A report was released on Tuesday according to which Indian realty sector might face problem of plenty with office rental space. A further drop in rentals is also expected. As per the report presented by Jones Lang Lasalle Meghraj(JLLM) and Confederation of Indian Industry (CII), the vacancy level in India will increase from 17.2% in 2009 to 20% by the end of 2010.
The report stated that during the first quarter of 2010, most Indian cities have experienced an upward movement in the volume of lease transactions. There have been recorded around a million sq. ft. of leases in each of the cities; Delhi, Hyderabad and Mumbai.
For the future, the report predicts that within the next three quarters, most micro markets are expected to reach their rental lows. This implies that even after balance of power favors the occupiers, the opportunity for then is diminishing with every passing quarter.
The report “The Seven Stars of India India’s best performing micro markets for occupiers” gives the prediction about real estate rental market in cities like Mumbai, Delhi, Bangalore, Chennai, Kolkata, Pune and Hyderabad.
After a year, the realty market seems to be overwhelmed with the comeback of the demand of luxury homes. Apart from the prime locations like Bangalore and Mumbai, the tier-II or tier-III cities, such as Nagpur and Ahmadabad are also witnessing remarkable growth as far as luxury homes are concerned. Within just six months, these cities have seen a rise of about 20-25% in account of premium residential projects.
Some of the developers who have floated several luxurious schemes across the country in order to grab more and more investors and end-users are Hiranandanis, Sobha, DB Realty, Lodhas , Indiabulls and Prestige.
However, each city has its own range of prices of these luxury homes. The cities Bangalore and Hyderabad have a pricing of Rs 6,000 per sq ft while the pricing in Mumbai is Rs 30,000 per sq ft.
“From Jones Lang LaSalle Meghraj (JLLM) which is a real-estate consultant, the managing director, strategic consulting, Mr. Deepak Bhavsar said that there has been an increase of 10-12% projects in Delhi NCR and Mumbai.
In past few years, the realty sector has shown tremendous growth but according to experts, it may still remain a regional play in the country. The underlying reason is that different regions have different laws.
JLLM,Jones Lang LaSalle Meghraj, a property consultant firm’s Country Head and Managing Director Anuj Puri said that developers experience difficulties in having a pan-Indian presence due to the different procedure and different laws in every state for acquiring land, property taxation and approvals for projects.
Since there is a need of understanding local dynamics for developing realty projects, many developers take property sector as a regional business.
The problem for developers of having a pan-India presence cannot be helped until there is in land acquisition process and regulatory approvals are the belief of many consultants and developers.
As per some senior executive of JLLM, Jones Lang LaSalle Meghraj, integrated commercial space developments is following the steps of integrated residential complexes and is thus expanding in India.
Mr. Anuj Puri, th Country Head of JLLM said that this is an upcoming trend as well as a saleable one.
Such projects house office space, five-star hotels and retail area among other facilities.
The project in Bangalore from Brigade Group is an example of such projects while there are many more such projects queued up.
As per the expectation of Puri, the margin builders have kept in these projects is higher than that in other projects.
Other examples of such projects are Capital City by BPTP Ltd in Noida which is spread across 21.17 acres and comprises 2.1 million sq ft of office space, Nirmal Galaxy by Nirmal Lifestyle at Mulund in suburban Mumbai.
One of the builders said that there is no doubt in the success of such projects since their housing counterparts are already a success.
As per the report from JLLM, Jones Lang LaSalle Meghraj, a realty advisory firm, the senior citizens’ home is now a days the most upcoming field of realty. This fact is evident from the increasing number of projects housing stock directed at this section.
The report published by JLLM ’Senior housing sector in India: Key Trends’ gives full details of this observation. According to the report, the seniors are not seen the same way they were seen a decade ago. These days, their status is experiencing a drastic change, the reasons being change in mindset, augmented financial independence and growing cohort size. The big caliber of this segment and its unique needs and promises are offering a good vector of opportunities to the Indian realty market.
Also, as per the report, the number of seniors believing in the idea of good standard of living and the sunset years of their lives with similar-aged companions and sharing facilities in settings of security and enablement is rising rapidly. A survey was conducted on households with senior citizens from which it was inferred that more than 60% of them found concept of an elderly club or a senior citizen’s association as a viable and practical one. The old age homes are now replaced by contemporary retirement homes or resorts was one of the conclusions from the report.