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

Most Indians plan to switch from renting to owning Assets: Study

12/30/2021 11:58:00 AM

Mumbai: Three out of every four Indians now prefer asset owning over renting to secure their future in the post-pandemic world, a study by Godrej Housing Finance (GHF) revealed on Wednesday. The study, Post 'Generation-Rent' was commissioned by Godrej Housing Finance (GHF), to gain insight into the shift in consumer's preference and the factors thereof that drive the decisions for considering property purchase, asset creation, and investment avenues by Indian consumers to secure their future in a post-pandemic world. Industry experts predict a continued uptick in the coming months, easing the long period of pent-up demand across sectors. The survey validates the sentiments as most of those surveyed stated they are now more open to investing in a property of their own against the earlier notion of being labelled as the 'Generation-Rent'. ‘Generation-Rent’ is a well-documented phenomenon associated with Millennials across the world who prefer to rent over asset ownership of consumer durables and even housing. In stark contrast to earlier assumptions, around 62% of Indians highlighted that they now preferred purchasing their furniture, car, home, and wedding apparel rather than renting them as this provides them with greater stability in future. The Post ‘Generation-Rent’ study by Godrej Housing Finance revealed that almost half of Indians (49.13%) had started making headway in their house-hunting aspirations and reaching out to housing finance companies in the past year. Nearly 33% believe that buying a new house is the best investment option at present, while 16% mentioned owning a house is a top priority as work from home is the new normal. The study also found that 25.5% of the Indians consider owning a home the second-most important aspect defining 'personal security', with job security leading the chart with 40.6% voting for it. "The pandemic has brought about a clear shift in preference amongst Indian consumers. They are gravitating towards future-proofing through long-term investments. With affordability at an all-time high, there has probably never been a better time to buy a house, which is both an important element of asset allocation and a key pillar of financial security. That said, customers believe that this change requires enhanced support from their financial partner to advise and guide them through this long-term commitment," Manish Shah, MD & CEO, Godrej Housing Finance, said. The study further revealed that flexibility on policy, credibility and transparency of the brand, digital offerings, and relative turnaround time for processing are the top factors that drive the selection of financing partner. This can be attributed to consumers becoming accustomed to the on-demand gratification of their requirements aided by digital technology. The study also found that digital-first and frictionless processes are perceived as both an advantage and a starting point for consumers while choosing today's financing brands. Companies and services that offer end-to-end digital solutions gain an edge in consumer preference over more traditional financing models. Source: Live India

Commercial realty market likely to touch 32 million sq ft in 2022 if Omicron impact is mild

12/29/2021 12:56:00 PM

The first quarter of 2021 saw office occupiers adopting a cautious approach while reviewing commercial real estate requirements. With increasing fears of a resurgence in the Covid- 19 pandemic in the second half of March, certain occupiers went into wait-and-watch mode. The leasing momentum subsequently picked up after the second wave. A report by Knight Frank India said that the total number of office transactions in the eight India markets in Q3 2021 reached 83 percent of the 2019 quarterly average level. Among the larger markets, Chennai, Bengaluru, and the National Capital Region (NCR) recorded the highest recovery in the third quarter of 2021, with transactions reaching the 123 percent, 112 percent and 93 percent levels, respectively, of the quarterly average in 2019. The Information Technology sector was the largest consumer of space during the quarter and took up 34 percent of the space transacted. The heightened transaction activity from this sector is an extremely encouraging driver for office demand as it is the most prolific occupier category in the office market. Occupiers also took up nearly 23,500 co-working seats across the eight markets during the quarter, the highest this year, the report said. According to JLL’s Office Market Update Q3, 2021, the mass vaccination drive and unlocking of the economy has aided in the revival of the office market. The net absorption in Q3 2021 surpassed the net absorption recorded in Q1 2021 by 12 percent, painting a clear picture of improved market sentiments and growing confidence among occupiers, the report said. The Bengaluru, Delhi-NCR and Hyderabad markets accounted for nearly 60 percent of the net absorption during the quarter. Net absorption includes fresh leasing in completed buildings and pre-commitments in buildings that become operational during the time being reviewed, and excludes exits/terminations, churns, renewals, and pre-commitments in future supply. Mirroring 2021 Experts say that while 2022 is expected to sustain the gradual recovery, it will be far from the levels in 2019 as the requirements from occupiers will be judicious and calibrated. Co- working is expected to thrive owing to the flexibility it offers in these times of uncertainty. The experts say that while it is still too early to predict the impact of the Omicron variant on the commercial market, it is likely that 2022 will be similar to 2021. The demand for managed office spaces and players will continue to remain strong in 2022 as well. An analysis by ICICI Securities has said that pan-India net absorption of 18.5 msf (million square feet) is expected in CY21 (11.5 msf achieved in 9MCY21) and there may be a recovery in CY22E with net absorption of 26.8 msf. The key risk is a significant delay in return-to-office plans of corporates owing to any fresh Covid wave. According to Samantak Das, chief economist and head of research, JLL India, the net absorption in 2021 is likely to be more than 25 msf and this is a number comparable to the average of 2020, which saw commercial real estate bear the brunt of the first wave of the pandemic. The average for the last five years except last year was around 32 msf of net absorption. “There is a likelihood of the commercial market touching the 32 msf figure in 2022 provided the impact of the Omicron variant on the economy and the real estate sector is milder than the second wave,” he adds. Factors that will weigh in The hybrid model, work from home, work near home and work from anywhere will prevail in the medium term, especially for those sectors that can be managed by a hybrid model. The impact on REITs, too, is likely to be marginal as some sectors such as health and insurance may grow faster overall, reducing the impact on total net leasing. Since quality assets are important for REITs, there is expected to be traction in terms of green buildings. Also, many more buildings may get upgraded in the coming quarters. Upgradation is expected to take place in case of both Grade A and Grade B buildings, Das said. In terms of institutional funds flowing into real estate, 2021 may see anywhere between $3.8-4 billion. This is lower than the last couple of years during which more than $5 billion of investments were recorded annually. “We expect this to be achieved in 2022,” he adds. Sanjay Dutt, MD and CEO of Tata Realty and Infrastructure Limited is of the opinion that there will be “a surge in demand for Grade A offices, flexible/hybrid office spaces … with big companies planning to bring their workforce to offices. Additionally, leasing of large-quality office space is likely to increase as companies are increasingly hiring thus boosting the demand for commercial spaces across all cities”. Venkat Narayana, CEO At Prestige Group, said that as far as the office sector is concerned, in 2021, leasing activity gained momentum and witnessed decent growth. However, net absorption across the top seven cities is yet to reach pre-Covid-19 levels. With office demand making a significant come back post the pandemic, new office completions across the top 7 cities have also improved. “We believe that demand for office space is set to strengthen backed by the increasing rate of vaccinations, affordable rentals, businesses resuming their expansion plans and Work from Office for many employees ami Covid protocols.” Naveen Nandwani, MD, Commercial Advisory & Transactions, Savills India, is of the opinion that while it is a “little early to predict the occurrence of a third wave, it is likely that 2022 will be similar to 2021 for the real estate sector. The demand for managed office spaces and players will continue to remain strong in 2022 as well. As corporates continue optimising their real estate capital and operating costs, they will either re-negotiate in their existing spaces or relocate to comparable alternatives.” Also, most employees have opted for a three-day work week from office with an option to continue working from home. This flexibility and a possible decentralisation of the tech industry will lead to the development of smaller cities as satellites for bigger companies. Changes in the way businesses operate will drive the growth in demand for commercial spaces in many tier-2 cities, he said. Commercial leasing in 2021 After the second wave, most corporates had planned to get employees back in office, which resulted in an upsurge in renewals for office space. Office space renewals accounted for 23 percent of the leasing post March 2020, up 8 percentage points from the pre-pandemic level, a report by Colliers and Propstack said in October. Occupiers’ decisions are quicker than in 2020, with the focus on new-generation offices, said the Colliers and Propstack report, titled Evolving Office Space Trends in a Post Pandemic World. The BFSI sector’s leasing has increased, with the thrust from Bengaluru, Chennai and Mumbai. Fresh leasing post pandemic was at 67 million sq ft, which is a drop of 45 percent from the pre-pandemic level, said the report. Demand for new leases has improved significantly due to the robust hiring plans of firms in the IT-BPM, BFSI and manufacturing sectors looking to set up new global in-house centres, said Bhupindra Singh, Managing Director, Regional Tenant Representation and Office Services, North India, Colliers. Salesforce leased 7 lakh sq ft of commercial IT space in Hyderabad for about Rs 5 crore a month. The lease was registered in October 2021. KPMG Global Services Pvt Ltd leased commercial space in Mumbai for five years at a rent of Rs 37 lakh per month.The consultant has leased 24,788 sq ft of space at Nesco IT Park from October 1, 2021, to September 31, 2026. According to the documents, the rent-free period of four months is from October 1, 2021, to February 1, 2022. The lock-in period is for three years, the documents showed. The company has leased the 13th floor, Central B wing at NESCO IT Park from NESCO Ltd. The leave and licence agreement was registered on October 29, 2021. Co-working segment expected to gain traction in 2022 Co-working is expected to thrive owing to the flexibility it offers in these times of uncertainty. Amit Ramani, founder and CEO of Awfis, said that the co-working segment is expected to witness incremental demand in 2022. The company is diversifying by partnering with hotels and malls to expand its base in other parts of the country. “Along with this, we have also diversified our product line to cater to end-to-end workspace requirements of large occupiers, including workspace design, management and FM services,” he said. He agrees that the past two years have been unprecedented and riding the third wave will definitely be a challenging hurdle, across sectors. Source: Money Control INDIA

Independent floors emerging as most sought-after residential assets post COVID-19

12/28/2021 10:27:00 AM

The COVID-19 pandemic has re-imagined the way we live, work and play. Amid the extended work from home scenario, our homes have emerged as the fulcrum of our daily activities. COVID-19 has also reaffirmed the significance of a home as a safe address and stable asset class instead of living in rented properties. Purchasing a home has been traditionally considered a milestone in Indian ethos. The average age of buying a home in India has reduced drastically from approximately 50 years to 30 years in the past three decades. An Anarock consumer sentiment survey in 2019 has revealed that at least 37 percent of participants serious about buying homes fall in the age bracket of 35-45 years. The pandemic has further triggered the millennials to consider owning a home versus renting. The rising disposable incomes, extensive travel, and exposure to the global lifestyle have made customers more aware and conscious about their choices. As a result, today’s discerning homebuyers are willing to go the extra mile to ensure superior quality. The COVID-19 pandemic has further strengthened this trend; the focus, however, is now on a wholesome experience rather than only an excellent product. Developers have also responded to this trend by offering a wide gamut of residential choices – apartments, villas, independent floors, etc., uniquely tailored to buyers’ preferences and budgets. According to a 2021 Anarock survey, 85% of buyers in NCR purchased their first homes between July 2020 and March 2021. Furthermore, a SquareYards 2021 report points out that Gurugram has emerged as the most sustainable city to live in amid the pandemic due to low population density, high open area ratio, and higher number of healthcare institutions per unit area. One of the dominant trends is the renewed interest towards independent floors in metropolitan cities. The extended work from home culture has blurred geographical boundaries and necessitated staying connected with family to beat stress amid such unprecedented times. The concept of independent floors offers a plush lifestyle at a comparatively lesser cost than villas and bungalows. With more space at one’s disposal, it allows a blend of privacy and community by living in the vicinity of like-minded people with similar aspirations, tastes, and priorities. These independent floors are often inhabited by families who wish to re-establish themselves at an upscale location without compromising their privacy. A 2021 JLL report highlights that independent floors have witnessed a surge in demand in Gurugram. The recent policy of the Haryana government permitting up to four floors on a single plot to be sold individually has also provided a fillip to this trend. The salient features of such offerings are aesthetically-designed residences by eminent architects of global repute; best-in-class amenities such as gym, spa, gym, kids’ play area & leveraging of cutting-edge technology to ensure a superior experience. In addition, working from home has also led to a reconfiguration of residences to accommodate a distinct office space. Due to travel restrictions, independent floors located in gated townships are being increasingly preferred by homebuyers as these townships serve as a self-sustainable oasis with healthcare, banking, education and recreation facilities in the vicinity. As a result, location, connectivity, ticket size, design, and technology have become the key parameters influencing homebuyers’ decisions. The second wave of coronavirus in 2021 had a minor impact on the industry; nevertheless, the residential market managed to recover from the onslaught of this pandemic. According to a 2021 Knight Frank report, residential sales witnessed an uptick by 44% Y-o-Y in Q1 2021, bolstered by the revival in sentiment. It is a testament to the segment’s resilience, a trend which is expected to continue on the back of declining cases, strong economic fundamentals, and push by the government. Source: Financial Express INDIA

Real estate most preferred store of wealth; digital only 4%

12/26/2021 11:07:00 AM

At the level of the global economy, the historical link between the growth of wealth, or net worth, and the value of economic flows such as GDP no longer holds. These were the findings of a McKinsey report that borrowed a fundamental tool from the corporate world — the balance sheet — to take stock of the underlying health and resilience of the global economy. Net worth is the store of value that determines wealth and supports the generation of future income. At the consolidated global level, net worth is equivalent to the value of real assets because all financial assets are matched by corresponding liabilities so that they net out. The study done by McKinsey’s Global Institute focussed on 10 countries that together account for about 60% of global GDP, namely, Australia, Canada, China, France, Germany, Japan, Mexico, Sweden, the United Kingdom, and the United States. Researchers looked at the state of the global economy after two decades of turbulence, notably the 2008 financial crisis and its aftermath, more than a decade of ultra-low interest rates and heavy central bank intervention, punctuated by the Covid-19 pandemic. Moreover, as economies turn digital and intangible, paradoxically brick-and-mortar make up most of the global net worth at 68%, of which land contributes roughly half at 35% and dwellings and non-residential real estate contribute 33%. Meanwhile, balance sheets have expanded rapidly over the past two decades, even as economic growth has been tepid. Despite the rise of digitisation, intangibles are just 4% of net worth. Fixed assets, excluding buildings and intangibles, account for 17%; and inventories at 8%. A large proportion of savings has struggled to find investments offering sufficient economic returns and lasting value to investors, the report says. They have instead found their way into real estate, a traditional asset class, or into corporate share buybacks, driving up asset prices. Only about 20% of net worth was invested in other fixed assets. Net worth tripled between 2000 and 2020 to $510 trillion, or 6.1 times global GDP, with China accounting for a third of global growth. Households are the final owners of 95% of net worth, half in the form of real assets, mostly housing, and the rest in financial assets such as equity, deposits, and pension funds. Net worth per capita ranged from $46,000 in Mexico to $351,000 in Australia. In China and the United States, the top 10% of households owned two-thirds of wealth. This has raised questions about whether societies store their wealth productively. The value of residential real estate amounted to almost half of global net worth in 2020, while corporate and government buildings and land accounted for an additional 20%. Assets that drive much of economic growth — infrastructure, industrial structures, machinery and equipment, intangibles — as well as inventories and mineral reserves make up the rest. The Case in India “That certainly is not happening here in India,” says Rohit Sarin, co-founder of Delhi-based multi family offices firm, Client Associates. Experts say that Indian money – a lot of it new age and retail — is deflecting from real estate, attracted more to asset-light tech businesses. This is a distinct divergence from the findings of the McKinsey report focused on our western counterparts. “In India the incremental flows of real estate are decreasing,” says Sarin, “in fact people are disinvesting, or buying homes they can live in.” He says if they do sell, they are monetising and acquiring more wealth and assets for self- use and not for storing their wealth. “In continental Europe, real estate is preferred because for them protection is a bigger goal than growth. Whereas in the U.S., growth is more important than protection and equities provide more growth than any other asset, even real estate,” says Sarin. Sanchit Gogia, the chief analyst, founder and CEO of Greyhound Research, says money in the country is entering an array of assets and only select real estate sectors. “Indians are investing in so many things. Real estate is selling but in pockets. For instance Hyderabad (SEZ, commercial), or lets say Gurugram (commercial) in certain sectors. But a lot of money is going in mutual funds, retail investing (and these are new age investors), angel investors. All the IPOs for some of the larger companies like Paytm, etc. — most of their investors are retail investors.” “People are flushed with savings as they stayed at home over the lockdowns. People are investing in gold, where the prices are on an all-time high. In cars, where there is a demand supply constraint; in digital start-ups. I'm not sure it’s real estate-centric. I think it is more IPO-centric,” Gogia explains. He says the new age money is coming from the new breed of tech investors. “They are liquidating their equity. The startup guys in Bangalore have almost nothing to do with real estate. The other lot is the more traditional investors who don't understand tech, or start-ups. They will invest in businesses which are asset-backed or physical assets like real estate. They also happen to have more money and so the larger chunk will always flow into the more traditional asset-backed businesses.” Pointing to a virtuous circle he talks about an observation, “a lot of the retail money is coming to the market because of tech and tech-backed businesses.” Source: Fortune India INDIA

Luxury housing uptick expected to continue in 2022

12/24/2021 2:59:00 PM

For the uber rich, a high-end property deal is no more than a number, particularly when it comes to homes in the range of Rs 80 crore to Rs 1,000 crore. While Delhi had its own share of super luxury bungalows being lapped up by industrialists, pandemic or no pandemic, India’s commercial capital continued to epitomise this syndrome in 2021. Real estate experts say the trend is likely to continue in 2022. Several transactions were registered in the Mumbai market until March 31, the day the Maharashtra government decided not to extend the stamp duty waiver. And yet, the trend of industrialists, diamond merchants and start-up owners purchasing luxury ready-to-move-in properties has continued right until the end of the year. In Delhi, too, several bungalow transactions were finalised in Delhi’s Lutyens’ zone and other luxury markets such as West End and Vasant Vihar. More recently, two branded players — Godrej Properties and Tata Realty and Infrastructure — said they had plans to launch projects in the segment. While Tata Realty and Infrastructure has plans to develop an ultra-luxury residential apartment project near Hailey Road in Delhi and is expected to invest close to Rs 200 crore by 2023, Godrej Properties said it has entered into a joint venture with the TDI Group to construct a luxury housing project in the Connaught Place area. “This is likely to be a trend going forward as most homebuyers in these posh markets prefer branded developers who adhere to RERA guidelines and GST norms. Of late, there have been massive delays by local developers active in these markets,” points out Amit Goyal, CEO at India Sotheby’s International Realty. Developers of high-value independent floors in some South Delhi markets have been avoiding registration under the RERA Act, leading to violations. The developers claim that they have been adhering to Section 3(2) (a) of RERA, which provides for exemption from registration if the land proposed to be developed is less than 500 sq. metres in size or less than eight apartments are proposed to be developed on the property. “While there are some challenges with regard to the supply of high-end floors in the Delhi market due to delays, the outlook for the super luxury market in 2022 remains robust. Having said that, the noose should be tightened around these builders and circle rates should be rationalised and more categories created. A mere 20 percent reduction of circle rates across all categories until December 31, 2021 has not served any purpose,” he said. “Most of the buyers buying properties in India are taking advantage of the lower mortgage rates and all-time-high equity market. Some of them are reinvesting to save capital gains from sale of equity shares or a stake in a start-up or property,” said Goyal. Big deals Recently, Anil Gupta, promoter of KEI Industries, a housing wire and cable maker, bought a property spread across 2,000 square yards in Delhi’s posh Shanti Niketan area for Rs 140 crore. The sale deed was executed on October 8, 2021. Earlier this year, the owner of a leading electronics contract manufacturer bought a house in New Delhi’s Lutyens bungalow zone for Rs 170 crore, in what is believed to be the priciest residential transaction in the city after the lockdown. This month, Mumbai-based Godrej Properties (GPL) announced that it has formed a joint venture with TDI Group to develop an ultra-luxury residential project over 1.25 lakh sq. ft in Connaught Place. Tata Realty and Infrastructure is planning to invest around Rs 200 crore to develop ultra-luxury residential spaces near Hailey Road in Delhi. The Hailey Road project, which is likely to be launched in 2023, will comprise around 40- odd luxury apartments spread over 100,000 sq. ft of built-up area across a 0.9 acre plot. Speaking to Moneycontrol, Tarun Mehrotra, Business Head, North & East India, Tata Realty and Infrastructure, said: “We have not applied for DUAC approvals yet. We had applied for multi-storey approvals and those, in principle, we have received. Now, we will be preparing building plans and applying for DUAC approval. Once DUAC clears we will apply to the NDMC.” The company had bought the Hailey Road plot way back in 2012 for Rs 218 crore and had earlier announced plans to build four villas on it. Low-density bungalows, luxury ‘jodi’ flats sell big in Mumbai The year 2021 saw ready-to-move-in luxury apartments in Mumbai being lapped up by high networth individuals (HNIs). The year started with the mega bucks bungalow deal inked by D’Mart founder Radhakishan Damani and his brother Gopikishan Damani for an Rs 1,001-crore independent house in Mumbai’s posh Malabar Hill area. The registration took place on March 31, the last day of the reduced 3 percent stamp duty on housing units in Maharashtra. In another bungalow deal, a company owned by Surat-based diamond merchant Ghanshyambhai Dhanjibhai Dholakia bought a bungalow at Worli Seaface in Mumbai for Rs 185 crore. The 19,886 sq. ft property, called Panhar Bungalow, and comprising a basement, ground floor and six other floors, was bought by Hari Krishna Exports. The seller of the property was Arkay Holdings, which is owned by Essar Group. The property deal was registered on July 30. The per sq. ft cost worked out to around Rs 93,000 per sq. ft. Pandemic influence Real estate experts say that demand for independent houses in the uber-luxury segments, especially above the Rs 100 crore range, picked up in Mumbai, particularly during the two waves of the pandemic. “Due to limited availability of such bungalows in a city such as Mumbai, decent appreciation of such properties is expected over a period of three to five years,” said Ritesh Mehta, Head Residential Property Sales, JLL. Later, in one of the biggest high-rise deals in India, the promoters of Mumbai-based real estate major K Raheja Corp decided to keep possession of three floors of their ritzy project in Mumbai — sprawled over 60,000 sq. ft and worth Rs 426 crore. The project, named Artesia, an iconic standalone 45-storey tower, is located in Worli and has an expansive view of the Arabian Sea and the Bandra Worli Sea link. Mehta points out that demand for ready-to-move-in luxury units that are now few and far in between is expected to continue into 2022. The segment picking up these units includes industrialists, corporate houses, stockbrokers and even those who have made money from recent IPOs. “Besides demand for bungalows, there is enormous traction in the case of Jodi apartments or one family buying the entire floor comprising four units. Families want to be together during the pandemic. Earlier, they would pick up luxury units in different projects but now they are buying apartments on the same floor. It is therefore not surprising that in a tower of 180 units there are not more than 100 families,” he explains. Taller buildings by the sea The luxury home inventory is only going to increase in the years to come with the Coastal Zone Management Plan (CZMP) for Greater Mumbai receiving approval by the Union Environment Ministry. This will lead to taller structures coming up near the seashore as developers will receive two-and-a-half times the construction rights on such plots. Earlier, construction was restricted because of their proximity (500 m) to the coast under Coastal Regulation Zone (CRZ) II rules. It was therefore not surprising that in October, Imperial Infra, a Boman Irani-led Rustomjee Group firm, concluded a sale agreement with the Bandra Parsi Convalescent Home Trust for a 1-acre plot near Taj Land's End Hotel. According to media reports, the Trust received Rs 234 crore from the sale, with part of the proceeds going to the suburban collector as the collector's fee. Luxury residential towers can come up on this plot, say real estate experts. “With this, the entire Bandra seafront is expected to open up for construction and redevelopment. This will lead to construction of more luxury stock in the next five to six years and that will help rationalise prices going forward,” explains Mehta. IPOs and fund raising propel the luxury property market The luxury story does not end here. If one were to look at the registration data of luxury properties in 2021, there were around 25 property deals priced over Rs 50 crore and worth Rs 2,936 crore that were registered in Mumbai in 2021, data shared by showed. As many as 21 such deals worth Rs 1,235 crore were registered in Mumbai in 2020 despite restricted registration activity on account of the lockdown. And in 2019, 14 luxury deals worth Rs 886 crore were registered and that too before the pandemic and without the stamp duty waiver. “It is pertinent to note here that in 2021, there was one large-value deal worth over Rs 1,000 crore by the Damanis due to which the total luxury sales touched Rs 2,936 crore this year indicating massive growth despite there being no stamp duty waiver for almost nine months,” said Sandeep Reddy, co-founder, Wealth created through stock markets, IPOs, private fund raises, finds its way into real estate, especially in high-end apartments, explains Reddy, adding this trend will continue in 2022. A case in point is the property bought by Siddharth Shah, founder of online pharmacy chain PharmEasy, which acquired Thyrocare. He bought an apartment in Mumbai’s Khar West for Rs 40 crore in August 2021. In Delhi too, soon after India’s biggest online-education startup Byju’s signed a deal to acquire tutorial chain Aakash Educational Services for $1 billion in April, the latter’s founder JC Chaudhary, bought a 2,000 square yard property in south Delhi’s Vasant Vihar area for over Rs 100 crore. He later also purchased a 5-acre farmhouse in south Bijwasan area for around Rs 96 crore. Source: Money Control INDIA

India’s co-living market likely to double by 2024: Colliers

12/23/2021 12:23:00 PM

Driven by reopening of offices, record vaccination and reopening of colleges in a phased manner, the shared economy or popularly known as the co-living segment in the country is expected to see a recovery in 2022. Though the pandemic marred the growth story of the co-living sector in 2020, it has already witnessed a sharp recovery in 2021. The co-living segment is expected to have 4,50,000 beds mainly driven by organized players by 2024 as opposed to 2,10,000 beds by the end of 2021, according to a Colliers report, titled ‘Future of Co-living in India.’ While there are various factors that contribute to the demand for co-living spaces, factors such as increasing workforce, migration to urban centers and dearth of good bachelor living options serve as major demand drivers for the organized modern co-living model. Nearly 10 million youth join the workforce every year and this further results in an increased demand for affordable living options near the Central Business Districts (CBDs). Furthermore, with migration in India touching the 9 million mark during 2011-2016, the market has seen a consequent increase in requirement of residential stock in urban centers across the country. “With the situation improving rapidly, the sector has recovered substantially and is looking more optimistic. The primary contributor to the recovery is the growing rate of vaccination. The unemployment rate is down to 7% in November 2021, a gradual dip from 11.84% in May 2021. Also, amidst the pandemic, hiring by IT companies has gathered pace followed by robust performance of the sector which will only add on to the demand for the Co-Living in coming quarters,” said Ramesh Nair, CEO, India, and Managing Director, Market Development, Asia, Colliers. The concept of ‘Shared Economy’ got severely tested during the peak of the pandemic. Factors such as uncertain economic conditions resulting in loss of jobs, work from home and the shift of migrant population to their respective hometowns in the wake of the Covid-19 outbreak brought the evolving Co-Living sector to an immediate halt. Between December 2020 and March 2021, the occupancy in most Co-living facilities crossed the 45 – 50% mark as the market improved and 60-70% in Q4 of 2021. However, the second wave proved to be a dampener from Q2 onwards as occupancy dipped sharply. The Co-living segment is further expected to witness recovery in occupancy in 2022 with factors such as increasing workforce, migration to urban centers for jobs, the unorganized shared living sector and the growing student population increasingly looking for the organized modern co-living model. “Co-Living has a strong long-term potential in the metro cities. However, the current market scenario has presented an opportunity to consolidate and reconfigure the market. While many players have exited the business as they could not sustain the financial stress of the previous year, others have capitalized on the opportunity to strengthen their position by strategic acquisitions and expansion in prime locations in metro cities,” said Subhankar Mitra, Managing Director, Advisory Services, Colliers India. The shift in perception amongst millennials to ‘sharing’ instead of ‘owning’ has made the co-living concept popular. For all groups – corporate occupiers, start-ups, entrepreneurs, and millennials – renting offers flexibility and savings. Co-working offers cost savings of 20-25 per cent compared to traditional office space leasing. Many investors already actively pursue options in the market to create flexible co-living facilities. The lucrativeness of a higher yield compared to a traditionally rented house has resulted in an influx of new players every year where this trend is expected to continue for the next few years. Co-living offers attractive returns; 2-4 times higher than the traditional residential yield of 2-3 per cent. However, Co-living in India is still in its nascent stage and the operators are constantly updating their metrics. The Covid-19 pandemic has further pushed the operators back to the drawing boards to reinvent their strategy to provide an attractive and safe housing solution. Source: Financial Express INDIA

Govt may change SEZ rules in Budget to ease compliance burden

12/22/2021 1:44:00 PM

The government plans to amend the SEZ Act in the upcoming Budget to reduce the compliance burden and allow companies operating within the conclaves to accept payments in Indian rupees, according to two people familiar with the development. The government could also allow entities that don't wish to avail benefits to be treated on a par with others located outside the SEZ, said two people aware of the development. Several stakeholders have raised concerns that as tax holidays come to an end, many companies will move out of SEZs due to the restrictions and these places could end up as ghost towns. "Many companies that have leased properties inside SEZs are looking to move out as there is a huge compliance burden, including that around net foreign exchange earning obligation. Although the infrastructure within SEZs is very good, for most companies, it doesn't make economic sense to continue operations," a person aware of the development said. The government is looking to make these changes in the upcoming Budget that will lead to companies not having to show import revenues or submit detailed operational information. As a corollary, the companies could continue to operate from SEZs like any other place without having to comply with all the elaborate compliance requirements. The commerce ministry is already working on such a proposal, another person aware of the development said. "If any SEZ wishes to be de-recognised, even that could be allowed. The government could also bring in a change whereby SEZs could offer additional commercial and residential holdings within their premises," the person said. Many SEZs had sought an extension of the direct tax holiday, especially on account of the Covid-19 pandemic. The primary attraction of setting up entities within an SEZ was the favourable taxation structure. Many SEZs had even approached the government to discuss the tax sops this year, but the government didn't relent. "The government representatives told us clearly that no tax sops or tax exemptions are possible this year," a person part of an industry association that met the government said. An email sent to the ministry of commerce and industry did not elicit any response till press time on Monday. Source: The Economic Times INDIA

Residential real estate likely to fare better in 2022: ANAROCK

12/21/2021 9:55:00 AM

2020 had been a tough year for the Indian residential market as the first wave of the pandemic had brought everything to a standstill. Nevertheless, all industries — including the real estate sector – emerged from the nationwide lockdown in 2020 with a valuable sense of resilience, damage-limiting skills and a new way of envisioning the business environment – especially in terms of technology adoption. As such, confidence at the beginning of 2021 was high and real estate developers as well as brokerages were well-prepared to face any possible future disruptions. According to an ANAROCK study, in 2020, 1.28 lakh units of new residential supply were added across the top 7 cities of India, while sales were clocked at 1.38 lakh units. From the previous peak of 2014, supply was down by 77% and sales were down by 60%. This large-scale decline indicated that the Indian residential market had bottomed out in 2020 and was likely to enter a long-term upcycle from 2021 onwards. “Reviewing the overall performance of the Indian residential real estate market in 2021 shows a definite upswing. Between Jan and Sep 2021, 1.63 lakh units of new residential supply were added across the top 7 Indian cities – 27% higher than 2020 full year supply – and 1.45 lakh units were sold – 5% higher than in the whole of 2020. While this depicts a cumulative trend, the Indian residential real estate sector’s comeback after the 2nd wave in Q2 2021 was phenomenal, sharp V-shaped one,” says Anuj Puri, Chairman, ANAROCK Group. In 2021, a bull run was witnessed not only in real estate stocks but also in the broader market. Ample liquidity targeted the stock markets on the back of satisfactory ROI expectations. The arrival of the Omicron strain towards the end of 2021 has slowed this movement to some extent; however, mid-to-long term prospects remain highly positive as COVID-19 has been reined in to a large extent in India, and most businesses are back on track. “Overall, real estate stocks boomed in 2021 as developers garnered good sales and were actively launching new projects. After the 1st wave, the real estate sector’s recovery was pronounced and improved even further after the 2nd wave as the sector imbibed new learnings to overcome challenges,” says Puri. In a visible consolidation mode, the sector now has large players commanding a significant share in overall housing sales. Housing demand remains high as Indians continue to spend considerable time at home due to WFH and remote working. Also, the macro conditions support home purchases with the interest rates on home loans are at a decadal low (starting at 6.5%) and the overall employment scenario looks secure enough to support long-term financial decisions. The positivity around physical indicators such as new launches and sales is reflected in the stock markets. Outlook for 2022 The Indian residential real estate market seems to have embarked on a long-term upcycle, and 2022 is very likely to fare better than 2021. With COVID-19 now having become a more accepted part of life and Indians getting used to the new normal, businesses are looking to expand. Compared to 2021, the residential real estate market in 2022 will see lower volatility. Source: Financial Express INDIA

Real estate outlook 2022: Investment volumes into realty to match those of 2021

12/18/2021 12:31:00 PM

Investors are positive on property market fundamentals, supporting high real estate allocations across the Asia Pacific, Americas, Europe, the Middle East, and Africa (EMEA). This demonstrates the continued allure of the asset class, enabling 2022 investment volumes to at least match those of 2021. There has been a rapid acceleration in the number of transactions closing in third quarter, which is expected to continue well into 2022, a new report by Colliers has said. Investments in the Indian real estate sector have remained resilient despite the headwinds triggered by the pandemic, adversely impacting the economy and business climate. For the nine months ended September 2021, investments were recorded to the tune of $3.5 billion, almost 75% of the quantum seen in 2020, it said. Residential and industrial and warehousing sectors have emerged as major beneficiaries this year, garnering a combined 36% of the investments. Core and core-plus office spaces are the top global strategy picks, with 60% of investors stating these assets as their investment preference, while industrial and logistics (I&L) assets will be the most coveted, it said. Their appeal not only stems from the realisation that office demand is here to stay, particularly in cities supported by strong transport infrastructure and high amenity values, but also the ease of large-scale capital deployment that office assets represent. The rising cost of construction, viewed by four in five (81%) investors as a pain point, could limit new builds, renovations, and retrofit projects, amplifying the demand for existing quality office assets, it noted. “While the office will continue to remain a dominant sector, investments in residential and industrial and warehousing are likely to strengthen in 2022 aided by strong business fundamentals. Income visibility and stability, attractive valuations and identifying the dark horses will underline the investment ethos in 2022”, said Ramesh Nair, CEO, India, and Managing Director, Market Development, Asia, Colliers. Across Asia Pacific (APAC), more investors are prepared to put into action their ambitious plans that have been delayed by COVID-19. Cross-border capital flows are also likely to return, as travel and business activity progressively returns. “The pandemic has accelerated a number of structural trends and will have lasting changes on the nature of real estate business in India. This presents several opportunities for investors looking to future-proof their portfolios or recalibrate their strategy towards growth sectors. This is already evident in the rapid investment being allocated towards the residential, increasing development of data centres, Industrial, Office as well as the evolution of the life science sector,” said Piyush Gupta, Managing Director, Capital Markets and Investment Services, Colliers India. Overall, industrial and logistic assets will be the most sought-after real estate assets in the region, with more than 20% of investors anticipating capital value gains of 10%-20% in value-add I&L assets in 2022, supported by tailwinds and large-scale economic transformation. Significant interest continues to surround core-plus offices, which remain a popular asset class for regional investors in Tier 1 cities like Singapore, Sydney, and Tokyo. 63% of the respondents indicated that they plan to invest in these assets, versus 54% last year. Multifamily/built-to-rent (BTR) properties are also an increasingly sought-after asset class, with investors targeting both core and development projects. In Japan, this is a sector that is well established and has long attracted foreign core capital, whereas in Australia, it is an emerging asset class with development opportunities. Investors see significant potential for the appreciation and repurposing of retail assets. Around a third of the investors mulling retail allocations are targeting opportunistic (including change of use) investments. In addition, hotels are also an opportunistic target, with 38% of investors looking at this sector. Specialised assets, particularly data centres, life sciences, and healthcare, are expected to help boost investment volumes in 2022, with student housing also poised for a comeback as Australia, the region’s main market, opens up to international visitors, the report said. The report also shows ESG (environmental, social, governance) considerations remain prominent, with nearly three in four investors surveyed globally integrating environmental factors into their strategies. This desire to invest with intent is both a means of future-proofing their assets and responding to the stakeholder and societal pressures requiring them to respond to the climate crisis. Source: Money Control INDIA

India's real estate sector expected to see healthy demand in 2022: Report

12/16/2021 10:49:00 AM

Knight Frank India, an international property consultant, on Thursday said in a report that 2022 may prove to be a more stable year for the pandemic-hit sector both for commercial as well as the residential sector. In its ‘2022 Outlook Report', Knight Frank India said residential segment could see upto 5% rise in values in 2022. "With physical offices here to stay, portfolio optimization and hybrid working are expected to be the dominant themes going forward driven by incremental demand from IT/ITes firms and the rebond of flexible office operators. For the residential sector further demand revival is expected with strong end-user interest aided by government impetus and incentives by developers ensuring buoyancy. The warehousing segment that has been risk averse during the pandemic will maintain the growth run rate driven by demand from the ecommerce and 3PL players," the report said. “The real estate sector recorded a smart recovery despite the pandemic exigencies in 2021 with segments like residential outperforming others. The disruption caused by the pandemic is slowing settling and the real estate market is expected to gain back its rhythm in the next two to three quarters, albeit, the threats of the new variant is adequately contained with minimum disruption in the early part of the new year. Should we be able to continue at this pace, the real estate sector will see adequate recovery to match or indeed cross the pre- pandemic levels.” Shishir Baijal, Chairman and Managing Director at Knight Frank India said. The key findings of this report highlights 2022 trends and dynamics across various real estate segments in India. Residential segment to witness around 5% capital value growth in 2022. Many of the supply and demand-side factors, assessed over the last decade, have started putting upward pressure on house prices. Residential sales momentum is expected to continue in 2022 as prospective homebuyers’ preferences for bigger homes, better amenities and attractive pricing will keep them interested to seal the deals. The Top 5 IT companies’ incremental demand for office space based on robust hiring in the last eighteen months is estimated at 11.67 mn sq ft, spread out over the next one to two years. Co-working sector will benefit as pandemic reinforces the need for agility like never before. Agility, a keyword associated with the co-working sector, will drive the demand rebound for flexible office spaces despite the return of normalcy. The recovery in the office sector and flight-to-quality trend is expected to keep rents stable to increasing in 2022. Transactions for warehousing segment, riding on the boom of the e-commerce sector, is projected to grow at a CAGR of 20% from 31.7 mn sq ft in FY 2021 to 45.9 mn sq ft in FY 2023. E-commerce share in total transactions projected to increase to 36% from 31% during this period Indian Data Centre market currently houses an estimated 445 MW of critical IT capacity, and with a significant approx. 290 MW addition in 2022, the total count will scale up to 735 MW by end of next year. Mumbai houses approximately 193 MW of India’s current 445 MW data centre capacity. Mumbai’s total capacity is estimated at 1,006 MW with 258 MW under construction and 555 MW in various stages of planning Resilience of Indian REITs during the pandemic and growing popularity with retail investors will help pave the way for other commercial real estate REITs. Source: Business Standard INDIA

Greater Noida authority to develop a Connaught Place-like commercial market

12/15/2021 12:00:00 PM

The Greater Noida Authority has begun preparations to develop a commercial market complex on the lines of Delhi’s Connaught Place near Sector Chi-Phi. Yet to be named, the market complex is expected to come up in an area of about 4-5 acres and will have 2-4 floors. From the many designs that were invited, the final approval was given to a private consultant. While the area has many residential and commercial units in its vicinity, it is also barely a kilometre from the Yamuna Expressway, and is expected to gain momentum with the commencement of the Jewar airport operations. Work on it is expected to formally start next year post-UP assembly election, officials have said. Narendra Bhooshan, the Authority CEO, told TOI, “There were plans to have a big commercial hub in Greater Noida as part of its development plan. Under that, we plan to build a circular commercial hub on the lines of Delhi’s Connaught Place near Sector Chi-Phi which has big wide roads on four sides and an open space for a big roundabout.” According to Bhooshan, there were many designs that were invited for the commercial hub. “But the final approval was given to a private consultant. We held a competition among select leading architects and selected one of their designs,” he said. “The plan to build the commercial circle was taken up since the demand for it increased in the area following the announcement of the Jewar airport.” Officials said the commercial circle may be developed in quartets, where more than one firm will be hired. “The proposed area where the commercial circle is to come up has wide roads on four sides. So, we have to decide whether we should go with everything in one go or take it up one by one and develop it in four parts like quartets. For this, we may float four different tenders to maximise the desired result,” he said. While the Authority will work on the costing and tender details before the UP assembly polls, officials plan to float the first tender by April 1, 2022, and “construction work will begin after the election results”. Source:ET Realty INDIA

RBI keeps repo rate unchanged at 4%

12/8/2021 2:56:00 PM

The Reserve Bank of India (RBI) on Wednesday kept borrowing costs at a record-low for the ninth consecutive time as it decided to continue supporting economic growth amid uncertainty over the impact of the Omicron strain of the coronavirus on the economy. The six-member Monetary Policy Committee (MPC), which has paused rate changes since August last year, unanimously decided to keep the benchmark repurchase rate at 4 per cent and voted 5-1 to retain its accommodative policy stance as long as is necessary, reflecting a continued bias to support economic growth given that inflation was not a big worry. The reverse repo rate -- the level at which it absorbs excess cash from lenders-- was kept unchanged at 3.35 per cent. It kept the GDP growth projections unchanged at 9.5 per cent for the current fiscal and retained the inflation forecast of 5.3 per cent for the full year. While the Indian economy has literally hauled itself out of one of the deepest contractions in April-June, it is not yet strong enough to be self-sustaining and durable. "Given the slack in the economy and the ongoing catching-up of activity, especially of private consumption, which is still below its pre-pandemic levels, continued policy support is warranted for a durable and broad-based recovery," Governor Shaktikanta Das said. "Our motto is to ensure soft landing that is -timed." There, however, has been no guidance on the rate trajectory. RBI had slashed the repo rate by a total of 115 basis points (bps) since March 2020 to soften the blow from the coronavirus pandemic and tough containment measures. This is on top of rate cuts to the tune of 135 bps since the beginning of 2019. The central bank struck to its principle of 'gradualism' since the downside risks to a durable growth trajectory have clearly increased due to the spread of of the new COVID variant Omicron. On inflation, the central bank took comfort from the excise tax cuts in petrol and diesel and the steps taken by the government to moderate prices in food categories such as edible oil and pulses. Das said the central bank will continue rebalancing liquidity conditions and will use VRRR (Variable Rate Reverse Repo) auction as the primary tool for liquidity management, shifting away from the fixed reserve repo rate. The RBI will raise the amount of cash it absorbs through the 14-day VRRR to Rs 6.5 lakh crore on December 17 and subsequently to Rs 7.5 lakh crore on December 31. At the same time, the auctions will have a higher proportion of 28 days vis-a-vis the primary tenor of 14 days. Excess cash in the banking system hovered at around Rs 9.2 lakh crore, close to a record high. The surplus liquidity is seen as a risk to consumer prices, already under pressure from a rise in vegetables and fuel costs. More steps are being taken to normalise the excess liquidity by reducing the additional quantum that was eligible under Marginal Standing Facility (MSF). Further, banks have been permitted to prepay any of their Targeted Long Term Repo Operations (TLTROs) withdrawals to optimise their liquidity position. "The MPC regarded the accentuation of headwinds emanating from global developments as the main risk to the domestic outlook, which is now somewhat clouded by the omicron variant of the COVID-19," he said. Source: ET Realty INDIA

Chandigarh administration okays adoption of model tenancy act

12/7/2021 10:52:00 AM

The UT administration has okayed the adoption of Model Tenancy Act approved by the Union cabinet in June this year. UT adviser Dharam Pal said that they have considered all objections and suggestions, and the file will soon be sent to UT administrator Banwarilal Purohit for final approval. The UT will then issue a final notification, he said. The administration has started the process to implement Model Tenancy Act in October 2020. The administration had sought objections and suggestions from the public on the draft of the Act. With the implementation of the Act, a rent authority will be established for regulating renting out of premises and to balance interests of owner and tenant by establishing adjudicating mechanism for speedy dispute redressal. A rent court and a tribunal will be set up to hear appeals and related matters. The rent authority will have exclusive jurisdiction over tenancy issues. All rent agreements will have to be submitted to it. The landowner and the tenant will have to separately file particulars within a month of signing the agreement. At present, these can be registered at the subregistrar’s office. In 2019, the administration had sent the Centre’s Model Tenancy Act, 2019, and the draft of the Chandigarh Tenancy Act, 2019, to the ministry of home affairs to take the final call on the tenancy Act to be to be implemented in the city. In June 2019, the UT had prepared a draft of the Tenancy Act based on the Centre’s Model Tenancy Act, 2015. But the Centre proposed a new Model Tenancy Act in August 2019. Source: ET Realty INDIA

Noida: Homebuyers rejoice as registration of flats now to be done on carpet area

12/4/2021 11:05:00 AM

The Noida authority has issued an order mandating that the registry of flats will now be on the ‘carpet’ area, much to the relief of thousands of homebuyers who have long been demanding that the registry of a flat should not be determined by the ‘super area’--a factor that gives the scope to a developer to escalate the cost of an apartment. The new order has paved the way for apartment owners to pay less to a developer and also a lesser registration fee for a flat to the stamp department. Since 2016, when the Real Estate Regulatory Authority (Rera) Act came into being, homebuyers intensified the demand for registry or sale of a flat on carpet area. Even before the Rera Act, homebuyers, citing the provisions of UP Apartment Act, used to demand that a flat’s rate be determined by the carpet area but the developers kept objecting to the demand. According to the provisions of the UP Rera that came into effect on May 1, 2016, the carpet area means the net usable floor area, excluding the area covered by external walls, service shafts, balconies, verandahs and open terraces. Buyers said the ‘super area’ refers to the common area that developers add to the actual size of the flat, thereby increasing the size of the unit to make more profit. “According to RERA, the developer should sell a unit on the basis of carpet area and not on the super area. The developer should make an agreement with a buyer based on the carpet area; if he does the registry of a flat on the super area, it is against the law. Be it agreement, sale or registry, if it is not determined by the carpet area, then it is illegal. Since Noida authority is a party in the sub-lease deed process, its circular (on registration of flats) will benefit customers. It was much needed to put an end to all confusions,” said Rajive Kumar, chairman of UPRera. “After a long battle, the Noida authority has finally issued an official order, sending a copy of the same to UP RERA, the stamp department and other agencies in this regard. We are delighted with this order as it will benefit scores of homebuyers, who are looking to buy an apartment or get a flat’s registry done. The move will bring down the overall cost for each flat by upto 28% ,” said Chakresh Jain, a homebuyer, who has been fighting for this demand for the last six years. Homebuyers had first raised this issue of developers charging more in the name of ‘super area’ of a flat before officials of the UP stamp and registration department in Noida on December 20, 2010. Subsequently, the administration had written to the Noida authority asking it to stop the sale of flats on ‘super area’ as it affects buyers. “From the model guidelines issued in 2018 by the UP Rera, it is clear that the sale/purchase or sub-lease deed should be executed on carpet area. In future, sale/purchase or sub-lease deed should be executed only on carpet area basis,” said Neha Sharma, additional CEO of the Noida authority. There are at least one lakh apartments, whose registry has to be executed in Gautam Budh Nagar. Developers also welcomed the move of the Noida authority. “The move will benefit homebuyers, who otherwise had to pay more in stamp duty at the time of registry. If the carpet area of a flat reduces, it will automatically bring down the cost of the flat, which in turn will benefit homebuyers,” said Subodh Goyal, secretary of Confederation of Real Estate Developers Association of India (CREDAI), a builders group. S S Pal, assistant inspector general of UP stamp and registration department in Noida, said, “We are ready to implement this order if the Noida authority has agreed on doing the registration of a flat based on the carpet area. Our duty is to execute registry on the basis of details provided by the Noida authority, buyer and the developer.” Source: Hindustan Times INDIA

Real estate sector revival to continue into 2022

12/2/2021 10:42:00 AM

The real estate sector has made an impressive revival despite disruptions and market upheavals during the pandemic. Analysts have a positive outlook that this revival will continue into the New Year. The sector has transformed into a buyer’s market, and today, with an evolved sense of preference, buyers are focusing on customised offerings to make ideal investment decisions. As per a recent report, nearly 80 percent of prospective home buyers prefer to purchase properties that are ready to move in or nearing completion. While work from the office has re- emerged, ‘work from home’ may not entirely go away as it is now an integral part of long-term work strategy. Moreover, a blend of positive factors like low home loan interest rates, customer-centric regulation, affordable property prices, developer offerings on new products and payment flexibility has prompted even fence-sitters to make the purchase decision, sooner than later. Thus, buoyed by strong economic fundamentals and a conducive business climate, 2022 is expected to unlock a plethora of opportunities for Indian real estate. We can see significant changes in consumer behaviour and market sentiments in real estate as the pandemic continues to ebb. Buyers are first researching projects digitally and are gaining more knowledge about them before physically visiting the projects and making decisions. Homeownership has become a priority, with businesses focusing on remote work – and homebuyers’ need for bigger spaces. Hence, customer-centricity is defining the Indian real estate sector and it is important to recognise this shift in their outlook towards property purchase. The positive performance of the residential sector followed by good execution in recent times are important signs that momentum in home buying will continue to persist in the near future. With pent-up demand, an upswing in the job market, the mass rollout of vaccines and the lowering of infections, the real estate industry is bouncing back. These factors will play a key role in boosting demand and pave the roadmap for a vibrant housing ecosystem. The festive season too has added to the already positive outlook that home buyers have been exuding in recent times. In fact, the industry has shown positive recovery with great momentum, taking the sales to pre-COVID levels within months after cities have returned to normalcy. A recent report has announced new residential unit launches increased by 90 percent in Q3 2021, a significant recovery compared to launches last year.In this renewed demand, ready-to-move-in spaces are the top priority among discerning customers who do not want to wait endlessly for their properties given the background of the pandemic. These homes are a safe investment option in today’s world where preferences are changing rapidly. While buying a home, customers are also now increasingly looking for reputed developers with an excellent track record, execution capabilities and quality projects. Developers are also increasingly relying on emerging digital technologies to deliver smarter experiences. The real estate segment has remained the safest investment option and will continue to attract investors keeping market sentiment buoyant. The increase in demand is organic as it is driven by the realisation among buyers that owning a home in the midst of the pandemic is invaluable. The trend of demand remaining buoyant can be attributed to several other factors, including the overall improvement in the job market, resumed economic activity, pent-up demand and an increasing desire to own physical assets during times of unprecedented uncertainty. The realty sector in India is one of the pillars of the economy and is the second-most elevated business generator in the country after agriculture as the sector is interlinked to 250+ allied industries. The sector represents almost 6-7 percent of the economy and is set to increase to around 13 percent by 2025. All in all, the future will be a harbinger of positive growth, innovation and investment for the residential real estate sector. Source: CNBCtv 18 INDIA

Real estate companies urge government to raise the criteria of affordable houses to ₹65 lakh

12/1/2021 11:47:00 AM

Real estate companies have urged the government to increase the criteria for affordable houses to ₹65 lakh from ₹45 lakh with the overall cost of cement and other construction materials going up substantially. While the recent Covid resurgence has posed challenges, the rising vaccinations, low home loan rates and developer incentives have been driving steady growth in housing demand, especially for affordable and mid-segment projects. According to the recent JLL India report, new launches have increased by 38 per cent till September to 93,873 units compared to last year. Ashok Chhajer, Chairman and Managing Director, Arihant Superstructures said the cost of construction has increased by 50 per cent in recent times and criteria for affordable housing should be revised to ₹65 lakh. The demand for affordable housing will get further boost if the concession of one per cent GST is extended for flats sold at ₹65 lakh and above from ₹45 lakh, he added. Growth in demand The demand for mid-size and affordable segment has gone up substantially across the country but was more pronounced in the southern markets as IT companies offered special bonus to attract fresh talent. Subhankar Mitra, Managing Director, Colliers India, an advisory services firm said Bangalore is the largest housing market in south India and key factors driving growth in City are their proximity to economic hubs including industrial areas, good infrastructure and upcoming metro lines. In recent times the supply in Hyderabad is skewed to properties of above ₹40 lakh while the demand is for cheaper homes while the south and south-west corridors of the Chennai region have witnessed much of the growth for affordable projects, he added. With remote working, the requirement for affordable housing in Tier 1, 2 and 3 cities, priced in the range of ₹40-50 lakh are expected to rise, resulting in a location-specific demand surge. Anuj Puri, Chairman, ANAROCK Group said though it is too early to gauge the impact of Omicron virus on the real estate sector, the second wave injected fresh demand into the housing sector as it emerged an important asset during pandemic. Given the present inflationary trends of input costs such as cement and steel, buyers are aware that developers will increase prices and genuine buyers are trying to seal deals before the price hike. Interestingly, the primary demand for affordable housing this year is emerging from the age group between 28 and 45 years. Millennials buying homes has gone up from 49 per cent to 63 per cent during the pandemic tenure. In the affordable segment, Chennai and Mumbai witnessed maximum launches and in the mid-range, Bengaluru, Hyderabad, Mumbai and Pune contributed over 81 per cent of total projects. Mid segment continued to account for the maximum share of 54 per cent in new launches, followed by the affordable and high-end segments with shares of 26 per cent and 19 per cent, according to JLL Research report. Source: Hindu Business Line INDIA

New Delhi slips to 38th rank in Knight Frank’s Prime Global Cities Index Q3 2021

11/30/2021 12:36:00 PM

The Prime Global Cities Index is a valuation-based index tracking the movement in prime residential prices in local currency across more than 45 cities worldwide using Knight Frank’s global research network. New Delhi is ranked 38, Mumbai 39 and Bengaluru 42 in Knight Frank’s Prime Global Cities Index Q3 2021. Bengaluru moved down one spot up against the previous quarter in the index as the quarter registered a 1.1 percent YOY price fall in the prime markets. Mumbai moved up to the 39th position in Q3 2021, against its 40th rank in the previous quarter, as prices fell marginally by 0.1 percent YOY. Mumbai, Delhi and Bengaluru’s prime residential market is witnessing price stability on a QoQ basis. Delhi is ranked 38th with a stable price level for the period Q3 2020 – Q3 2021. Mumbai ranked 39th with a marginal -0.1 percent annual change for the period Q3 2020 – Q3 2021. Prime residential properties in the city registered a price appreciation of 0.2% in Q3 2021 compared to the previous quarter, the report said. Bengaluru ranked 42 with a -1.1 percent annual price change for Q3 2020 – Q3 2021. The city witnessed no price change in Q3 2021 compared to the previous quarter. Prime residential property is defined as the most desirable and most expensive property in a given location, generally defined as the top 5 percent of each market by value. The Prime Global Cities Index is a valuation-based index tracking the movement in prime residential prices in local currency across more than 45 cities worldwide using Knight Frank’s global research network. According to Knight Frank’s research analysis, 39 cities witnessed a rise in prime residential prices between Q2 and Q3 – 2021. Fifteen cities registered double-digit priced growth. The Prime Global Cities Index, an unweighted price index of prime residential prices across 45+ cities, increased by 9.5 percent in the year to Q3 2021 compared to 8.2 percent in the year to Q2 2021. “As India’s economy recuperates from the impact of the pandemic and lockdown, the up-market segment of luxury homes is witnessing a surge in demand. The drivers for this demand are bottoming out of the prices across Indian cities along with various fiscal measures, which has made the overall environment very conducive for the residential sector. As developers and other industry stakeholders hold a positive sentiment, the segment is expected to record improved levels of activity,” said Shishir Baijal, Chairman and Managing Director at Knight Frank India. Miami was the best performing city in the index during the period, where luxury home prices appreciated 26.4 percent. According to the report, 84 percent of the global cities registered positive yearly price growth; while Miami leads the index this quarter for the first time since 2007 recording 26.4 percent rise in the year to Q3 2021, Jakarta was the weakest performing market with a decline of - 4.2 percent. Source: Money Control INDIA

Low mortgage rates, stagnant prices boost housing demand in Tier-II cities too

11/26/2021 11:29:00 AM

The recovery in housing demand is being driven by a growing demand for homeownership, which is being fueled by historically-low mortgage rates, stamp duty waivers in several states, and stagnant prices. According to the JLL – Residential Market Update: Q3 2021, “in Q3 2021, sales witnessed an upward trajectory, increasing by 65% on a sequential basis, with 32,358 apartment units sold during the quarter against 19,635 units in Q2 2021.” Developers eagerly launched new home projects with an eye on the festive season as economic growth returned in tandem with the gradual return to normalcy. According to data collated by, 65,211 units were launched in Q3 2021 — a jump of 199% compared to the Q2 2021 period when 21,839 units were launched. Sales in the real estate sector are also increasing due to people’s revived interest in real estate assets. As per, 55,907 units were sold in Q3 2021 compared to 15,968 in Q2 2021. Tier-II cities had a similar story. According to realtors operating in the TriCity (near Chandigarh) market, the region also had a healthy movement. “In the post-pandemic scenario, people are preferring developers with a good track record. The demand for luxury homes is on the rise in this market, and also the definition of affordable housing has changed as people want home with full amenities like security, safety, recreation, and shelter all at once. Apart from this, the demand for commercial projects has also increased because people have realized the financial stability of such assets,” says Prateek Mittal, Executive Director, Sushma Group & IIT Alumnus. The rise of surrounding areas such as Mohali and Zirakpur in Punjab was prompted by high real estate prices in the main city. “Infrastructural development is also adding to the sustainability of the Tricity market as people prefer buying properties near areas that can provide good connectivity; that is why people are thronging to real estate projects in Mohali and Zirakpur; this is attracting investments from NRIs,” adds LC Mittal, Director, Motia Group. Developers are offering various discounts such as straight-up price reductions, delayed payment arrangements, and other incentives to attract fence-sitters and prospective homeowners as the holiday season is fast approaching. The realtors here maintain that Chandigarh has long been on the realty map for NRIs; the opening of properties in neighbouring regions such as PR7 Airport Road has provided them with the opportunity to expect exceptional returns on their investment. It also boasts a high level of living, making it a popular location for buying and investing. Similarly, Mohali offers a diverse range of real estate prospects supported by robust infrastructure development. The recently constructed 200-foot Mega Airport Road has increased the value of properties in Mohali. Then there’s Zirakpur, which is seeing continuous real estate growth in Chandigarh. People are increasingly choosing larger, more secure homes, and this consumer trend has paid off handsomely for Zirakpur. Source: Financial Express INDIA

IT companies among largest consumers of realty space during Sept quarter

11/25/2021 11:31:00 AM

Notwithstanding the work from home trend emerging for most tech companies during the Covid-19 pandemic, information technology (IT) companies continue to be among the largest consumers of real estate space during the September 2021 quarter, according to a new report. The report, titled Real Estate Industry: Outlook and Challenges released by Infomerics Valuation and Rating Pvt Ltd, said IT remains the largest consumer of space during the quarter, occupying 34 per cent of the space transacted. Overall, the commercial segment, which is relatively a more formal segment (with big players involved), has seen an influx of investment. Among dominant markets, Bengaluru, Chennai, and the National Capital Region (NCR) recorded largest recovery in the September 2021 quarter. The report mentions that post-pandemic, the real estate industry has been witnessing drastic change over the past two years. While the Covid-induced ‘work from home’ model reduced the demand for commercial spaces, it increased the demand for residential spaces. However, commercial investments augur well, given the scope of business activity in India and this can be clearly witnessed with the on-going developments in the Indian business space; more companies are being formed as they touch greater heights of expansion with need for working spaces. Moreover, about 88 crore people are expected to live in urban areas in India by 2051 as against the current 46 crore people. Therefore, this trend-setting pattern is sure to be salubrious for the real estate industry along with government interventions and new schemes rolling in, in urban house spacing. Growth drivers Factors driving the growth of the real estate industry in India include low interest rates, favourable government policies, revised circle rates in Delhi, more ready-to-live projects, etc. The report also highlights the fact that more than 58 per cent of people consider property as a mode of safe investment, with a notion that the prospects for real estate are likely to get an upswing once the pandemic recedes. Source: Hindu Business line INDIA