, president, National Association of Realtors India. Residential property rentals in major cities such as Bengaluru, Chennai, Delhi-NCR, and Mumbai dropped 10-20% immediately after the pandemic began. However, as employees return to their jobs, the situation is beginning to change. "“UHNIs are actively looking to buy a new home in 2022 due to an increase in their wealth. We are seeing an increase in enquiries and are witnessing increased transactions for good luxury properties,” said Bhavesh Kothari, founder of Property First, a luxury property consulting firm. The residential rental market started to pick up momentum as early as the first quarter of 2022, thanks to a drop in new COVID-19 infections and aggressive immunisation across the country. This will be supported by most companies' plans to open offices from January and scale them up by June. According to the real estate head of IT/ITes firms, roughly half of the workforce is projected to return to workplaces for up to three days a week by the middle of this year, with employees and employers equally interested in returning to the workplace in a hybrid setting. "The industry was badly hit by the pandemic, but there is a huge opportunity for the organised players. Our new bookings have reached the pre-pandemic level, with an average occupancy level of around 60%," said Nikhil Sikri, CEO of the firm (name of the firm pls). The residential market is driven by the salaried population, and a large percentage of tenants in cities like Bengaluru, Hyderabad, Pune and Mumbai belong to sectors such as banking, financial services, insurance, software, and pharmaceuticals. "People looking at investing in residential properties have gone up, with rentals going up, and the market is seeing some stability returning for now. Searches for rental accommodation across the country have gone up acrossthe country from a year earlier," said Ramita Arora, MD (Bengaluru) Cushman and Wakefield. The pandemic outbreak almost brought the real estate rental market to a standstill for some months last year and earlier this year. The residential market has witnessed a sharp recovery in sales momentum and the trend has continued even in Q4FY22 with a good amount of pent-up demand generated over the past 2 years, which is now unlocking. The first quarter of the new year (January–March 2022) has seen quarterly sales attain a four-year high of 78,627 residential units despite the third wave, with all the top markets seeing a rise in the average capital values of residential properties as demand continued to strengthen, mentioned Knight Frank. Source: The Economic Times INDIA

Homebuyers welcome Maharashtra govt’s decision to extend PMAY scheme

5/31/2022 10:50:00 AM

Homebuyers have welcomed the Maharashtra government’s decision to extend its flagship affordable housing scheme known as the Pradhan Mantri Awas Yojana (PMAY Urban). The Central government had last month informed Maharashtra about PMAY-Urban being extended till September 2022, said officials from the Maharashtra Housing and Area Development Authority (MHADA), the nodal agency of executing PMAY in Maharashtra. They hinted that the scheme may be extended until 2024. Relief for buyers Twenty eight-year-old professional Maitrayee Iyer from Mumbai says she plans to own a house in the Mumbai Metropolitan Region (MMR) and plans to avail the benefit under the Credit Linked Subsidy Scheme (CLSS). "I plan to buy a house in Navi Mumbai or somewhere in Kalyan or Dombivali belt for which I plan to avail the CLSS benefit,” said Iyer. Another buyer, 27-year-old Soyal Rawat from Nagpur in Maharashtra said, "I plan to buy a house in the next one year as I have been planning for it since the last few months now. It is good that the PMAY scheme has been extended considering there are decent options for buying homes nearby Nagpur under the PMAY scheme. I plan to avail of a home loan under CLSS." PMAY (Urban) extended until September 2022 in Maharashtra Shivkumar Ade, Chief Engineer of MHADA, confirmed to Moneycontrol that the the PMAY Urban scheme in Maharashtra has been extended until September 2022. According to officials from MHADA, the Central government has granted a preliminary extension until September 2022. "There are chances that the scheme might be extended until 2024, and the Central government might write to us in the coming days.'' Maharashtra government had set a target of constructing 19.40 lakh houses under the PMAY scheme by 2022. According to data provided by MHADA, under the PMAY scheme, up to December, 2021 in all 1,161 projects consisting of 13 lakh dwelling units have been approved of which construction work of 4.86 lakh dwelling units are completed and that of 2.12 lakh dwelling units is in progress. The Maharashtra government's housing department has issued a notification to fast track the approvals of the PMAY projects. "Though the extension time given is less, we need to work towards approving the projects keeping the uniformity and smooth process in mind," the notification said. The notification said an additional force of nine engineers will be stationed at MHADA that will approve the projects from the existing team of around six engineers. As per the current procedure, MHADA is the nodal agency and all the urban local bodies including the municipal corporations and councils after approving proposals of PMAY housing projects, send it to MHADA's PMAY cell, which in turn sends it to the state government's committee for approval. Meanwhile, real estate developers in Mumbai welcomed the extension of PMAY scheme but were of the opinion that high land costs in Mumbai are a challenge. Harshul Savla, managing partner, Suvidha Lifespaces (M Realty), whose company is constructing a compact 1 BHK apartment for ₹1 crore in the eastern suburb Mulund said, "This is a welcome move. However, for a city like Mumbai where the cost of land is high constructing homes under the PMAY scheme is a challenge." "I feel the government should work towards ensuring that metropolitan cities also end up having such schemes of affordable housing being implemented on ground. Currently, I feel PMAY houses are coming up in cities or locations where the land price is relatively low, and there is no demand. This could lead to unsold inventory piling up,” he said. A large PMAY (U) project is coming up in the city limits of Mumbai. It comprises 4,000 apartments. This is being constructed by the MHADA in Goregaon area of western suburb in Mumbai. Private developers have not come up with projects under PMAY (U) owing to high cost of land in the city. The Housing for All by 2022 initiative was launched by the Modi government within five months of assuming office. It’s all about ensuring a home for every Indian by 2022. To boost affordable housing and achieve the vision of Housing for all by 2022, the government (Central and State) have undertaken several initiatives, such as Pradhan Mantri Awas Yojana (PMAY) that aims to build one crore homes in urban and rural India by 2022. With the construction of as many as 20 lakh houses yet to begin, the government is expected to extend the scheme until March 2024. Earlier, 2022 was the deadline for completing construction of houses under this scheme. The Centre has so far sanctioned 1.21 crore houses under the scheme. The Credit Linked Subsidy Scheme for the Middle Income Group (CLSS for MIG) was announced by Prime Minister Narendra Modi on December 31, 2016. It was initially launched for 12 months until December 2017 and covered MIG beneficiaries seeking housing loans for acquisition/ construction of houses (including re-purchase) from banks, housing finance companies and other notified institutions. For the MIG I category, which consists of individuals with an annual income of Rs 6-12 lakh, an interest subsidy of 4 percent is provided on a loan of up to Rs 9 lakh. For the MIG II category, which is made up of individuals with an annual income of Rs 12-18 lakh, an interest subsidy of 3 percent is given on a loan of up to Rs 12 lakh. The benefits are typically in the Rs 2-2.5 lakh range. The carpet area of a housing unit was initially revised to up to 120 sq m and up to 150 sq m for MIG I and MIG II respectively in November, 2017 and further enhanced to up to 160 sq m and up to 200 sq m for MIG I and MIG II, respectively in June, 2018. Source: Money Control INDIA

Punjab CM calls for direct flights from Mohali airport to US, Canada

5/27/2022 11:14:00 AM

Punjab Chief Minister Bhagwant Mann on Monday directed the state civil aviation department to immediately tie up with the Centre for direct flights to countries like the US and Canada from the international airport here. At present, only two international flights are operational from the airport to Dubai and Sharjah. Chairing a meeting to review the functioning of the civil aviation department, Mann said a large number of people from the state are settled in countries like the US, Canada, UK, New Zealand and Australia. This initiative will facilitate the Punjabi diaspora settled abroad to visit their native places in the state in a seamless manner, he said. To give an impetus to the agro and food processing industry in the state, Mann also asked the department to immediately start cargo flights from the international airport, according to an official release. The chief minister said this step will go a long way in giving much-needed boost to the export of food products across the globe and especially in supplementing income of state farmers manifold through this farmer-friendly initiative. Mann also asked the department to immediately convene a meeting with the Haryana civil aviation department for evolving a broad consensus on naming the international airport here as Shaheed-e-Azam Sardar Bhagat Singh International Airport. The CM also underscored the need to set up an international civil enclave at Halwara to be operational at the earliest so that the trade and industrial activities in the vicinity of Ludhiana could get a major boost. Stressing the need to streamline the functioning of the Punjab State Civil Aviation Council (PSCAC), Mann also asked the secretary, civil aviation, to work out modalities for giving preference to the state youth in imparting flying training. This council will be instrumental in providing flying training to the local youth as per international standards, said Mann. Earlier, they had to get flying training from other parts of the country and even abroad by spending huge money but now they would be provided with this facility at affordable rates within their own state, he said. He also asked the department to intensify its efforts for the upgrade of the system for facilitating the flying operations in low visibility conditions, especially during dense fog in winter. Source: Business Standard INDIA

Zirakpur-Panchkula Bypass project back on track

5/26/2022 12:46:00 PM

Hanging fire for nearly nine years, the Zirakpur-Panchkula Bypass project, aimed at decongesting Zirakpur by providing an alternative route to the traffic moving between Ambala and Shimla, is back on track as the National Highways Authority of India (NHAI) has begun the land acquisition process. Also pegged as a ring road, the 200-foot, six-lane road will originate from McDonald’s on the Ambala-Zirakpur highway, pass through Peer Muchalla, Sanoli, Gazipur, Nagla (all Mohali villages), before traversing along Sector 25, Panchkula, and culminating at the T-junction on Panchkula-Kalka highway near Sector 4. An estimated ₹800 crore will be spent on the 17-km project that is expected to be completed by March 2023. An NHAI official, privy to the development said, “NHAI has sent letters to the Greater Mohali Area Development Authority (GMADA) not to issue any Change of Land Use (CLU) for the land earmarked for the project and has also written to the Punjab revenue department to publish a notice under Section 3 of the Land Acquisition Act. A letter has also been sent to the district revenue officer not to conduct any registry in respect of the said land.” The official further said that the land acquisition process will be completed by October this year, following which the road was expected to be readied by March next year. Mohali district revenue officer Gurdev Singh Dham said, “After the NHAI letter, the officials concerned have been told not to register any land in the area, as NHAI has started the land acquisition process.” Work on the project had started in 2013, but came to a grinding halt in February 2014 after some landowners moved court seeking higher compensation. Then, NHAI had to wait for GMADA to transfer around 100 acres for the project. The land was eventually handed over in December 2020. Once the road is complete, the Shimla-bound traffic can take this road to bypass the bottleneck at Zirakpur and join the Shimla highway at the Panchkula end. Similarly, Ambala or Delhi-bound traffic from Shimla can also avoid Zirakpur. The road will also open an alternative route from Panchkula to the Chandigarh International Airport in Mohali, but it will be much longer than the existing route via Chandigarh. However, this stretch will give the option to avoid the Chandigarh and Mohali traffic. Chandigarh Master Plan 2031 also proposes this road to divert the around 1.5 lakh vehicles entering Chandigarh daily from Punjab and Haryana. According to the Master Plan committee, through this road, traffic between Mullanpur and Panchkula, and that from Kansal, Zirakpur and Panchkula not headed for Chandigarh can be diverted and significantly reduce traffic congestion on the arterial roads of Chandigarh — Madhya Marg and Dakshin Marg. Source: Hindustan Times INDIA

The strong comeback and rise of luxury homes

5/25/2022 10:47:00 AM

The luxury real estate market has made a very strong comeback since the onset of the pandemic. There is now a growing demand for larger homes that provide a healthy lifestyle and bring people closer to nature. Moreover, due to the COVID-19 pandemic, this segment of residential homes has evolved from a snobby connotation to a domain of family health and wellness. Customers are now drawn to the resort-like comfort, convenience, and amenities these luxury projects offer and are willing to spend more to be part of them. The impact of COVID-19 on homebuyer preferences was highlighted in a recent CII-ANAROCK Consumer Sentiment Survey. According to the survey, “Cheap housing is the lowest priority for the first time, with more than 34% of respondent home seekers focusing on properties valued between INR 90 lakh and INR 2.5 cr.” The majority of NRI respondents preferred luxury properties with a price range of INR 1.5-2.5 crore. Location, social infrastructure, in-development amenities, and the size of one’s home were significant contributors towards the price brackets that we see gaining traction. In the years preceding the pandemic, the Rs 60 lakh to Rs 1 cr ticket size was growing as the sweet spot in Bengaluru. Following the pandemic, the industry is witnessing strong demand from Grade A players for plots in this price range, as well as luxury homes across segments. Even the 3-4 cr ticket size has seen an excellent offtake over the past two years. A trend not just restricted to Bengaluru but seen across India. Over the past 22 months, consumers have spent relatively more time in their homes due to remote work and remote education. Thus, families are scouting for larger configurations to accommodate more time at home for everyone in the family, full-time resident support staff, and SOHO (small office/home office) options. High-quality projects from Grade A players with features such as business centers, convenience stores, jogging tracks & green spaces, basic medical facilities, and as much of the outside world as possible connected to the projects are in great demand. Buyers have realized the value of well-designed and well-ventilated large homes with access to open spaces and thoughtful amenities. Additionally, investor confidence in real estate has increased, with branded developers now accounting for a larger than ever share of the pie, and buyers regarding them as safe investments. The widespread expectations of the next boom in real estate are also driving investors back into the sector as they expect healthy appreciation in strategic micro-markets like North Bengaluru. The Indian real estate sector bore the weight of the COVID-19 pandemic, and many projected a long period of hardship, particularly for the luxury segment. However, when customers began to gravitate towards luxury homes due to the healthy lifestyle they offer, things began to change, and luxury has now been redefined as a way of living. Three years ago, product designers were trying to make smaller homes to make them affordable. The same designers are now working on designing bigger homes as there is a clear shift in consumer preferences post pandemic. With stock markets in choppy waters for the past few months and expected to stay that way for some time to come due to the international pressures; and with increasing talk & signs of the next boom in real estate, for Grade A players it is now about being able to match the rising demand on all fronts. Overall, a bull run is coming in Indian real estate! Grab that deal while you can. Source: Financial Express INDIA

Residential property prices go up in South India

5/19/2022 11:40:00 AM

Prices for residential properties in South India, including Bangalore, have gone up by 8–10%, and they are likely to keep going up because of rising input costs and disruptions in global supply. The prices of critical raw materials, including steel, cement, aluminium, and PVC, have risen sharply between 30% to 100% during the last year. Realty developers have been having a tough time protecting their margins as rising fuel prices have added to their woes. "Cost increases are inevitable this fiscal year due to inflation and consolidation in the industry. We expect a 10-15% price rise on the future projects and existing ones," said M Murali, Chairman and Managing Director, NSE 0.47 % Ltd. Due to a revival in demand and rising costs, developers are also launching new projects at a premium. "The increase in cost is definitely affecting the project margin, but that will differ from project to project depending on the stage of construction of the project. The price increases are only temporary, and the price should stabilise once the geopolitical issues are resolved.The demand has been robust for residential, and we expect it to remain the same," said Atul Goyal, CFOBrigade Group .According to NSE -2.68 % , housing demand is likely to grow by 5–10%, supported by favourable demographics and urbanisation despite the headwinds. It estimates housing demand rose a solid 33–38% last fiscal, surpassing preCovid-19 levels. But this was on a low base compared to fiscal 2021, when demand had fallen 20-25%. "We expect residential real estate prices to rise 6–10% across the top six cities this fiscal due to a steep rise in material costs and relatively favourable demand-supply dynamics, especially for established developers. Some of them have started hiking prices by 2% per quarter and may continue to do so over the next couple of fiscals to account for rising land prices, "said Aniket Dani, Real estate developers across the country have been seeking the government’s intervention to arrest the increase in the cost of building materials, especially steel and cement. "Investment in the real estate sector in India has grown in recent times, especially in the wake of the pandemic, as real estate was viewed as a safe and tangible investment option amidst the economic volatility. In the last two years, stocks have performed well & also there has been a rise in salaries in the IT sector- both these factors have led to a good flow of investment in real estate since it’s considered the most stable and safest investment option,"said says Bhavesh Kothari, founder of Property First, a luxury property consulting firm. Source: The Economic Times INDIA

Mohali real estate sector bounces back from pandemic slump

5/17/2022 12:09:00 PM

Bruised and battered by the pandemic, the real estate market in tricity is finally beginning to bounce back, with Mohali gaining the most traction. It has come a long way since October 2020 – after the first wave receded – when Greater Mohali Area Development Authority (GMADA) had managed to earn merely ₹417 crore by selling off almost half of its total 113 properties. There was a slight improvement in October 2021 when the regulatory authority earned ₹520 crore through two auctions. But with the virus abating, fortunes have turned. In an auction held in January this year, GMADA pocketed a whopping ₹808 crore by selling nine of its major commercial properties. The district also witnessed a major boost in stamp duty – the fee collected on the registration of properties – in 2021-22 when the earnings stood at ₹1,300 crore. In 2020-21, the earnings from stamp duty were a mere ₹822 crore. Mohali city had the highest collection of ₹614 crore in 2021-22. In 2020-21, the amount was almost half at ₹375 crore. Most sought-after addresses Peripheral areas such as Zirakpur, Kharar, and New Chandigarh have emerged as the tricity’s new property hub. Thanks to GMADA-led IT City and Aero City projects, Airport Road has become the most-sought after address for both investors and home seekers — bids for commercial and residential units here are drawing record amounts. There are around 200 private housing societies in Mohali. Hot properties on Airport road The high value of Airport Road and prospects of good returns are attracting investors not only from Punjab but Chandigarh, Himachal Pradesh, Haryana, and NCR region too. In the auction held in January this year, a commercial site measuring six acres in Aerocity went for ₹281 crore against the reserve price of ₹207 crore, which means the cost of an acre was around ₹47 crore. A group housing site, measuring 12.60 acres, in Sector 67, went for ₹294 crore against the reserve price of ₹283 crore. In the auction held in October last year, five acres of a commercial site in Aerocity went for ₹192 crore against the reserve price of ₹152 crore. Also, a 4.6-acre site for a housing project in Sector 77 on Airport Road went for ₹100 crore against the reserve price of ₹68 crore. The demand is soaring despite the hike in prices. A three-bedroom flat, which was priced at ₹60 to 65 lakh during the peak of pandemic, now costs ₹85-90 lakh. Builders are optimistic too as home loan interests are at the lowest in nearly two decades. They foresee a move from rentals to house ownership fuelling the demand. Builders say buyer queries are increasing and end-users are looking for ready-to-move properties. The ₹20,000 crore fund created by the Centre for real estate projects has helped boost the sector. Pandemic effect The pandemic brought about a major change in people’s money habits. Instead of saving, they are now in investment mode. Besides, they are spending more time at home. Also, people living on rent started aspiring to have their own property. Harish Gupta, president, Zirakpur builders association NCR buyers Mohali is seeing a real estate boom and as per the trend, most investors from NCR are eyeing Airport Road projects. Even though the prices are going up, investors are enthusiastic. During the peak of pandemic, the cost of the 2 BHK on Airport Road was ₹45-50 lakh, now it is ₹60- 65 lakh. Amit Mittal, managing director, Green Lotus Utsav, residential project on Airport Road Investment frenzy The demand for both commercial and residential properties has gone up after the pandemic as people believe that investing in property will ensure the best returns. Despite the rates going up, people are investing their money in property, especially in areas under GMADA LC Mittal, director, Motia Group, residential and commercial project, Airport road Up-phase in market The real estate sector has bounced back with huge sales constantly being reported in the post-Covid era. After a decade-long slump in the market, the sector is now entering a 3-5 year up phase, where the demand is robust even with increasing prices and raw material costs. Tier-2 cities are witnessing a bigger boost due to reverse migration. Prateek Mittal, executive director, Sushma Buildtech, residential and commercial projects in Zirkapur and Airport road Source: Hindustan Times INDIA

Government to set up panel on RERA non-compliance

5/12/2022 12:39:00 PM

India has decided to assess the reasons for non-compliance of orders issued by various chapters of the Real Estate Regulatory Authority (Rera) that was set up to ensure protection to troubled homebuyers. A committee including homebuyers and realty developers will be formed to examine different orders that have been passed by the state-specific authorities, but have not been complied with yet. The government may also seek state governments to provide their inputs in this matter with an objective of making Rera more effective and offering an impactful recourse mechanism to homebuyers. The decision to this effect was taken in the recent meeting of the Central Advisory Council (CAC). While Rera authorities are issuing orders for compensation and interest to homebbuyers by the developers, many of these orders are not being complied with. Homebuyers and their associations have been raising concerns over non-enforcement of these orders, and the authorities have been facing criticism. "Despite the orders getting served, homebuyers are left in the lurch as the enforcement of these orders is taking unreasonable time. The Housing Minister himself suggested this move to form a committee to study study the procedure followed by states that rank high in enforcement of RERA orders," said Abhay Upadhyay, president, Forum for People's Collective Efforts. He said this will lead to a template for other states to follow so that RERA orders see faster execution The government has also decided to form a committee comprising government representatives, homebuyers and developers to take up the issue of implementation of RERA in West Bengal and Telangana. Source: ET Realty INDIA

NCR office leasing set to pick up on strong demand

5/10/2022 11:02:00 AM

Hiring by the IT and business process management sector, global multinationals setting up global capability centres (GCCs) along with professional services and e-commerce firms will push the demand for office space leasing in NCR, said top property consultants. Nearly, a third of the quarter's leasing (January-March) consisted of large transactions(above 100,000 sq ft) across micro-markets in Gurugram and Noida with some occupiers also locking hard options for future expansion plans, as per consultants. "While a third of the deals were one lakh sq. ft. and above, many multinationals have also taken space in the bracket of 50,000 sq ft to 100,000 sq. ft. There is a strong demand for Grade A buildings as employee wellness remained a high priority for corporates, who drove leasing momentum in wellmanaged and quality buildings," said Vibhor Jain, managing director - North India at Cushman & Wakefield. Net absorption for Q1 was recorded at 1.3 msf, a slight reduction of 7% on a quarter on quarter comparison.Strong demand with large space take-up by even new-age firms is likely to keep Delhi NCR's office space on a strong footing in the quarters ahead. "IT and Business Process Management (ITBPM) sector is well placed to hire five million employees across the country in the next 5 years. Cumulatively, it is estimated that they will end up taking 80-120 million sq ft in Grade A office buildings including co-working spaces across the country," said Shweta Sawhney, MD, Delhi-NCR, Savills India. Fresh leasing, including expansion and consolidation by occupiers, constituted 91% share of the quarter's leasing. Pre-commitments formed 7% of quarterly leasing. "Cities which will lead this absorption are Delhi NCR, Bangalore and Hyderabad. Across the consulting sector as well, there is additional employment likely of 80k-100k hires by FY23. All these factors point towards exciting times ahead for commercial real estate and demand will remain robust across the key markets despite hybrid working scenarios," said Shweta Sawhney. Source: The Economic Times INDIA

Real estate in India set to bounce back stronger in FY 23

5/5/2022 12:06:00 PM

Strong and positive momentums are expected to continue prevailing in Indian real estate in FY 23, backed by the solid structural foundation, gain in demand, and lowered home loan rates. By all means, FY 23 will be the fiscal year the industry has been hoping for long. The upswing in the market will also stem from a favorable economic outlook. Most of the rating agencies have estimated the growth of India in the comfortable range of 8-9%. The surge in commercial activities alongside a rise in the job market and income levels will naturally translate into increased housing demand. Market bounce back is also the progression of the gradual recovery observed in the past 6-9 months. After softened demand due to the pandemic, the real estate market has been on an upswing since the second half of the previous year. The iterations of repo and reverse rate cuts by the government resulted in liquidity injection, thereby helping in accelerated growth. The developer fraternity also played its part by introducing a host of attractive schemes, luring the fence-sitters, and giving the market a positive push. In FY 23, the growth juggernaut will continue. Interestingly real estate in Tier 2 and 3 markets will also climb fast. Sustained infrastructure investments, increased connectivity, and better job opportunities will be fuelling real estate in smaller cities and towns in India. Already metro and suburban transit systems are taking shape in cities such as Lucknow, Kanpur, Agra, Patna, Cochin, etc, which will boost real estate demand. Under UDAN new airports are built, which will foster regional economic growth and help the realty sector considerably. After taking a backseat over the past 2 years, office leasing will see incremental growth, especially from tech, IT, and retail companies. Already large tech companies have closed big- ticket size office lease deals. More will follow. E-commerce and 3rd party logistic enterprises will continue to pour money into warehousing, making it one of the fastest-growing categories in commercial real estate. Investments in data centers will also soar. Big tech giants such as Google and Amazon are racking up investments in the Indian data center space, lured by its long-term potential. Pick-Up in Investment Activities Real estate has been mostly an end-user-driven market over the past 3-4 years. However, the trends are now shifting and it is once again featuring on the investor radar. Real estate is a smart investment option, provided one has a mid to long-term horizon in mind. Moreover, it has strong aspirational value. Real estate can also give a stream of constant income in the form of monthly rentals. Both large and small investors in India are once again realizing the benefits of investing in real estate, especially at a time when cautious investment remains part of the general lexicon. Moreover, apart from the stock market, fragility has persisted in other financial assets, which makes real estate a viable alternative. For investors, who have a long haul and are not looking out for quick returns, real estate will be an exciting option to explore in FY 23. Source: Financial Express INDIA

India’s data center capacity to top 1.3 GW, grow 2.4 times by 2024

4/28/2022 1:48:00 PM

Capacity expansion by existing and new players in the data centre industry is expected to result in an additional capacity of 804 MW during 2022-2024, translating into 34% compounded annual growth rate for the period, showed a JLL India study. Mumbai and Chennai are expected to witness higher growth owing to their infrastructure advantages. As a result, both cities will account for 68% of the total capacity in 2024. The addition of a new cable landing that would connect these cities, going forward, would also lead to higher bandwidth. However, landlocked locations like NCR-Delhi would also see growth in capacity addition due to government-led digital initiatives and data demand. Proactive state policies, meanwhile, are creating Hyderabad into an emerging location for hyperscale cloud players. A large share of this new data center supply has been pre-committed by hyperscale and is expected to become operational in the next three years. The Indian data center industry’s capacity addition between 2022 and 2024 would result in the creation of 9.7 million sq ft of real estate space for this new capacity across India’s leading cities. Since data center construction is driven by the design specifications of each operator, the nature of this capacity addition would differ across DC hubs in the country. However, DC hubs in India are most competitive in terms of land, construction, mechanical, electrical and plumbing costs. “Owing to its high share of capacity addition, Mumbai is expected to create demand for 6.18 million sq ft, going forward. The comparatively high land cost of the city vis-à-vis other data center hubs will lead to a higher outlay of $3.3 billion for setting up data centres in the city. As Chennai has similar advantages, it would follow with 2.03 million sq ft of real estate space addition at an investment of $1 billion,” said Rachit Mohan, Head, Data Centre Advisory, India, JLL. The strong demand growth has been matched by a supply addition of 119 MW during the year, registering a growth of 23% over 2020. Mumbai, Pune, and Chennai together accounted for 83% of the total supply during 2021. Data center operators have been following a land banking strategy to provide scalable and seamless options for hyperscale cloud players. In the Mumbai region, Navi Mumbai has emerged as a preferred location due to its high-capacity power station, developed territorial cable connectivity, and availability of land at a lower cost than the mainland. Hyperscale cloud players have been exploring various availability zones to ensure seamless operations. The expected growth in demand is likely to lead to strong capacity addition during 2022-2024. The demand momentum for the data center that picked up during 2020 has gained pace, with an estimated absorption of 116 MW during 2021, a 14% yearon-year increase. Hyperscale cloud players accounted for 69% of thisabsorption, as pre-committed capacities were delivered during the year. Hyperscale cloud allows businesses to expand their IT infrastructure based on its demand. Mumbai accounted for 53% of the total absorption as the preferred location of leading cloud players. The sector’s three basic conditions of power supply, connectivity and customerbase are amply provided by the city, making it the default location of data center operators. Pune accounted for 21% of the total absorption, followed by Chennai at 15%. The need to diversify across regions, as well as the emergence of strategic locations and favorable regulatory policies, is leading to an expansion trend across India’s key data center hubs. Source: The Economic Times INDIA

Indian real estate market to grow to Rs 65,000 crore by 2040: CIRIL

4/27/2022 12:58:00 PM

Consultancy firm CIRIL said in a report that the Indian real estate (RE) market is poised to touch Rs 65,000 crore by 2024 and by 2025, this sector is expected to contribute to 13 per cent of the country's GDP. In 2019, the size of the RE market was Rs 12,000 crore, according to the report. Despite fears related to the Omicron crisis, the market in 2022 looked bullish while demand is accelerating across all categories, the report added. Regarding commercial RE, the report said offices with enhanced technology driven ecosystem in workplace will be in demand and developers are investing in technology and digital channels to reach out to the consumers. Co-working space has emerged as a sustainable business model for corporates who want to remain flexible on cost components on the face of a possible resurgence ofCOVID caseloads, the report said. India's retail industry is projected to grow at a slower pace of nine per cent during the period 2021 to 2030 and is likely to touch USD 1400 billion by 2026. CIRIL said that Indians are taking to online retail in a big way, and by 2024, the country's e-commerce industry is likely to touch USD 111 billion, driven by mobile shopping. The warehousing RE sector will continue to grow as e-commerce has gained traction, and the transactions in this sector are projected to grow at a compounded annual growth rate (CAGR) of 20 per cent in FY 2023, the report stated. The e-commerce part in the total warehousing transactions will increase to 36 per cent in FY 2023. CIRIL said according to Department for Promotion of Industry and Internal Trade (DPIIT), FDI equity inflow stood at USD 547.2 billion between April 2000 and June 2021, indicating that the government's efforts to improve ease of doing business and relaxing FDI norms have yielded results. Foreign portfolio investment (FPI) has been one of the largest drivers of India's financial markets, while institutional investors are expected to continue investing in the Indian RE with more funds, the report said. Source: The Economic Times INDIA

Share of luxury property in total sale jumps to 12% in Q1 2022: Report

4/26/2022 3:08:00 PM

The sale and supply of luxury homes reached a new high in Q1 2022, with the highest sales and supply in three years driven by pent-up demand, benign interest rates, and stable prices, as per a report by Anarock property consultant. Luxury property accounted for 12% of overall sales in Q1 2022, up from 7% in Q1 2019, as ultra-high-net-worth individuals hurried to purchase larger homes to accommodate the need for more room during the pandemic. "The new supply in the luxury category in Q1 2022 is the highest in a given quarter in the last three years. As per Anarock Research, as many as 13,330 units were launched in the luxury category across the top 7 cities. The preceding quarter of Q4 2021 saw the second highest supply in the category of approximately 9,350 units, and Q1 2020 saw only 4040 new units, "said Anuj Puri, Chairman, Anarock Group. "Luxury homes are no more about brick and mortar but the overall living experience, an exclusive address that is complimented with an unmatched lifestyle, provided within the privacy and comfort of one’s home. One of the most significant trends this year has been an influx of demand for homes in the luxury and superluxury segments, "said Aakash Ohri, Group Executive Director and Chief Business Officer, DLF Home Developers Ltd. Earlier this year, DLF Limited, India’s largest listed real estate company, announced sales worth Rs. 1500 crore from the first phase of its highly anticipated luxury residential project in New Delhi, ONE Midtown. Experts say that in the luxury segment, demand started picking up significantly, right after the first wave of induced lockdown ended. "The pandemic has amplified the need and desire for bigger homes, with private lawns and open space, exclusive rooms for work and study from home, entertainment and lifestyle requirements like a gym and a swimming pool," said Akash Puri, Director-International, India Sotheby’s International Realty. Sotheby’s International Realty India, which deals in luxury properties, clocked Y-o-Y growth of more than 30% consecutively for the last two years—2020 and 2021 and it expects to close this year with even better sales numbers. "There is a rising need for luxury housing in the north-south region as compared to the eastern and western parts of India. FY21-22 was a year of new innovations, allowing us to push the envelope and focus more on digital performance within opulent, functional homes," said Sanjay Dutt, MD & CEO, Tata Realty and Infrastructure Ltd. New launch data by ANAROCK indicates the increased new supply in the luxury segment pricing and that there has been a 230% jump in Q1 2022 as against the pre-pandemic period of Q1 2020. Developers say that most of the buyers are HNIs who are looking for a lifestyle upgrade. "Rising demand for all kinds of luxury real estate, like luxury and ultra-luxury condominiums and villas, has taken a lion’s share of the market and sparked a desire for high-end amenities, wide-open spaces with a serene and peaceful environment," said Amarjit Bakshi, CMD, Central Park. Source: The Economic Times INDIA

Homebuying demand in residential market showing increase: Knight Frank – NAREDCO Real Estate Sentiment Index

4/22/2022 1:05:00 PM

The flagship survey conducted quarterly by Knight Frank India and National Real Estate Development Council (NAREDCO) noted that Current Sentiment soared to a new high of 68 – indicating that most stake holders experienced positive developments in their businesses in the last 6 months including the period of the survey. Importantly, the Future Sentiment score recorded at 75 was at a historical best. This score indicates the expectations of the developers/investors for the next six months from the time of the survey. The Current Sentiment score increased from 65 in Q4 2021 to 68 in Q1 2022 as the last six months remained positive for growth for most real estate stake holders. The Q1 2022’s survey findings present a very optimistic stakeholder outlook for the residential market in the next six months on the back of strong homebuying demand. 80% of the survey respondents expect residential sales to increase in the next six months. This is a significant improvement over Q4 2021, when 72% of the respondents had a similar view. 78% of the survey respondents in the current quarter expect residential prices to increase in the next six months. During Q4 2021, only 34% of the survey respondents had a similar take. Stakeholders’ sentiments about residential launches also remained upbeat for the next six months. 80% of the stakeholders expect residential supply to increase in the next six months. The Future Sentiment score, which gauges the stakeholders’ expectations for the next six months, also soared to 75 in Q1 2022 in view of a resolute economic outlook and continued demand for real estate space across asset classes. With the removal of all COVID-19 protocols by the Indian government, there is a further boost in sentiments. South Zone remains the most optimistic market with the highest score across zones in the current quarter. The Future Sentiment Score for South has inched up from 64 in Q4 2021 to 66 in Q1 2022. Compared to Q4 2021, the Future Sentiment score for the North Zone has inched up substantially with an increase from 57 in Q4 2021 to 65 in Q1 2022 as key markets in the North Zone recorded good traction in both office and residential sectors. The other zones – West and East – maintained their optimistic position with a score of 57 each. Despite a marginal fall in East, where the score altered from 58 in Q4 2021 to 57 in Q1 2022, both these regions remained in the optimistic territory. As the Indian economy navigated the third wave whilst being faced by uncertainty of a war in Europe, the real estate sector momentum remained unabated, especially of the residential segment. Commercial real estate segments also showed growth after the hiatus of the pandemic. While the sentiments have been positive for the two previous quarters, this score is one of the best reached in the history of the survey. When asked on their Economic Outlook for India, 85% of respondents in Q1 2022 expect the overall economic momentum to improve over the next six months. In terms of Credit Availability Outlook, 66% of the respondents expect the funding availability to increase over the next six months, while 29% expect it to remain the same during the period. Shishir Baijal, Chairman and Managing Director, Knight Frank India said, “The growth in the residential market has been impressive, elevating the sentiments of the entire sector. As most companies start calling their staff back to work, office space demand has also been growing steadily. The buoyancy in stakeholders’ take on the sector reflects positively in both the Current and Future Sentiment Scores. However, geo- political tensions impacting crude oil prices, are leading to a rise in inflation in Indian market, which can impact demand from end users. The scenario is further complicated with supply chain disruptions, rise in input cost and an impending interest rate hike, all of which need to be watched carefully in the near future.” Source: Financial Express INDIA

Chandigarh to install solar plants on houses free of cost

4/20/2022 12:15:00 PM

The city is going to be the first in the country where private players will be roped in for installing rooftop solar plants on private residential buildings free of cost. After witnessing a lukewarm response from city residents, who were not willing to shell out for a rooftop solar plant, the Chandigarh Renewable Energy and Science and Technology Promotion Society (CREST), the nodal agency for the installation of solar photovoltaic (SPV) power plants on rooftops, proposed the Renewable Energy Service Company (RESCO) with a build-operate-transfer (BOT) model. Later, CREST filed a petition before the Joint Electricity Regulatory Commission (JERC) for approval of the business model framework for installation of grid-connected rooftop power projects for domestic consumers by a third party under the RESCO BOT business model as per provisions of the JERC. During a recent hearing in the JERC, the petitioner (CREST) submitted that the issues raised by the UT Electricity Department (respondent) have been addressed and further, the department has agreed to the new business model submitted to the commission for its approval. The Electricity Department submitted that the business model had been agreed to by them. The department has also agreed to the terms and conditions under the Quadripartite Agreement (QPA) except a provision relating to banking of power in the said QPA. The petitioner and the respondent have also submitted that after resolving the issue of banking of power, they would submit the initialised QPA to the commission for its consideration within a week. Debendra Dalai, Chief Executive Officer, CREST, said the UT was expected to soon get approval for the implementation of the business model in the city from the JERC. He said the city was all set to have the RESCO model to be implemented on private residential houses “It is going to be a unique model to give a big boost to solar power generation and Chandigarh will be the first city in the country to implement it,” he said. Under the model, a private company will install solar panels without taking any money from house owners. The owners will have to give only space on the rooftop to the firm and they will get electricity at nearly Rs. 1.50 per unit less than the existing rates for the next nearly 15 years. After the completion of the BOT period, the company will hand over the solar plant to the owner. The firm will recover the cost by selling the energy produced from the plant. All maintenance of the plant will be carried out by the firm during the BOT period, he said, adding that excess power left after utilisation by the house owner will be transferred to the grid. The Ministry of New and Renewable Energy had enhanced the city’s solar power generation target from 69 MW to be achieved by 2022 to 75 MW to be met by August 15, 2023. Till date, the UT has achieved a generation of around 47 MW. Owners to get power for Rs. 1.50 per unit less A private company will install solar panels without taking any money from house owners. The owners will have to give only space on the rooftop to the firm and will get ower at nearly Rs. 1.50 per unit less than the existing rates for the next nearly 15 years. After the completion of the BOT period, the company will hand over the solar plant to the owner. The firm will recover the cost by selling the energy produced from the plant. All maintenance of the plant will be carried out by the firm during the BOT period and excess power left after utilisation by the house owner will be transferred to the grid. Source: Tribune INDIA

PR-7 road becoming an investment hub in Tricity for investment

4/15/2022 12:19:00 PM

The real estate sector has experienced a boom in recent years due to many people investing in the industry. The market dynamics are changing every day. Due to favourable government policies, the real estate sector is coming forward with many high-scale investments which is also contributing to the development of the economy. PR-7 Road of Chandigarh is the primary attraction for investors today. The road brings investors from the realtors and the NRIs of Punjab and Himachal Pradesh. Already connecting Chandigarh to Mohali via Zirakpur, the Airport Road is further aimed at connecting to Panchkula. The Airport road is 200 ft. wide and is capable enough to handle heavy traffic. Apart from offering quick connectivity to major cities, Zirakpur is home to many other facilities like shopping complexes, multi-cuisine food spaces, entertainment opportunities like theatres, etc. The area is expected to have a population of more than 20 lakhs in the coming decade. Having all major facilities, Zirakpur is an investors’ delight and is minting huge returns because of the ever-growing developments in the vicinity. There are various real estate groups coming up with multiple projects in the region that bring huge returns on investment. The resurgence in Tier-II cities is being fueled by increased economic activity and infrastructural development in many of these towns, lowering outward migration to metros and resulting in a more evenly distributed real estate market. Businesses, office spaces, retail stores, and hospitality businesses have various requirements. Spacious spaces surrounded by greenery, located in outstanding city locations with state-of-the-art infrastructure, are perfect for new-age enterprises and entrepreneurs. “PR-7 is not only a realtor’s bastion; it attracts investors and the stakeholders who see a developing zeal in the region. The upcoming projects by developers will strengthen the region’s economy,” said Mr L.C. Mittal, Director of the Motia Group. Motia Group has their project with a combination of an integrated township and a business hub, Royal Business Park, located at the Delhi-Chandigarh National Highway 22. Helmed as one of Punjab’s largest business parks, it will provide customers with all luxurious facilities like hotels, restaurants, in-house parking, well-crafted office spaces, banquets and plenary infrastructural amenities for business growth. It will have all the necessary structural schemes to satisfy the demand for affordable Grade ‘A’ co-working spaces in and around the Tricity area which is dominating the sector nowadays. The presence of great real estate projects and the emergence of the IT/ITEs sector and world-class education and medical facilities are the key reasons for Zirakpur’s growing popularity. Today, the city can brag about having good infrastructure and cutting-edge office campuses, attracting corporate and startups. Another major factor in putting Zirakpur on the real estate map is its continuously improving infrastructure. Source: APN News INDIA

Institutional investments into real estate sector touch $1.1 billion in Q1 2022: Colliers

4/14/2022 12:51:00 PM

Reopening of the economy post the third wave of Covid-19 pandemic and an improvement in investors’ sentiment has led to institutional investments into the real estate sector touching $1.1 billion during Q1 2022, which is double compared ($0.5 billion) to the same period last year, an analysis by Colliers has said. The investment activity during the quarter was driven by some large-sized deals in the office sector, Colliers added. Investments were largely driven by foreign investors that accounted for about 70 percent of the inflows during the quarter. Interestingly, after a drop in 2020, the share of domestic investments has reached 30 percent, almost the same as pre-pandemic levels. This shows a resurgence in the confidence of domestic investors, the analysis said. The top three asset classes in the first quarter of 2022 included office, retail, industrial and logistics with 95 percent share. "Real estate sector has undergone positive structural changes and performance indicators reflect strong come back across residential, office, industrial, logistics sectors, with newer themes around technology and digital clearly emerging. Investors, both domestic and global are appearing bullish on Indian real estate supported by pro-growth government policies with a long-term view to develop and hold assets. From a city level, Mumbai continues to be the market leader with a share of 25 percent in total investment inflows. This shows immense confidence of investors in the sector,” said Piyush Gupta, Managing Director, Capital Markets & Investment Services, Colliers India. The office market has made a comeback in terms of investments, with occupiers continuing to see it as a stable income-accruing asset class. Moreover, the office market is now recovering with Q1 2022 seeing stable vacancies for the first time in two years. The retail sector attracted the second-highest share of investments at 23%, backed by one major transaction. Investment in the retail sector was the highest since the start of the pandemic. Global investors continue to show strong interest in under construction as well as stabilized retail assets, as they are expecting a revival, it said. Industrial and logistics assets received inflows of $0.2 billion, accounting for about 16 percent of total investments. Investor appetite for industrial and logistics assets remained robust backed by strong structural demand from e-commerce and 3PL firms. Investors continued to scout for land parcels for in-city warehouses and in the peripheral locations of larger markets. Heightened investment activity is seen on the back of strong demand for modern industrial and logistics assets coupled with a shortage in supply. “Multi-city deals accounted for 65 percent of the total investments in Q1 2022 as investors laid focus on entering into strategic alliances with leading developers and on acquiring/developing portfolios across multiple cities. We are also seeing the creation of platforms for investment in specific asset classes, especially across the commercial office and industrial asset classes”, said Vimal Nadar, Senior Director and Head of Research, Colliers India. Investments in the residential sector remained muted attracting only $15 million in Q1 2022, just about 1 percent of the total investments. However, Colliers expects investment momentum to increase over the next few quarters as domestics investors remain bullish on the sector and are actively raising funds. The residential sector is witnessing tailwinds amid a significant rebound in sales momentum after a turbulent spell since the NBFC crisis in 2018, followed by the pandemic. In Q1 2022, a major investment group marked the close of an affordable housing fund, one of the largest funds targeted towards residential real estate in India. Investments in data centres continued to grow in Q1 2022 to about $40 million, as global data centre REITs, data centre management firms and hyper scalers continued to invest in India. Chennai is witnessing significant traction in data center development and has the potential to emerge as a key data centre hub in South Asia due to its strategic location as submarine cables landing station. Investment opportunities in data centres are surging, given the huge growth in demand for cloud computing from enterprises, deeper internet penetration, and infrastructure status granted to data centres, the analysis added. Source: Money Control INDIA

Office space leasing grows 97% YoY in Q1 2022: Report

4/12/2022 12:16:00 PM

Office space leasing in India grows 97% Y-o-Y to about 11.4 million sq. ft. in Q1 2022 with Bangalore, Chennai and Delhi-NCR accounting for two-thirds of transaction activity, according to a report by CBRE South Asia. The report said that technology corporates drove leasing with a share of about 34%, followed by BFSI firms (17%), flexible space operators (13%), engineering & manufacturing (12%) and research, consulting & analytics (11%) firms. The report further highlighted that office space take-up was driven by small- (less than 10,000 sq. ft) to medium-sized (10,000-50,000 sq. ft.) transactions with a share of around 84%. Pune and Chennai, followed by Delhi-NCR and Bangalore, dominated large-sized deal closures. Supply witnessed in Q1 2022 was around 9.4 million sq. ft. – a slight dip of around 11% Y-o-Y and 41% Q-o-Q. Bangalore, Hyderabad and Chennai dominated development completions, accounting for a cumulative share of about 70%. Supply was driven by non-SEZ developments with a share of around 83%. “With the government’s evolving COVID-19 protocols and the recovery in office leasing in 2021, we expect the positive momentum to further strengthen in 2022. We continue to witness a pickup in long-term decision-making by occupiers, aided by ‘return-to-work’ strategies, thereby accelerating project completions,” said Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE. Renewals, renegotiations, and the addition of flexibility options are likely to be the focus of occupiers in the short term. CBRE expects to see clearer evidence emerging in any corporates’ intended to shift towards hybrid working policies, with several occupiers planning to implement policies allowing office-based working with the option of working remotely. With an increased focus on wellness, user experience and sustainability, occupiers are expected to demand more sophisticated and tech-enhanced real estate offerings. Source: The Economic Times INDIA

Real Estate Sector In India Showing Sharp Recovery, Investors Looking Forward

4/8/2022 3:27:00 PM

The real estate sector in India is showing a sharp recovery in the recent period. According to an ANAROCK Research report, "Quarterly housing sales in Q1 2022 are at an all-time high since 2015 with approximately 99,550 units sold across the top 7 cities." This data shows that it is a 71% yearly rise against approx. 58,290 units were sold previously in Q1 2021. in addition to that, new launches across the top 7 cities have witnessed a 43% yearly increase, from 62,130 units in Q1 2021 to more than 89,150 units in Q1 2022. MMR and NCR are the two most significant areas for the real estate sector in India, which have accounted for more than 48% of the total sales among the top 7 cities. Additionally, NCR is also witnessing an above 114% yearly jump. With this sharp rise in the sector, investors are again gaining confidence and thinking more about investing in housing. The real estate sector in India is showing a sharp recovery in the recent period. According to an ANAROCK Research report, "Quarterly housing sales in Q1 2022 are at an all-time high since 2015 with approximately 99,550 units sold across the top 7 cities." This data shows that it is a 71% yearly rise against approx. 58,290 units were sold previously in Q1 2021. in addition to that, new launches across the top 7 cities have witnessed a 43% yearly increase, from 62,130 units in Q1 2021 to more than 89,150 units in Q1 2022. MMR and NCR are the two most significant areas for the real estate sector in India, which have accounted for more than 48% of the total sales among the top 7 cities. Additionally, NCR is also witnessing an above 114% yearly jump. With this sharp rise in the sector, investors are again gaining confidence and thinking more about investing in housing. Along with new launches, the unsold inventory in the top 7 cities has also seen an approximately 2% yearly decline - from 6.42 lakh units towards Q1 2021-end, to approximately 6.28 lakh units by Q1 2022-end. A similar trend was seen on a quarterly basis. "The bull run in the housing market continued in the first quarter of 2022, with approx. 10% q-o-q and 71% y-o-y growth in sales, thus recording all-time high quarterly sales since 2015. The impact of the third Covid-19 wave was significantly lower than of the preceding two waves. The unrelenting appetite for home-ownership amid the pandemic has coupled with a growing certainty of impending price rises to speed up housing sales velocity," Anuj Puri, Chairman of ANAROCK Group has commented about this growth. During the Russia-Ukraine war, investors were flocking toward commodities like gold. Significantly equities have seen a sharp fall in India. This had worried investors. However, the situation is changing now. The Russian government is being soft about the war. So, the gold rates are staying under pressure. At this moment, investors can start thinking about other investment instruments like real estate. With the sector's sharp recovery, both on a yearly and quarterly basis, it has considerable potential to grow further. Source: Good Returns INDIA

India among the cheapest flexible office locations in world: Report

4/7/2022 12:43:00 PM

Indian metro cities are among the cheapest to operate flexible office, with New York being the world’s most expensive flexible office location, according to a joint report by flexible office specialist, Workthere and international property consultant Savills. New York, San Francisco, Singapore, London and Berlin are among the world’s most expensive office locations, with per seats rental ranging from Rs 60,000 to Rs 72,000. In India, Mumbai ranks as the most expensive flexible office location with Rs 20,420 rental followed by NCR with average rental of Rs 14,759. “India has been witnessing new trends in the flexible workspaces segment. Co-working operators are constantly evolving and relooking at their strategies to gain better investment. As many companies seek a return to the office, employees prefer a hybrid work setup that creates more flexibility,” said Naveen Nandwani, MD, Commercial Advisory & Transactions, Savills India and head of Workthere India. Workthere is a brokerage-backed online listing platform, for flexible, coworking and managed office spaces, across geographies. India has one of the largest office markets in Asia Pacific region. The major demand drivers for office spaces have been the IT/ITeS, BFSI and consulting occupiers. The top operators in India are Awfis, WeWork, CoWrks, Smartworks and Tablespace with over 125,000 total seats. While technology occupiers continue to drive demand; flexible workspaces have gained share and took 13% of the overall office demand of 639.9 mn sq. ft. in 2021. The emergence of India as a start-up powerhouse is also an important contributor to the demand for flexible spaces. They have managed to reinvent their offerings and reposition themselves better suited to today’s dynamic world. Time and distance are important factors indicated by most employees and hence there’s high demand concentration in the suburban and peripheral areas of cities. Flexibility is clearly seen as a benefit for space management. Cheapest Office Locations : India among the cheapest flexible office locations in world: Report “The flexible market is now dominated by high quality spaces because occupiers are focussed on cultivating an updated office strategy around a space employees want to be in, and in an environment that enhances their desired culture,” said Griffin Foley, Northeast Lead, Workthere Americas. Foley added that businesses were seeking to locate in places near subway stations to make the commute more convenient and limit travel times. One of the most mature flexible markets globally, London was now experiencing a strong recovery. “Due to the large number of flex spaces there is a variety of pricing models and quality, meaning the rate of that perceived recovery, when only pricing is taken into account, is slightly below expectations as some operators are willing to drop prices to increase occupancy levels,” said Jack Williamson, head of Workthere UK, Meanwhile, Berlin’s flexible market has limited supply with a vacancy rate of 3.5%. The growth of the flexible market is being driven by science, digital and technology sectors, keeping it buoyant during the Covid-19 pandemic, where the flex market only saw a 1.4% decrease in space during the two years of the pandemic. This growth is set to continue, said Workthere, as Tesla prepares to begin production of electric vehicles from its first European manufacturing plant, located near the city; there is also a plentiful supply of venture capital funding for innovative start-ups. Lisbon, which is among the cheapest flex markets in the rankings - at just $329 per desk per month - was booming since conventional office space is now hard to secure. Lisbon is experiencing an overall office vacancy rate of 7%, and is now one of the most competitive European flexible markets. Source: The Economic Times INDIA

‘Centre’s infrastructure push driving demand for construction machinery’

4/5/2022 11:44:00 AM

The Centre’s infrastructure push has led to a notable growth in demand for construction equipment and related equipment surpassing pre-Covid level demand. Companies engaged in production and supply of earth moving equipment, piling and mining equipment have seen a robust jump in demand over the last three months, especially after the Union Budget, say officials. The construction equipment segment and the commercial vehicle industry are considered to be the barometer of economic activity. Sales of medium and heavy trucks and buses during FY22 by the two biggest CV players — Tata Motors and Ashok Leyland — grew by 51 per cent and 41 per cent respectively. Though it is on a low base, the level of machine utilisation in the past few months has shot up considerably. Back to normal Deepak Shetty, CEO and Managing Director, JCB India, said, “After a challenging two years due to the pandemic, we are seeing business coming back to pre-Covid levels backed by a revival of the business sentiments. Announcements like the Gati Shakti and the institutionalising of NABFID are positive developments. Despite the disruptions, last year was the third best year ever for us.” Kamal Bali, President and Managing Director, Volvo Group, India said, “In the January-March quarter, we saw a sharp uptick in road construction activity, especially from February onwards. Mining industry applications peaked with an increase of over 40 per cent in the last fiscal but supply chain constraints restricted our deliveries.” Volvo’s construction equipment range saw its FY22 volumes hit pre-pandemic levels with a growth of 20 per cent, however, Bali did not share absolute sales numbers for the year. Volvo plans to add additional models for manufacturing in India at its Bangalore facilities in FY23. Demand has been strong for China-headquartered heavy equipment manufacturer Sany Heavy Industries. Deepak Garg, Managing Director, Sany Heavy Industries India said, “Our annual production capacity is close to 8,000 and currently we are producing close to 6,000 units a year. One year down the line we might have to add further capacity taking it to 16,000 units. We are optimistic of FY23 keeping in mind the investments that the government spoke about.” Source: Business Line INDIA

Structural safety of real estate projects, changes in RERA provisions to figure in upcoming CAC meeting

3/31/2022 1:19:00 PM

The Central Advisory Council (CAC) meeting scheduled for April 12 will discuss issues relating to the structural safety of real estate projects following an incident of partial roof collapse in Gurugram wherein two women were killed. The meeting will also deliberate on constituting a committee for the resolution of legacy stalled projects and the issue of some states tweaking the provisions of RERA, while framing rules under the Act by exempting the registration of 'ongoing projects.' The CAC, set up by the government for effective implementation of the Real Estate (Regulation and Development) Act, 2016 (RERA), will hold its third meeting on April 12. The first two meetings of the CAC were held on May 14, 2018, and April 29, 2020. The council, chaired by Housing and Urban Affairs Minister Hardeep Singh Puri, will consider measures like physical inspection of projects during construction and structural audit at regular intervals by reputed institutes. “Recently, there have been reports of incidents related to structural safety in multistorey apartments. Though, RERA mandates the promoters to rectify the structural defects highlighted within a period of 5 years from the date of possession, some provisions related to structural safety may be deliberated to ensure further safety of high-rise buildings and to prevent loss of life and property. "These provisions may include a physical inspection of projects during construction, Structural Audit by reputed institutes on regular intervals, declaration of Structural Safety by promoter before applying for completion or occupancy certificate, etc. Central Advisory Council may consider,” according to the agenda. The committee may comprise representatives from the Ministry of Finance, Ministry of Housing and Urban Affairs, sector experts (dealing with stalled projects and insolvency proceedings) and give its recommendations to the central government within two months from the date of its constitution, the agenda said. “Central government established the Alternative Investment Fund (AIF)- Special Window for Affordable and Mid-Income Housing Fund (SWAMIH) Investment Fund of Rs 25,000 crore to provide last mile funding for projects that are net-worth positive and registered under RERA, including those projects that have been declared as Non-Performing Assets (NPAs) or are pending proceedings before the National Company Law Tribunal (NCLT) under Insolvency and Bankruptcy Code (IBC),” it said. "As of February 14, 2022, 249 deals aggregating to ₹23,778 crore were approved which will benefit more than 1,46,946 homebuyers and unlock projects worth ₹66,163 crore,” it said. It is evident that this fund has proved to be very instrumental in completing the legacy stalled projects and is fulfilling the dreams of homebuyers, who invested their life savings in these legacy stalled projects, which were launched before the enactment of RERA, it said. The third meeting of the CAC will also discuss the issue of tweaking RERA provisions by some states. The CAC agenda noted that all states/UTs have notified rules under RERA except Nagaland, which is in the process to notify the rules. As many as 31 states/UTs have set up Real Estate Regulatory Authority (Regular-25, Interim-06). States like Meghalaya, Sikkim, West Bengal, and UT of Ladakh are yet to establish authority. In the agenda, it was pointed out that some states have tweaked the provisions of RERA while framing rules under the Act by exempting the registration of 'ongoing projects. The matter was taken up by the housing ministry on several occasions and through various communications. The CAC in its first meeting deliberated upon the issue of dilution by the states while framing rules under the Act. As decided in the meeting, the ministry has taken up the matter through various communications. Homebuyers’ body Forum for People's Collective Efforts (FPCE) president Abhay Upadhyay said in a statement that the agenda for the upcoming CAC meeting shows that the Ministry of Housing and Urban Affairs is serious and keen to address all major concerns not only in the implementation of RERA but also in providing resolution for incomplete legacy stalled projects started before RERA came into force. “We have been raising the issue of dilution in RERA Rules by the states due to which many incomplete projects were left out of the ambit of RERA and also that RERA Authorities are unable to enforce their own orders due to which RERA orders became nothing more than a piece of paper. "The recent incident of poor construction quality leading to loss of lives will also be part of the discussion,” Upadhyay said. The proposal to form a committee under the Chairmanship of CEO, NITI Ayog is also welcome and shows that the government is keen to ensure the completion of remaining incomplete stalled legacy projects, he said. “We have also come to know that the Ministry has accepted our suggestion to live stream the proceedings of the CAC meeting on social media platforms to ensure complete transparency,” Upadhyay added. Source: Money Control INDIA

Real Estate expanding into Virtual Space with PropTech

3/30/2022 11:44:00 AM

This decade of the 21st century will be marked by technological advancements in every field and strata of life. The real estate sector is no different to that. The traditional methods and mindset might have slowed the pace of this transition but the onset of the pandemic made it necessary to adopt this harbinger of change. PropTech has now seeped into the DNA of Real Estate and the figures are testimony to that. As per statistics, 2021 witnessed a record fundraising in PropTech with $9.5 billion from investors and venture capitalists in the mid of November, breaking the previous record of $9 billion fundraising in 2019. PropTech is an acronym for ‘Property’ and ‘Technology’ and it encompasses all the sections of real estate, be it residential, commercial or retail. In the age of information, PropTech has enhanced connectivity and bridged the communication gap between various parties involved. Another aspect is that it enhances the standard and ease of living of the users. They can be understood as ‘SaaS’ (Software as a Service), ‘PaaS’ (Platform as a Service) and ‘IaaS’ (Infrastructure as a Service). Collectively, the digital transformation they have brought have completely changed the real estate scene in India. It is estimated that the PropTech segment in India will reach $1 Tn by 2030 from $120 Bn in 2017 (INC 42) despite exponential growth in recent years. The early examples of PropTech would be the listing websites that list the properties on the platform to buy, sell or rent. By removing the intermediaries from the process, they made it transparent, smooth and credible. In India, the property brokerage business is estimated to be worth $1,400 million, or $1.4 billion. Technology, now, has emerged as a secure and competent tool in the Commercial Real estate Segment (CRE) for landlords, tenants and investors. The drastic transformation can be witnessed in the commercial real estate sector. Apart from the listing, the option to see and compare all the available real estate in an area, their prices and a personalised search as per the need of the consumer are being made available. Developers are now providing 3D and VR views of properties. Some businesses also assist with the transaction process such as loan advisory, help with rental agreements & legal services. However, if one has to specifically mark a section where this digital transformation is most apparent, it will be the office spaces. After 2 consecutive lockdowns and a work-from-home scenario, businesses have turned to technology to adapt to the ‘new’ normal, providing cloud-based information systems, digital locks, voice-controlled amenities, virtual board rooms for meetings and conferences and so on. The health-wise safety has taken the center stage and more focus is on the wellbeing of the ‘consumer’. Apart from Gen X (age bracket of 42-57), the Millennials (age bracket of 26-41) have emerged as the new customer class and being a witness and the forerunner of the age of the internet, they not only rely heavily on PropTech, they are spearheading this trend with the innovation and visionary start-ups too. PropTech India Insight Report by Built World Technology says that India is poised to become the leading emerging market PropTech destination as it has all the necessary ingredients; a large and wealthy real estate sector, megacities on the rise, a growing middle class and vibrant tech hubs. One doesn’t need a soothsayer to know India is soon to be a trailblazer in PropTech and this trend will reform the real estate sector from what we see today. Source: Financial express INDIA

12 real estate projects in Uttar Pradesh being completed under Section 8 of RERA provisions

3/29/2022 3:38:00 PM

Section 8 of RERA empowers authorities to hand over the completion task to buyers' association. As many as 12 real estate projects in Uttar Pradesh whose registration had been cancelled or terminated and whose development works had not been completed are being rehabilitated through promoters or association of allottees under the provisions of Section 8 of RERA Act, UP RERA said on March 24. On the issue of balance instalments of some of these projects not being paid by some allottees, the authority has said that in case of non-payment of instalments, the promoter has the right to receive interest and cancel the allotment. The issue was brought to the notice of the Authority during review meetings held recently. As many as 11 of these projects are in Ghaziabad and Gautam Buddha Nagar and one is located in Lucknow. Action is being taken by the Uttar Pradesh Real Estate Regulatory Authority under Section 8 of the RERA Act 2016 to complete such projects by a group of allottees or joint efforts of promoters and allottees. Most of the projects are progressing normally, UP RERA said in a statement. Section 8 of RERA empowers authorities to hand over the completion task to buyers' association. The RERA Act clearly states that “Upon lapse of registration or on the revocation of registration under this Act, the Authority, may consult the appropriate government to take such action as it may deem fit including the carrying out of the remaining development works by a competent authority or by the association of allottees or in any other manner, as may be determined by the Authority". UP RERA had laid down terms and conditions for both promoters and allottees to ensure the availability of economic resources in these projects and to undertake time-bound development of work. Project advisory and monitoring committees have been constituted to see that the development work in these projects goes on unabated. The progress of the projects is reviewed by the committee every quarter with the concerned promoter and group of allottees and efforts are made to remove any obstacles in the development of the project, it said. The problem of non-payment of balance instalments on time has been taken up seriously by the Authority which has said that allottees of the respective projects pay the balance instalments regularly with a view to ensuring time-bound development of the project. However, in the event of instalments not being paid, the Land Estate (Exchange and Development) (Agreement for Development / Lease) Rules, 2018 will kick in. As per Rule 9.3 (i) of the Amendment Act, the option of levying interest on the allottees or cancelling their allotment is available and in case of projects where development work is stalled due to non-payment of remaining installments, notice should be sent by the promoter/group of allottees concerned to those allottees who have not paid their remaining instalments yet, UP RERA has said. In case of non-payment of these instalments within the stipulated time period, as per Rule 9.3 (i) of the Land Estates (Exchange and Development) (Agreement for Development / Lease) Rules, 2018, the balance amount of instalment have to be paid with the interest at the rate of SBI MCLR plus 1 percent. For such allottees, who have not paid two consecutive instalments, a notice should be sent to pay the balance instalment along with interest rate of SBI MCLR+1 percent within one month. It should also be mentioned in this notice that if the concerned allottee does not pay the third instalment along with the remaining two instalments on time, then his allotment will be cancelled. It should also be clarified in the notice to be sent to the allottee that after the cancellation of allotment, after deducting the booking amount and interest related liabilities, the principal amount deposited will be returned to the allottee, only after the unit will be re-sold or the project is completed (whichever happens earlier), UP RERA said. Source: Money Control INDIA

Real estate investments expected to increase by 5-10% in 2022; tech firms to dominate leasing

3/25/2022 12:35:00 PM

Total investments in real estate in 2022 are expected to rise by 5-10 percent of $5.5 billion recorded in 2021 to reach near the pre-pandemic levels of 2019 and gross absorption in office space is expected to touch 45-47 million sq. ft. in 2022, a growth of about 13-14 percent from 2021, according to a report by CBRE India titled Market Outlook Report 2022. Capital flows are expected to continue to be led by development sites / land and the office sector, whereas the industrial and logistics and residential sectors could also see higher equity inflows, the report that was released at the CII annual conference on real estate said. The theme of the conference was Reinvigorating the Real Estate Industry in 2022 and Beyond. Metros are expected to lead investments in office, retail and development sites and I&L to extend to tier-II cities. Mumbai, Delhi-NCR and Hyderabad drove investment activity in 2021 with a combined share of nearly 60 percent in total investments. The aforementioned cities along with Bengaluru are expected to remain on investors’ radar in 2022, with major focus expected on office, development sites and I&L assets, it said. With the emergence of tier-II cities as the new engines of warehousing demand, there is likelihood of investor demand for such spaces in these locations. This is largely on the back of increased e-commerce penetration, steady income growth, higher savings and aspirational spend patterns seen in such cities, it said. Impact of Russia-Ukraine war The report also said that the Russia - Ukraine conflict has also added to the pressure on building material costs, considering that the two countries cumulatively account for around 10 percent of the global steel trade. Russia is also a significant producer of aluminum and nickel. This would add to the pressure faced by the developer community, further raising the cost of construction, it said. Commercial leasing in 2022 Technology firms would continue to dominate leasing in 2022 while flexible space operators, BFSI, engineering and manufacturing and life sciences segment are expected to contribute to the growth in office space take-up significantly. Similar to 2021, Bengaluru, Hyderabad and Delhi-NCR are expected to continue to drive transaction activity in 2022, the report released at the CII Conclave said. Leasing by flexible space operators is also expected to grow, with their stock expected to touch 47-48 million sq. ft. by the end of 2022. A similar trend is expected to be displayed by engineering and manufacturing companies, considering the manufacturing sector’s potential to contribute more than $500 billion annually to the global economy by 2030. Additionally, the fintech sector in India is expected to witness an incremental valuation of around $100 billion from 2021-25, which would lead to a rise in space take-up by BFSI firms in the coming years, it said. The report also noted that SEZ supply would mostly be led by Hyderabad and Delhi-NCR, while non-SEZ supply would be driven by Bengaluru, followed by Delhi-NCR and Hyderabad. 2022 to witness uptick in residential launches As for residential, an uptick in new launches is expected particularly in Pune, Mumbai, Hyderabad, Delhi-NCR, and Bengaluru. However, this steady supply infusion may pose some risks to delivery timelines and execution capabilities. It could also create unsold inventory pressures, especially amidst rising capital values and the probability of increasing home loan rates (due to anticipated monetary tightening). In 2021, affordable and mid-end segments together accounted for nearly 80 percent of the total sales – a trend that is likely to continue in 2022. In the premium / luxury segment, fuelled by the anticipated appreciation in capital values, there is likelihood of renewal of investor confidence and increased activity by HNIs and NRIs as well, the report noted. “The second wave of the pandemic was a blip on the Indian economy and by extension to the real estate sector. We have come a long way since then. Leasing activity across all sectors and segments has witnessed an uptick in the past six months and we expect this growth to continue into 2022. In fact, a few sunrise sectors such as I&L are expected to surpass pre-pandemic levels as well in terms of leasing as well as supply addition,” said Anshuman Magazine, Chairman and CEO, India, South East Asia, Middle East & Africa, CBRE. “We also expect the India market for alternate segments such as DCs, life sciences, etc. to mature further, enabling investors to diversify their portfolios as well as provide more investment opportunities,” he said. Alternative Investment Funds to become major source of real estate funding As the focus of some of the prominent HFCs and NBFCs turns away from corporate loan books to retail loan books with an aim to strengthen their balance sheets, Alternative Investment Funds are expected to become a major source of lending to the CRE sector going forward, the report added. Source: Money Control INDIA

Firms in co-working space expanding to tier 1 & 2 cities

3/22/2022 12:01:00 PM

Co-working operators are expandinginto tier-1 and tier-2 cities, driven bythe adoption of the hub-and-spoke model by organisations, reverse migration of employees to their hometowns, affordable office rental costs, a growing startup ecosystem and the availability of talent, said industry executives. Large companies are now asking for multi-city space from co-working companies. "We have closed multi-city deals with our existing large enterprise clients in IT/ITeS, BFSI (banking, financial services and insurance), especially in markets like Pune, Noida, Hyderabad, and Bengaluru," said Harsh Binani, co-founder, Smartworks. In the past six months, demand for tech-enabled managed workspaces has grown threefold, according to industry experts. “With Covid-19 subsiding, we have been observing a substantial increase in the number of queries for our office as an outsourced service. Corporates are determined to lease and divest their office spaces to avoid unwanted longterm commitments and capital expenditures, "said Ankit Jain, director, Skootr. The company plans rapid expansion in Bengaluru, Mumbai, Pune and Noida in 2022 to cater to the growing demand for offices. Corporate occupiers are looking for portfolio re-optimisation and focusing on the concept of managed office spaces. “We have sold 6x more seats in the last three months than what we used to sell pre-Covid, with a huge chunk under our demand-led supply model for mid-to-large-sized corporates across tier-1 and 2 cities. We are working towards further expanding our base pan-India with 200 centres by the end of 2022,” said Amit Ramani, Founder & CEO, Awfis. Half of a large co-working operator’s demand now comes from large occupiers who want satellite offices under the hub-and-spoke model. “For all practical reasons, co-working spaces are the most preferred option for companies to satisfy this demand,” said Nikhil Madan, co-founder, The Office Pass. According to international property consultant Savills India, about 23% of the leasing in the first two months was for flex and serviced offices. “The first two months of the year have been where we are seeing a shift toward flexible and serviced office solutions. Also, tech demand is likely to pick up with a very strong return to office sentiment,” said Shweta Sawhney, managing director, Delhi-NCR, Savills India. Source: The Economic Times INDIA

About 1.75 crore houses have been completed under PMAY-Gramin: Centre

3/19/2022 12:38:00 PM

NEW DELHI: The Central government on Wednesday informed that 1.75 crore houses have been completed under Pradhan Mantri Awaas Yojana - Gramin (PMAY-G). Union Minister for Rural Development Sadhvi Niranjan Jyoti in a written reply in Rajya Sabha on Wednesday said under the scheme, 2.28 crore houses have been sanctioned to the beneficiaries, out of which 1.75 crore houses have been completed as on March 9, 2022. "The PMAY-G guidelines provide for the construction of a house within 12 months from the date of sanctioning the same to the beneficiary. The assistance is released to the beneficiary in a minimum of 3 installments linked to various stages of completion like at the time of sanction, foundation, plinth, windowsill, lintel, roof, etc. Since the figures of house sanction and completion are dynamic and there is a gap of 12 months between sanction of the house till its completion, therefore, there would always be some gap between the figures of houses sanctioned and houses built during the implementation of the scheme," she stated. The minister said that during the period of the Covid-19 pandemic induced nation wide lockdown, all construction activities including construction of houses under PMAY-G were also affected which retarded the pace of construction of PMAY-G houses. "Besides, the delays are also due to delay in release of Central & State Share from State Treasury to State Nodal Account of PMAY-G, cases of the unwillingness of beneficiaries to complete the construction, migration, disputed succession of deceased beneficiaries, delay in allotment of land to landless beneficiaries by the States/UTs and at times those occuring on account of General/Assembly/Panchayat elections, unavailability of building materials etc," . she added. She also informed that the Union Cabinet has approved the continuation of PMAY-G beyond March 2021 till March 2024 for completion of remaining houses within the cumulative target of 2.95 crores houses under PMAY-G. Source: ET Realty INDIA

NCR continues to be a hub for luxury homes

3/17/2022 12:26:00 PM

Many reports indicate a rising demand for luxury homes in the market; this is especially true in the Delhi NCR market, where some of the best properties guarantee a world-class living. Despite the demand for luxury houses spread across the NCR, premium developments in Gurugram and Faridabad offer the best options with an ‘in-the-midst-of-nature’ experience. Premium developments like Amstoria, Terra, Astaire Gardens in Gurgaon offer the similar kind of products in these larger township. It offers Independent floors, high-end 3 BHK and 3BHk+Home office apartments, Villas, Plots, etc. According to data by ANAROCK, housing sales in the top seven cities surged by 71% y-o-y in 2021, with the premium segment (priced between Rs 90 lakh and Rs 2 cr) accounting for 25% of total sales. The luxury market is dominated by well-heeled buyers looking for a new way to escape the monotony of life. As a result, NCR offers projects that provide resort-like experiences or initiatives that provide urban experiences. The purpose of buying a luxury property is to find a location that would allow the buyers to live a healthy and secure life. However, determining the price range is challenging since the luxury home buyer market includes people from many walks of life. Since June 2021, residential demand has shifted significantly, with demand for larger apartments at an all-time high; the COVID scenario has tilted the balance in favour of the real estate. Demand has outstripped supply in the Delhi NCR market, meaning that a good project has a decent chance of being snapped up by buyers. To take advantage of the market’s momentum, developers have raised the number of new launches. According to Sotheby’s Luxury Housing Outlook-2022, up to 67% of high-net-worth individuals intend to buy luxury houses in 2022, with a lifestyle shift being the key driver. The luxury industry is dominated by well-heeled clients looking for a different kind of escape from ordinary life. NCR will profit as a result, as the region contains some of the greatest assets in the market. Also, a CII-ANAROCK Consumer Sentiment survey conducted last year said that a substantially higher percentage of NRIs are looking for self-use apartments. According to the survey, at least 53% of NRI respondents who plan to acquire property in India will do so for personal use and 47% for investment. A prior ANAROCK poll put NCR third in attracting NRIs, behind Bengaluru and Pune, which boosts the prospects of luxury in the region. The vast majority of NRIs (about 90%) prefer properties developed by well-known companies, which explains why NCR, which has a vibrant real estate sector, has performed so well. One of the biggest draws for NRIs to NCR is the planned development, where even the sector roads are developed before the commencement of a project. Financial Express INDIA

Govt brings clarity in policy for FDI in real estate business

3/16/2022 11:07:00 AM

FDI is not permitted in an entity which is engaged in or proposes to engage in real estate business, construction of farm houses and trading in transferable development rights To bring more clarity in its FDI policy for the realty sector, the government on Monday "amended and aligned" the existing definitions of the real estate business. According to a press note from the Department for Promotion of Industry and Internal Trade (DPIIT) released on Monday, FDI is not permitted in an entity which is engaged or proposes to engage in real estate business, construction of farm houses and trading in transferable development rights. It added that earning rent/income on lease of a property, not amounting to transfer, will not amount to real estate business. "Real estate business means dealing in land and immovable property with a view to earning profit, and does not include development of townships, construction of residential /commercial premises, roads or bridges, educational institutions, recreational facilities, city and regional level infrastructure, townships...," the note said. FDI is prohibited in real estate business and construction of farm houses, according to the note. Mergers and amalgamations Further, the DPIIT has also made changes in the norms pertaining to acquisition of shares under scheme of merger/demerger/amalgamation. The merged or new entity "may issue capital instruments to the existing shareholders of the transferor company resident outside India", the note said. "Where (in) a scheme of compromise or arrangement or merger or amalgamation of two or more Indian companies, or a reconstruction by way of demerger or otherwise of an Indian company, ...the transferee company or the new company, as the case may be, may issue capital instruments to the existing shareholders of the transferor company resident outside India," it said. This will be subject to certain conditions, it added. Sources: Business Line INDIA

Residential realty gets a boost from the ultra rich

3/15/2022 10:57:00 AM

A new generation of self-made ultrarich Indians is investing in the country's residential real estate, according to a study by property consultant Knight Frank. About 29% more of India’s ultra-highnet-worth individuals (UHNWIs) purchased a residential property in 2021 compared with the previous year, Knight Frank said in its report. Entrepreneurs are increasingly investing in second homes as the residential segment witnessed a sharp recovery after the outbreak of Covid-19. Currently, on average, an Indian UHNWI — a person with a net asset of $30 million or more — owns two homes. Shishir Baijal, chairman and managing director of Knight Frank India, said: "Investment in the real estate sector in India has grown in recent times, especially in the wake of the pandemic, as real estate was viewed as a safe and tangible investment option amid the economic volatility. Further, at attractive valuations, real estate continued to drive institutional demand." According to property brokers, UHNWIs are actively looking to buy a new home in 2022. These individuals prefer to invest first in domestic properties, followed by the markets in the UK, UAE and the US. "We are seeing a 2x jump in the share of real estate in our UHNI clients’ overall investment portfolios. In the last two years, stocks have performed well and there has been a rise in salaries in the IT sector — both these factors have led to a good flow of investment in real estate since it’s considered the most stable and safest investment option," said Bhavesh Kothari, founder of Property First, a luxury-property broking firm. The club of self-made UHNWIs in India has been growing, amid a boom in the startup sector with many of these companies getting funding from venture capital firms and other investors at high valuations. The number of UHNWIs in India has grown by 11% YoY in 2021, the report said. Among key Indian cities, Bengaluru witnessed the fastest growth in the number of UHNWIs: up 17.1% to 352 in 2021. The southern city was followed by Delhi (12.4% and 210) and Mumbai (9% and 1596). India was ranked 3rd in terms of billionaires’ population in 2021, after the US and China, the report said. "There is a clear indication that the desire to upgrade homes will be a big motivator in 2022 due to the ongoing hybrid work model. We are seeing an increase in enquiries and sales momentum. We have been witnessing strongsales momentum, especially in the last 12 months, with almost 90% sold inventory now," said Ashwinder R Singh, CEO (residential) of Bhartiya Urban, a Bengaluru-based real estate development company. According to an Orios Venture report, India saw 46 new unicorns in 2021, taking the number of such startups with a valuation of at least $1 billion to 90. Indian startups in 2021 raised $42 billion, up from $11.5 billion in 2020. Oneout of every 13 unicorns globally now was born in India. Source: Economic Times INDIA

Co-working to dominate the future of workspaces in 2022

3/14/2022 12:13:00 PM

‘Flexibility’ has become the new buzzword in the office space industry during this pandemic. Companies are now constantly mapping emerging trends and ​changing preferences​,​ to make the right choice for their office investments. The hybrid work model, rise of the entrepreneurial culture, the boost in startups and boutique firms have been pushing the demand for co-working spaces in India. Even in IT/ITeS and BFSI (banking, financial services, and insurance) sectors, companies ​are ​finding​ ​​these offerings to work best for their expansion plans and ​also add up to the ecosystem of their workforces. These sentiments are further reflected in a recent CII-Anarock report ‘Workplaces of the Future’ that predicts that the market size of co-working spaces would double in the coming 5 years at a CAGR of 15 percent. The current market share of flexible workspaces against the total office space market stands at 3 percent and this is expected to go up to 4.2 percent by 2023, as per a recent report by JLL. The report also estimates that the flexible space segment would grow at an average of 15-20 percent year on year. Owing to benefits such as shorter tenures, low capital investment, facility management, safety, wellness and security, and low maintenance, the corporates are increasingly investing in co-working spaces.​ They are focusing on cost optimization to avoid the pandemic-related risks of the future such as movement restrictions, lockdowns, etc. The pandemic has completely redefined how companies look at ​these spaces in these volatile times, the cost advantage of using a co-working space also gives them an edge and makes it more attractive for the corporates willing to invest across cities and geographies. Moreover, co-working spaces also are a great help in decentralizing office spaces and reducing long-term lease commitments.​​ ​These offerings also support them to set up an entire network of satellite and regional offices which was difficult for them earlier.​ ​In addition, the companies now find co-working spaces the best-suited options to support their workforces who choose to continue working remotely. ​The rise of entrepreneurial spirit especially in youth, enhanced infrastructure development, improved internet services, large-scale technology deployment, and ease of doing business have made India the third-largest startup hub in the world. The emergence of startups has led to an increase in demand for co-working spaces. Subsequently, most founders​ have started looking​ for affordable, hi-end, and well- managed office spaces for their enterprises, and the demand for flexible workspaces grew three-folds. A Cushman & Wakefield report mentions that co-working operators expanded their portfolio aggressively last year and took on lease 21 percent more office area adding up to 4.91 million sq.ft. in 2021 in comparison to 4.05 million sq.ft. in the previous year – across the top eight cities of Bengaluru, Hyderabad, Pune, Mumbai, Delhi-NCR, Chennai, Kolkata, and Ahmedabad to meet the rising demand for flexible workspaces from corporates amid the pandemic. The style of operating business and working have changed and companies will seek flexibility as the key factor in the future too. The co-working spaces will support them in developing different work environments to maintain a healthy work-life balance.​ On the other hand, employees looking for hybrid work models have increased and continuous efforts will be made in this direction to cater to the rising needs. These flexible offerings will dominate the future of workspaces in 2022 and would be critical ​in adapting to the operational changes to yield better results. Source: Financial Express INDIA

RERA implementation to improve post SC direction on examining states' rules: FPC

3/13/2022 2:59:00 PM

Homebuyers' apex body FPCE expects the implementation of realty law RERA to improve following the Supreme Court's recent direction to the Centre to examine the rules framed by states and see whether those subserve the consumers' interest. Last month, the Supreme Court directed the Centre to examine whether the rules framed by various states under the Real Estate (Regulation and Development) Act, 2016 (RERA) are in conformity with the central legislation and subserve the interset of homebuyers. A bench of Justices D Y Chandrachud and Surya Kant gave three months to the Centre to examine if there are any deviations between the rules drawn up by the states and those framed by the Centre in 2016, and to place the report by by the first week of May 2022. When contacted, Forum for People's Collective Efforts' (FPCE) President Abhay Kumar Upadhyay said: "Despite five years of its full implementation, RERA is yet to reach anywhere near its intended objective." The prime reason for this is that the states to whom responsibility has been given for its implementation did not follow any uniformity in their general real estate rules and rules for agreement for sale, he pointed out. "Their (states') rules were not within the four corners of the provisions of RERA. This took sting out of the Act and homebuyers were deprived of the the benefits of RERA," Upadhyay said. On the other hand, the association's president said, builders took full advantage of this and the fear of RERA catching them faded. "In view of this, though late, but still this ruling from the Supreme Court will set things right going forward and many homebuyers will then reap the benefit," .. Most importantly, this ruling would break the belief in most builders that they are above the law or that they can take the law for granted, he said. "I sincerely hope that both the ministry to whom the task has been assigned directly and also the Amicus who has also been given responsibility will devote sufficient time and report not only all deviations but also missing content which may have left loopholes in the implementation of RERA," Upadhyay said. This order has once again raised the hopes of homebuyers that they will get justice sooner than later, he added. Colliers India CEO Ramesh Nair said the Supreme Court's decree to scrutinise RERA rules of states is significant as there is a lack of uniformity in builder-buyer agreements across RERA rules of various states. "This directive will help bring accountability and transparency in dealings between homebuyers and developers in several cases," he said. The anomalies mainly existed with respect to the payment schedule, delivery schedule and associated delays, as well as liability towards structural defects, Nair pointed out. "A uniform builder-buyer agreement will also lead to more confidence amongst homebuyers. It will instill trust in homebuyers, unwarranted liabilities," Nair said. Homebuyers would also have more faith in developers across the spectrum, and even in under-construction projects, the Colliers India CEO said. Source: Economic Times INDIA

Green infrastructure for sustainable people, planet & prosperity goals in India

3/12/2022 12:58:00 PM

Infrastructure has been the epicentre of developmental initiatives in the Union Budget 2022. With massive investments inflated in the face-lifting mega projects, infrastructure expansion is focused as the winning solution for paradigmatic outcomes. For the fastest expanding economy like India, such an end-to-end robust infrastructure network is a substantial commitment to lead an investment driven growth. In India, the term infrastructure is primarily associated with the ‘grey’—engineered, brick and mortar features. Nevertheless, green infrastructure is rapidly making inroads in modern urban planning at the national, regional, and municipal level. At a time when India has pledged to embark on its decarbonization journey in order to achieve targeted green goals, the need for sustainable infrastructure is critical for a better tomorrow. Notifying Green Hydrogen policy is a step in the direction to reduce dependence on fossil fuel and promote alternate clean fuel economy. Green infrastructure implies to the projects that are well planned, designed, constructed, operated, and decommissioned in a manner to ensure economic, social, and environmental (including climate resilience) sustainability over the entire life cycle of the project. It enables sound economic development, job creation and consumption of renewable goods and services. It also enhances quality of life for citizens, increases the utility of alternative green energy, and improves cost efficiency in the long run. Budget 2022 has become the first of its kind to make considerable space for green infrastructure as it has focussed on clean and sustainable urban development through three major sectors – transport, energy, and agriculture – in a bid to achieve carbon neutrality in the long haul. It has also announced several initiatives to galvanise climate-friendly actions like the allocation for renewable energy and energy storage technologies such as solar modules, energy transition and issuing of green bonds among others. Three key Budget announcements have specifically accorded high praise across board – setting up a high-level committee of urban planners, economists, and institutions to recommend policies for urban planning and governance; plans to issue green bonds and referring to climate action as ‘sunrise sector’. It clearly shows the government’s seriousness in achieving sustainable goals and enabling it to attract investors to fund environment friendly projects like those that reduce carbon intensity. These moves not only give a big boost to India’s commitment at COP26 of reaching net zero by 2070, but also achieving ambitious targets like 175 gigawatt of renewable energy capacity by this year. Installing green infrastructure practices can add value to a project by resulting in more buildable lots and higher market prices, provided the need for storm water ponds are eliminated. The other things that limit opportunities for green infrastructure include: zoning density standards, storm sewer connection requirements, minimum parking and road widths. This will nudge developers to offer additional value proposition in the projects. Besides, many consumers are willing to shell out more for close proximity to attractive landscaping and contour green space. However, if green infrastructure practices fails, it is often because they were not installed properly. Apart from the fact that construction procedures and sequencing for green infrastructure sites are different from conventional sites, many developers are unaware of the potential for cost savings with green infrastructure. Even those who are aware of the potential for cost savings may find it impossible to reconcile green infrastructure approaches with other codes and standards. Many of the strategies for overcoming these barriers require action by the corporations. Local governments are in the best position to promote remote sustainable development. They can streamline building codes and ordinances, incentivize developers with exemptions, enable automation technology, incentivize electric charging, activate smart cities growth in association with private players, consolidate fragmented responsibilities for ease of doing business, revise resource utilization and management policies, penalize excessive carbon emission, replace pollutants with non-pollutants green industries and focus on research with soil and climatic conditions. They can also help regularize cost of development and maintenance, effectively with long term and cheap credit funding and tax rebates among other things. Climate change is affecting us now more than ever and green infrastructure can help build up community resiliency today and into the future. This truly begins with conscious consumerism that propels urban liveability and adds to the communities’ wellbeing. Source: Financial Express INDIA

Steps being taken to resolve difficulties in land pooling scheme: Housing minister Hardeep S Puri

3/10/2022 12:00:00 PM

Union Minister of Housing and Urban affairs Hardeep S Puri said that the steps are being taken to resolve residual difficulties faced in implementation of land pooling scheme in Delhi and removing bottlenecks in Development & Control norms for unauthorized colonies. For the improvement of infrastructure in the unauthorised colonies, amendments has been proposed in the PMUDAY Regulations so that vacant land parcels can be utilized for creation of parks, schools, hospitals / dispensary for the benefit of residents. Many applicants under PM-UDAY are not in possession of valid ‘Will’ document. As on March 4, around 1,000 applications under PM-UDAY have been kept under abeyance due to unavailability of valid ‘Will’ or ‘Gift Deed’ documents. The proposed amendment for not treating valid ‘Will’ as a mandatory document will resolve the grievance of applicants whose applications have been kept on hold due to absence of valid Will. Puri said that more than 400,000 registrations have been completed by DDA under PM-UDAY. 12,009 Conveyance Deeds & Authorisation Slips have been issued. Land Pooling Scheme will benefit another 75 lakh people. Puri also said that ‘Jahan Jhuggi Wahan Makan ' Scheme for in-situ slum rehabilitation will benefit more than 50 lakh people by offering pucca homes to those living in informal settlements in Delhi. Three projects in Kalkaji, Jailorwala Bagh & Kathputli colony comprising 8,000 houses is already in progress. Development Control norms for Unauthorized Colonies are formulated with the aim to improve the quality of built environment, to provide continued affordable rental housing and to improve the existing physical and socioeconomic conditions in UCs. According to the ministry, 3024 EWS houses at Kalkaji Extension completed and the eligible households of JJ cluster Bhumiheen Camp, Kalkaji will be relocated shortly. Eligibility determination of 2700 JJ dwellers in Bhumiheen Camp, Kalkaji is in process. 679 declared eligible and draw and has been conducted. For remaining 2021, the dwellers have been asked to complete their documents within this month. Source: The Economic Times INDIA

Real estate market to touch new heights in 2022

3/9/2022 12:19:00 PM

India’s real estate sector is witnessing a healthy increase in demand in 2022 and this momentum is expected to hold for the rest of the year. From commercial spaces to the residential market, the overall market outlook is a bright one for the real estate industry. Despite pandemic exigencies, the sector has continued to show resilience and steady growth in 2021. India’s first wave of Covid-19 brought the sector to a relative standstill for a while. However, by the last quarter of 2020, the market had begun to pick pace, particularly owing to an increase in demand for residential spaces. The second wave of Covid-19 hit the sector just as it had begun to revive itself. Unlike the first wave, the ramifications of the second wave were not as prolonged or prominent. Vaccination drives and lowered infection rates infused optimism in the market. In addition, the festive season fed the sector’s growth. Buoyed by these factors, the sector made a strong comeback. The growth registered in Q3 2021 is likely to continue and the year is going to end on a positive note. In Q3 2021, according to a report by JLL, residential sales witnessed an upward trajectory, increasing by 65 per cent on a sequential basis. The industry is additionally to benefit from a regime of low interest rates, coupled with duty waivers (in some states), realistic property pricing and attractive offers leading to affordable synergy. In the past year, the real estate index has risen by 75% and is the second-best performing sector index, largely beating the benchmark index Nifty50. Bolstered by historically-low loan rates and temporary stamp cuts, the real estate has not only made a comeback but is expected to flourish in the year to come. 2022 a significant year for real estate The real estate sector in India is set to experience around 5% capital value growth in 2022 in the residential segment. Certain projections state that the sales momentum is expected to increase in 2022 as prospective homebuyers will continue to prefer bigger homes, better amenities and attractive pricing will keep them interested in sealing the deals. Meanwhile, as work resumes in offices, the recovery in the commercial sector and flight-to-quality trend is expected to keep rents stable to increase in 2022. Additionally, the luxury housing market is poised to touch new heights in the coming year. The budget effect A number of initiatives have been undertaken by the Government of India with the hope of incentivizing real estate purchases. The announcements made in the Union Budget 2022-2023 will help in creating a thriving atmosphere in the real estate sector. The government continues to prioritize the affordable housing segment and parallelly looking at ways to strengthen the existing financing systems to provide liquidity to stuck real estate projects. In the first week of December, the Government of India extended the deadline to provide pucca houses to all families in rural India to 2024. The Cabinet decided that the flagship rural scheme, Pradhan Mantri Awas Yojana-Gramin will be provided INR 2.17 lakh crore in additional Central and State funding to achieve its target of building 2.95 crore houses. The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) has announced that it will be keeping the repo rate and reverse repo rate unchanged for the tenth consecutive time. Setting the tone for the year, MPC gave a clear indication that it is growth oriented. Holding the interest will help in increasing the affordability for the consumer and help in holding the current demand trends. Continuing growth NITI Aayog expects that the Indian real estate sector will reach a market size of $1 trillion by 2030 and will account for 13 per cent of India’s GDP by 2025. Already the third-largest sector to bring about economic growth, the real estate industry is expected to continue its upward trajectory in 2022. Source: The Times of India INDIA

Chandigarh administration plans alternative, shorter route to airport from Sector 48

3/8/2022 2:00:00 PM

CHANDIGARH: The UT administration is planning an alternative and shorter route to the international airport from Sector 48 side without involving land falling in Punjab, with UT adviser Dharam Pal chairing a key meeting on Tuesday. The way is being considered from Sector 48 to Faida village opposite sectors 47 and 48 to the airport that residents currently reach by taking about 14km detour via Mohali. Before the construction of the new airport, the distance from the Industrial Area roundabout to the old terminal was 2.7km. In December last year, the adviser had directed the deputy commissioner and the chief engineer to submit a report on the shorter route . In the Chandigarh Master Plan 2031, another proposal of road connectivity to the airport has been given from Sector 48 (Purv Marg) through Jagatpura village, which will be about 4.7km from the Industrial Area roundabout, reducing the distance by 10km. The department related parliamentary standing committee on home affairs, in its report tabled in Rajya Sabha, in 2020, had asked the home ministry to conduct a meeting of Chandigarh, Punjab, Haryana, and civil aviation to resolve the issue of shorter access route to the airport. The committee, under the chairmanship of MP Anand Sharma, in its report had said, “We are aware the short approach road towards the airport was functional in the past. But now, around extra 30 km needs to be covered because the entry has changed to the other side and approaching it is time-consuming. The committee recommends the home ministry conduct a meeting with the UT adviser, chief secretaries of Punjab, Haryana and secretary, civil aviation, and resolve the issue of 7km stretch towards the airport.” Source: Times of India INDIA

Both luxury and affordable housing to dominate residential realty in first half: Realtors

3/4/2022 1:43:00 PM

In spite of the Covid-19, 2021 was a fantastic year for the Indian housing sector. Housing sales that were initially impacted by the second wave of the pandemic began to pick up the pace after June 2021. According to data from consultancy firm ANAROCK, housing sales in the top seven cities increased by 71 percent year over year in 2021. The highest number of units sold was 76,400 in the Mumbai Metropolitan Region, followed by around 40,050 in the National Capital Region. Of all the launches, the mid-segment (Rs 40 lakh to Rs 80 lakh) had the maximum share with 39%, followed by the affordable segment (priced under Rs 40 lakh) with a 26% share. The premium segment (priced between Rs 80 lakh and Rs 1.5 cr) had a 25% share. “Despite the threat of a third pandemic wave, the sector has proven its ability to overcome significant obstacles. The year 2021 was set aside for a speedy comeback, and the months ahead appear optimistic. End-users are taking over the traditionally investor-driven real estate market. In the residential sector, the transition from investor to end-user began a few years ago, and with COVID, the scale has tipped even more towards end-users. Right now, luxury and affordability remain the biggest attractions in the residential real estate segment,” says Dhiraj Jain, Director, Mahagun Group. According to Sotheby’s Luxury Housing Outlook-2022, as many as 67 percent of high-net-worth individuals want to acquire luxury properties in 2022, with a lifestyle change being the primary motivation. Well-heeled buyers are looking for a different kind of retreat from everyday life that dominates the luxury market. As a result, NCR offers projects similar to resorts or farms. The Haryana government is also working to ensure that high-quality housing gets developed. In the state’s agricultural zones, the Haryana government has established a new policy of change of land use (CLU) to avoid unplanned farmhouse construction and encourage eco-friendly living units. Raheja Developers, a renowned real estate company, has applied for the CLU to build Haryana’s first CLU- approved farmhouse. The developer has Riyasat Hills Farmlands, which spans 100 acres, and is located near Sector 95B, one of Gurugram’s highest capital appreciation zones. “Everyone is baffled by the deadly Coronavirus. Homes that help relieve stress are in high demand. People are becoming more aware of the importance of leading a healthy lifestyle, reclaiming their lives, and reconnecting with their inner selves. People have been coming closer to farmhouses over the past year and a half, and things have changed dramatically. As a responsible developer, we are mindful of our customer demands and will offer products that satisfy them,” said Nayan Raheja of Raheja Developers, describing the advances in the sector as optimistic. Another developer influencing people’s perception of homes is Central Park. Central Park Flower Valley, on the main Gurugram-Sohna road in Sohna Sector 32-33, is claimed to be a project that allows people to live life to the fullest in safe surroundings. Commenting on the trend, Amarjit Bakshi, chairman and managing director of Central Park, said, “In the current environment, the luxury category has benefited the most, particularly in Gurugram, where demand has outpaced supply. With the New Year upon us, we are enthusiastic about sales, which will most likely include an increased number of luxury residences. The confidence about luxury housing is based on the fact that the ratio of luxury sales to overall real estate sales has risen.” Projects that promote a healthy lifestyle and bring people closer to nature are highly in demand in Gurugram. According to Navdeep Sardana, chairman and managing director of Whiteland Corporation, Gurugram has dominated the NCR real estate market, and Gurugram’s proportion of overall Delhi NCR sales is anticipated to grow. “The city’s luxury market (above Rs 1 crore) stands out, with demand outstripping supply. In recent years, the ratio of luxury sales, in total real estate transactions, has increased. The residential market has sparked the interest of HNIs and inhabitants from South Delhi, who have noticed that world-class luxury projects are worth investing in,” he said. The perspective evolved substantially when developers in the NCR developed properties that impacted the NCR’s luxury real estate market. Gulshan has a one-of-a-kind wellness project in Noida, called Gulshan Dynasty. Yoga pyramids, hydroponic farming for organic produce, meditation field, specialized sunbathing space, more than 450 kinds of medicinal plants, rooftop theatre, and separate access and exit points for residents and other support employees are among the project’s cutting-edge features. “We envisioned a project with amenities that exude class while caring for people’s health, and we wanted to build a product that would change the way people live. As the target population is well-traveled, a project that can support their lifestyle, rather than a nice-looking structure, is in strong demand. Call it luck or foresight, but the project is ideally suited to the unexpected shift in demand caused by the pandemic,” said Yukti Nagpal, Director, Gulshan. According to realtors, the affordable category would also do well in 2022 since the government is set to extend incentives for buying affordable homes priced up to Rs 45 lakh by a year. The demand for affordable housing has risen as a result of historically-low home loan interest rates and infrastructural development in newer locations, which are typically at the heart of affordable housing. “The tax advantage will spur even more expansion. The need for affordable housing will continue to be robust in 2022. Furthermore, the one-year extension of the tax credit for affordable housing projects will help in the expansion of new supplies. It also highlights the government’s long-term commitment to providing affordable housing and efforts to achieve ‘Housing for All.’ The need for affordable housing in the Delhi-NCR region is concentrated in Gurugram, which accounts for more than a third of the total demand. Several projects are being launched in the region, and buyers are responding positively. In larger cities, anything less than Rs 45 lakh is unviable. Hence the government should pay attention to affordable housing minimum prices. The demand from larger cities is high due to the concentration of working- class people here,” said Vikas Garg, DMD, MRG World. Source: Financial Express INDIA

Panchkula civic body opts for land pooling to set up 24 sectors

3/3/2022 2:35:00 PM

For the first time, Panchkula Municipal Corporation is planning to make new residential sectors in the district with land pooling schemes on the lines of of Punjab and Gujarat. Panchkula mayor said that the agenda in this regard will be taken up in the upcoming house meeting on March 7 and sent to the Urban Local Bodies (ULB) head office for approval. Elaborating on the plan, mayor Kulbhushan Goyal said that till now HUDA and Housing Board were making residential sectors. The mayor said that under Section 42-A, clause 42 (1) of MC Act 1994, development of urban area falls under the MC. He added that the civic body would use the masterplan of the Urban Complex planned in Kot and Billa villages in 2013 to make 24 residential sectors. The MC will use the land pooling scheme similar to Gmada (Greater Mohali Development Authority) to develop the sectors. Local villagers will be requested to pool land for development of new sectors and an agreement will be signed with them for development of the area. The MC plans to hire consultants to ensure the success of the plan. The mayor said, "Many villagers are interested in developing their area under the land pooling scheme, under which the land owner will be given one 1,000 to 1,200 square yard plot inside the sector and the MC will not have to pay any amount to the land owner. There will be no enhancement like problems that will occur in the future". He further said that the proposal would be shared with councillors in the upcoming house meeting. After discussions and their approval, the proposal will be sent to ULB for approval. Source: ET Realtty INDIA

Indian UHNWIs allocated 29% of wealth towards purchase of residential property in 2021

3/2/2022 2:26:00 PM

India’s ultra-high-net-worth individuals plan to buy a new home in 2022 led by the growing number of UHNIs in the country. Indian UHNWI prefers to invest in properties in the domestic market (home country India), followed by international markets of UK, UAE and US, mentioned in a Knight Frank Wealth Report 2022. As per the report currently, 29% wealth of Indian UHNWIs is allocated towards purchase of principal and second homes. Further, 22% of UHNWIs’ investable wealth was allocated towards direct purchase of commercial property (including rental property, offices etc.) while 8% was allocated towards indirect purchase of commercial property (including REITs, funds, etc.). Additionally, the survey cited that 8% of the property portfolio was held overseas.These UHNIs have a net worth of US$ 30 mn and above. “Investment in the real estate sector in India has grown in recent times especially in the wake of the pandemic as real estate was viewed as a safe and tangible investment option amidst the economic volatility. Further, at attractive valuations, real estate continued to drive institutional demand. The governing rules surrounding REITs are regularly updated to augment the scope of these investment instruments in India. Our survey indicates that the investor interest will remain stable in 2022,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India. Globally, 21% of the ultra-wealthy are expected to purchase a home in 2022. The report further highlighted that on an average an Indian UHNWI owns 2.3 homes and 32% of the Indian UHNWIs have rented out their second homes during 2021. The survey further reveals that 31% of the respondents have invested in office followed by 15% in retail, residential private rented sector (PRS) and development land each in 2021. “The Wealth Report confirms a clear rise in demand for residential property - with 26% of global UHNWIs looking to buy a new home in 2021, a sharp increase from the 21% we revealed in 2020. Demand is especially strong for rural and coastal properties, with access to open space being the most highly desired feature. The pandemic is super-charging demand for locations that offer a surfeit of wellness - think mountains, lakes, and coastal hot-spots Demand will help fuel price rises of up to 7% for our key markets this year,” said Liam Bailey, Global Head of Research at Knight Frank. According to Knight Frank’s The Wealth Report 2022, the value of the Prime International Residential Index (PIRI 100) increased by 8.4% in 2021, up from approximately 2% in 2020, its highest annual increase since the index was launched in 2008. Globally, Bengaluru (ranked 91 st) and Mumbai (ranked 92 nd ) recorded a marginal growth of 0.3% YoY in 2021 in terms of luxury residential prices. Delhi (ranked 93 rd ) remained unchanged in regards to prime residential prices. “A period of recalibration is likely in 2022 as housing markets regain some of their usual seasonality and borders reopen, with COVID-19 suppressors – rather than eliminators – winning out. This will enable cross-border transactions to slowly recover; a key component of demand that has been largely absent from prime markets since the start of the pandemic,” said Baijal. The report mentioned that the India has ranked 3rd in terms of billionaires’ population in 2021 following the US and China. The number of ultra-high-networth-individuals (UHNWIs) has globally increased by 9.3% in 2021 over 51,000 people have seen their net assets increase to US$30m or more. In India, the number of UHNWIs (net assets with US$ 30m or more) has grown by 11% YoY in 2021. The number of UHNWI population in India is expected to grow by 39% between 2021- 2026, with 19,006 people expecting to have net assets of US$30m or more by 2026. Globally, it is estimated that 135,192 UHNWIs are self - made and under the age of 40, accounting for around a fifth of the total UHNWI population. India has ranked 6th in percentage growth of the UHNWI population that is selfmade and under the age of 40 years. While Delhi has witnessed an increase of 101.2% followed by Mumbai (+42.6%) and Bengaluru (+22.7%) in the last five years. However, in the next 5 years, Bengaluru is projected to witness an increase of 89% of the UHNWI population and become home to 665 ultra-wealthy individuals by 2026. Source: The Economic Times INDIA

Rising salaries in Chandigarh region leads to increase realty demand

2/28/2022 1:09:00 PM

Chandigarh recently got captured in the Randstad’s salary trend, which is an indication of the increased disposable income in the region. In fact, Chandigarh came on top in salaries paid at junior and mid- levels; the city came in third at the senior level salaries. The news brings glad tidings for the real estate sector too, as people will invest more in buying real estate assets. The change came as tier 2 cities are emerging as the talent hubs and job-creation centres. Talking about the progress made by Tier II cities, Prateek Mittal, Executive Director, IIT Alumni at Sushma Group, said, “Earlier, people only migrated to metros for better growth opportunities. But now Infrastructural developments and improved connectivity has helped cities like Chandigarh build businesses that can compete at any level and are able to attract the best of the talents by offering them attractive compensations.” The rise in salaries in these areas had led to an increasing demand for projects in surrounding areas of Chandigarh such as Mohali and Zirakpur. “Higher salaries have not only pushed the demand of residential real estate, but have also provided a boost to the commercial real estate as the brands see a huge consumption potential here, especially in areas like Zirakpur” Prateek Mittal added. The opening of properties in neighbouring regions such as PR7 Airport Road has offered people the possibility to expect excellent returns on their investment. “The region has a good standard of living, making it a desirable place to buy and invest. Furthermore, commercial property investment is safe because the investor will receive guaranteed returns on money, whether through rental or investment returns. The one million catchment area here ensures that any commercial project here will be a success, and the residential property along the route is also attracting a lot of attention,” LC Mittal, Director, Motia Group Not only residential segment, commercial segment too is gaining in this region. Looking at the potential of the workforce available here, especially in the post-pandemic scenario, many corporates are looking for commercial assets in the region. “Today, the city can brag on having good infrastructure and cutting-edge commercial complexes. Apart from the corporates, the commercial segment here is witnessing NRI investment, who have assessed the long-term gains of this realty segment, Akshay Taneja, MD, TDI Infratech” Similarly, Mohali is also experiencing steady growth. People with increased disposable incomes are more concerned about the sizes and security. “The town has seen several high-profile residential and commercial developments. The city’s steady growth has enticed residents from surrounding places to relocate. The town is well connected to neighbouring cities and major transit hubs; it includes a big chunk of the Chandigarh International Airport Hub and a portion of the authorised Free Economic Zone,” Tejpreet Gill, MD, Gillco Group. Source: APN News INDIA

The changing dynamic of luxury housing in India

2/26/2022 12:57:00 PM

The pandemic was a silverlining forresidentialreal estate. Investors and homebuyers alike focussed their attention to spend on buying a home or upgrading theirliving space. Luxury housing suddenly saw a peaking interest from across demographics. The luxury housing market was, however, not the same pre-pandemic. In the past decade, it has seen various ups and downs. 2019 was in fact not a great yearforreal estate overall. Prime markets like Mumbai and Delhi saw a rise in inventory, sky-rocketing rates and instability among key stakeholders. Stalled projects, litigations on developers, aggrieved buyers were on the rise. Let’s take a step back to understand the reality of luxury housing market back in 2010. Luxury was only forthe ultra-rich, HNIs or NRIs back then. Even NRIs focused on investment and opted for homes which assured good returns. Global exposure was just gaining pace and the Indian consumer was yet to evolve. Luxury was focused solely on location and pincode. It was mostly about over-paying for a property based on where it stood. But the definition of luxury was changing. Aspirations were on the rise with increasing global exposure. As consumers would grow more aware, they wanted luxury and also their money’s worth. Value proposition would become the key focal point forthe premium homebuyer. Slowly by 2013-14, the barfor aspiring to live in a luxury home lowered as many developers started targeting businessmen and CXO level professionals. Consumers too were demanding more from their home aesthetically. Right from safety features, amenities, architecture and interior, there was a wave of increased awareness and want for better living spaces. However, there was one majorlimitation. There were limited developers who were in a position to offerlavish properties and they did charge a premium for providing premium projects at prime locations. Luxury housing was limited to Mumbai and Delhi at this point, only extending to a few other metros like Bengaluru. Bright future Then the life-changing RERA bill in 2016 was introduced. This changed the perception of the real estate industry. It helped regularise and consolidate the entire sector. It took a year for people to completely understand and adhere to the norms set out by the regulator, but this only made it possible forresidentialrealty to getready for a bright future. Luxury housing benefited highly as people were willing to invest larger sums of money in their homes with the surety that RERA brought. However, the confidence with which most developers approached the luxury housing market was misplaced. In 2018, most major cities in India were sitting on inventory that would take four years to clear. The majorreason was that many developers completely ignored the aspect of location and demographic study before creating a luxury property. For most homebuyers, even the luxury segment; the purchase of a home is the largest single pay cheque they will cut in theirlife. This means they will evaluate every single nuance and want the home to meet each of theirrequirements. The evolved buyer wanted both — location and luxury. Having said that, there is no one-size-fit-all approach here. In metros and prime cities, every area, sub-area, has a different demographic and culture. Hence, thorough background research, survey and study are essential before investing in a project, which most developers failed to do. In the major cities in India, there were two prevalent cultures thatran the residentialreal estate market. First being the renting culture and second was the fact that more time was spent outdoors than indoors. Thus smallerliving space didn’t seem like a major hurdle. Now let’s talk about what changed in March 2020. The COVID-19 pandemic completely changed the way people think about their homes. Consumer behaviour witnessed adramatic change;resulting in a structural shift in how and where people live, as well as their attitudes about homeownership. Sense of securityMany people re-evaluated their priorities and began to value the sense of security that came with having a home after being cooped up in their homes during the strict lockdown. The pandemic emphasised the importance of homeownership and fuelled demand for large homes with top-of-the-line amenities. With people being confined to their houses forlong periods of time in the new normal, the demand for homes with ultra-modern amenities skyrocketed. Those who already owned a property chose to upgrade from their current living standards. With homes becoming the sole space for all activities, there is now a need for extra rooms, as consumers look to create activity driven arenas like a study room or a workout space within their homes. The fact that people are considering a good investment opportunity as a strong reason for buying luxury real estate points to a bullish outlook on luxury home prices. Further,residences having private gardens and homes with decks or balconies are being preferred for muchneeded fresh air. The rise of the work-from-home phenomenon among UHNIs, led to a strong demand for high-end properties that may serve as catch-all compounds, live-work spaces, and provide a resort-like living experience, attracting real estate developers. As a result, the luxury real estate market in India has evolved, prompting developers to produce ready-to-move-in luxury condominiums that provide a healthy lifestyle, world-class amenities, and distinctive architecture that supports the purchasers' concept of modern and elegant living. Knight Frank’s recentreport states thatresidential sales momentum is expected to continue in 2022 as prospective homebuyers’ preferences for bigger homes with better amenities. Owing to the various relaxation of business establishment procedures and the ease of doing business (EoDB), many foreign players and MNC's have been attracted to India. The expected rise in the number of HNI's and India's growing stature as an economic power promises much in the luxury product segment. This real estate category is expected to continue growing stronger and evolving further with increasing domestic applications of technological innovations and fusion of aesthetics with luxury, attracting national and international players to the market. Interestrates impact the price and demand ofreal estate — lowerrates bring in more buyers,reflecting the lower cost of getting a mortgage, but also expand the demand forreal estate, which can then drive up prices. Real estate prices often follow the cycles of the economy, but investors can mitigate this risk by buying REITs or other diversified holdings that are either not tied to economic cycles orthat can withstand downturns. Government policies and legislation, including tax incentives, deductions, and subsidies can boost or hinder demand forreal estate. Luxury homes in Mumbai are anticipated to be in demand while property prices are likely to remain stable despite the buoyancy in housing demand. Post the pandemic, luxury housing market has reported significant traction; buyers are responding favourably to residential purchases across segments as sale prices have corrected in the last few quarters, making real estate investment attractive, especially in the premium segment. Source: Real Estate INDIA

Home sales increased by 13% in 2021 : Report

2/18/2022 11:22:00 AM

Home Sales in India’s eight prime housing markets increased 13% in 2021, compared to the overall sales in 2020, according to a report by A much sharper growth was seen in terms of new supply in 2021 as against 2020 as 2.14 lakh units were launched in 2021 compared to 1.22 lakh units in the preceding year, showcasing an upward swing of 75%. “Despite multiple waves of the pandemic, which resulted in multiple lockdowns, the residential real estate market has not only bounced back but is also on the cusp of a cyclical upturn. With policy support from the government and the low interest rate regime maintained by the RBI, I am very confident about the sector, entering into 2022,” said Dhruv Agarwala, Group CEO, Builders sold 2,05,936 housing units in 2021 as against 1,82,639 units in 2020. This growth in sales was largely driven by India’s financial capital Mumbai, where a total of 58,556 homes were sold in 2021. Flexible payment plans continue to keep homebuyers inclined towards underconstruction homes, which made up for 80% of the home sales during the year, the report adds. “Developers have been quick to respond to the positive changes in buyer sentiment, as evidenced by the offers available in the market, especially during the festive season of 2021, which resulted in improved metrics for both, demand and supply. Basis the data available with us, it seems very likely that we will see an increase in prices in 2022, even as the inventory overhang continues to decline in 2022. The biggest trend we foresee is that the real estate market will continue to consolidate its growth in 2022 as well,” said Rajan Sood, Business Head, Consistent increase in raw materials prices is pushing up property prices, with all eight prime residential markets covered in the report showing annual increase in per square foot price of new properties. Ahmedabad and Hyderabad housing markets were leading this pack, with an annual price hike of 7% each in 2021. The improvement in sales in 2021 has been instrumental in lowering the inventory burden for India’s real estate developers. Consequently, inventory overhang --- the estimated time builders would take to sell off the existing unsold stock, based on the current sales velocity--- has now declined to 42 months. As on December 31, 2021, builders had an unsold stock consisting of 7,26,943 units in India’s eight housing markets. While the inventory overhang is the highest for the Delhi-NCR market at 68 months, it is the lowest for Kolkata, at 31 months. Source: The Economic Times INDIA

SC directs housing ministry to assess if state rules under RERA comply with those notified by Centre

2/16/2022 11:02:00 AM

The Supreme Court on February 14 directed the ministry of housing and urban affairs to scrutinise whether the rules adopted by the states under Real Estate Regulatory Authority (RERA) comply with those framed by the Centre and appointed advocate-on-record Devashish Bharuka as amicus curiae in the case. A bench of Justices D Y Chandrachud and Surya Kant gave three months to the Centre to examine if there are any deviations in the rules framed by the states to the rules framed by the Centre in 2016 and to place the report by first week of May, 2022. The Supreme Court was hearing the petition seeking a direction to the Central government to frame a Model Builder Buyer Agreement to ensure transparency and to protect the interests of homebuyers as per the aims of the Real Estate (Regulation and Development) Act, 2016. The court observed that the Central government had shared the draft 'agreement for sale' in 2016 after the enactment of RERA with all the states and Union Territories and currently West Bengal, Jammu and Kashmir and some north-eastern states are yet to notify the rules. "At the present stage, it is necessary for the court to be apprised of whether the rules which have been framed by the states contain the essential norms which have been adopted by the Union Government in the rules of 2016 referred to above, or whether there are any deviations which would not subserve the interest of the flat purchasers,” the bench observed. “This exercise should be carried out at two levels. Union Ministry for Housing shall scrutinize the state rules and report to this court if they comply with the 2016 rules by centre. We also appoint Mr Bharuka as the amicus in this case and also assist this court is carrying out this exercise,” a bench of Justice DY Chandrachud and Justice Surya Kant said. Additional Solicitor General Aishwarya Bhati, appearing for the Centre, submitted that the statutory rules have been framed and placed before the bench for the Union Territories, whereas, several states have notified them except for a few such as West Bengal and other states from the North East region. The bench agreed that there may be some local conditions which need to be taken care of by the states but most of the rules should be in compliance with the Centre's draft rules of 2016. The bench asked Bhati if the Centre has examined whether the rules which have been framed by the states are in conformity with the rules the Centre has framed. Bhati said that they have compared the rules framed by major states where construction activity is more and they have done in the case of Maharashtra and Haryana. She said that the government will do that exercise of examining all the state rules and apprise the court about the same. However, Senior Advocate Menaka Guruswamy, appearing for BJP leader Ashwini Upadhyay, who has filed a Public interest litigation (PIL), said that there has to be a minimum set of guidelines for the protection of the consumers. She said concerns remain despite Centre's 2016 rules and that is why this writ petition was filed. She said that the Union of India says that it is the responsibility of state governments to frame rules and they ignore sections 41 and 42 of RERA which have been reproduced in the October 4, last year order of the court. On Nov 5, 2016 RERA had formulated rules and all states were requested to forward copy of rules as notified. The Supreme Court on January 17 had told the Centre that it was not in favour of separate state governments having builder-buyer agreements, but would rather prefer a national- level model to deter builders from fleecing homebuyers. “We are concerned about the broader public interest of the middle-class home buyers,” Justice Chandrachud and Surya Kant had said and asked the Centre to consider framing uniform rules under the provisions of RERA. “The whole purpose of the present PIL is that there should be a model builder-buyer agreement which will be formulated by the central advisory council so that there is some uniformity in the basic terms and conditions and the flat buyers are not exploited,” he had said. Justice Chandrachud said, “We are very keen on this. Instead of leaving it to all the individual states, we want the Centre to formulate a uniform builder-buyer agreement, which shall be applicable in all the States.” He also cited the West Bengal matter, in which a state law regulating the real estate sector was similar to RERA and was struck down by the court last year. The bench had asked Solicitor General Tushar Mehta, appearing for the Centre, to seek a considered view of the Union Government of the need to formulate a model builder-buyer and agent-buyer agreement at the central level. On November 8, 2021, the Supreme Court had said that a model builder-buyer agreement is needed in the real estate sector and the Centre should file its reply on the issue as it is an "important matter in the public interest". On October 4, the top court had issued a notice to the Centre, asking it to frame model agreements for the builder-buyer and the agent-buyer deals to bring in more transparency in the real-estate sector. A PIL has been filed by advocate and BJP leader Ashwini Upadhyay, seeking a direction to all states to enforce a model builder-buyer agreement and a model agent-buyer agreement and to take steps to avoid "mental, physical and financial injury" to customers. "Promoters, builders and agents use manifestly arbitrary one-sided agreements that do not place customers at an equal platform with them, which offends Articles 14, 15, 21 of the Constitution. "There have been many cases of deliberate inordinate delays in handing over possession and customers lodge complaints but the police don't register FIRs, citing arbitrary clauses of the agreement," the PIL had said. Source: Money Control INDIA

Home loan interest rate to remain at multi-year low as RBI keeps repo rate unchanged

2/11/2022 1:09:00 PM

In the last meeting of the Monetary Policy Committee (MPC) during the financial year 2021-22 held in February 2022, the Reserve Bank of India (RBI) kept the policy rates unchanged. The repo rate, thus, remains at 4 per cent while the reverse repo rate is at 3.35 per cent. RBI repo rate has a direct and an immediate influence on the home loan interest rate. Repo rate is the rate of interest at which the banks borrow money from the RBI while Reverse repo rate is the rate at which the banks earn by keeping surplus funds with RBI. Since October 1, 2019, RBI has mandated banks to offer retail loans such as home loans and auto loans linked to an external benchmark, which for most banks is the RBI repo rate. For most banks, fresh home loans are based on the bank’s Repo Linked Lending Rate (RLLR), also referred to as an external benchmark rate (EBR). Every time, RBI revises the repo rate, the revision in the interest rate is much quicker in RLLR for the borrower compared to the loans linked to MCLR. The Marginal Cost of Funds based Lending Rate (MCLR) was introduced from April 2016. Among other factors, the MCLR is based on the bank’s own cost of funds. Going forward, those paying EMI on home loan and car loan based on a flexible interest rate will continue paying almost the same rate of interest as applicable to them currently.”The continuation of the low home-loan interest rate regime is bound to instill more confidence in the home buyers and support the ongoing market and economic recovery which has been promising in the recent past,” says Lincoln Bennet Rodrigues, Chairman & Founder, The Bennet and Bernard Company. Most banks are currently offering home loans starting at an interest rate of around 6.5 per cent. For those looking to get a home loan to buy their home, the interest rate environment appears conducive for them as the interest rate on home loan is at a multi-year low nowadays. The banks may not offer loans on their RLLR but depending on the loan amount and other factors, the effective home loan interest rate may differ. On an average, for the majority of borrowers based on the loan amount, profession, gender etc, the home loan interest rate is 7 per cent or even higher across most banks. Some of the banks that a new borrower may explore for the best home loan interest rate include SBI, LIC Housing Finance, Bank of Baroda, ICICI and HDFC, Kotak Mahindra Bank etc. Even those borrowers who are paying EMI based on bank;s MCLR may see some revision in their monthly installments as and when their reset-date comes. If you are a borrower with a loan linked to Marginal Cost of Funds based Lending Rate (MCLR), the fall in MCLR will help you pay lower EMIs on your loan as and when your reset-date comes up. Existing borrowers who have already taken a loan taken before October 1, 2019, may continue with their loans linked to Marginal Cost of Funds based Lending Rate (MCLR) or can switch to RLLR. The MCLR loans can be switched to RLLR but one should carefully evaluate the cost-benefit before doing so. This may incur a cost and hence consider the remaining tenure of the loan before taking this step. Before switching, one may wait for a few more months to get a clear picture of the interest rate movement. Choose a lender that offers a low rate of interest based on your profile. Even a 100 basis points reduction can help you to save a few lakh in interest cost, depending on the remaining tenure of the loan. Assuming a home loan of Rs 40 lakh for 15 years, one can save Rs 8.5 lakh in total interest cost and even save in EMIs totalling Rs 57000 in a year, if a lower rate of 2 per cent is what the borrower chooses. Source: Financial Express INDIA

Mumbai to witness 4.5 million sq ft office leasing in 2022, report

2/10/2022 1:26:00 PM

Mumbai, the country’s commercial capital, is likely to clock in gross absorption of around 4.5 million sq ft Grade A office spaces in 2022 as the strong vaccination drive is expected to continue to build occupier confidence, leading to gradual return to office for employees, according to international real estate advisory firm Savills India. The city recorded gross absorption of 4.6 million sq ft Grade A office spaces in 2021, registering a year-on-year increase of 59%. The gross absorption was split as 30:70 between the first and the second half of 2021. In addition to fresh leases of 4.6 million sq ft, the city witnessed renewals amounting to 4.7 million sq ft in 2021. The renewals were noticed majorly in the micro-markets of Navi Mumbai and eastern suburbs. “The vaccine administration programme is gradually seeing the return of employees to office. With the precaution (booster) dose now being eligible for many and with Omicron cases reducing, we anticipate the return to office to gain momentum in the rest of 2022. While we cannot rule out more variants of the virus including some more waves, our prognosis is that office leasing volumes will be stable in 2022,” said Bhavin Thakker, MD, Mumbai & Head – Cross Border Tenant Advisory, Savills India. The banking, financial services and insurance (BFSI) segment along with technology occupiers is likely to lead the office leasing demand during the year. Increased demand from data center operators, especially in the micromarket of Navi Mumbai is expected to emerge. The vacancy rate may increase marginally to 21% by December 2022 and the overall Grade-A rental values are expected to remain stable. The city is likely to witness a new supply of 6.9 million sq ft based on the scheduled completions during 2022. This planned supply constitutes IT and non-IT developments concentrated in the micro-markets of Central Mumbai and Navi Mumbai. In 2021, the BFSI segment continued to be the demand driver, garnering a 52% share in Grade-A gross absorption, followed by technology occupiers accounting for 12% share and engineering and manufacturing occupiers accounting for 5% share, Savills India said. The city witnessed 2.5 million sq ft of Grade-A supply infusion, registering an increase of 62% over 2020. Majority of the new supply was in the form of IT developments in the micro- markets of Navi Mumbai and Western Suburbs II. Vacancy levels in the city rose to 19.1% at the end of December 2021 pushing the rental values southwards by 4% in 2021 compared to those in 2020. Source: The Economic Times INDIA

Interest subsidy of Rs 41,415 crore disbursed to 17.68 lakh beneficiaries so far under PMAY (Urban): Govt

2/9/2022 2:33:00 PM

The government has disbursed interest subsidy of Rs 41,415 crore to 17.68 lakh beneficiaries so far under the Pradhan Mantri Awas Yojana (Urban), the Rajya Sabha was informed on Monday. The PMAY (Urban), launched by Prime Minister Narendra Modi in June 2015, aims to ensure ''housing for all by 2022'' by providing financial assistance to beneficiaries. In a written reply, Union Housing and Urban Affairs Minister Hardeep Singh Puri said subsidy of Rs 5,320 crore has been disbursed so far under the Credit Linked Subsidy Scheme (CLSS) in the current financial year. ''During FY 2021-22, an amount of Rs 8,000.00 crore (including Rs 1,000.00 crore for CLSS component) was allocated for PMAY-U in Budget Estimates (BE) which has now been enhanced to Rs 27,000.00 crore (including Rs 12,000.00 crore for CLSS component) at Revised Estimates (RE) stage in consultation with Ministry of Finance,'' Puri said. The minister said the HUA ministry supplements the efforts of states and Union Territories for providing houses to eligible urban beneficiaries of the country. The Pradhan Mantri Awas Yojana-Urban (PMAY-U) launched in June 2015 aims at giving central assistance to states, UTs and Central Nodal Agencies (CNAs) for providing houses to all eligible families and beneficiaries in urban areas of the country within scheme period up to March 31, 2022. Replying to another question about Smart Cities Mission, he said the government has spent Rs 3,013.73 crore on slum redevelopment projects so far under the SCM. Under the Smart Cities Mission, projects, including those related to slum re-development, are proposed and implemented by cities in accordance with their Smart City Plans (SCPs). Source: Money Control INDIA

Institutional investors pumping more capital into residential realty

2/8/2022 1:49:00 PM

Institutional investors have started to invest more money in residential real estate because of better sales momentum in this part of the market. The combination of key factors, such as record-low interest rates, pandemicdriven realisation of the need for home ownership, developer incentives, and increased buyer confidence, bodes well for the residential sector. In addition, institutional investors are taking recovery into account when they put their money into the right projects and places. Since the Real Estate (Regulation and Development) Act, 2016, there has been a rise in the level of transparency in residential real estate. This is giving institutional investors more confidence as they increase their exposure to this market. "We have seen a lot of consolidation in this space over the past few years, and there is a growing sentiment that the sector has largely been cleaned up. This, coupled with the strong residential demand that we are witnessing, has brought a lot of investors back into the market," said Lata Pillai, managing director and head, Capital Markets, India, JLL. "Robust hiring in the past 18 months and increasing salaries in technology, healthcare, and other sectors is likely to keep the momentum going for housing sales and institutional investors' interest in the sector." According to her, one of the distinguishing features of the investments in 2021 has been the comeback of the residential sector, which has seen the secondhighest share of total investments in Indian real estate. In 2021, the residential sector got 2.3 times more money than it did in 2020. That's $1.08 billion, compared to $460 million in 2020. Realty developers are also showing a willingness to invest in land and even undertake joint developments in the backdrop of the increase in demand for residential properties. "We are witnessing the same activity seen in 2014-2015 in terms of investment in land backed by funds. Until last year, it was through the acquisition of incomplete projects, and now it is through development management agreements. Institutional funds are expecting residential demand to remain buoyant for the next four years as the housing cycle usually lasts 5-7 years," said Gorakh Jhunjhunwala, managing director, Meraqi Advisors. The transactions concluded in the last few quarters also indicate the continuation of investment momentum for the housing segment. Recently, Brookfield Asset Management invested over ₹1,000 crore in Hyderabad-based realty developer INDIS' five under-construction residential projects to grow its housing project portfolio in the mid-market segment in South India's urban locations. Global alternative investment firm PAG has entered into an agreement to invest around ₹740 crore in two projects by real estate developer Kalpataru Group. On top of that, Oaktree Capital Management also invested ₹425 billion in Hubtown's 25 South, which is a prime sea-facing, high-end luxury residential development spread over 5.3 acres of land in Mumbai's Prabhadevi neighborhood. Source: The Economic Times INDIA

Infrastructure status for data centres to help developers access cheaper finance: Experts

2/4/2022 1:58:00 PM

The government’s decision to award infrastructure status to data centres is expected to help developers access cheaper finance and also push investments into this segment, according to experts. Various state governments have already announced incentives for companies investing in data centres and have attracted investment from multinational companies. "The Budget announcement of giving infrastructure status to DC and energy storage systems is a long-standing ask of DC firms and a much-needed step in the right direction,” said Vivek Dahiya, managing director-India lead, data centre at Cushman & Wakefield. “It couldn't have come at a better time as there is tremendous growth being witnessed in this sector and steps like the roll out of 5G and data localisation will only further augment demand for DCs in India." Continued growth in data centres globally has led to an ever-growing development pipeline in India. According to a Cushman & Wakefield report, the hyperscale cloud revenue globally for 2021 stood at $124.7 billion, out of which, India accounted for $3.8 billion in revenue. Data centre parks will also lead to various information technology and related units coming up in the vicinity and generate employment. "As we transit into the age of Digital India, granting infrastructure status to data centres is a shot in the arm,” said Niranjan Hiranandani, CMD at Hiranandani Group. “It brings data centredevelopment on a par with other major sectors to avail long-term and cheap credit, bolstering data localization in the wake of protection of data sovereignty in the age of globalisation." Experts say the government’s move will boost India’s ambition of being a strong data centre player in the region. "We expect that 2,500MW of new data centrecapacity will be needed by 2026 in India," said Shishir Baijal, chairman and managing director, Knight Frank India. Uttar Pradesh, which already has a data centrepolicy in place, expects the data centre sector to generate direct employment for 4,000 people and indirect employment for another 20,000. While the Centre has prepared a draft of a datacentre policy, Telangana is another state that has a data centre policy. Source: The Economic Times INDIA

Govt’s Rs 48,000 crore allocation for PMAY to boost affordable housing

2/3/2022 1:06:00 PM

The government’s Union Budget proposal of Rs 48,000 crore outlay for helping build low-cost houses in both rural and urban regions across the country is expected to boost the affordable housing segment and ancillary industries including cement and steel. Given the backward and forward linkages with ancillary industries, the plan to support the construction of over 80 lakh such houses will help in pushing demand for construction materials. The Budget proposal is expected to help the government move towards the achievement of its stated objective of Housing for All. “The Prime Minister housing scheme is expected to achieve the ‘Housing for all’ objective with 80 lakh beneficiaries. This will lead to higher growth of affordable housing. The spending on various housing projects is expected to create demand for real estate-linked industries,” said Radha Dhir, CEO & Country Head, India, JLL. The announcement by the government about working closely with the state governments for a reduction of time for land and construction-related approvals is also expected to promote affordable housing for the middle class and economically weaker sections in urban areas. “The government’s decision to allocate Rs 48,000 crores towards Pradhan Mantri Awas Yojna (PMAY), which will be key accelerating the pace of ‘Housing for All’ agenda that the government had set out to achieve. This allocation is significantly higher than the allocations in the last two budgets which demonstrates the government’s commitment towards housing for all,” said Shishir Baijal, CMD, Knight Frank India. The government has allocated Rs 48,000 crore for the completion of 80 lakh houses under the PMAY scheme in the financial year 2022-23. This is significantly higher compared to Rs 27,500 crore that was allocated for the ongoing financial year for both urban and rural regions. The central government has also stated that it will work with the state governments for reduction of time required for all land and construction related approvals, for promoting affordable housing for the middle class and Economically Weaker Sections (EWS) in urban areas. “The government plan to work with the state government for a reduction of time for land and construction-related approvals promoting affordable housing for the middle class and economically weaker sections in urban areas is laudable. Easing land and construction-related approvals will help the development firms in meeting the delivery timelines,” said Rajan Bandelkar, president, NAREDCO. The government has also proposed to work with the financial sector regulators to expand access to capital along with a reduction in the cost of intermediation for affordable housing. Pradhan Mantri Awas Yojana (Urban) mission was launched in June 2015 with an objective to provide housing for all in urban areas by year 2022. Under this scheme, the government has already sanctioned support to 1.14 crore houses, of which the construction of 54.45 lakh houses has been completed. The mission provides central assistance to the implementing agencies through states and Union Territories (UTs) and Central Nodal Agencies (CNAs) for providing houses to all eligible families and beneficiaries. As per PMAY(U) guidelines, the size of a house for Economically Weaker Section (EWS) could be up to 30 sq meter carpet area, however, states and UTs have the flexibility to enhance the size of houses in consultation and approval of the ministry. Source: The Economic Times INDIA

Mumbai realty scales a new peak, records decade’s best January stamp duty collection

2/2/2022 10:52:00 AM

Beating pandemic blues, Mumbai hit a new 10-year high in property stamp duty collection for the month of January, generating over Rs 477 crore through more than 8,100 transactions. Though the number of property registrations were down 20% from a year ago, revenue jumped 56% year-onyear, according to data from Maharashtra’s Inspector General of Registration. Notwithstanding the drop, the January 2022 registration volume was higher than all pre-Covid January months. Last year, the same period had a lower stamp duty rate window at 3% and it was not as severely inflicted by Covid. "Albeit in a limited way, caution on account of the third wave has influenced sentiments, which is reflected in January registrations,” said Shishir Baijal, CMD at Knight Frank India. “However, as previously experienced, we see this slowdown as a temporary blip and the market will gain momentum as the rate of infection declines." Apartments spread over 500 sq ft accounted for 60% of all residential property sales in Mumbai despite a government announcement abolishing property tax on houses smaller than 500 sq ft. The 500-1,000 sq ft housing segment accounted for 45% of all sales in January. "Despite the third wave of the pandemic, both enquiries and the conversion of those into actual sales continued to show an uptrend in January,” said Kamal Khetan, CMD at Sunteck Realty. “Site visits during the first half of the month were lower, but the digital platform helped in taking the deals and negotiations ahead without wasting time until the site visits improved. Both the affordable housing and premium segments have reported steady growth. " Sunteck Realty has reported a 29% jump in pre-sales worth Rs 352 crore for the quarter ended December. The listed company has reported 23% on-year growth in nine months’ pre-sales at Rs 800 crore. The western and central suburbs of the city continued to dominate the Mumbai market. The western suburbs was the most prominent market, accounting for 52% of the registrations in January 2022, while the central suburbs accounted for 34%. "Over the next fortnight, the Union Budget and monetary policy actions will be crucial in catalysing latent demand, and we remain hopeful that the government and the central bank will continue with their growth-oriented policies," Baijal said. Experts say with the Reserve Bank maintaining its stance on low interest rates and developers making attractive offers, the sales trajectory has picked up again, with monthly sales surpassing even the pre-pandemic levels seen in 2018 and 2019. The Mumbai property market has been buzzing with activity since the state government announced a reduction in stamp duty rates in 2020 to boost the real estate sector and around 260 connected industries. The reduced stamp duty has led to a surge in the number of transactions across segments, including luxury, mid-income, and affordable housing. While the lower stamp duty benefit window period ended in 2020, the property markets across key cities in Maharashtra are still witnessing robust activity. Source: The Economic Times INDIA

Property stamp duty revenue Rs 1 lakh crore across 28 states in April-November

2/1/2022 1:25:00 PM

The cumulative revenue collection from stamp duty and registration charges (SD&RCs) for all states in India was recorded at Rs 1 lakh crore for the first 8 months of the financial year2022 (April-November 2021), showed a Motilal Oswal Financial Services study of the government data. The total SD&RCs collection for the financial year 2021 was recorded at Rs 1.27 lakh crore. The average monthly SD&RCs collected by 28 states stood at Rs 12,500 crore in the first eight months of FY22, which was slightly lower than Rs 12,800 crore suggested by the pre-Covid growth trend (FY19-FY20). However, the average was higher than the monthly average of Rs 10,600 recorded in the year FY21, showed the stock brokerage firm’s study. Maharashtra recorded the highest collection of Rs 17,100 crore contributing 17.1% of the total collection recorded during the first 8 months of FY22. Uttar Pradesh, Tamil Nadu and Karnataka registered Rs 12,800 crore, Rs 8,700 crore and Rs 8,400 crore respectively during the period. “The residential real estate sector has bounced back strongly since 2HFY21 and it continues to perform well in FY22. In fact, it is doing better than anticipated. We hope that the Government provides some incentives to this sector in the upcoming Budget. Considering its massive forward and backward linkages to the real economy, it has the potential to boost GDP growth substantially,” said Nikhil Gupta, Chief Economist, Motilal Oswal Financial Services (MOFSL). According to the study, Telangana, Sikkim and Jammu & Kashmir are the only states whose revenue collection for the first 8 month of FY22 have out past the revenue collection from SD&RCs achieved during FY’21. Telangana recorded SD&RCs collection of Rs 7,000 crore during the period against Rs 5,200 crore during FY '21 and Rs 6,700 crore in FY20. This also translated into an overall collection constituency increase from 4% in FY’21 to 7% in 8MFY’22. Source: The Economic Times INDIA

67% HNIs plan to buy a luxury home in 2022: Survey

1/19/2022 1:36:00 PM

A large number of HNIs (high net worth individuals) are proposing to buy property in the next two years, reflecting a strong and decisive turnaround in the luxury real estate segment, reveals a survey conducted by India Sotheby’s International Realty. The survey elicited responses from over 200 HNIs and UHNIs to gauge the mood of the luxury home buyer across India’s top 8 cities — Delhi-NCR, Mumbai, Kolkata, Bengaluru, Hyderabad, Pune, Chennai, and Goa. Out of the 76 per cent who responded in the affirmative to buying real estate in 2022, 89 per cent said they would look to buy residential real estate vis-a-vis 11 per cent who opted for commercial real estate. This translates to 67 per cent of the respondents wanting to buy luxury homes, going forward. “An overwhelming 67% per cent of respondents said they would look to buy luxury residential real estate in 2022. On the key motivation to buy another property, 46 per cent of the respondents said, the biggest reason for them to buy property in the pandemic years was a lifestyle upgrade. About 31 per cent of HNIs also said the biggest motivation to buy real estate in the last 18 months was ‘a good investment opportunity’, reflecting the emergence of bullish outlook that HNIs have on luxury real estate and their expectation of home prices to rise,” according to Sotheby’s Luxury Housing Outlook-2022. Within the choices of buying residential real estate, a city apartment continued to top the charts with 34 per cent saying they would look to buy a bigger city-based apartment. On the other hand, more than 1/4th of the respondents (29 per cent) expressed their desire to acquire a holiday home. “This remains one of the biggest aspirations for the HNIs, a change we see as significant,” observed Amit Goyal, CEO of India Sotheby’s International Realty. Goyal further said, “The fact that people picked a good investment opportunity as a strong reason for buying luxury real estate points to a bullish outlook on luxury home prices. Unlike some of the developed countries, where the price increase frenzy seems to be cooling off, in India, I believe, we are at the start of a secular price rise. We expect low-rise homes in the thriving urban centers, especially in Delhi NCR and Mumbai, and the vacation home destination of Goa, to be the outperformers of 2022.” As regards the money the HNIs are willing to shell out on another property, the maximum response was received for a luxury city apartment or villa for the price range of Rs 10 – 25 crore with 69 per cent respondents picking this bracket. The sweet spot of pricing for a luxury “holiday home” was between Rs 5 crore and Rs 10 crore with as many as 71 per cent of respondents opting for this price band. About 29 per cent of the respondents were even willing to spend more than Rs 10 crore for the right vacation home. ‘Work From Home’ Findings The survey was completed before the onset of the third wave of Omicron surge, but it clearly showed that the hybrid work model is here to stay. Almost 65 per cent of the respondents answered, they do not see themselves going back to the physical office, all 5 days of the week. “This is a clear indication that the desire to upgrade homes will remain a big motivator in 2022,” the survey found. The extensive survey also revealed that 28 per cent of the HNIs had gone back to the office – full time, prior to the third wave of COVID. Almost half of the respondents though continue to be in a “hybrid” work mode, spending anywhere between 1 and 4 days working from home. Also, about 15 per cent seem to have made a complete switch to “work from home” – which was negligible in India, pre-pandemic. Real estate agents/advisors were the top choices for HNIs when it comes to the source of information for decision-making on buying real estate in India. However, information gleaned from the internet is catching up as a strong source of information for HNIs when it comes to real estate buying decisions. Source: Financial Express INDIA

Residential Real Estate Poised For Healthy Growth In 2022

1/13/2022 12:40:00 PM

The residential real estate sector has witnessed major changes during the pandemic. Despite the decline in the market last year, gaps were bridged, transparency was maintained, sustainability was prioritized, new trends were innovated, and preferences were shaped. In this scenario, as customer-centricity took the center stage, the performance of the residential market was seen with strategic interest. During this time, the residential market came to play a larger role in serving a consumer base that looks at real estate assets as a steadfast promise for a secured future. As per the Colliers report, the residential real estate sector saw the highest surge in the past four years in terms of investments. At USD 0.9 Billion, this was a two-fold jump from 2020. The sector exhibited a staggering recovery fueled by the massive increase in the demand for capital. Consequently, the inflows in the residential segment witnessed a significant uptick with a two-fold increase Year on Year. These statistics provide overwhelming evidence to substantiate that the shadow of the pandemic is fading, and a silver lining is now visible, which is sure to drive a healthy growth of the sector in 2022. The pronounced buoyancy in market sentiment exhibited by the real estate sector is supported by a shared understanding among investors and buyers that stems from the significant returns witnessed in the last two quarters. The channels of investment have gained steam, supported by favorable policy support, exponential infrastructure development, as well as a congenial global business climate. In the wake of the pandemic, homebuyers have come to realize the importance of owning a home. With the uncertainties of this new world, the housing segment as emerged as a stable and lucrative investment choice. Increased awareness of health, well-being and comfort, combined with the extensive adoption of modern technology have propagated sustained growth in the segment. With a large spectrum of the population now inoculated with the vaccine, and market transactions achieving pre-pandemic invigoration, the real estate sector has now shifted gears from recovery to growth mode. Inspired by an indomitable entrepreneurial spirit and a conducive framework for economic growth, is giving rise to a new generation of uncompromising homebuyers. Market analysts are confident that the year 2022, will see greater proliferation of demand in the luxury segment. The pandemic has ushered new trends and expectations. While factors like affordability still play a crucial role for homebuyers, the new normal has seen this demographic requiring not only flexible work policies but also homeschooling for their children. The desire to stay close to their families combined with major infrastructure development is sure to strengthen the realty market in tier-2 and tier-3 cities. Homebuyers are now looking for a plethora of modern facilities and hi-tech amenities. In addition to posh neighborhoods, homebuyers have also come to prefer properties with sizeable balconies and large open spaces enveloped by verdant greenery. The extensive infrastructure development across the country has played a defining role in supporting realty growth in these volatile times. The vision outlined by the government for major infrastructure projects, along with the encouraging schemes designed and executed to bolster the Indian economy have greatly aided the growth of the real estate sector. As previously untapped opportunities are explored in the real estate sector, the coming year will be defined by attractive property valuations across the country. With a flourishing investment ethos sweeping across the nation, the year 2022 heralds a promising outlook for the Indian real estate sector. As per various industry reports, the accelerating momentum in sales exhibited by the residential segment would most certainly continue. This is further validated by an expected rise of up to 5% in property valuation next year. With the aftershocks of the pandemic a fading echo now, the real estate market is sure to achieve an unprecedented growth in the new year. Source: Business World INDIA

Real estate sector in India may scale new heights in 2022

1/12/2022 4:25:00 PM

The real estate sector emerged as the most desired investment choice in 2021. Owing to the two waves of the COVID-19 pandemic and the consequent lockdowns, ‘Owning a Home’ became the buzzword in every conversation – in family, social, and professional circles. Despite being a challenging year in which lives and livelihood were at stake, economic growth tumbled and job losses were rampant across sectors, the real estate sector witnessed a strong rebound thereby making positive headway for the coming year. The resilience of the sector from the last two waves of the pandemic makes one hopeful that the sector will tide over the latest Omicron variant threatening the world now. The real estate sector, on its part, has been agile to the changes creeping in. Ably aided by technology, it revamped its approach and aligned its visions and operations with evolving trends and customer preferences. The pandemic setbacks couldn’t deter the spirit of the sector for very long and the promising recovery was witnessed through the improved market and consumer sentiments. On the back of propelling business environment, the real estate sector expanded its ambit from metropolises to explore the underlying opportunities in non-metros and emerging locations. Large-scale infrastructure boost, low tax rates, latest trends, and policy push from the government helped in driving the next wave of realty growth in the country. The pandemic-infused trends coupled with low-interest rates, affordability, and other favorable factors harnessed the positive sentiments in these markets. Besides, the state capital and metro cities, tier 2 & 3 cities emerged as strong growth drivers of the real estate sector. Tier 2 cities like Lucknow, Amritsar, New Chandigarh, Faridabad, Indore, Ahmedabad, and others witnessed the increased traction from property buyers and emerged as promising property locations. Owing to the infra developments, well-planned connectivity, livability, and world-class social infrastructure, tier 2 & 3 cities are attracting more and more potential buyers. Undoubtedly, these markets will continue to lead the sector’s growth in the coming year and beyond. The emotional sentiment of homebuyers of owning a home in their hometown also propelled these cities into prominence. Also, the intra-city movement of families into organized group housing complexes was a big driver of home sales in these cities. Bigger residential spaces and plenty of open and green spaces were the hallmarks of development in these cities. The home buying sentiments were also quite pronounced in the top eight cities. According to an industry report, the July-September quarter witnessed a 92 percent hike in home sales. The report also highlighted that the July – September period witnessed a surge of 21 percent in the new home launches. The increased numbers indicate the regained consumer and investor confidence and are encouraging enough for the market to maintain the growth momentum in the year ahead. The retail sector, which was hurt by the pandemic, soon adapted to the new trends due to evolved consumer aspiration and preference. It saw new asset classes like hi-street and multipurpose commercial properties finding favor with investors and consumers. The focus has pivoted towards hi-tech, modern, organized, and safe shopping experiences. The rising number of well-known brands and conscious consumers are catapulting the demand for upscale shopping complexes & malls, entertainment hubs, and high-streets across the country. To perfectly catch the trends and ever-evolving preferences infused by the pandemic, the Hi streets have emerged as the strongest contributor in the growth of the commercial segment. Developers are strengthening their portfolios as more and more investors and retailers are hugely investing in this commercial asset class. Today, the Indian market stands as one of the favorite markets of various global brands. They are eyeing the Indian market with aggressive business expansion plans. Besides, transforming lifestyle, elevating urbanization, and allowing 100 percent FDI in retail are the key factors leading to the success of hi-street concepts in India apart from malls and shopping centers. These spaces yield better rental returns and retailers are actively investing in the segment. The mixed-use development of urban India like modern multi-level car parking with multiple benefits is likely to facelift the infra landscapes in the cities. The segment is another emerging asset class likely to be in the center stage in the coming year. Owing to the significant contribution to the Indian economy, the real estate sector will emerge as a strong pillar in the years ahead to support India’s dream of becoming a $5 trillion economy. Huge investment through Public-Private Partnership (PPP) in infrastructure will certainly help the country double its economic potential. If the positive sentiments continue to soar in the coming period, the sector will become the next big thing in India’s economic growth. Source: Financial Express INDIA

Shorter route to airport: GMADA speeds up land acquisition in Mohali

1/11/2022 12:08:00 PM

Having expedited the work on the shorter route to the Chandigarh International Airport, via Phase 11, the Greater Mohali Area Development Authority (GMADA) is likely to complete the land acquisition by March. The around 3-km stretch will allow commuters from Chandigarh and Mohali to head to the airport via the road in front of Bawa White House, instead of taking the longer route via Airport Road. This will bring down the 18km distance from Tribune Chowk, Chandigarh, to the airport in Mohali by nearly 3.5km. At present, commuters have to head all the way to the T-junction near Indian School of Business, after passing by Bawa White House, to turn left towards Airport Chowk, where they again have to turn left towards the airport. “The 164-foot-wide road is part of the Mohali Master Plan. We will soon be issuing a notice under Section 11 of the Land Acquisition Act, inviting objections from landowners. Thereafter, we expect to complete the acquisition process by March. The acquisition rates will further determine the total cost of the project,” said a senior GMADA official, dealing with the project. The authority will be acquiring 18 acres in villages Kambala, Kambali and Rurka for the project, which is expected to take a month to complete after the tender is allotted. The around 3-km stretch will allow commuters from Chandigarh and Mohali to head to the airport via the road in front of Bawa White House, instead of taking the longer route via Airport Road. (HT) Kharar-New Chandigarh road hits hurdle Owing to payment issues, the deadline for the 8km Kharar-New Chandigarh road has been pushed from January 31 to April 15. Work on the 200-foot-wide road, starting in New Sunny Enclave and ending in Mullanpur, began in October 2020. Once set up, it will reduce the distance between Kharar and Mullanpur to 20km. Currently, commuters have to travel via Chandigarh or Kurali to reach the township. GMADA chief engineer Davinder Singh said, “There are some minor payment issues, which will be sorted soon and the road should be ready by April 15 this year.” Source: Hindustan Times INDIA

All about Starter Homes: 4 Reasons young people should consider buying starter homes this new year

1/6/2022 2:23:00 PM

When it comes to real estate investments, experts point out that young people have never been enthusiastic about homeownership as they are usually not able to afford a mortgage. Mitu Mathur, Director, GPM Architects and Planners say, “Young people are much less stable as their lives keep changing constantly. Hence, they end up renting homes close to their workplaces. While this might sound ideal, there are several advantages of investing in a starter home, especially for the young generation.” Initially, factors such as distance from the workplace and lack of ease of commute have always been reasons for not investing in homes. But today, experts say with the increase in rental prices across major metropolitan cities, starter homes have proven to be the right step towards escaping the vicious renting lifestyle by being more manageable. “Now, young people do not hesitate in investing their money in decent-sized homes, such as a typical two-bedroom unit with a study, which provides them with the right opportunities and advantages,” says Mathur. Affordability: Rapid urbanisation, nuclear family and rise in disposable income has played a pivotal role in changing the outlook of the younger generation from being a tenant to a homeowner. “With a surge of these affordable and smart homes, there is a huge market for buying starter homes in present times,” says Mathur. He further adds, “Moreover, starter homes are affordable, making it an advantageous point for investment for younger people who are otherwise burdened with debts in some way or the other.” Infrastructure growth: Today, distance from the city centre or one’s workplace is no longer a constraint. Knowing that it is an advantage, one can easily buy a home in the suburbs. Experts say, the rise of affordable housing units in the suburbs combined with a steady surge in infrastructure investment, such as better roads, and public commute, by the government, is making it easier for people to travel to work or stay connected with friends and family. Increased trust in real estate: Earlier, experts say, young people were also reluctant to invest in real estate projects, as there was a lack of trust in the real estate community. However, with the intervention of acts such as RERA in proper form, one can easily recognise good developers. Flexibility of life: With work from home becoming more common today and people spending more time at their homes with their loved ones, people have realised the value of investing in the right homes — the right size and with the right amenities. “The flexibility in the younger generation’s lifestyle has proved to be an added advantage towards investments in starter homes,” says Mathur. Demand for facilities/amenities: There is also a need and desire for newer facilities and amenities with changing lifestyles. Industry experts say companies are now enabling projects with new types of facilities at nuclear and public levels such as small study areas, small niches for sitting, home libraries, well-designed community spaces, Wi-Fi-enabled public spaces, cafes, landscape areas, co-working spaces and creche areas which have become increasingly common and desirable in today’s housing complexes. Mathur adds, “Today, young people prefer to have such facilities at the reach of their hands while living in their condos. This increasing need for a community/social area where people can work, interact, and socialise is being catered by builders and designers, attracting young people.” He further adds, “Real estate has seen the test of time as an investment where one can get a tangible return usable by people and their families. Therefore, it is wise to invest a little higher and get a starter home today and pay the EMI rather than monthly rents.” Source: Financial Express INDIA

Housing sales in India rise 71% y-o-y, reach 90% of pre-Covid levels

1/5/2022 11:33:00 AM

India’s residential real estate saw a 71 per cent rise in sales year-on-year (y-o-y) in 2021(January-December) with nearly 2.37 lakh units being sold across the seven key markets that include Delhi-NCR, Mumbai, Chennai, Bengaluru, Hyderabad, Pune and Kolkata. The sales stood at 90 per cent of pre-Covid levels (2019). Mumbai-MMR or the Mumbai Metropolitan Region saw the highest sales of 76,400 units, followed by the Delhi-NCR or the National Capital Region with 40,050 units. On a y-o-y basis, Hyderabad reported the highest absorption of 197 per cent (2021 vs 2020). According to ANAROCK data, new launches saw an 85 per cent jump y-o-y to around 2,37,000 units (up from 1,28,000 in 2020). These were nearly pre-Covid level numbers. Housing sales in top 7 cities breach pre-Covid19 levels in Q1 Of the new launches, the mid-segment – ₹40-80 lakh – had the maximum share at 39 percent followed by the affordable segment (priced under ₹40 lakh) with a 26 per cent share. The property launches in the ₹80 lakh to ₹1.5 crore price bracket had a 25 per cent share. Amongst cities, Mumbai-MMR and Pune together accounted for over 76 per cent of the new supply in 2021. On a city-wise basis, Kolkata and Hyderabad saw an increase in new supply by 290 per cent and 144 per cent, respectively Increase in property prices likely “That launches were back to pre-Covid levels is very significant, and housing sales fell short of 2019 by a mere 10 per cent are positive indicators. Of the four quarters, Q4 2021 (October-December) was by far the best, with housing sales in the top seven cities attaining a new high, since 2015. Nearly 90,860 units were sold,” said Anuj Puri, Chairman, ANAROCK Group. According to him, the input cost pressure and supply chain issues may induce a 5-8 per cent increase in property prices. End-users will remain the dominant market force and peripheral areas of the larger cities will continue to see both supply and demand traction. Housing sales may rise 30% in 2021: Anarock report Average residential property prices across the top cities increased by 3-5 per cent in 2021 compared to 2020. Bengaluru and MMR witnessed the highest price rise of 5 per cent each while Chennai and Kolkata saw a 3 per cent increase. Increased launches and overall absorption in the top seven cities in 2021, when compared to 2020, resulted in minor changes in available inventory. However, compared to 2019, there has been a 2 per cent reduction in the available inventory by the end of 2021. Data indicates that the seven major cities together have an unsold stock of around 6,38,000 units in 2021-end. Among the cities, the MMR and NCR areas saw a y-o-y decline of 10 per cent and 5 per cent, respectively. Grade-A developers are expected to increase their market share and sales will come back to the pre-pandemic levels of 2019. Source: The Hindu Business Line INDIA