Author Archives: skgupta

India loses $210 billion in Coal Scandal.

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The Indian Parliament erupted in hoots and jeers Thursday after a draft report by government auditors estimated that the national treasury lost $210 billion by selling coal fields to private excavation companies in sweetheart deals.

According to the report, leaked to the Times of India newspaper, the primary beneficiaries were about 100 private and state companies that were handed contracts for 155 coal fields between 2004 and 2009 without going through a competitive bidding process. The report said that $210 billion — five times India’s annual defence budget — was a conservative estimate given that it relied on prices for low-grade rather than medium-grade coal.

The report represents the latest in a string of corruption scandals to hit the ruling Congress Party — others have involved the telecommunications, real estate and sports industries — that has left India’s leadership weak and bereft of policy initiatives. Opposition leaders called the latest revelation the “mother of all scams,” accusing the government of looting the country.

But auditors with the comptroller/auditor general’s office countered that the leaked draft is misleading, adding in a letter to the prime minister’s office that the figures publicized were the product of discussions held at a “very preliminary stage.

“We are examining the news report and I have called for records,” Coal Minister Sriprakash Jaiswal told journalists, adding that he wasn’t in office at the time of the suspect deals. “After that I will reply.”

The government said it has not received the report yet from comptroller/auditor general’s office.

India, the world’s third-largest coal producer after China and the United States, has seen a series of mining scandals. In August, the top elected official in south western Karnataka state resigned after being implicated in a mining scandal that a watchdog said involved $400 million. Three months later, a report claimed that almost 50% of the iron ore exported from western Goa state was illegally mined.

India is hungry for energy to fuel its fast-growing economy, and coal accounts for 70% of the mix, a percentage expected to grow, given limitations on the further development of power from nuclear reactors and renewable sources. Environmentalists, however, say increased production is ecologically unsustainable.

Gulshan Homz : Press Release

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Gulshan Homz, part of the GC Group of companies, has announced the launch of its new residential project:  Gulshan Ikebana at Sector 143B, Noida Expressway spread over 12.5 acres land with apartments of sizes 1400 sqft (3BHK) to 2300 sqft (4BHK+Study) and offers a sleek, infinitely flexible, multi-dimensional and open life and is well conceptualised for quintessential living. Ikebana is designed keeping all the modern needs, indulgences and luxuries in mind so one would enjoy excellent location advantage with lust green surrounding and seamless connectivity which will offer natural retreat and also excellent metropolitan convenience and vibrance.

Amenities:-

  • Water softener plant, Bus shelter
  • Club, Karaoke theme Restaurant
  • Internet Connectivity,24 x 7 Security
  • Intercom Connectivity, Customer Care Centre
  • Rain Water Harvesting, Water Softener Plant
  • Swimming pool, Steam/Sauna/ Massage Rooms
  • Yoga Centre, Indoor Games
  • Jogging Track, Badminton
  • Basketball Court ( Half Court), AC Gymnasium
  • Special Play-pan for kids, Immaculate Landscaping
  • Aerobic Dance Floor, Coffee Shop
  • AC Unisex Beauty Salon, AC Banquet / Party Hall / Guest Lounge
  • Business Lounge, Laundry Services
  • Cabs on call, Amphitheatre
  • Kids Lounge, Regular in- Compound OPD
  • Ambulance on Call, Doctor on Call
  • Stretcher Lifts, Wheel chair for Elderly and sick

About the Developer:

Gulshan Homz has constructed luxurious living spaces and the Group has improvised its skills over the years to launch a number of premium projects. They have stamped a mark of excellence in luxury Real estate developer with honest morale, integrity, sound business ethics, transparency and invaluable experience. With a vision to pass on a green environment and prosperous cities to the future generations they look forward to developing luxurious real estate options.

IMf Chief says,Global Economic Crisis presents many lessons.

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The International Monetary Fund (IMF) Managing Director Christine Lagarde on Tuesday said the global economic slowdown has presented many lessons, and added that the financial sector, which has been identified as a ‘high contagion’ agent for the crisis must aid growth, not threaten it.

Addressing at a New Delhi conference on sustaining high-quality growth in India and China, Lagarde billed the financial and real estate sectors as the prime causes of the global financial crisis.

“We’ve also identified that the financial sector and financial institutions were high-contagion agents for the crisis, and that tells us, I think, a lot about where reforms have to focus going forward, both in the advanced economies and the emerging markets,” said Lagarde.

“Whether it is China or India, the financial sectors and the financial institutions have to be strong, have to be agents for growth and not a threat to growth,” she added.

Referring to the financial crisis in the Euro zone, the IMF chief said concerted efforts by some European nations and the European Central Bank (ECB) had pulled the continent further away from the brink, though several challenges still remained to be tackled.

“Thanks to the ECB, thanks to the European partners really addressing the issue of governance and thanks to the European partners and the IMF really focusing on what needs to be improved, we are further away from the abyss than we were three months ago, but there are still some really significant vulnerabilities and fragile areas that need to be tackled, that need to be addressed with rigour and vigour in the months to come,” Lagarde said.

Housing and Real Estate: Telecom negatives present challenges

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While recognising the importance of the services sector (it accounts for 59 per cent of gross domestic product), the Economic Survey has raised concern over several components in it. Three months after the government rolled back its decision to allow 51 per cent foreign direct investment (FDI) in multi-brand retail, the survey referred to it as a major challenge before the sector.

FDI in retail could begin in a phased manner in the metros, the survey suggested, a day ahead of the Budget. Though it did not specify the details, experts said the government document hinted at a low FDI cap, perhaps one of 26 per cent. It has also talked of “incentivising” mom-and-pop stores (kirana shops) “to modernise and compete effectively with retail shops, foreign or domestic”.

While agricultural marketing could improve immensely with the growth in modern retail trade, the revenue to the government could also increase. Currently, the retail sector is largely unorganised and has low tax compliance, it argued.

Reacting to the portion in the survey relating to FDI in retail, Purnendu Kumar, senior vice-president (retail), Technopak, said, “This is something similar to what was articulated earlier — issues like better integration with farmers leading to better pricing for them and quality storage leading to lower wastages. It needs to be seen how the government would be able to execute this, considering the Congress party does not account for the majority on its own.” Incentivising small traders was a welcome step, but the details were not available, Kumar said.

Karandeep Singh, chief financial officer, Flipkart, a leading online retail chain, said, “While the future is promising, it will be realised only if the government acts on some of the guidelines provided in the survey.” According to Singh, opening up FDI in retail and continuing to make the infrastructure sector attractive for investments were critical to creating more jobs and having a multiplier impact on the economy.

Excellence Recognition in Real Estate Sector.

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Realty plus Excellence Awards 2012 series for the northern region of India will be on March 21. The awards for South India and West India were given away on March 2 and March 9, respectively.

The Realty plus Excellence Awards recognise people who have played a key role in the growth of the Indian real estate sector. Contributions made by developers, architects, interior designers, state government, and property advisors are recognised. These awards are decided upon by a distinguished jury.

Anuj Puri, Chairman and Country Head, Jones Lang LaSalle India, is the Jury Chairman for this year’s awards.

Positive effect: What Budget 2012 means for Mumbai’s Real Estate.

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Allowing external commercial borrowings (ECBs) in the low-cost housing segment, the supply of affordable housing projects will increase in the outskirts of Mumbai in areas such as Karjat, Boisar, Nalasopara, Virar, Dombivili etc. on the heels of increased liquidity for budget home projects.

The extension of 1% interest subvention scheme on housing loans up to Rs 15 lakh wherein the cost of the house does not exceed Rs 25 lakh, for another year will also help sustain demand for affordable housing in Mumbai.

The increased allocation for highways and other infrastructure projects will help boost development of Mumbai’s outskirts and increase the supply of housing units there. This will result in price stability and affordability over the long term. The investment-linked deduction of capital expenditure in affordable housing, proposed to be raised to 150% from 100%, will also encourage more supply of low-cost housing in the city.

The reduction of the withholding tax on ECB interest from 20% to 5% will help Mumbai’s affordable housing segment by creating much-needed liquidity for budget home developers. End users will have more money available for home loans with the setting up of a credit guarantee trust fund to ensure better flow of institutional credit for housing loans.

The announcement of central assistance and Japanese participation in the Delhi-Mumbai Industrial Corridor project is a big plus. Areas on Mumbai’s outskirts that lie along the corridor will see increased land values.

By reinforcing the tax pass-through status for all types of Venture Capital Fund (VCFs), there will be renewed confidence levels of real estate private equity investors to invest in cities such as Mumbai (which has seen most of the PE investments post the Global Financial crisis.)

The John Marshall Law School will present “Real Estate Investing in India: Opportunities and Challenges” at an event.

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The Centre for Real Estate Law at The John Marshall Law School in Chicago will present the lecture “Real Estate Investing in India: Opportunities and Challenges” on April 4, 2012.

Risks and benefits that come with purchasing real estate in India is the topic of an April 4, 2012, lecture at The John Marshall Law School in Chicago. Guests Shahrookh Cambata, Scott Eisenberg and Marc J. Strauss will speak at the event.

The free program, from 8:30 to 11 a.m., looks at the interest in real estate in India. Investments have grown as the expanding real estate markets in the U.S. and Western Europe have caused investors to consider developing markets for better opportunities. Speakers for “Real Estate Investing in India: Opportunities and Challenges” will discuss the risks and benefits of investing in India. Real Estate sales there have thrived since 2005 because the Indian government strengthened its protection of foreign ownership.

 

The lecture will feature three experts: Shahrookh Cambata, managing member and CEO of Greaves Travel; Scott Eisenberg, attorney and real estate entrepreneur for Lakeshore Investment Development; and Marc J. Strauss, general counsel for First Rockford Group.

 

Registrations are requested and are being accepted at http://www.events.jmls.edu/re-india. Attorneys can earn two hours of CLE for this program.

Real Estate Sops can’t impress Firms.

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The finance minister relaxed borrowing norms for real estate firms and extended the loan subsidy for low-cost affordable houses. The concessions have, however, failed to impress the industry leaders who termed it as a too-little-too late move that would have a limited impact on the sector.

“I propose to allow ECB (external commercial borrowing) for low-cost affordable housing projects,“ the Budget said.

The move has a dual aim of expanding the window of funds for real estate developers such that affordable housing projects do not face cash crunch and are completed within the time frame.

Global consultancy Deloitte said RBI had earlier allowed ECB for developers in integrated township projects of 100 acres or more till December 31, 2010.

The FM also extended, by a year, the 1% interest subsidy on loans up to R15 lakh where the cost of house does not exceed R25 lakh.

Budget 2012: 1 per cent TDS imposed on property sales.

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The government has proposed one per cent TDS (tax deduction at source) on transfer of immovable property if the sale value exceeds Rs 50 lakh in urban centres and Rs 20 lakh in other areas.

Finance Minister Pranab Mukherjee said in his Budget speech that the measure is proposed in the Budget and is being taken to “deter the generation and use of unaccounted money.” Immovable properties, other than agricultural land would be covered under the new provision.

The application of TDS would be effective from October 1 this year. It has been provided that transfer of property would not be registered unless the buyer furnishes proof of deduction and payment of TDS.

At present, tax is required to be deducted at source by the transferee on transfer of immovable property by a non- resident. But, there is no such requirement on transfer of such property by a resident except in few cases, it added.

Reacting to the proposal, the apex realty body CREDAI said that this would lead to increase in property prices.

“It looks like that the proposal of TDS would apply on transactions in the secondary market and not on sale of builder’s flat,” Confederation of Real Estate Developers’ Association of India (CREDAI) Chairman Pradeep Jain said.

The new proposal intends to collect tax at the earliest point of time and have a reporting mechanism of transactions in the realty sector.

The provision would apply if the consideration exceeds Rs 50 lakh if property is situated in “specified urban agglomeration” and Rs 20 lakh if property is situated in any other area.

Gurgaon is safe as an investment bet.

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Capital values rose by more than 30-35% in Gurgaon’s residential sector over the last one year. Developers are now going slow on execution of real estate projects, resulting in a drop in supply of residential apartments in most prime markets. Emerging residential areas are still not able to meet the huge housing demand.

Due to rampant construction delays, the expected supply of residential properties announced in early 2009 has not been able to reach the market. Around 500,000 units that were scheduled for possession in key markets by end of 2011 are delayed by another year.

There has been an increase in lateral hiring by corporates. With job scenario improving all over the country, people have more to spend. This has resulted in good investment opportunities, and investor sentiments in the affordable and mid-income segment of Gurgaon’s residential market have improved.

Gurgaon remains promising for office space, and there are good prospects for more major global players setting up operations here in near future. On the whole, this augurs well for the residential property market, more or less assuring relatively healthy absorption of residential space in the times to come. The new infrastructure initiatives being undertaken by the government will also play a crucial role for Gurgaon’s residential and commercial property sectors.

Realty Sector in Disappointment

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The Union Budget 2012-13 on Friday proposed allowing external commercial borrowing for low cost affordable housing projects.

Presenting the Budget in the Lok Sabha, the Finance Minister, Mr Pranabh Mukherjee, also proposed setting up of a Credit Guarantee Trust Fund to ensure better flow of institutional credit for housing loans.

The Minister also proposed to enhance provisions under Rural Housing Fund from Rs 3,000 crore to Rs 4,000 crore besides extending the scheme of interest subvention of 1 per cent on housing loan up to Rs 15 lakh where the cost of the house does not exceed Rs 25 lakh, for another year.

Meanwhile, real estate players were disappointed with the Budget saying it failed to highlight the role of the housing sector in the economy.

“The proposal of bringing in an umbrella tax structure to the cement industry will increase the cost of housing and will negate the development process. Also providing ECB to affordable housing is a minor respite to the sector. There is an inherent risk of liquidity drying up wherein the exemption of capital gains tax to invest in small and medium enterprises may result in cash out from real estate,” Mr Lalit Jain, President, CREDAI, the industry body of real estate players, said.

The sector also said that the increase in service tax will increase the cost of construction by Rs 50-100 per sq feet.

According to Mr Anurag Mathur, Managing Director, Cushman & Wakefield India, “The increase in allocation in infrastructure implies a clear intent on enhancing the urbanisation process as well as providing a support to the slowing industrial sector. At the same time the increase in the service tax from 10 per cent to 12 per cent would lead to additional burden on the tenants as the service tax on rentals has remained unchanged.”

Union Budget 2012-13: Buying or building of a house will cost more.

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Realty players said that purchase or construction of a house would now cost more due to expected rise in prices of key raw materials cement and steel and a hike in service tax by 2 per cent.Barring low-cost housing, property prices are expected to rise in the coming days after the proposed hike in service tax from 10 per cent to 12 per cent.

TDS at the rate of 1 per cent on transfer of immovable property (other than agricultural land) above a specified threshold will also add to the cost of buying a house. The threshold would be over Rs 50 lakh an urban areas and Rs 20 lakh elsewhere, according to the budget proposals.

Cement and steel manufacturers have already hinted at a price hike after the Budget proposed raising the excise duty to 12 per cent.

Commenting on the budget proposals, Confederation of Real Estate Developers’ Association of India (CREDAI) Chairman Pradeep Jain said, “Application of TDS on the purchase and sale of property and increasing Service Tax by 2 per cent will further add on to the overall cost of property and are bound to make property more costly in coming days.”

Realty consultant DTZ said that increase in the service tax is going to further increase marginally the overall burden on the home buyers of mid and high segment (dwellings costing more than 25 lakh). The impact of service tax would be about Rs 40,000 on a Rs 75 lakh home.

However, DTZ said that affordable housing, being part of negative list, is exempted from service tax and the move would give a boost to the affordable housing segment.

Jones Lang LaSalle India Chairman and Country Head Anuj Puri said that “the increase in the service tax rate from 10 per cent to 12 per cent will increase the cost of production for developers, who are already reeling under high input costs. It follows that this increased burden will be passed on to end users”.

Builders say that Pranab Mukherjee has ignored ground realty in the Union Budget 2012-13.

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With predicting an escalation in property prices, top players in the realty sector said they had been ignored by the finance minister.

Chief of the Confederation of Real Estate Developers’ Association of India (CREDAI), Lalit Kumar Jain, said the announcement on external commercial borrowings (ECB) for affordable housing was a minor respite but still meaningless. Jain, who is also chairman and managing director of Kumar Urban Development Ltd, added, “We contribute 6.5% to the GDP and expected a big boost from the budget for affordable housing through special schemes, an interest subvention of 5-7 % for LIG (low income group) and EWS (economically weaker section) housing and promotion of rental housing through tax exemption.”

Jain also pointed out that the interest subsidy on home loans was too low. The Budget has extended the scheme of interest subvention of 1% on housing loan up to Rs 15 lakh where the cost of the house does not exceed Rs 25 lakh for another year.

In addition, Gaurav Gupta, director, Omkar Realtors & Developers, lamented that the realty sector had got nothing to boost market and customer sentiments. “There are no indications of this sector being granted the status of an industry, which it much deserves. On the contrary, the increase in service tax will push up realty prices as the additional cost will be passed on to the buyers.”

Tata Housing MD and CEO Brotin Banerjee added, “Initiatives to make affordable housing available to a larger section of the society have only been met partially.”

There were some who welcomed the proposals. Sachin Sandhir, MD, RICS South Asia felt it “exceeded expectations” given the pressures on the fiscal situation.

Realty Sector has no resurgence.

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The latest Economic Survey reveals that the share of the housing sector to the overall GDP is likely to rise by one per cent to 6 per cent on increased investment. Currently, about 5 per cent of India’s GDP is contributed by the housing sector. With institutional credit for housing investment growing at a compounded annual growth rate of about 18-20 per cent per annum in the next three-five years, the housing sector’s contribution to GDP is likely to increase to 6 per cent.

As every rupee that is invested in housing and construction, Rs 0.78 gets added to the GDP. Investment in housing and real estate activities can be considered a barometer of growth of the entire economy. Unfortunately, the 2012-13 Budget does not recognise this. Although the finance minister’s speech concludes by reiterating the fact that there is a need to create an “enabling atmosphere” and that India is on the brink of “resurgence”, he has done precious little to make that happen.

India’s GDP has not been growing as it was sometime earlier was the topic of the finance minister before presenting the Budget. His five-point objective does not really lay any emphasis on the housing and real estate industry. While he has tried to restrict central subsidies to fewer than 2 per cent of GDP to improve the quality of public spending, he has failed to provide for measures which will give impetus to the industry at large, housing and real estate in particular.

The finance minister has permitted external commercial borrowings (ECBs) for low cost affordable housing projects. One wonders if this would do any good, since players in this industry are not used to taking the ECB route for affordable housing projects. This provision therefore does not make sense.

Extending the scheme of interest subvention of 1 per cent on housing loans up to Rs 15 lakh (on houses costing up to Rs 25 lakh) for another year also does not make sense, unless and until the limit of Rs 25 lakh is increased.

Home Loan Rate Should Be Restructured.

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With speculations about the Union Budget 2012-13 already doing the rounds, city’s real estate industry too has voiced its expectations. Mainly revolving around increased subsidy on interest rate for loans towards affordable housing and industry status for taxation and construction and relaxation of FDI up to 51 per cent into multi-branding, the industry is hopeful of a favourable budget.

Sushil Mantri, president of CREDAI, Bangalore, says that “The Indian real estate industry was riding through highs and lows in 2011. Last year, one per cent interest rate subsidy was offered for loans towards affordable housing. If the subsidy can be broadened, home buyers especially in mid and lower income groups will benefit.”

“Indian real estate, especially housing needs the government’s support for further growth. The government should consider restructuring interest rates on home loans to attract larger base of lower and middle income group to benefit. For loan amounts lesser than Rs 25 lakh, the interest rate should be lower and should scale up as the loan amount goes higher,” said Sankey Prasad, chairman and MD of Synergy Property Developments Services.

Further the Experts demanded that the glaring concerns of the real estate industry be addressed.

“The real estate industry will be looking forward to RBI’s intervention to control inflation which has adversely affected the industry. If FDI is relaxed up to 51 per cent in multi-branding, this will boost the growth path for the Indian retail industry,” Sushil Mantri added.

Realty players demand Industry status and affordable housing as a priority from the Budget 2012-13.

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The Union Budget 2012 to be presented by the Finance Minister Pranab Mukherjee is being looked at to provide relief in terms of policy reforms with the real estate sector of the economy coming under repeated credit pressures owing to high interest rates for borrowing.

Experts say that the real estate sector needs government support as well as further stimulus to get out of the current slump. With the first step, experts have sought industry status for real estate, since the sector is a major driver for economic growth and generates countless jobs across its various verticals and associated industries. Experts this feel will also help the sector raise debt from FIs at a much lower rate.

Common demand across all real estate companies is that of an industry status being assigned to the sector in the Budget 2012-13 with ways to make affordable housing available to a larger section of the society.

Samir Jasuja, founder and chief executive officer at Prop Equity said, “In this budget, we expect the central government to grant the real estate sector the industry status as that would help the reeling sector raise debt from financial institutions at a much lower rate, which may partly improve the liquidity crunch crisis.”

Indian developers will present properties to NRI investors at Doha exhibition.

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Indian developers are all geared up to offer NRI investors a wide choice of properties across India at an exhibition which is going to start on 16th March 2012.

It is the 20th India Property Exhibition in Doha on Friday which will showcase more than 100 projects spread across New Delhi, the National Capital Region, Jaipur, Mumbai, Pune, Goa, Hyderabad and several other cities.

The $12 billion realty market in India is on a high growth curve, because of the fast growing economy, increased participation of global players in the Indian market and new technological innovations.

According to organisers – Indus Fairs and Events (India) and Apex Business Solutions, Doha – the investment portfolio includes apartments, independent houses, bungalows, luxury villas, farmhouses, commercial properties, beach resorts and plots.

Realtors ask for Better home loans and tax cuts.

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Realtors from Chennai are expecting the Union government to enhance the income tax exemption for up to Rs 3 lakh paid as interest on housing loans in a year from the existing Rs 1.5 lakh which will help to boost the real estate market.

Siva Krishnan, head of residential services (Chennai), Jones Lang LaSalle India, said that  “The market, which was struggling last financial year, has picked up and we expect the government to enhance the income tax exemption limit.”

The Confederation of Real Estate Developers’ Associations of India have expressed that the realty sector and housing policy should be modified in order to address a huge demand of 26 million homes. “Inordinate delay in the sanction of approvals have hit hard. Provision of single-window clearance for real estate development projects is the need of the hour,” said CREDAI president T Chitty Babu.

In addition he also said that “Some of the measures like creation of Special Residential Zones can help. Affordable housing sector should continue to grow based on the incentive given for borrowings from banks for homes.”

Also the 36-month holding period should be reduced to 12 months.

Realty sector seeks affordability from the government.

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Real estate businesses have much expectation from the forthcoming Union Budget 2012 that it will contain some pragmatic provisions that will lower effective price barriers for home-seekers.

Vice-president of Credai (Confederation of Real Estate Developers Associations of India) Pune Metro, Anil Pharande, said that on a macro level, a higher allocation of infrastructure funds for housing can be a favourable approach. “The government can set clear guidelines on timely commencement and completion of projects and link disbursement of these funds with adherence to these guidelines.”

Pharande also added that removal of the 10 per cent service tax on residential real estate construction, that increases the cost of new homes by as much as 3 per cent, is critical for a cost-sensitive market like Pune, which has mainly lower mid-income segment.

Real estate developers says, that broader incentives for development of affordable housing are needed, to encourage more developers to become active in this important sector and increase the supply of budget homes in the city as the city continues to face problems including high lending rates and construction costs, insufficient infrastructure and lack of affordable housing.

Even the 1 per cent interest rate subsidy on home loans can also work as a good measure to bring affordability. Also the present eligibility limit of loan amount of Rs 20 lakh should be raised to Rs 30 lakh which will help people think about buying apartments of decent sizes. Reducing taxes such as excise VAT and stamp duty on real estate will also make home purchase attractive, Pharande said.

Budget 2012: A ray of Hope for the Real estate sector.

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The real estate industry is very optimistic about the coming budget 2012 as the budget may bring a sheer relief  for the affordable housing buyers.

Real estate industry generates countless jobs across its various verticals and also the sector is a major driver for economic growth so it is  hoping to get an industry status.

To improve the significance of the housing sector sufficient steps were not taken in the Budget 2011-12 which in return gave very less to the developers and customers.

Shailesh Sanghvi, Director, Sanghvi Group of Companies said that,”We expect revision in tax for affordable housing projects in order to address the acute housing shortage in the country.”

The priority must be given to the banks who  in return offer concessional costs to the common man and also affordable housing should be considered important .

The interest subvention of 1% on home loans could be raised from Rs 20 lakh to 30 lakh.

In addition Ajmera also said that “The budget should look forward to extending the existing benefit of Section 80 IB(10) of the IT Act for developing affordable housing as the country is still in a huge shortage of tenement.”

Government must take steps which in return would be beneficial to both developers and also buyers. Real Estate sector is hoping the best from the Budget 2012.

As per the developers, Pranab Mukherjee, must present such a Budget that should bring happiness,joy and comfort to every sector.

 

 

Realty Funds gets Cold Shoulder from HNIs

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Realty has historically been a favourite of HNIs, who have invested even in tough times.

But the dismal performance of most players, not-so-attractive returns on offer and an opportunity to tap the market directly are keeping HNIs away from the real estate funds, which are trawling the money market for investors.

Now, Real estate funds are finding it difficult to raise fresh funds as their mainstay investors, the high net worth individuals (HNIs), are turning their back on them.

Sutapa Banerjee, senior vice-president and head (private banking, India), ABN Amro Bank said that, “The interest in real estate has not dried up. Property continues to be a significant part of an HNI’s portfolio.” In addition, there seems to be some discomfort with funds investing in realty.

During the first major fundraising in 2006-07, funds were highly optimistic on the sector. But after the crash in 2008-09, exit with decent returns became a major issue for them.

An HNI advisor, Jayant Pai said, “Investors generally have a recent bias and the recent happening isn’t very good. The existing funds have promised good returns, but they are still on paper; these exits have not come through. A good amount of funds have extended their exit time period, this affects the internal rate of return.”

Bengaluru has Impact Of IT, ITES on Real Estate.

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Advantages like available skilled workforce, a high quality of living and better career prospects are at Bengaluru but factors like the cost of real estate and ready access to international destinations also matters a lot.

Services such as call centers, transcription, data processing, online education, etc are included in ITES which has made a huge impact on international workflow into India, mainly because of low communication costs and the financial sense behind outsourcing non-core activities. It is an obvious advantage for any modern city to have a significant presence of this industry, which creates white-collar, high-profile jobs and has remarkable effects on its real estate market.

Commercial developments in the city have been done by the private sector and the Bangalore Development Authority (BDA), which controls the growth process of the city.

The city’s commercial market has three spatial limits – central business district (CBD), suburban and peripheral. Bengaluru has no true concept of a CBD which resulted in business growth from MG Road to other main roads such as Residency Road, Richmond Road and Brigade Road, Infantry Road and Cunningham Road.

Some of the prominent streets in prime off-CBD areas in Bengaluru are Commercial Street, Infantry Road, Cunningham Road, Richmond Road, Residency Road, Millers Road, St Mark’s Road, Vittal Mallya Road and Lavelle Road. The advantages they offer are reduced congestion, the availability of space and proximity to the City Centre.

Bengaluru suburbs are classified as areas near to Airport Road, Koramangala, Indira Nagar and Jaya Nagar. The peripheral areas consist of Bellary Road, Whitefield and Bannerghatta Road.

Two New Shows ‘Made to Order’ and ‘Big Style Icons’ launched by Big CBS Prime.

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BIG CBS PRIME has announced the launch of two new shows. The two new properties called Made to Order and BIG Style Icon are made keeping in mind the preferences of the people who live in style, the shows mainly focusing on the hottest properties in the Indian Real Estate market and an exclusive peek into the world of the elite, respectively.

Made to Order is like a journey into the best real-estate properties money can buy. Everyone dreams of owning a house so luxurious, so splendid that stands out amongst the others, but for most, these remain a dream. This show is targeted at the upper crest of society for whom nothing is out of reach!

Whereas, BIG Style Icons as the name suggests is a profiling of the lavish lives of society’s elite and the extraordinary and exclusive brands which are their favourites. The show will feature the people who are well known for their style quotient with hand-picked style icons which will see the likes of Vijay Mallya, Yash Birla, Shah Rukh Khan, MS Dhoni and Atul Kasbekar to name a few. The show will focus on an Icons’ favourite brands, preferred machines, his style statement, his workout den and much more.

Both properties offer an excellent and appropriate platform for marketers from the real estate, high end fashion brands and premium products, as the Channel ensures reach to a large relevant audience base with minimal spill-over.

Very soon BIG CBS Networks will be launching a multi-faceted promotional campaign for these shows. The properties will be extensively promoted and marketed across multi-media platforms of television, radio, OOH, print and social media platforms ensuring excellent reach for marketers associating with the properties.

Affordable Housing Policy to be implemented by the State Government from 15th April.

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From April 15, the state government’s affordable housing policy is set to be implemented. With a preliminary notification already out, the policy will be implemented after the final notification in a month’s time.

This decision took place at a recent meeting between Additional Chief Secretary (Urban Development Department) TC Benjamin and representatives of Confederation of Real Estate Developers’ Associations of India (CREDAI) from Pune, Nagpur, Kolhapur, Nashik and Aurangabad.

The government in the notification has made it mandatory for all projects on more than 2,000 sq m land to reserve 20 per cent of the land or constructed space for small-sized housing.

Benjamin said that, “The state has a dearth of such housing and this initiative will help bring about more such houses in residential projects. It will have to be implemented by the builders after April.”

Builders expressed reservations about whether the 20 per cent of the land should be reserved in the same area. However, it was decided that they could have a little farther but in the same zone. To this Benjamin added that, “They have to provide the housing with almost the same kind of infrastructure.”

However, most of the builders had reservations about having the economical housing on the same campus but agreed to have it a little farther away from their projects.

Pune CREDAI representative Satish Magar, who attended the meeting, said, “We are open to the policy but had some issues, which we discussed.”

CCI again caught DLF for imposing unfair conditions on flat owners.

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CCI has again accused DLF of imposing unfair conditions on home buyers on its high-end residential project Magnolia in Gurgaon. For this, Magnolia Flat Owners’ Association had filed a complaint against DLF Universal, Haryana Urban Development Authority and the Director Town and Country Planning, Haryana, with the Competition Commission of India (CCI).

In the report, the CCI director general found that DLF has issued allotment letters, and apartment buyers’ agreements were signed even before it got approvals from the town planner. Also, the builder has revised the building plans and applied for increasing the height of the towers after collecting 90% of the money from the buyers, and two months after the original date of delivery promised by the company.

CCI had also found DLF guilty of abusing its position at the Park Place Project in Gurgaon, where they asked the company to cease and desist from imposing unfair conditions on buyers. The order had also directed DLF to suitably modify the unfair conditions imposed on existing buyers within three months.

Drish Paul, the president of the Magnolia Flat Owners’ Association, said that “Many people are living on rent, waiting for apartments to be handed over. We would eventually like to get compensated for the loss due to the delay in completion of the project.”

In a similar order in August 2011,CCI had slapped a fine of 630 crore on DLF for unfair practices, abuse of market dominance and disregard for consumer rights in its Belaire residential project in Gurgaon.