The developers would not have imagined that the sky reaching property prices will have as disastrous as this. Many of the builders now have unsold properties at their hand as they are not able to find any property buyers. Continue reading
Office space demand rises or falls, experts vary.
BANGALORE: A recent report of CB Richard Ellis, a US based property consultant, stated that the office space absorption in India rose by 37%. The rise is on a year-to year basis. In the opinion of CBRE, January 2013 witnessed higher demand.
Meanwhile another American property consultant stated that the office space demand is down by 37%. This report of Cushman & Wakefield was absolutely on the opposite of what the CBRE report.
The reports of Jones Lang Lasalle and DTZ India are also not complementing each other. While JLL speaks of a moderate demand, DTZ speaks of a fall in the demand.
As per the report of JLL, office space demand is more or same. Compared to the first quarter of 2012 the demand is moderate this year. The report of JLL stated that in most of the cities the demand for office space remained moderate.
As per DTZ India the office space absorption is down by 20%. Anshul Jain, CEO at DTZ India, said that only 4.8 million of office space was absorbed this year. This is 20% lower than the 6 million sq. ft. absorption of 2012. Continue reading
Office space demand to grow this year.
As per the reports of DTZ, nearly 30.5 million sq. ft. of office space will be demanded this year. Comparing to the last year’s office space demand, this year it will be more and far better.
Global economy has started picking up after the downturn. This will boost the office space absorption this year. Additionally other factors such as increase of foreign direct investment (FDI) in the retail sector also will have impact on office space demand of the current year.
Along with the 51% of FDI, the revised repo rates of Reserve Bank of India (RBI) too will boost the demand for office space. The market sentiment has resulted and the economy looks stronger now.
Anshul Jain, DTZ India CEO, said that the fears over the global financial crisis have started fading, resulting in improved market sentiment. Continue reading
Lowered IT demand affects commercial realty sector.
Commercial realty sector is hit by lowered office space absorption by IT companies. Tracking the office space absorption in top eight cities of India, property consultants C&W and DTZ have reported that the rate of office space absorption has been falling in top cities of India.
Last year, 29.05 million sq. ft. of office space was absorbed. This figure shows a 23% decline in the rate of office space absorption compared to the previous year.
The contribution of the IT sector was a mere 44% last year. On the other hand the information technology sector had contributed over 64% of total office space absorption. This slowdown of IT segment affects commercial realty sector adversely. Continue reading
Office space absorption in Bangalore fell due to the lower demand from IT and ITeS sectors.
Real estate experts said that the office space absorption in Bangalore has been dropped as the IT (Information Technology) and ITeS (IT enabled Services) did not raise much demand. The reports show that the office space absorption has dropped by 24% last year.
Cushman & Wakefield, a global real estate consultancy, reported that in 2012 nearly 7.3 million sq. ft. of office space was absorbed. This rate of absorption is very lower to the 9.59 million sq. ft. of 2011. If the IT and ITeS sectors had shared nearly three fourth of the total supply in 2011, in 2012 their absorption is just above two fourth of total supply. Continue reading
Realty firms on Tuesday hailed the RBI’s decision to cut short-term lending rate saying the move would reduce the cost of funds to home buyers as well as developers and boost property demand.
“Reserve Bank’s decision to cut the repo rate by 50 basis points and abolish pre-payment penalties is a good move for home buyers,” Confederation of Real Estate Developers Association of India (CREDAI) Chairman Pradeep Jain said. In its annual credit policy, RBI has asked banks not to levy foreclosure charges or pre-payment penalties on home loans extended on a floating interest rate.
The country’s largest realty firm DLF also welcomed the decision, saying it would significantly improve the cash flows of developers. “It is positive news although very-very delayed. This will benefit home buyers besides the industry. It will improve cash flows tremendously,” DLF Group Executive Director Rajeev Talwar said.
Jain too said that liquidity for developers would improve and cost of funds would be cheaper. On demand, Credai Chairman said the move would definitely boost housing demand. However, property consultant DTZ India CEO Anshul Jain felt more measures need to be taken to have a positive impact on housing demand.
“It is a step in right direction although lot more measures need to be taken before we see any effect of the rate cut on the real estate sector,” said Jain of DTZ. The housing demand, which is very subdued currently, would only rise if the interest rates on home loans come down to below 10 percent, he added.