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.
Tag Archives: Jones Lang Lasalle Meghraj
Indian Commercial Realty Market Achieving Stability
Real Estate Intelligence Services (REIS) which is a division of Jones Lang LaSalle Meghraj released a report which said that stability in the commercial real estate market of India is observed with the economic recovery of India.
According to the report, although in 2010, the landscape will be beneficial for tenents, but in 2011, influence of landlords will be higher. It implies that since the office rents are beginning to hit the ground, in the coming term, they should be proactively looking to lock in attractive leases.
Abhishek Kiran Gupta, the Associate Director JLLM said in the report that the Indian commercial realty market is about to attain stability with the well going economic recovery of India.
Real Estate Suffers due to Regional Laws
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.
JLLM and WIPRO Come Together.
Real estate consulting company Jones Lang LaSalle Meghraj (JLLM) has signed a big contract with a country’s major information technology company Wipro for managing its 2.3 million square feet of office space in Bangaluru, Mumbai and Mysore.
Wipro is the third largest exporter of the country of information and technology whereas with global revenue of $2.5 billion in the last year, Jones Lang LaSalle serves clients in over 60 countries from750 locations across the world, including 180 corporate offices. The firm is a forerunner in property and corporate facility management services, with a portfolio of approximately 1.4 billion sq ft worldwide.
The statement issued by JLLM contained “Riding high on its recent successes with Indian corporates such as Max India Group and Lavasa (of HCC group), Jones Lang LaSalle’s Integrated Facilities Management India team has won a facilities management contract with another Indian corporate giant – Wipro Technologies”.
“There is a vastly increasing demand for professional integrated facilities management services in India,” said Yash Kapila JLLM’s Integrated Facilities Management MD.
The coming together of two big corporations is a good sign for the industry.
Emergence of Commercial Complexes
April 27, 2010
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.
Elderly Now Willing to Spend on Realty
April 24, 2010
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.
Hike in Mumbai Property Prices is expected
April 20, 2010
A current report by JLLM, Jones Lang LaSalle Meghraj revealed the fact that since sales are increasing and investor sentiment s are being strengthen, residential housing prices in Mumbai are expected to move further upside.
According to the report, demand for commercial spaces is improving and this growth is likely to continue till the end of 2010. As far as leases and outright purchases are concerned, this will result into a large number of transactions.
The supply is coming in all segments of residential, from luxury to mass housing. For the next year, in order to keep the markets going, both retail and commercial segments are also yielding enough supply.
The report also said that since many developers are now going for public funding, a large number of activities on the residential property front, owing to the strong demand will take place.
Besides, in order to boost accessibility more locations within the city and reduce commuting time, infrastructure projects such as the monorail, metro, and flyovers are being put in place.
Swami said that considering the pace at which these measures are implemented, in the medium to long-term this is good news for the realty sector. He also added that residential realty is likely to continue its demand growth, and thus will be on the priority list of most builders.