Commercial Realty in Mumbai To Outperform NCR’s

Knight Frank reported that Mumbai commercial realty has outperformed the National Capital Region. The property consultant’s report states that Mumbai is hotter than NCR for investment in commercial realty.

According to the recent report of Knight Frank, Central Mumbai has outperformed the National Capital Region for investment on office space properties. Mumbai commercial realty is the best investment destination as it assures 19 percent net annual return.

The property prices in the city are expected to grow by 63 percent. Similarly the rentals will grow by 47 percent, the report of Knight Frank adds. Continue reading

NCR Residential Market Hit by Delayed Projects

Delayed projects have hit the NCR residential market. Due to the delay of projects the home sales have dipped in the NCR.
NCR residential market is affected by construction delay.

NCR residential market is affected by construction delay.

DELHI-NCR: The prospective buyers are nailed by delay in projects. As per a recent report by Knight Frank states that new launches in the Delhi-NCR has fallen by 31%. It has adversely affected the NCR residential market.

As per the report, NCR residential market has nearly 1,40,000 unsold inventories. Out of this, over 27% is under construction.

As per the Knight Frank India report the 33,500 units were launched in the second half of 2012-13. This shows a fall of 31%. Global property consultant firm warns that the launches will see slowdown in the coming months too, affecting the largest residential market.

Developers are finding it really hard to complete the projects. The escalating prices of raw materials make construction costlier. This prompts the developers to invest more. Difficulty in finding sufficient fund is thus another reason for delayed projects. Continue reading

Anand Rathi and Knight Frank Eye the Second Realty Fund

Anand Rathi Financial Services and property consultancy Knight Frank India are planning to launch their second real estate fund by end of this months and looking to raise around Rs 500 crore (~$100 million), sources close to the development told VCCircle. Unlike its peers who are hitting foreign shores to raise new funds, the joint fund rental yield and appreciation portfolio (RYAP) fund will be raised from the domestic market.  Like its predecessor, it will invest in commercial assets in tier I cities which include Mumbai, Pune, Bangalore, National Capital Region (NCR) and Chennai.

The fund would be targeting returns of 10-12 per cent from its investments and expects to stay invested in an asset for four-five years. A senior executive of the joint venture fund house who did not wish to be identified, said, “We are waiting for final Alternate Investment Fund (AIF) guidelines as right now there is no clarity on registration of funds and other norms. Once we have clarity on the same which we are expecting by mid-May we will register and start our fund raising process.”

In April 2, markets regulator Securities and Exchange Board of India (Sebi) had unveiled its final norms to regulate AIF’s in the country. Fund managers expect the detailed guidelines to be issued in the next two weeks.

Knight Frank India and Anand Rathi Financial Services had joined hands two years ago to raise Rs 225 crore rental yield fund. It has invested Rs 135 crore from the existing fund in two projects including Hub town Ltd’s commercial project in Mumbai and Cerebrum IT park development by Pune-based Kumar Urban Development Ltd.

Demand for Super Luxury Housing is Back

Chennai Properties - Real Estate India - Villa Viviana 1

Luxury Property

The super luxury housing segment whose range was from Rs. 4 cr to Rs. 30 cr and which had taken backseat during the slowdown is now coming back. The demand for these residential properties has risen by 30- 40 percent.

The real estate firms such as Lodha Developers, Orbit Corporation, and Skyline Constructions are taking advantage of this demand hike and plan to cash in on a rather specialized alcove- the boutique homes category.

According to the national head (residential agency) Knight Frank India, Anand Narayanan KB, the sales of such luxury boutique homes are much higher as compared to volume luxury properties since there is limitation in this segment.

The HNI segment is to be hit by these homes. This includes senior professionals, CEOs, wealthy non-resident Indians and entrepreneurs in new-age businesses who are seeking for house in India. The CEO, Homebay Residential, Jones Lang LaSalle Meghraj, a real estate services firm, Mr. Raminder Grover noticed that the prices of luxury homes has gone up by 20%.

However, he also added that the prices should not rise now and become stable or otherwise the demand will go down again.