Tag Archives: commercial real estate

The importance of green certifications in Indian commercial real estate

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According to McKinsey, commercial real estate contributes 40% of global carbon emissions. There is, however, a beacon of hope: green building certifications. 

Though there is a worrying environmental shadow associated with India’s commercial real estate boom– according to McKinsey studies, the sector contributes an astounding 40% of global carbon emissions– there is cause for optimism: green building certifications serve as guidelines for creating environmentally friendly workplaces that will help Indian businesses and the environment grow sustainably. 

Energy Efficiency

Envision offices well-lit by natural light, furnished with energy-efficient appliances, and managed by intelligent technology that maximizes energy consumption. These are made feasible by green buildings. Consider the Infosys campus in Hyderabad, the world’s first IT SEZ building to receive the LEED Platinum certification. Its distinctive double-skin facade reduces heat gain and optimizes natural light, greatly reducing energy use. 

Water Conservation 

Green buildings handle water like a precious commodity. They use water-saving landscaping techniques, low-flow faucets, and rainwater collection for irrigation. Rainwater harvesting is used by its Green Centre in Gurgaon, the nation’s first LEED Platinum-rated building, to meet all its landscaping needs. 

Sustainable Materials 

The building materials of an office have a big effect on the environment. Green certifications encourage people to utilize recycled sustainable, and locally sourced materials to lower transportation-related emissions. A prime example is the World Trade Centre Noida, the first commercial building in India to receive a LEED Gold certification. It was built with minimal environmental impact using fly ash and recycled steel. 

Green buildings have many advantages that go well beyond protecting the environment. They result in observable financial gains for companies. Utility bills decrease as a result of less energy and water used. Furthermore, tenants are very interested in renting out green buildings due to the growing number of environmentally conscious consumers. For building owners, this means increased rental income and property values. Reputable corporations like GIC, Blackstone, and Brookfield have recognized this trend and are prioritizing their office buildings’ green certifications. 

There are further benefits to green buildings: 

Strengthened Reputation: 

Accompany’s brand image and reputation are strengthened by its commitment to sustainability through green certifications. 

Future- Proofing: 

As environmental laws change frequently, green buildings make it easy to comply with their new requirements. 

Technology is further revolutionizing green buildings: 

  • The Smart Joules system automatically adjusts energy consumption based on occupants and time of day. 
  • Intelligent Water Management: Water helps identify leaks, promotes water-saving practices amongst employees, and utilizes IoT technology to detect and address water leakages efficiently. 
  • Employee Well-Being: Caleedo uses technology to monitor temperature and air quality, creating a comfortable and healthy work environment that improves employee well-being. 
  • Wireless Security Solutions: Organizations such as Spintly provide wireless security systems, which do away with the construction waste that comes with conventional wired systems. 

The need for healthy work environments and the welfare of employees is growing, especially for foreign businesses looking to lease office space in India. Grade A office buildings are adopting this innovation due to this trend. Leaders in the industry understand that adopting green practices is not only wise for the environment but also prudent for business. 

Developers and investors can design and operate environmentally friendly offices by embracing PropTech solutions and green building certifications. These green procedures save money, draw premium tenants, and guarantee long-term success. This dedication to sustainability will influence how offices are built in India going forward, opening the door to a more environmentally friendly and healthful future for all. 

According to the CREDAI-CRE Matrix report, India’s demand for Grade-A office space will exceed 70 million square feet by 2024.

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Market rentals across Grade A spaces increased by 8.7 percent QoQ in Q1CY24.   

According to a CREDAI-CRE Matrix report, Grade A office space leasing demand in India will exceed 70 million square feet (MSF) by 2024. 

According to the report, Grade A office demand in India increased by 12 percent quarter-on-quarter (QoQ) and 14 percent year-on-year (YoY) in the first quarter of the calendar year 2024, reaching 16.7 million square feet. 

Bengaluru, MMR (Mumbai Metropolitan Region), and Delhi-NCR (National Capital Region) were the primary drivers of the increase in demand, accounting for nearly two-thirds of total office demand. According to the report, the top three cities experienced a 23% increase over the previous year. 

Market rentals in Grade A spaces increased by 8.7 percent QoQ in Q1CY24 nationwide. 

The report also highlighted the size of larger deals (more than 1 lakh sqft) driving office demand. In the first quarter of CY 2024, occupiers leasing more than 1 lakh sqft accounted for  56% of the total up from 36% in the fourth quarter of CY 2023 and 33% in the first quarter of CY 2023. Bengaluru, Hyderabad, and Noida accounted for 66% of these deals over one lakh square feet. 

CREDAI President Boman Irani stated that Grade A spaces have seen a significant increase in demand over the last 4-5 years, primarily from GCCs and the IT sector. 

“Our forecast for pan-India grade A office demand will be 70 million square feet by 2024 due to strong economic fundamentals and significant investment in physical and digital infrastructure.” This forecast demonstrates not only the commercial real estate sector’s resilience, but also the vast opportunities that developers, corporations, and investors face,” Irani said. 

In the resurgence of office space use, the IT/ITeS sector emerged as the dominant force in leasing demand, accounting for approximately 28% of office space requirements. Meanwhile, the BFSI sector’s share of leasing demand grew from 16 percent in the first quarter of fiscal year 2023, and 13 percent in the fourth quarter of the same year to 20 percent in the first quarter of fiscal year 2024. 

According to Abhishek Kiran Gupta, CEO and Co-founder of CRE Matrix and IndexTap, the upcoming quarters will see a rise in office supply completions. With market rentals geared toward landlords in key markets, leasing business volumes will also increase. 

“As rentals rise in prime markets such as NCR, Bengaluru, and  Mumbai, we expect to see larger deals in cities like Pune, Chennai, Hyderabad, and Noida, where occupiers are willing to pay a premium for high-quality space. The new government’s budget is also expected to boost the infrastructure and BFSI sectors, which will likely keep rental rates rising,” he added.

India’s Commercial Real Estate Is On Track For Successful Growth This Year

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India’s real estate shows growth potential for investment opportunities after the pandemic. 

Amid global economic challenges, India’s real estate sector is experiencing a significant resurgence, attracting international investors as the economy recovers. Despite challenges in the US real estate market, India’s real estate landscape thrived in 2023, with significant activity across segments. Institutional investment in Indian real estate totaled USD 5.8 billion, with commercial properties accounting for more than half of that amount. This increase in investment following the pandemic reflects growing market confidence, as evidenced by companies encouraging employees to return to physical workspaces and expanding global operations in India. 

The success and momentum of 2023, marked by high demand, absorption rates, and emerging trends such as the demand for flexible workspaces and sustainability initiatives, paved the way for the real estate industry’s future. Favorable economic conditions and government policies also contribute to strong market sentiment, indicating the possibility of continued growth and investment opportunities in the commercial real estate sector. 

Investment Opportunities 

In the case of commercial real estate in India, investors have several options. Office spaces in major markets, data centers, warehouses, and other commercial properties are in high demand. The rise of technology-driven industries has increased the demand for office space and data centers, making them appealing investment targets. India’s commercial real estate sector is a tempting investment opportunity due to market size, government support, and potential return on investment. 

Forecast for commercial real estate in 2024: 

Commercial real estate is expected to perform well in 2024, thanks to several factors that indicate potential returns for investors. Institutional and foreign direct investments (FDI) boost market confidence and growth. Furthermore, fractional ownership emerges as a compelling investment opportunity, allowing investors to diversify their portfolios while potentially earning high returns. This alternative investment method allows individuals to pool their resources and invest in high-value commercial properties, gaining access to previously unavailable assets. With the potential for high yields and the ability to spread risk across multiple properties, fractional ownership contributes to commercial real estate’s positive outlook in 2024, offering investors appealing opportunities for growth and profitability. 

Rise in NRI Interest:

 The growing interest of NRIs, particularly those from the Middle East, is reshaping India’s commercial real estate market. These NRIs recognize the potential for profitable investments in Indian real estate, which helps to drive the sector’s growth and dynamism. As a result of their participation, the market is stronger and more resilient, as they are also helping to diversify the investor base. As NRIs continue to express interest in Indian commercial real estate, the sector’s outlook for this year and beyond improves, emphasizing its appeal to domestic and international investors. 

Should you consider investing? 

High net-worth individuals (HNIs) can use numerous investment strategies tailored to their financial objectives and risk tolerance. Diversification across asset classes helps to mitigate risk and ensure long-term returns. Asset allocation is critical, with HNIs determining the proportion of their portfolio invested in various assets based on risk tolerance and investment horizon. Dynamic rebalancing entails proactively reviewing and adjusting the portfolio in response to market movements and financial objectives, thereby improving risk management and optimizing returns. Seeking professional advice from wealth advisors and financial experts can help HNIs align their investment decisions with their goals and minimize risks while increasing returns. 

Conclusion

To summarize, India’s commercial real estate sector is on track for a bull market in 2024, building on the momentum gained the previous year. However, investors should conduct due diligence and seek professional advice to make informed decisions consistent with their financial goals. Investors can capitalize on the potential of India’s commercial real estate sector in the coming year by carefully evaluating market dynamics and understanding individual risk tolerance. 

With knowledge and strategic planning, investors can maximize the potential of India’s commercial real estate market in the coming year. 

Investing for the future: The rise of co-working spaces in commercial real estate

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As the commercial real estate market evolves, one key trend that continues to shape the industry is the proliferation of co-working spaces. These shared work environments, which provide flexible lease terms and amenities, have altered how businesses and individuals view workspaces. Incorporating co-working spaces into a real estate investment portfolio can be a strategic move that capitalizes on changing trends while providing financial benefits. 

The expansion of coworking spaces 

Co-working spaces emerged as a solution for freelancers and small businesses seeking flexible, cost-effective work environments. Over time, these spaces have evolved into innovative hubs that cater to a wide range of clients, from startups to multinational corporations. The rapid expansion of remote and hybrid work arrangements has only fueled this trend, making co-working spaces an essential component of modern office culture. 

As companies adopt more flexible work policies, the demand for adaptable and dynamic workspaces increases. Co-working spaces enable businesses to easily scale their operations, whether downsizing or expanding, without being limited by traditional long-term lease agreements. 

The financial appeal of coworking spaces 

Co-working spaces provide significant benefits to real estate investors. One of the primary advantages is the ability to generate multiple income streams from a wide range of tenants. This diversification helps to spread risk across various industries and business sizes. 

Furthermore, co-working spaces tend to have higher occupancy rates than traditional office spaces, maximizing revenue potential per square foot. Moreover, these spaces frequently command high prices due to the extensive amenities and services such as meeting rooms, private offices, and community events. 

Development of real estate investment portfolios. 

Integrating co-working spaces into a real estate investment portfolio can result in significant long-term returns. By incorporating these spaces, investors can position themselves at the forefront of a rapidly changing market and capitalize on shifting preferences in office environments. 

Coworking spaces allow for property appreciation. As the demand for flexible workspaces increases, the value of properties that house co-working operators is expected to rise. This potential for asset appreciation provides additional financial incentives to investors. 

Furthermore, investing in co-working spaces enables a more dynamic and resilient portfolio. Co-working operators’ flexibility can help them weather economic downturns and changing market conditions, as these spaces can quickly adapt to new situations. 

Navigating risk and challenges 

While co-working spaces offer numerous benefits, investors should consider the risks. The success of coworking operators can be influenced by management quality, competition, and market trends. Furthermore, the industry’s rapid growth has resulted in some market saturation in certain areas, potentially affecting the profitability of individual co-working spaces. 

Choosing established co-working brands with a proven track record of success can increase stability and reduce the likelihood of failure. Furthermore, understanding local market dynamics and competition is essential for making sound investment decisions. 

Summary  

Co-working spaces have emerged as a transformative force in the commercial real estate industry, reshaping how businesses and individuals approach workplaces. Co-working spaces can provide significant financial rewards for real estate investors but only if they are mindful of the risks. 

As demand for flexible workspaces rises, investors who believe in this trend will be well-positioned for long-term success. Understanding the benefits and challenges of co-working spaces, and selecting the right partners can help investors to capitalize on this dynamic market and secure a profitable future in commercial real estate.   

Shops, homes, and faith: places of worship ready for a surge in visitors

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The boom in retail in India has also had an impact on significant religious infrastructure. While visitors to Shirdi can now purchase FabIndia Kurtas, there is a Spykar store in Somnath. There are Zudio and Blackberry stores in Varanasi and Bodh Gaya, respectively. 

Fast-food restaurants such as Domino’s, KFC, and Burger King have not lagged, establishing their presence in remote religious locations such as Puri, Katra, Ajmer, and beyond.

Though the growth of Ayodhya’s retail and hospitality sectors has drawn attention, the nation’s retail chains have grown gradually but steadily. 

This pattern suggests that tourists’ tastes are shifting as more and more visitors look for life-changing experiences outside of customary activities. According to a report by real estate consulting firm CBRE, the growth of urban spiritual tourism is satisfying this demand by drawing tourism to locations recognized for their profound religious and spiritual significance. 

According to the report, the major cities experiencing this retail boom are Madurai, Ajmer, Varanasi, Katra, Somnath, Shirdi, Ayodhya, Puri, Tirupati, Mathura, Dwarka, Bodh Gaya, Guruvayur, and Madurai. 

The products retail brands offer are changing for high-street locations and small clusters. Businesses and local governments are collaborating to develop distinctive retail experiences. This involves incorporating regional customs into the layout and amenities of stores, eateries, and lodging facilities,” claims CBRE. 

To offer visitors a taste of a city beyond spirituality, cities like Amritsar, Varanasi, Madurai, Puri, Guruvayur, and others use their distinctive culinary traditions and Local fashion expertise. 

Infrastructure upgrades enable peaks in spiritual tourism. 

According to a report by Jefferies, despite the current infrastructure bottlenecks, the most visited religious sites in India welcome 10-30 million tourists each year. Such cities are now undergoing an infrastructural upgrade– which will bolster their growth. 

The state and federal governments are constructing airports, public transportation systems, and well-connected roads. It supports the development of lodging establishments such as hotels, guesthouses, and wellness centers to ensure that travelers have a comfortable stay. 

“India’s faith-based economy is expanding rapidly due to the country’s growing spiritual tourism industry. Government programs to enhance connectivity between pilgrimage sites and to boost tourism are speeding up this growth even more. Another important factor is the growth of online retail platforms that make it simple to obtain faith-based goods and services, according to Anshuman Magazine, chairman and CEO of CBRE’s operations in India, South-East Asia, the Middle East, and Africa. 

While Jefferies anticipates 50 million visitors per year on average to Ayodhya, other pilgrimage sites are also expanding quickly. “India offers a vast array of tourism experiences, such as beaches, hill stations, cultural & heritage sites, historic monuments, and more. The largest category of tourism in India is still religious travel, the report continues. 

High-end hospitality brands are also entering these cities, in addition to retail chains. Other chain brands that are opening boutique and experience hotels in these cities include Taj, ITC, Lemon Tree, Novotel, JW Mariott, and Mayfair. 

“Big hotel chains are adjusting to the changing needs of spiritual travelers by providing pristine, sanitary, and kid-friendly lodging at premium rates. According to CBRE, “Branded hotels are starting to emerge as major players, providing a fusion of comfort and traditional hospitality catered for spiritual seekers.”

Discover the top Indian cities for commercial real estate investments.

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Real estate investing has long been considered a prudent financial move, and commercial real estate has always set the standard for available options. Several Indian cities present enticing returns for investors in commercial investment while compiling a list of India’s top cities. 

Everyone says, “Investments are subject to market risk,” but very few guide where to put your money. This article may be helpful if you are considering investing in commercial real estate in India and are looking for options. 

Even though our nation is still developing, some cities have incredibly developed real estate markets with excellent investment opportunities. This article lists the top three cities for investing in commercial space with their benefits. 

What is a commercial property? 

Any real estate used for purposes other than residential is considered a commercial property. These properties, which can be office spaces, retail stores, industrial warehouses, or hospitality establishments like hotels and restaurants, are all intended to bring in money. 

Advantages of owning commercial real estate

Whether it is a home or business, real estate investment continues to be considered the better choice. Compared to other real estate investment options, commercial property has certain advantages. They are as follows:  

Consistent Revenue 

The possibility of a consistent income stream is one of the main benefits of investing in commercial real estate. Unlike residential spaces, commercial spaces usually involve long-term lease agreements with businesses. For investors, this guarantees a steady stream of rental income that is predictable and stable.  

Greater returns on rentals 

When compared to residential properties, commercial properties typically offer higher rental yields. Because the returns are typically higher, it is an appealing option for people looking to maximize their investment returns. 

Greater duration of leases 

Generally speaking, commercial leases are deeper than residential ones. As an investor, you can profit from long-term income stability, which lowers the risk of vacant properties and fluctuations in income. 

An increase in property value

Commercial properties in prime locations frequently increase in value over time. Property values rise in response to an improvement in the local business climate, which raises demand for commercial space. 

India’s top cities for commercial real estate investments 

Risks, future potential, and return on investment (ROI) are a few variables that determine which city is best for commercial investment. The top three Indian cities for commercial space investment have been ranked. Take a look at the list: 

Bangalore 

Bangalore, sometimes known as the Silicon Valley of India, is a popular place to invest in real estate both residentially and commercially. Due to its close ties to the thriving IT actor, there are numerous employment opportunities in the real estate sector. 

Astute investors believe Yelahanka, Hebbal, and Electronic City are great choices. Large companies like Dell, Aegis, Infosys, Wipro, Hewlett-Packard, Accenture, Tata Consultancy Services, and Tech Mahindra have chosen Bangalore’s IT sector, which boosts the city’s real estate market. 

Considering this, real estate investing is still very common in Bangalore. The dynamic real estate market presents an ideal opportunity for investors seeking to increase and stabilize their real estate holdings. 

Mumbai 

Mumbai, India’s financial hub, has added residential and commercial space to its real estate portfolio. Mumbai is one of the priciest places to invest in real estate investments, making it one of the most expensive places to do so. 

The strategic features of the city, such as the Mumbai Trans Harbour Link, Atal Setu, and several metro links, are crucial in promoting the growth of commercial real estate. As a result of this advancement, builders and developers have aggressively promoted investment by providing significant discounts on real estate. The Maharashtra government’s discounts and reductions in stamp duty have increased consumer confidence and interest in the market. 

Pune 

Pune, a megacity in Maharashtra, has established itself as a city with potential commercial investment, contributing 13 percent of the state’s GDP. The city is a center for technology, and major companies in the sector are in high demand for commercial space. The city’s excellent connection to Mumbai has contributed to the recent explosive expansion of the housing market. 

Pune’s real estate values have shown investors an excellent return on their investment. The purchase of real estate (both residential and commercial) saw a notable uptick in 2021. Experts in real estate predict that the city will maintain its current trend and emerge as a viable center for commercial investments. 

Summarize 

India and its developing cities offer investors plenty of space and investment potential. Therefore, the ideal location for your commercial real estate investment if you want a higher return on investment. Bangalore, Pune, and Mumbai are the best places to invest in commercial real estate. Before investing in any type of real estate, whether commercial or residential, it is advisable to conduct in-depth market research.

Tenants of commercial properties must pay 18% GST on their electricity bills.

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The Central Board of Indirect Taxes and Customs released a circular on Tuesday regarding the applicability of GST on the reimbursement of electricity charges that airport operators, mall operators, and real estate companies receive from their lessees or tenants.

The government explained that tenants, especially those renting commercial properties, must pay 18% Goods and Services Tax (GST) on electricity charges if the supply coincides with the rental of immovable property and facility maintenance. However, the power billed on an actual basis by real estate owners or malls, which act as discus agents, will not be subject to any GST. 

The Central Board of Indirect Taxes and Customs (CBLC) released a circular on Tuesday about the applicability of GST on the reimbursement of electricity charges that airport operators, mall operators, and real estate companies receive from their lessees or tenants.

It clarifies that providing electricity in conjunction with the rental of real estate or the upkeep of buildings, as the situation may dictate, constitutes a composite supply and is subject to the appropriate taxation, the statement read. 

“The leasing of real estate and grounds maintenance is the primary supply; the provision of electricity is incidental,” the statement reads. “The GST rate on renting immovable property or maintaining premises would be applicable even if electricity happens separately,” the document said.

It also stated explicitly that homeowners in housing societies would not be subject to GST. The resident welfare associations (RWAs), real estate developers acting as pure agents, or real estate owners provide the electricity; it will not be included in the price they pay. “Furthermore, they will appear to be acting as pure agents for this supply where they charge for electricity on an actual basis, that is, they charge the same amount for electricity that the State Electricity Boards or DISCOMs collect from their lessees or occupants,” the statement went on. 

Expert opinions on this clarification vary. “The real estate industry is concerned about the CBIC’s most recent clarification. This clarification applies GST to electricity charges, regardless of whether they are provided separately or in conjunction with real estate. Although there are some exceptions, such as when property owners recover electricity costs on an actual basis or act as pure agents,” according to Saurabh Agarwal, a partner at the consulting firm EY. 

In his view, “The implications of this clarification remain a concern in cases where real estate companies convert high tension lines to low tension lines and charge higher rates due to transmission loss.” “Going forward, landlords may factor in the GST cost on electricity when determining lease rental amounts, which could increase the rental cost,” he continued. 

But MS Mani, a partner at Deloitte India, thought it was for businesspeople. “This will help the recipients of such composite supplies who were uncertain about their eligibility for input tax credits (ITC), in addition to ensuring uniformity of procedures throughout the real estate industry,” he said regarding the clarification on electricity charges recovered as part of a composite supply. 

Commercial real estate increased by 7% in India’s main Tier-1 cities.

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According to a PropWquity study, the supply of commercial real estate in India’s major Tier-1 cities increased by 7% in the third quarter of 2023 to an overall total of 14.61 million square feet. The government’s proactive efforts to support the IT industry through infrastructure improvements and tax breaks are responsible for this growth. With about 35% of the new supply, Hyderabad was the best performer overall. Bengaluru came in second with 25% of the new supply. A notable 20% increase in net occupancy occurred during the same period, going from 10.30 million square feet (in Msft) in Q2 CY’23 to 12.31 million square feet (in Msft) in Q3 CY’23. In contrast, gross occupancy increased by a meager 2% from Q3 2023 to Q2 2023. This significant increase in occupancy is evidence of the market’s dynamism and the high demand for commercial real estate at the time. 

Companies and businesses have been growing their operations, demonstrating the industry’s dynamism and room for growth. With a 9% YoY increase in new supply, MMR has the highest net occupancy among the Tier 1 cities. In contrast, because of the excess supply from prior quarters and high rental prices in this one, the Delhi-NCR area has seen a significant decline in the construction of new properties, with a 65% decrease compared to the previous year. As a result, Delhi NCR now only makes up 7% of the supply of new real estate in Tier-1 cities. The higher net occupancy in this quarter is the main reason for the sharp increase in rental rates in Delhi-NCR, which have increased YoY by 17% and QoQ by 45%. Due mainly to leasing initiatives by Citi Bank and Teleperformance, Gurugram’s Sector-18 and Noida Expressway rank among the top micro-markets in the Delhi NCR according to occupancy levels. 

India’s market for commercial real estate is expanding rapidly, providing companies with dynamic spaces that adapt to their changing needs. The supply of commercial real estate has increased by 7% in tier-1 cities, suggesting a bright future for the industry. We can not wait to take part in this thrilling adventure. With the festive season approaching, strong demographics, a boost in business confidence, and government initiatives in high-value industries like infrastructure and manufacturing, the current wave in Indian commercial real estate is predicted to continue for the upcoming quarter. 

There was a small shift in the number of open positions from Q2 2023 to Q3 2024 in the Top Tier-1 cities of India. There are 152.32 million square feet of vacant space overall in these cities as of Q3 2023. The most unsold stock is found in Hyderabad and Bengaluru, at 43%, and MMR, at 15%. This pattern illustrates how the Indian real estate market has changed over time, driven by several variables, including the current state of the economy, the dynamic interplay between supply and demand, and the changing needs of businesses. The commercial real estate market is formed by these factors taken together. Although the marginal increase in vacancy levels is promising, major players in the industry must stay vigilant and flexible to adeptly navigate the continually shifting landscape of the commercial real estate sector. 

Investment in Commercial Property

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Office buildings, shopping malls, warehouses, and industrial parks are just a few examples of the various property types that fall under the umbrella of commercial real estate. Even though residential real estate is what many people see, commercial real estate makes up a sizable portion of the market. 

You can make money by investing in commercial real estate, but you must understand the various types of properties and what to consider for each one. 

This article will examine market trends and investment opportunities for the real estate sector. We will also discuss the benefits of investing in commercial real estate. 

Recent Trends and Developments in Indian Commercial Real Estate

The Indian commercial real estate market has been the most impacted by the COVID-19 outbreak. The sector was already struggling because of the economic downturn, and the pandemic has only worsened things. The number of individuals looking for office and storage space had significantly decreased due to the lockdown. However, there are also some promising developments. 

India’s commercial real estate market has seen steady growth in recent years, driven by the country’s robust economic expansion, urbanization, rising disposable incomes, and an increasing number of expanding businesses. Due to this, commercial property prices have increased in India’s largest cities, including Mumbai, Delhi, and Bangalore. 

The government uses green building technologies to construct more energy-efficient and sustainable buildings. Environmentally friendly construction techniques will also be used by builders to reduce operating costs and draw mindful tenants. 

Once the government authorizes foreigners to make direct real estate investments, the demand for space in commercial buildings will rise. For investors and property owners, FDI may result in larger investments, more capital investments, and higher property values. 

Benefits of Indian Commercial Real Estate 

The country’s strong economy is helping India’s commercial real estate market grow and attract foreign investors. A serious concern is the need for more modern infrastructure, which could make it challenging to travel the country and conduct business. 

Generally speaking, commercial real estate in India has more benefits than drawbacks. 

  • Strong economic growth: The young population, expanding middle class, and reforms that make the nation more business-friendly add to the booming Indian economy. Strong demand for commercial real estate is a result of this growth. 
  • Cost-effective: Commercial property costs are increasing due to the high demand. They’re still reasonably priced, especially when compared to markets like Hong Kong or London. 
  • Favorable demographics: A key factor in India’s economic growth is the country’s sizable young population. The country’s middle class is also expanding, which increases demand for goods and services and expands business opportunities. 
  • Infrastructure development: India is progressing, even though there are still many issues with it. The Indian government is making significant investments in infrastructure growth, which may enhance the appeal of commercial real estate in some areas. 

Indian commercial real estate’s drawbacks 

India’s economy has grown at one of the fastest rates in the last ten years, and the same can be said for the country’s real estate market. Although commercial real estate in India has grown significantly, there are still some drawbacks that investors need to be aware of. 

  • Lack of transparency: India’s real estate market requires greater openness. Due to reliable data and information, it can be difficult for investors to make informed decisions. 
  • Costly: Commercial building construction and maintenance are expensive in India. Businesses struggle to establish operations in India as a result. 
  • Regulatory ambiguities: The regulatory climate in India is murky. Businesses find it challenging to long-term plan their operations as a result. 
  • Political unrest: India is a nation with a volatile political situation. The political unrest may make it challenging for businesses to run efficiently. 
  • Economic turbulence: Commercial real estate in India is subject to market fluctuations and can be affected by economic downturns, just like any other investment. 
  • Limited Liquidity: Due to the market’s lower liquidity than a few other markets, it can prove hard to sell commercial real estate in India quickly.

What justifies commercial real estate investment? 

There are advantages and disadvantages to owning both residential and commercial property. Depending on your financial objectives and how you intend to invest your money, one may be better for you than the other. 

Any inverter can profit and benefit from purchasing commercial real estate as an investment. Better returns and a diversified portfolio will be to your advantage. It will increase your passive income during this time. 

Commercial real estate can provide a variety of benefits that can help you meet your financial objectives, whether you are a novice or a seasoned investor. 

Income tax exemptions and deductions are available for commercial real estate investing. On the annual value (i.e., the annual rent collected on the property), investors can deduct a flat 30% of their expenses. 

Additionally, you may deduct up to INR 2 lakhs from your taxable income for interest paid via EMI under Section 24 of the Income Tax Act of 1962. 

An investment vehicle known as a REIT (Real Estate Investment Trust) enables people to invest in a diverse portfolio of commercial real estate properties. Investments in Commercial real estate REITs can be profitable, but buying and managing individual properties requires more money or managerial expertise. 

Commercial Property for Sale in Chennai

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Are you trying to find a commercial property in Chennai? Then you should read this blog! Commercial real estate property in Chennai is one of the most sought-after investments. There is a high demand for office and retail space due to the country’s development and growth in the IT and corporate sectors. 

Although the real estate market remained unaffected by the pandemic, demand for commercial real estate fell slightly in 2020 due to businesses closing their offices and switching to remote working arrangements. Despite a decline in the market, the Commercial real estate industry is on the right track to quick recovery as real estate investors resume their interest. 

Commercial spaces are gaining in demand as offices gradually open up, making them one of the safest and most secure investments. The time is correct to invest in commercial property in Chennai. You must consider several factors to locate the best commercial property for sale in Chennai. 

Learn more about finding the best commercial property in Chennai by reading on. 

The commercial real estate industry, predicted to contribute roughly 13% of India’s GDP by 2025, is essential to the country’s economy. One of the most developed metropolises in the nation, Chennai has a sizable commercial market. When it comes to investing in commercial real estate in Chennai, there are many options available. 

Finding and investing in the best commercial property in Chennai can be challenging. Commercial real estate involves high costs, so even if the investment is safe, it will still require careful planning on the part of the investor. 

How to find Chennai’s Best Commercial Property 

Location

Location is a crucial factor to consider when investing in commercial property in Chennai. When you invest in a premier commercial area, commercial real estate offers the best returns. Compared to investing in an already settled region, investing in a developing area offers higher returns because the former has more room for expansion. 

Select the Best Builder 

If you decide to purchase a commercial property in Chennai, make sure to pick one that was constructed by a reputable builder with extensive experience in the field. It is crucial to consider the builder’s reputation. The quality and returns will be better the higher the reputation. 

Financial Planning 

Purchasing commercial real estate for sale in Chennai will require a significant investment. You must, therefore, properly plan your finances. Check out if you would be better off taking out a loan or paying cash for a commercial property. If you are considering getting a loan, talk to loan experts before approaching banks that provide loans at reasonable interest rates. 

Be mindful of the relevant legal implications. 

Purchasing a commercial property in Chennai involves several legal considerations, such as insurance, planning permissions, safety and fire codes, licenses, and other accessibility. You must pay stamp duty because you are purchasing a commercial property in Chennai. These problems are fixable by talking about them with a lawyer who can help you navigate these legal nuances. 

Recognize the market 

Market research is one of the first steps you should take when looking for commercial property in Chennai. Even though the real estate market is generally stable during uncertain times, you must understand the market’s history. Observe market trends, assess the potential for future growth, and consider the property’s location and condition. With the help of this information, you can choose the ideal commercial property in Chennai. 

Think about your investment options. 

You can invest in a variety of commercial properties. Commercial real estate provides a wide range of options for you, including warehouses, offices, industrial, and other commercial spaces in addition to wholesale and retail stores. Based on the property’s location, intended use, and anticipated returns, choose the best commercial property in Chennai.  

Commercial Shops In Noida Extension

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Real estate investing is no longer a simple task. It is hard to decide where to invest. There are numerous commercial projects in India, but before investing in any venture, you must be cautious about your funding. First, you must determine what type of property you want to invest in or what property will fit your budget. There are a few good commercial assets where you can earn money. We always advise our clients to invest in retail shops in Noida if they have an investment budget but no experience in industrial property. However, if you have any experience in the business sector and a large budget, you should invest in the commercial property in Noida Extension. 

Commercial Shops in Noida Extension 

You can spend your money on Retail Shops in Noida Extension. Commercial Shops in Noida Extension have a lot of potential for good returns on Investment for a short period. One of the reasons is that the developers building a retail store here are very professional and well-known. They are using cutting-edge technology in construction, so the overall result is better. They hire internationally renowned architects for projects to develop new designs and ideas in India.  These international architects have worked on a variety of projects in developing countries, and as a result, they require full-size experience. 

Central Noida Retail Stores 

There are a few projects in Noida where you can buy retail shops for incredibly reasonable prices. Spectrum Metro is a good project where you could invest in retail stores in significant Noida. These stores stand in E. Sector 75 Noida, which is the center of Noida. The world 50 & 51 Noida, the oldest and most expensive part of Noida, opposes Spectrum Metro Noida. The USP of the project is the upcoming Max Health Center directly across from it because most people will buy their medications and food items from its strategically located store. 

Guidelines for Purchasing Commercial Stores in Noida Extension

People are choosing commercial shops in Noida Extension NCR because, as we all know, the area is experiencing significant residential and commercial development due to industrialization, commercialization, and high-connectivity infrastructure developments. Always look for commercial shops near Metro stations; doing so will increase investment returns in the long run. The foot traffic will increase due to the proximity of a metro station, which will eventually be to your advantage and that of your investments. 

The best options are great retail stores with spacious storefronts for retail space units with designated signage areas. Retail establishments with designated drop-off points give you the advantage in future profits. Another excellent investment is a store with kiosks and seating areas. If you are looking for commercial office space, there are designated, separate drop-off and entrance areas for offices if it is a mixed-use building with both office and retail space. 

The city’s thriving business district is conveniently close to a contemporary, upscale business complex. The proximity of a market, hospital, and metro station is also crucial. Always look at the real property from a real developer when searching for commercial property in Noida Extension. Real estate developers who are fake and pitiful are currently abundant on the market. As a result, always investigate the developer’s reputation. This advice will give you a long-term rental business and raise the bar for your smart scale. 

One of the areas with the fastest growth rates in the nation and Delhi NCR is the Noida Extension. This region has gone too far in terms of amenities, appreciation, connectivity, infrastructure growth, and final security.  

Understanding GST on Renting Commercial Properties

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Real estate is one of the country’s most important economic sectors. Many people in the country rely on property rentals as a source of income. The impact of GST on the property rental industry has been significant. Learn more about GST on commercial properties by reading this blog. 

In India, how is commercial rent taxed?

If you rent out your property for commercial purposes and earn more than Rs 200,000 per year, you are subject to GST. GST applies at 18% of the taxable value. 

Who is responsible for GST on commercial property rent?

Owners of rental properties are required to collect GST from renters. This GST is part of the rent. If the rent from AY 20-21 onwards is Rs 2.4 lakh a year, the rent payer must deduct 10% income tax. 

Both residential and commercial properties are subject to TDS. TDS is not taxed. 

Commercial property tax breaks are available. 

Commercial property can be bought and sold. 

The standard deduction

Commercial properties rented at a set price are eligible for a 30% repair deduction. It allows you to save a reasonable amount of tax regardless of how much you spend on your property purchase. 

Interest deduction on loans 

You can deduct the total interest paid on loans involved in buying or building commercial real estate to modify or build real estate. In this category, upfront penalties or processing fees are also tax deductible. It is only valid for the year of ownership following completion. You can also claim the total interest paid in five equal installments before the year of purchase. 

Use of commercial property for work/ business.

You cannot deduct fictitious rental income. You can deduct depreciation and the interest paid on the loan used to purchase the property. The actual cost of maintenance and repairs is tax deductible. 

The new tax regime limits tax deductions for commercial real estate loan interest. Section 24 deductions for rented property do not apply. You can charge up to the annual net sum of gross rent minus municipal tax if you claim interest and standard deductions. 

How much of your rent is tax-free?

You are not required to pay tax on amounts previously paid as property tax. Deduct current-year property taxes from gross rental income or gross annual value (GAV) for the year. 

Section 24A of the Income Tax Act allows for a 30% deduction from net annual value. People pay no tax on this amount and deduct it from their taxable income. Other expenses, such as painting and repairs, are not tax deductible once the 30% limit under this section applies. 

Assume an owner takes out a loan on a rental property. In this case, the loan interest paid during the fiscal year reverts to rental income after standard deductions. This rebate is allowed under Section 24B of the Income Tax Act. 

Interest on borrowed capital for acquisition, construction, repair, or diversion is deductible in the case of rental property. The Income Tax Appeals Court has ruled that owners are not required to pay taxes on unrealized rental income for unpaid rent. 

Because rental income is taxable under sections 22 and 24 of the Income Tax Act, this section only applies to income from habitable land. Renting vacant land is taxable as other sources of income. 

How is rental property tax calculated?

After deducting municipal taxes, standard deductions, and home interest, compute rental income taxes based on the Gross Annual Value (GAV). 

Consider the following example to demonstrate how to calculate taxable income on a rental property:

Assume the owner receives Rs 30,000 in monthly rental income and pays Rs 30,000 in local tax (calculated using the property unit area system). He has also taken out a home loan and is paying Rs 90,000 in interest to secure it. 

Calculate your taxable income as follows: 

Rental Property Income Amount in Rs. 
Gross Annual Value 4,80,000 (40,000 per month) 
Deduct Municipal Taxes 30,000
Net Annual Value 4,50,000
Deduct: 30% standard deduction 1,35,000 (30% of 3,30,000)
Home loan interest90,000
Income from house property2,25,000

Tax Calculation on Rental Property

In this case, the GAV of the property is Rs 4,80,000, which is greater than Rs 2,50,000, so tax is due on the rental property. If you pay Rs 20,000 monthly rent, your GAV is Rs 2,40,000 (20,000 *12). 

How can I avoid paying rental income taxes?

The following suggestions will help you save money on your rental income taxes: 

Upkeep fees: 

Deducting maintenance charges from rent is one of the simplest ways to save tax. The cost of maintenance can include in the rent. In some ways, the tax on rental income is rising. For example, if you calculate a rent of Rs 50,000 and add Rs 10,000 for maintenance, you must pay taxes on the entire amount. However, you can save Rs 10,000 in tax by excluding such costs from maintenance charges. The lease contains only one line saying that tenants can pay maintenance fees directly to the society association.”

Municipal taxes: 

A few individuals realize that municipal taxes, such as property and sewerage fees, can be deducted from rental income. The only requirement is that the property owner pays all municipal taxes. Tenants are frequently liable to municipal taxes. As a result, the tenants’ payments are not deductible. Municipal tax credits reduce your tax liability by lowering your income from real estate. 

Joint Possession 

You can pay taxes on your rental income if you buy a property with a trusted family member (husband/wife/parents). Rental income is shared and taxed with other family members in such cases. 

Fully or partially furnished properties: 

The property owner will provide amenities such as WiFi, a gas connection, DTH/cable TV, and a newspaper. Such charges are typically billed as rent and paid by the owner’s relevant authorities. In such cases, you can request that the lessee pay the bill and deduct the rent amount. Alternatively, you can collect them separately from the tenant. It’s not part of the rent. Therefore, rental income will decrease. 

Standard Deduction: 

When a property is purchased and rented for investment purposes, it follows that there will be some costs for repairs and maintenance. 30% of the annual net value can be claimed as a standard deduction regardless of the repair costs. 

What is the GST rate on commercial property maintenance fees? 

Buyers must pay GST on maintenance costs plus GST on property purchases. The builder levies 18% GST on monthly maintenance fees of around 4000 rupees. Maintenance charges are exempt from GST up to Rs 7700/- per month. 

What are the tax advantages of a commercial property loan? 

Tax break under section 24(B)

This section allows salaried individuals to claim income tax breaks on property loans. If the loan is used to [purchase a new home, you are eligible for a tax credit of up to Rs. 2,00,000. Interest payments are tax-deductible. 

Section 37 (1) Tax Benefit: 

Property loans are not tax deductible, whether they are for business or personal reasons. Because you are investing in real estate, a loan for investment reasons may be tax-free. 

What is the penalty for failing to declare rental income? 

When landlords intentionally omit income from their returns, the IRS imposes fraudulent filing penalties. It could include a fine of 20% of the owed amount plus 75% of the total tax due. These penalties are in addition to any unpaid taxes. 

Kerala Shops and Commercial Establishment Act 1960

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The Kerala Shop and Establishment Act 1960 intends to legalize businesses and safeguard the rights of employees. This law establishes the necessary guidelines for Kerala’s annual salaries, leaves, working hours, holidays, maternity leave, and other benefits. 

Companies must register under this act to get a mandatory license to run a business successfully in Kerala. Companies must register following this act to obtain permission to run their businesses in Kerala well. This guide provides details on shop and establishment registration in Kerala. Keep reading to learn more. 

Definitions 

An establishment or administrative service where the employees are primarily engaged in office work, a hotel, restaurant, boarding or eating house, cafe or any other refreshment house, a theater or any other place of public amusement or entertainment, and any other establishment that the government may, by notification in the Gazette, declare to be a commercial establishment are all considered to be commercial establishments. 

“Establishment” refers to a store or other place of business;

A shop is any establishment that engages in trade, business, or customer service. Whatever the location, it also includes any offices, storerooms, godowns, or warehouses used in connection with such sales or companies. However, it excludes commercial establishments and shops attached to factories where employees are entitled to benefits under the Factories Act of 1948. 

Eligibility Requirements for Registration Under the 1960 Kerala Shop and Establishments Act 

Every business establishment located in Kerala state territory is subject to this act. Every service, no matter how big or small, must register. Therefore, shop and establishment registration is necessary in Kerala for all retail stores, lodging facilities, restaurants, theaters, and public entertainment venues. 

The Kerala Shops and Commercial Establishment Act Exempts Certain Establishments from Registration

This law contains some exemptions. The list is as follows: 

  • Employees working in a management position in any establishment employees in management positions in the organization. 
  • People who give services that involve traveling people who provide travel-related services. 
  • Central or state government undertaking establishments for essential or state government undertakings. 
  • Establishments under local authorities 
  • Cantonment authorities and establishments under the Reserve Bank of India.
  • Shops and establishments in marketplaces where temporary fairs are occasional stores and businesses located in areas with frequent temporary fairs. 
  • Establishments that do not fall under the Factory Act of 1948. 

How do I register establishments and shops online in Kerala?

The steps that are required to register under the act:

  • Visit the official website of the Kerala government’s labor division as your first step. 
  • After reading the relevant instructions, click “Proceed” after selecting the “Online Registration” tab. 
  • Step 3 is to choose the district name and registration office after choosing the Kerala Shops and Establishments Act 1960. 
  • Locate the key areas, which are:
    • Name of the company and the manager, 
    • Name and mailing address of the businesses, 
    • Name of the company and the kind of business 
    • Number of males and females employes  
    • Owner’s mobile number, etc. 
  • Step 5: Download the format for the employee information, complete the fields, and click “apply.”
  • Step 6: Write down the temporary registration number and the application number. 
  • Step 7 is to download the challan and make the necessary payment. 
  • Step 8: Display and print the application using that temporary registration number. 

Registration Paperwork for Kerala Shops And Commercial Establishments Act 

To register, applicants must submit the following paperwork: 

  • Details of the employer or manager. 
  • The trust deed, partnership deed, or association documents.
  • Bank details 
  • For rented shops, a rental deed is necessary. 
  • Managers, directors, and officers.
  • Details of applicants’ PANs and Aadhaars 
  • List of employees and their names, address, date of birth, workplace designation, and year of joining. 
  • MOA or AOA 
  • Certificate of incorporation 

Registering Under the Kerala Shops and Commercial Establishments Act: Required Documents 

The following fees need to be collected for applicants to register their stores and other businesses in Kerala: 

  • No employees – Rs. 10 
  • 50 rupees for five workers 
  • 5-10 employees – Rs. 50 
  • 10-20 employees – Rs. 200
  • 20-30 employees – Rs. 300 
  • 30-50 employees – Rs. 500 
  • 50-100 employees- Rs. 1000
  • Above 100 employees – Rs. 2000 

Steps for Kerala Shops and Commercial Establishments to Check Application Status of Registration 

You can check the status of your application using a straightforward process. These are as follows: 

  • Step 1: Visit the official website of the labor department of the Kerala government. 
  • Step 2 is to enter the registration number. 
  • Step 3: Complete the captcha and select “show.”

Validity of Shop and Commercial Establishment Registration Certificates in Kerala 

This registration certificate for a shop and commercial establishment in Kerala is valid for one year from the issue date. Applicants must apply for certificate renewal at least 30 days after the certificate’s expiration date. 

Continue reading if you want to know how to renew your certificate. 

How do I renew a shop license online in Kerala?

Applicants must renew their licenses every year. Otherwise, they may encounter difficulties in running a business. This renewal process is as follows: 

Step 1: Go to the Kerala government’s official labor department website. 

Step 2: Navigate to the portal and select “online renewal.”

Step 3: Go to the license renewal page by picking “online renewal.”

Step 4: Select “renewal of registration” as the renewal type. 

Step 5: Review your license information in the following window. 

Step 6: Next, select the period of renewal for the option. 

Step 7: Download the employee’s details format, fill in the blanks, and next select the Browse tab. 

Step 8: Finally, choose “apply for renewal.”

Kerala Shops and Commercial Establishments Act Rules  

Here are some of the most essential rules for shops and commercial establishments in Kerala. 

  1. Employment of Women, Children, and Young People

This act prohibits children from working in shops or commercial establishments on the state’s territory. Women and minors under the legal limit of 17 are not allowed to work before or after 6 a.m. or after 7 p.m. 

  1. Working Hours

 Employees should limit their work to eight hours per day and forty-eight hours per week. Working hours should be limited to ten per day, including overtime. Employees should not also work for more than four hours without a break.  

  1. Exemption of work 

Pregnant women are exempt from working before delivery or for a specified period after delivery. They are also not permitted to carry loads while pregnant. 

  1. Regulations and Work 
  • A company will not fire an employee who has been with them for more than six months without good reason.
  • Organizations must provide at least one month’s notice to employees who have not served for six months. 
  • Employers must pay their employees’ average daily wages for the leave they receive. 
  • Employers should pay holiday pay to employees who have served for at least a year. 
  • Employers must keep a copy of the license in the shop or commercial establishment premises. 
  1. Week-off

Every store and commercial establishment should be closed at least one day per week. Shop owners should post this closing day in a visible area for customers. This day, however, should be changed more than once every three months. 

  1. Annual leave Paid

After 12 months of service, employees get access to 12 days of paid vacation. You can extend it for a maximum of 24 days. Furthermore, under Section 13 (2) (a), employees with wages are entitled to twelve sick days for accidents or sickness. 

  1. Employees’ Rights
  • Employees may request special leave for sterilization. 
  • Casual leave for 12 days is allowed for employees with filled wages. 
  • Employees may only put in fifty hours of overtime per quarter. 
  • Employers should pay employees twice as much for overtime. 
  1. Penalties

There is a risk of being penalized if all rules and regulations do not apply correctly. 

  • Breaking the rules of the Shop and Establishment Act can result in a penalty of $250 plus an additional 10 per day if the cause of the cost persists. 
  • Any violation of sections 6, 8, 9, 11, 12, 13, 13A, 14, 18, 21, 21A, 22, 5D, 5E, and 5F are punishable. 

The Advantages of the Shops and Commercial Establishment Registration Act in Kerala 

The advantages of Kerala shop and establishment registration are listed below for convenience. 

  • It serves as legal proof for the shop’s and establishment’s owners. 
  • The registration certificate grants the right to operate any business within the state’s borders. 
  • Applicants who hold this certificate are eligible to open a current business bank account. 
  • The certificate holders can supplement the state government’s inspections. 
  • Business owners who register under the act are eligible for government benefits for small businesses. 

Save these details about shop and establishment registration in Kerala to start your business within the state. The procedures outlined in the guide will make it easier to complete the registration process.  

Can a residential real estate agent sell commercial property?

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Commercial and residential real estate brokers come from the same industry. The simple fact that both agents work in real estate is the only obvious similarity. The property type that each individual specializes in becomes the defining characteristic. Residential real estate agents assist clients with buying, selling, and renting property for their use. 

On the other hand, commercial property agents handle real estate used for business or investment purposes. These agents advise investors on risk issues and ensure they get an ROI when they buy and sell real estate. They also lease properties, locate new spaces for their assets, and locate new areas for their client’s businesses.

Now, we have to consider several factors to elaborate on other differences. What skill sets do they possess first, for instance? What kind of transactions do they handle, what sort of property do they deal with, etc.?

Properties’ nature

One of the vital factors is the type of property. It covers topics like the number of housing units, the kind of building, the size, etc. You might need a commercial property agent when you want to buy or sell a property with more than four properties. Such transactions require commercial real estate loans, with stringent requirements and technicalities that may be challenging for a residential agent to complete. On the other hand, residential agents can complete transactions that do not require extensive 

residential agents to complete. On the other hand, residential agents can complete transactions that do not require extensive commercial knowledge. 

Skillset

Let’s start with the most fundamental factor in deciding if a residential agent can sell commercial property. Both residential and commercial agents must have specific skills to sell a property. Agents are expected to have perseverance, bravery, and strong communication skills. However, selling commercial properties necessitates a thorough knowledge of economic principles. Commercial agents work with properties that require them to understand concepts that residential agents might become familiar with, such as gross rent multiplier, cap rate, internal rate return, etc. However, commercial transactions may be made when residential agents are skilled in aspects of commercial property. Consider a residential agent with extensive knowledge of rent rolls, caps, and internal rates. They’re in a position to conduct business thanks to these skill sets. 

Partnership 

A residential real estate agent can sell commercial property by collaborating with a commercial agent. In addition to helping the client get the best rates, working with a commercial agent offers independent analysis. 

Databases create an issue for qualified residential agents. Most commercial businesses maintain a database of available lease spaces. A residential agent may not, thus, have access to these “private” lease spaces. 

Conclusion 

Agents who specialize in residential sales may also be able to sell commercial properties in some circumstances. Nevertheless, depending on the type of property you are dealing with, it is advisable to select a knowledgeable agent. Choose a residential agent if the property is for personal use; commercial agents are better suited for dealing with commercial real estate. Working with an expert gives you value for money and service. 

THE FUTURE OF INDIAN REAL ESTATE BY 2040

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Why Real Estate Investment in India is the Most Profitable Option?

A short look at the Real Estate Industry:

The word “Real” is the Latin root rex, which means “royal”. Earlier, kings used to own all the land in their kingdoms. Therefore, the most globally acknowledged sector all over the world is the real sector. If we know real estate in terms of business, it means the game of producing, buying, and selling property. According to the economic sector, the construction of industry ranks third among the 14 major sectors. The future of Indian real estate by 2040, the market will grow to Rs. 65,000 crores (US$ 9.30 billion) from Rs. 12,000 crores (US$ 1.72 billion) in 2019.

After the agriculture sector, the real estate sector is the second-highest employment generator in India. Also, this sector will sustain non-resident Indian (NRI) investment for the short and the long term. Bengaluru is the top city and is the most recommended property investment destination for NRIs, followed by Ahmedabad, Pune, Chennai, Goa, Delhi, and Dehradun. PropertyWala.com evaluates the future of Indian real estate by 2040.

The Market size of the future of the Indian Real Estate Industry by 2040:

This sector is about to reach US$ 1 trillion in market size by 2030, up from US$ 200 billion in 2021 in India. It contributes 13% to the country’s GDP (Gross Domestic Product) by 2025. India’s growing infrastructure is much needed to grow as retail, hospitality, and commercial real estate are also growing significantly. Within a year, India’s real estate sector saw over 1,700 acres of land deals in the top 7 cities. In the commercial real estate sector, foreign investment was at US$ 10.3 billion from 2017-21.

Indian firms are estimated to boost >Rs.3.5 trillion (US$ 48 billion), according to the report of ICRA (Investment Information and Credit Rating Agency of India Limited). It is through infrastructure and real estate investment trusts in 2022. The Savills India report said that the real estate demand for data centers is to increase by 15-18 MSF in the year 2025 whereas in 2021 around 40 MSF has been delivered in India. Now, it assumes that the country will have a 40% market share within 2-3 years whereas India is looking to deliver 46 MSF in 2022.

Conclusion:

In India, a total of 55,907 new housing units were sold in the 8 micro markets between July 2021-September 2021, which means there is 59% growth year over year, whereas, in the third quarter of July-September 2021, new housing supply stood at ~65,211 units, an increase by 228% YoY across the top 8 cities when its compared with ~19,865 units which launched in the third quarter of 2020. The commercial space is to record increasing investments in 2021-22 when it comes to commercial space in Gurugram.

 According to the Economic Times Housing Finance Summit report:

Almost, 3 houses are raised per 1,000 people per year as compared to the construction rate of 5 houses per 1,000 people. The current shortage of housing in urban areas is said to be ~10 million units. Hence, 25 million units of housing are vital by 2030. This is to meet the growth in the country’s urban population.

East and Southern Bangalore to witness high demands

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Interestingly, the biggest coincidence that can be seen in all metro cities is the fact that in all of these, the southern part of the city experience major development and is always considered as the posh regions. The new flats for sale in Bangalore, especially in the south region are most popularly seen in Kanakpura Road. These flats are mostly in demand by the young professionals working here. However, the demand is not so great here when it comes to 3BHK Flats. The basic demand seen for 3BHK Flats in Southern Bangalore is seen in Whitefield and Electronic city. Southern Bangalore was the first part of the city which was established and is thus the most developed and has reached its saturation. The reason people tend to favour this place is the amazing connectivity with the electronic city via NICE Ring road. The infrastructure is well developed and has high growth potential in terms of real estate if you are looking to buy a property in Bangalore. The area has close proximity to office areas and offers and chilled out the environment.

Also, the east of Bangalore also experiences high demands in residential apartments. The areas like Brookefield, CV Raman Nagar, ITPL, KR Puram and Whitefield offers a lot of 2BHK Apartments which are ideal for you and your family’s needs. These flats are mostly preferred by high-end individuals, mostly the people working in the vicinity. Thus, both these areas are ideal for you if you need to settle in Bangalore with a lavish upfront.

Affordable Housing, a priority for real estate

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With an aim to achieve housing for all by 2020 and thus planning new flats in Delhi/NCR till 2022, finance minister on January 1 had stated that the affordable housing schemes will be given infrastructural status which will be a great deal for builders like Ashiana, Housing, Puravankara. This move will dip the costs for the builders and developers and attract most and more investors.

It would also mean a great hike in demand for loans which would be a step in the forward direction for housing finance companies like Gruh Finance, as well as Repco Home Finance.

“Infrastructure status to the affordable housing segment especially to Noida real estate will mean lower loan costs for the sector and thus aims at the margin issues that private players in this segment face,” said Nidhi Seksaria, Advisory Partner & Leader – Real Estate, BDO India LLP.

“The combined with interest subventions, this could be a big step in making apartments for sale in Noida more affordable,” he said.

Ashiana Housing was already trading 15 percent higher at Rs 163. On the other hand, Puravankara was up by 3 percent. The housing finance companies, Gruh Finance was already up by 1.4 percent while Repco Home Finance was up nearly 2 percent.
To achieve the targets set by the government in the affordable housing sector, the builder tends to increase their number of apartments with a certain decrease in amenities which consequence into lower costs. The competition has increased in the past quarter and thousand of new flats for sale in Noida are being constructed and ready for you to live in.

Ban on registering the Unapproved plots in Tamil Nadu

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The banning on the registration of plots which are still unapproved is back in Tamil Nadu with full force. The Madras Court on Friday clearly ordered to restrain all registrations of plots which are still not approved or those who apply for the re-registration with pending layout approvals. The law has been confirmed for the next three weeks and till no further notice comes.
Adding to the ban, the Justice M Sundar and the Chief Justice Indira Banerjee asked for all the details of the applicants of registration with unapproved plots in the violation of the court dated as on September 9, 2016, ban order.
The legal justice has stated that the decision for these issues will be taken after a special sitting which will be organised either on May 4 or on May 5.
The law has turned sour after the case that held on September 9, 2016, when the Chief Justice Kishan Kaul rapidly approved all the registrations of the plots which were still not approved or of those who tried to convert farmlands into housing plots without following the rules and regulations. Also, the bench held responsible all the officials who were personally liable for the violation of rules and regulations.

Why Attapur deserves your Investment

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In the city of Hyderabad, Attapur is now developing as a new suburb which is an ideal location for the residential complexes now. The main reason behind this is the presence of several different colleges which makes it an ideal location for the students to live in. It is also really close to Jawahar Nagar, the educational hub of Hyderabad. Not only the students but the people who work in the IT Hub of Hitec City also prefer this place as it is in close proximity given the excellent transportation and the development of roads. The fact that Attapur provides people with a lot of housing options that too in affordably large sizes, make the residents travel 10km each day to and fro for their work.
Many people say that Attapur is the centre of their work and other public infrastructure needed by them. The location is in close proximity to their offices, their children’s schools, Airport, Koti and Secundrabad. The main purpose of each and every resident is solved because of this and people find no problem in travelling a few kms for every work present in equal distances.
When it comes to water and transport, the PVNR Expressway connected to the outer ring road makes it really easy for the people to commute.

Demands in Bangalore West take a major hike

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The increasing commercial demand in the vicinity of West Bangalore is asking the residential sector to grow and lead the city to a better place.
The Mumbai-Bangalore Industrial Corridor, Greater Peenya Industrial Area, proposed Peripheral Ring Road (PRR) Metro Rail connectivity, Dabaspet Industrial Area, integrated townships along the NICE corridor, all these factors make the west of the city an investment destination. The plots in Bangalore in this region is owned by automotive parts, manufacturing, electrical, electroplating, pharmaceutical, chemical, electronics, building materials, aerospace components, garments, castings, forgings, foundries, and scientific instruments industries.
The whole area is well connected to the plunged road built over Peenya international airport, in the Mysore road. It is also connected to NICE corridor as well as the metro rail network.The well established and renowned market of Yeshwanthpur having a micro market with healthcare, retail and other public infrastructure gives a major push to people to come and live here.
Shrinivas Rao, CEO of APAC, Vestian Global services stated that the major factors that increase the rates of property in Bangalore are the presence of economic complexes and industrial sectors with the perfect physical infrastructure and amazing connectivity with all public convenience nearby. It has been noted that after 2008 this western area of Bangalore was influenced by a major hike in IT and ITeS companies which came and set up their base here. These industrial areas included Kumbalgodu and Bidadi which resulted in their nearby localities like Kengeri to become a popular residential choice for those who are employed in this area or the vicinity. According to reports and databases, Kumbalgodu Industrial Area, Bidadi Industrial Area and Global village IT park, together holds a total number of 80,000 employees. Also, after the rapid metro connectivity in this region, it has become very easy for people to travel and save their working hours. With all these factors in hand, the fact that region is well connected to the NICE Road, Outer Ring Road and Tumkur Road gives the place an additional advantage to grow more property in Bangalore west.
Currently, 79854604-lake_6the development that is being done in this region comprises of apartment projects and plots in Bangalore West. The Kengari residential sectors incorporate a large scale of apartment projects and townships in the mid segment value people. It is thus expected that the annual residential sale growth in this region is 6-8 percent while the rental yeild will be 4 percent.

A good news for Bangalore real estate

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Stop worrying more about investing in a building or a land or any property in Bangalore specially those which are close to lakebeds.
The properties owned by builders near these lakebeds were told not to construct their builders as the National Green Tribunal, in an passed order on May 2016 clearly increased the buffer zone of the lakebeds from 30 metres to 75 metres and announced that no construction will be done around the 75 metres zone of the lakebeds. However, now the BBMP has given out a sigh of happiness. They have clarified that those projects which recieved their contrsution approval before May 2016 can resume their construction. These will be only applicable to those who got licened before the NGT order arrived.

BBmp recently issued a circular on 30th March 2017 which came out with the green signal for the buiilders. Commissioner N Manjunath Prasad ordered that the NGT directive will be now not be applicable for site and properties which already secured their plan before the Green Court came out with their new orders and restrictions. This implementation sent to all eight zonal heads has brought out a relief to the real estate sector and is expected to grow the market as well with the increased rates in such locations.

Now the builders are excited and are offering new deals in their flats in Bangalore lakebeds. These areas are now more costlier than ever. The serenity of the lakebeds of Bangalore has always been an ideal place for all the segments of the society and is much desired specially by old people who plan on living their old age in a wonderful environment as same.
Not only flats, but some builders are now planning on moving to lake house projects. They are now applying for permissions for their beautiful projects from the NGT and are expecting great revenues for the real estate market.

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5 reason you should buy a property in Noida

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After the utterly clumsy place of the capital region of India, Delhi and the densely overcrowded place for offices, Gurugram people are quite as well left with a choice of Noida. This is the reason that the residential sector of Noida Real estate is highly increasing since the past two decades. Noida is considered as a cheap and easy city to live in provided its easy connectivity to Delhi, Faridabad, Agra, and Haryana.
Noida has been considered as the most affordable place to live in given the high number of affordable flats here. There are many reasons that add to the fact but if we want to name a few we can easily do so by guiding the basic points.
The first one can be the extremely well maintained and thoughtfully built infrastructure. The infrastructure that has built the city is the basic reason for more and more citizens coming here. The excellent infrastructure makes it capable of being the next best thing in the world. The availability of lands for residential, commercial as well as infrastructural facilities is something that makes it top the list leaving Delhi and Mumbai behind.
Second reason is the reputed faces of developers who are eyeing in this place to make their new launches. Builders like Supertech, Unitech, Ansal, Emaar, MGF and now Godrej has made their new launches in Noida and Greater Noida. These flats suffice all the segments of the society and promise to be affordable with the availability of luxury.
Third and the most important reason that helps people to relax and invest in these lands is new rules against Forgery. New and quick rules have now been applied to the forgery cases of land. Earlier, the land disrupts were handled by the court’s jurisdiction which always tends to stretch such cases to a number of years, but now a sigh of relief has approached when all these cases are being handed over to the stamps jurisdiction.
The fourth best reason would be the easy connectivity of Noida to other regions like Delhi, Ghaziabad, Gurgaon, Agra. The major plus point Noida has is the rapid availability of Metro from Delhi to Noida. Also, the ongoing construction of Metro from Delhi till Greater Noida via Noida will add a golden point to all these and make it more convenient for those who travel till Greater Noida and will also decrease the traffic on roads.
The fifth point is for those who have a property in Noida or are living on rent flats in Noida. The major availability of marketplaces throughout Noida makes it very easy and accessible to live here.

New residential projects in North Bangalore

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With the high increase in commercial activity in North Banglore region, the demand for residential sector also gets affected. New residential projects are being launched in this area which comprises of both apartments and Luxuroy homes (villas).

Bengaluru provides flats for sale in affordabe prices. The development in this area offers residential spaces for all three budgets; premium, mid range and luxury. Areas like Thanisandra, Yelahanka Doddaballapur, location near airport offers mig segment housing to its buyrers whereas, for luxury living one has to look for available in and arond Hennur Road, Kogilu, and some parts of Thanisandra.
New flats for sale in Hebbal-Yelahanka stretch of Bellary Road, which includes Hebbal and RMV II Stage has luxury apartments in the price range of Rs 8,000-12,000 per sqft. The areas situated beyond Devanahalli till Doddaballapur is very popular as it comprises of a large variety of high-end villa projects and also, plot development projects. The price here ranges between Rs 6,800-12,000 per sqft accumuating an area range of 2,500-7000sqft.
Meanwhile, the plot development projects in this area ranges from Rs 2,150 to 4,000 per sqft. Plots as well as luxury flats in this region are mostly preffered by high net worth individuals and investors due to their ability to serve as good holiday or retirement second home options. Apartments towards Nandi Hills Road are looked at with a keen eye as they range between Rs 7,300-10,00 per sqft. Vijayoura has new flats for sale ranging between 4,500-5,050.

Increasing residential demand in the Silicon Valley of India, Whitefield

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As it is known that there is a large workforce employed in the area of Whitefield, and preferring to live in the vicinity, is increasing up the demands for residential options here for the comfort of the employees.
Once known as a secluded area of Bangalore to the Silicon Valley of India, Whitefield’s story was shaped primarily by the IT Hub revolution that changed the sleepy landscape with Asia’s first tech park which rose up in 1994.
The excellent development that took place in Whitefield and the EPIP zone have seen over the years seems like a page of a fictional book with a perfect ending. Mammoth towers in glass and chrome stand tall amidst natural greenery which has been long preserved by the developers of these MNC acquiring most of the Bangalore properties especially in Whitefield. Many hitherto heavy manufacturing factories have given a big hand to making this a wonderful place with a lot of infrastructural possibilities and residential flats in Bangalore.
It is no wonder that after all these factors these localities in the vicinity of these ultra facilitated tech parks have largely begun to mushroom into elite gated communities of residential buildings. Villas the high priority choice by the people who want to live here and work in these high-end vicinity of business parks.
While the ITPB has singularly driven the demand for residential property options in its vicinity, the other tech parks and business parks in the EPIP zone too have drawn a high demand for housing options ranging from mid-segment apartments and high-end homes enclosed within well-appointed gated enclaves, to villas and plots.
A member of the committee, Jain has stated that Whitefield, Electronics City, and the EPIP zone was a major initiative taken by the government to create the place into something better which eventually turned out to be called as the Silicon Valley of India with a number of reputed Multi Nationals setting up their base here. This is also increased the demand for high-end flats and villas by the people who come here every year from all over the country to earn their lavish living.

Where to buy your house in Bangalore?

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Like every other place, Bangalore also hit itself hard with demonetisation. This deeply effected the realty sector which consequenced in the announcements on Akrama Sakrama Scheme, National Green Tribunal’s drive to reduce the lake beds in the city. However, this is now beginning to change with the initial dust of demonetisation finally settling down. With the Union Budget Announcement, which extended a big hand to support the affordable housing, the demands have increased yet again.

Bangalore is reported as the third largest hub for High Net Worth Individuals which increases the demands for luxury housing in the form of apartments or plots in Bangalore. As the southern and eastern zones of Bangalore are popular for their commercial complexes and workplaces, major residential demands are fed by these areas.

With a 4% increase of ready to move in demands, a data was collected about where should buy their properties according to the budget.

For those who wish to manage a housing within 40lakhs have a number of options to choose from sppecially in the IT hubs such as electronic city. 1bhk Flats falls the most popular under this category. Amonsgt married couples who choose to live in the city regarding work, opt for a 2bhk house in Electronic City, Whitefield or Bannerghatta Road.

The residential demand in these areas are the highest and always dominate the popularity charts with a perfect capture of 40% of the total demands.

Apart from this, the Bangalore real estate is not keeping the 3BHK Flats and private villas aside and are launching new apartments under the category of 60lakh to 1 crore in areas like Hennur which have large scale infrastructure, easy connect with outer ring road and the international airport. Apart from Hennur, Kanakpura Road and Hebbal are also set with their ready to move in flats to meet the expectations of investors who desire luxury laced with tranquility.

Now for those entrepreneurs who does not wish to compromise on their lavish living and royalty, Bangalore is providing them plots and private villas in the range of Rs 1 Crore- 2 crore in areas such as Sarjarpur Road and Arekere. These have recently turned out to be a royal investing for the rich entrepreneurs which are mostly HNIs.