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PLAN YOUR FINANCE

Vikas Agarwal has some tips to help you plan your finances to manage cyclical trends in interest rates

The current market conditions are good for those looking at <a href= “http://www.zameen-zaidad.com/”> investing in a house </a>. The property prices have corrected over the last few quarters due to the global economic slowdown. Many good deals are available in the market now. Also, many new housing projects are being launched by developers, targeting middle income buyers. The pricing of these properties is attractive and affordable. In conjunction with better property prices, the availability of housing loans at <a href= “http://www.zameen-zaidad.com/”> attractive interest rates </a> makes the investment a good value proposition for those who want to own a home.

Analysts believe there are many factors that indicate a rise in property prices as well as home loan interest rates in the medium to long term. The economic conditions are improving and demand is picking up in the property market which is expected to drive the property rates upwards.

Similarly, higher fiscal deficit, higher demand and higher inflation rate will force the Reserve Bank of India (RBI) to tighten the monetary conditions in the medium term. However, currently, the banks are sitting on a pile of cash and the demand in the retail loan segment is not as much. Many banks are planning to come out with <a href= “http://www.zameen-zaidad.com/”> attractive home loan schemes </a> to attract homebuyers during the coming festival season. Therefore, those looking at investing in property should move now for a good deal in both property and home loan.

Due to the effect of globalisation and aggressive marketing in the home loan market, there is a lot of volatility and cyclical trends in interest rates. Analysts believe they will go up in the next few quarters. Therefore, it is important to put some financial planning in place now. Banks do not revise (upwards or downwards) the EMIs immediately when the rates change. Usually, they first look at an increase/decrease in the loan tenure. In case the interest rates go beyond a point where the EMI will not cover the interest portion or the loan tenure goes beyond the retirement age of the borrower, they call for an increase in the EMIs.

Here’s how you can build a corpus that can be used to make a part repayment of the loan or fund higher EMIs in specific periods:

Invest in equity-based instruments

Analysts advise investing in equity-based <a href= “http://www.zameen-zaidad.com/”> investment instruments to build </a> a corpus over a long term, as equitybased instruments gives positive returns in the long term after factoring in the inflation rate. The global economy is slowly coming out of recession. Therefore, say analysts, the stock markets will remain bullish in the medium to long term.

Those planning to buy a house can look at investing in a systematic investment plan (SIP) of a good equity mutual fund. This will help in creating a corpus over a medium to long term.

Invest in gold

<a href= “http://www.zameen-zaidad.com/”> Investing in gold is another way </a> to build a corpus. The best way to invest in gold is to buy gold exchange-traded funds or pure gold bars. Historically, gold has yielded high returns over a long term and investments in gold do not have much downside risks.

VPF contributions

The salaried employees can look at depositing some extra money into their provident fund account through voluntary contributions. One can withdraw up to 36 times his monthly salary from the provident fund after completing 10 years of service, to make a repayment on his housing loan. In case of a need, withdrawal of the extra amount contributed as voluntary provident fund can be an option to make a part repayment of the loan and reduce the EMI to manageable levels.

Loan-cum-savings account

Many banks offer a loancum-savings account product. Under this scheme, the borrower can park his additional funds in the savings account and get the benefit of the same interest rate as is being charged on the housing loan. This account is handy in building a corpus where the borrower is not sure of committing a dedicated amount every month.

Courtesy:- TOI dt:- 05-09-2009

posted by zameenkaushar2009 on Sep 12, 2009 7:51 AM Permalink | 0 comments
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IIDL AT YOUR ‘SERVICE’

IFCI Infrastructure Development Ltd ( IIDL), a subsidiary of the country, IFCI Ltd, signed a Management Contract with the internationally renowned Fraser Hospitality Pvt Ltd to manage its ‘ serviced Apartments’ property named ‘Fraser Suites’, being Developed at Mayur Vihar, New Delhi.

The 9 story, 90-unit property ,being developed by IFCI Infrastructure Developed Ltd, ( IIDL), is scheduled to be completed by end-March2010.The eco-friendly, Ultra-modern Property sets new benchmarks in ecological design. The superstructure , based on the Vaastu Energy Grid for passive bio-climatic solar architecture aims at optimising solar advantage through the use of solar heating .

Courtesy:-HT dt:-05-09-2009

posted by zameenkaushar2009 on Sep 12, 2009 7:49 AM Permalink | 0 comments
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GRAND VENEZIA IS LAUNCH A NEW PROJECT IN GREATER NOIDA

Grand Venezia is poised to be a truly international mall, a brand name in itself.
Whether it's a stroll along a cobblestone walkway, or a relaxing ride in an authentic Italian gondola, The Venetian Mall offers a shopping experience like no other. Enjoy world class dining, shopping and elegance in an atmosphere of sophistication and refinement. Enjoy all that life has to offer... indulge in the uniqueness of Grand Venezia Mall! Grand Venezia will be a whole newmeaning with an irresistible offer no other leisure destination can match.

Amenities

A SHOPPING EXTRAVAGANZA

The fun of shopping! As you glide through the moonlit canals of Grand Venezia Shopping Mall, your Gondolier gently serenades you with romantic Indian and Western classic songs and music. This instrumental collection of favorite Indian and Western love songs will take you there through the strings of the mandolin, the chords of the accordion, and the sweeping notes of the violin. Romance yourself around the world with this elegant shopping mall.

Entertainment

Grand Venezia offers an action packed entertainment zone that has enough excitement for adults and kids alike. Whereas lifestyle clubs, hi-tech virtual games and a bowling alley will ensure that adults have a ball of a time; there will also be a special kids zone, surrounded by live cartoon characters, happy meals and fun shows. Grand Venezia Mall will also poised to be the hub of cultural events and entertainment. An open amphitheatre will provide a platform for hosting cultural events, brand promotions, product launches, movie screenings and live shows.
One can also enjoy the latest in entertainment at Multiplex having a capacity of more than 1000 se

Investment

A golden opportunity to make world's best brands your tenant...
Assured Returns
Grand Venezia offers you an undisputed advantage in terms of high returns on investment. It has the features which no other property in India can match. Leasing, Renting or Ownership, whichever the option you have in mind, your investment is bound to generate maximum benefits, right from day one. Giving you an advantage that anybody else would find hard to match.
High Appreciation Value
Grand Venezia is located in the sunrise destination of Greater Noida, where property values have steadily risen and continue to do so. Which makes Grand Venezia, the current and future hotspot with high appreciation value. In fact, owing to the spectacular theme based structuring of the mall, making it the first of its kind in India, it will become the most sought-after destination, causing property values to soar beyond limits.

For more info log on to http://www.zameen-zaidad.com

posted by zameenkaushar2009 on Sep 8, 2009 11:56 AM Permalink | 0 comments
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MINT TOWERS GURGAON - III

Mint Towers, a part of Eden Heights Gurgaon, are being developing by GPL Infrastructure. Mint Towers are affordable and efficiently planned. Other features of Mint Towers are - Faster Construction, Spacious Bed-Rooms (11x14 & 10x13), Three side Open Apartments, Airy & Well lit flats, 100% Power Back-up, 24x7 Security, Tennis & Basket Ball Courts, Spacious Club Facility, Connectivity to proposed Metro Station & Ideally located in vicinity of National Capital. These Towers host limited edition, affordable, efficiently planned 2 Bedroom + Study Apartments. Specially designed & priced keeping in mind the needs of the young corporate individuals. Part of an 11 acre township with world class facilities at Eden Heights, strategically located just off the Southern Periphery Road, Sector 70, Sohna Road, Gurgaon.
Some of the Key Factors, which make the apartments at Mint Towers different from the other offerings at present times are:

Construction in Full Swing
Sample Apartment Ready
Compact Size of 1050 sq.ft. (2 Bedrooms + Study)
Amazingly Efficient Floor Plan (Bedroom Sizes: 11x14 & 10x13)
Three Side Open apartments, to make sure all apartments are Airy & Well Lit.
All Facilities that one would expect in any good community.
Well planned landscaping within the Community.
Wi-Fi Ready Apartments
24 x 7 Security
100% Power BackUp
Large Size Club within the community with world class facilities.
Tennis Courts
Basket Ball Courts.
Connectivity to Proposed Metro Station
Affordable Prices to encourage actual users to make the most of it.

Please feel free to browse through the various links provided on the left hand panel to find the desired information. If you have any questions, please feel free to call our professionals on the numbers mentioned.
Our executives are standing by to answer any queries that you may have. You may also choose to send us a quick query through the query box on the right hand side and be assured of a quick response.
We surely look forward to having you to Live Easy @ Mint Towers.

Our Company is on the approved list of leading banks/financial institutions for grant of home loans. We have got an able team to process home loan proposals. Interested persons for Mint Towers, Gurgaon can contact our executives on mobile no 91-9650398325, 9810445860, 9911158601 or email at – info@zameen-zaidad.com

For more info log on to http://www.zameen-zaidad.com

posted by zameenkaushar2009 on Sep 8, 2009 11:55 AM Permalink | 0 comments
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WHEN & WHERE TO BUY, SELL AND INVEST IN HOUSE PROPERTY

Prudent buyer of house property is one who looks after the current market conditions and the prevalent bank rate of interest on home loans. Following are the points to be taken care of for buying, selling or investing in house property :

Prevalent Market Conditions - When there is more availability of dwelling units in the market, one should go for buying or investing in house properties. If more number of houses are available, one can make choice of size and location of the house property. Under such scenario, the price to be paid for buying the house will be reasonable owing to competition among the builders and developers for selling their products.
Business Place/Working Place – The house property should be purchased in the vicinity of the business/working place to save the time in journey to and from house to business/working place. When less time is spent in journey, more time can be devoted to business/office works. This will enhance the business prospects or efficiency in office work.
Approved Real Estate Agents – While going for buying the house property, one should enquire the details of projects from the govt approved real estate agents or from those real estate agents which are having long standing in the market to get the genuine deal and to avoid any future complicacies.
Credible Builders and Developers – One should purchase the house property from the reputed and credit-worthy builder/developer to have good quality product. Even if some more price is to be paid for buying the house property, one should opt for the quality product. Price should not be compromised for bad quality product.
Prevalent Bank Interest Rate – When bank interest rate on home loans are low, only then one should go for buying the house property while availing home loan to have overall lesser cost of the house property.
High Price Market – To sell the house property one should wait for high price market to get the best price.

On observing the above-said aspects, one will pay less for buying the house property and will get more on selling the property.

For more info log on to http://www.zameen-zaidad.com

http://www.propertycafeteria.com

posted by zameenkaushar2009 on Sep 5, 2009 12:09 PM Permalink | 0 comments
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CHEAPER HOMES DO THE TRICK

Locals demand affordable apartments, NRIs focus on premium segment

The Realty sector is alive and kicking in the temple town of Thrissur, considered the cultural capital of Kerala. Despite the economic downturn, sales of flats and villas have not been hit as much as in several other places in the country.

After tiding over the recessionary phase, the builders are now drawing up plans for new projects in and around Thrissur, including Guruvayur, which is around 25 km from the city. Guruvayur is famous for the Sri Krishna Temple and has devotees from all over the country flocking to it.

Thrissur is home to three banks — Catholic Syrian Bank, Dhanalakshmi Bank and South Indian Bank and several private chit fund companies. It is also the hub of gold jewellery manufacturing in the state. Many prominent jewellers have their roots in Thrissur.

The suburban areas of Thrissur are also fast developing. A new IT park, a branch of Kochi Infopark, is coming up at Koratty, half an hour drive from the city. It also has the advantage of proximity to Cochin International Airport, which is 20 km away from Koratty.

The demand for premium apartments (above Rs 60 lakh) is mostly from NRIs who want to settle in Thrissur. The local demand is for cheaper apartments — ranging from Rs 20-25 lakh. As compared to 2008, the square foot rates have shown a rise.

The builders argue that the rate increase is more due to rise in the cost of raw materials. According to Mr Varghese, vice-president (marketing) of Skyline Builders, the cost of cement, steel and the wages of labourers have increased over the last one year. “Last year, before the slowdown, our average rates in Thrissur were Rs 1,450 per sq ft. Now it is around Rs 1,000 higher,” he said. Skyline completed two projects during 2008. In the last 20 years it has completed 14 projects. Mr Varghese said land cost has more or less stabilised after the boom period in 2008. “Instead of buying land at fancy prices, we market our projects in such a way that it becomes a destination for the buyers. Our apartment project at Gosayikunnu on the outskirts of Thrissur was sold that way,” he said.

Last year, during the recessionary phase, several builders adopted measures such as downsizing the apartment size to create demand. Shobha Developers was one prominent builder to adopt the strategy for its 600-apartment complex at Puzhakkal on the way to Guruvayur.

Without raising the sq ft rates, Shobha Builders reduced the size of the apartments, which naturally reduced the prices for the apartments. The size of the proposed flats was reduced from 4,000 and 3,000 sq ft to 2,000 and 2,500 sqft. However, the square ft rate remained at Rs 3,000. The company sources said this resulted in higher sales during the time of recession. The company has sold around 25 flats by adopting this strategy. It has so far sold 40% of its project. The prime location in Thrissur remains the Swaraj Round, its main road. Any project within 1-2 km of the round commands a premium price. Other locations have sprung up in the fast developing city, which are getting good prices. Thrissur Builders, which have around 20 projects in Thrissur, has four ongoing projects at several locations. The projects in the area near North bus stand and Viyyur are getting higher prices now. According to Joshey, marketing officer of Thrissur Builders, the demand now is for cheaper apartments. ``Our apartment projects at West Fort and Kanimangalam have prices in the range of Rs 20 to 25 lakh. The rates hover around Rs 2000 per sq ft,’’ he said. The company’s villas coming up at Olari are priced higher at Rs 3000 per sq ft.

Many builders are setting up projects in Guruvayur. Earlier, the customers used to book the flat without even looking at the project. That has changed now and most of the people now come and see the construction before booking. Shantimadom Builders has several villas in Guruvayur.

Courtesy:- ET dt:- 23-08-09

posted by zameenkaushar2009 on Aug 28, 2009 9:56 AM Permalink | 0 comments
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DLF BAGS GURGAON LAND FOR RS 1,750 CR

DLF, the country’s largest realty firm, today bagged a 350-acre plot for Rs 1,750 crore in Haryana for developing a recreation and leisure project, making it one of the costliest land deals in recent times.

“The letter of acceptance has been issued to the successful bidder (DLF) after getting the approval from the state government,” Haryana State Industrial & Infrastructure Development Corporation Ltd (HSIIDC) Deputy General Manager Priya Sardana said.

Earlier this week, DLF emerged as the sole bidder for the 350-acre project after the bids of other parties — Unitech and Malaysia-based Consortium comprising Country Heights, Country Club of South Africa and Rajarhat IT Park — did not qualify on technical grounds.

The qualified bidder, DLF, had quoted its bid at Rs 12,000 per sq mt against the reserve price of Rs 11,978 per sq mt for the project.

Earlier, BPTP had bagged a 95-acre plot in Noida for Rs 5,006 crore in 2008, but later surrendered because of inability to arrange funds for the payment.

DLF had acquired 38 acres in the heart of Delhi for Rs 1,675 crore. Unitech had bagged 1,750 acres in Vizag for Rs 3,350 crore, while the company won 340 acres in Noida at Rs 1,582 crore in 2006.

HSIIDC had invited competitive bids in January this year for allotment of 350 acres of prime land on freehold basis, at village Wazirabad in Gurgaon, for setting up of a recreation and leisure project comprising commercial and residential buildings and golf courses.

The corporation reinvited the bids after the sole bidder at that time — DLF — pointed out certain difficulties in project implementation.

In the second round of bidding, Unitech was disqualified as its partner was found ineligible for developing the project, while the bid of the third party did not qualify as the net worth of the Malaysia-based company Country Heights was less than the required amount of Rs 500 crore.

Courtesy:- BS dt:- 21-08-09

posted by zameenkaushar2009 on Aug 28, 2009 9:54 AM Permalink | 0 comments
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Lodha Developers on fund-raising spree

Former Old Lane Fund Partners Buy 26% Stake in Dombivli Project For $25 Million

Mumbai-based Lodha Developers is tying up funds from private equities (PE) at the project level ahead of its Rs 2,500-Rs 3,000 crore planned initial public offer (IPO).

Few former Old Lane Fund partners have made a $25-million investment for 26% stake in the group’s 115-acre housing and office complex in suburban Dombivli in Mumbai.

The investment values the project, which falls under its CASA brand for mid-income housing, at Rs 460 crore (Rs 4 crore per acre).

“In terms of this , the residential rates for our Dombivalli project will range between Rs 2500-Rs 3000 per sq foot. We are also in continuous talks with various funds who are interested in investments at the project level,” said Abhisheck Lodha, director, Lodha Group.

None of the PE investors from Old Lane, who have formed a new $400 million for realty and infrastructure, were available for comment.

With the latest private equity deal, Lodha Developers now has private equity investments to the tune of $600 million in various special purpose vehicles from the likes of Duetsche Bank, HDFC Realty’s international fund and ICICI Ventures. “The IPO may improve the valuations of the Lodha’s Hyderabad project in which the fund has invested resulting in higher prices for the sale of residential units in the complex,” says senior fund manager at HDFC Realty.

An official in the Lodha group, who did not wish to be named, said the company is expecting a valuation of up to Rs 20,000 crore at the time of tapping the capital markets.

But analysts say a lot will depend on whether the appetite for real estate returns among investors. Now the IPO which is expected to hit the market by late October-November, could provide an exit route particularly for Duetsche Bank since the deal was structured around convertible debentures. Servicing these investments was looking difficult, as a slump in the property market had receded the hopes of meeting the pre-decided returns on them. The company has appointed Enam Securities and JP Morgan as its merchant bankers.

Courtesy:- ET dt:- 20-08-09

posted by zameenkaushar2009 on Aug 21, 2009 11:52 AM Permalink | 0 comments
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MINI INDIA IN THREE ROOMS

A story of how five DU students, of different faiths, managed to locate a rented flat and live there in harmony, Bhavya Nayna Channan

As soon as the DU cutoff lists were out in July, this bunch of friends, all boarding school boys from Darjeeling, began work on that most vital thing, next in importance only to taking admission -- house hunting in this big, bad city, where brokers can make wolves weep.

The boys -- Ashwini Darnal (Hindu, from Darjeeling), Ritesh Agarwal (Marwari, from Rajasthan), Faizal Alam (Muslim, from UP), Ben Kipgen (Christian, from Manipur) and Atisha Penjore Bhutia (Tibetan Buddhist) had been studying in St. Joseph's (North Point) Darjeeling since Class III, so they all wanted to stay together in Delhi. They first found accommodation as paying guests, two guys sharing one room.

Initially, peace prevailed - the landlord was good to them and everything was going according to the agreement. But trouble started soon enough. There was - harassment over electricity and water bills, and even the neighbors began to com plain about their late-night studies and habit of watching l football matches.

The boys decided to move - out and rent a flat. "The bro kers really took advantage of the situation," says Ashwini. Places that cost Rs 10,000 to rent were shown to them as 18-grand-a-month flats. Worse still, each locality had several brokers who all rat tiled off different rates, leaving the boys' heads spinning with confusion.

With a total budget of Rs 20,000, inclusive of everything (ration, cook, maid, electricity and water bills), they finally managed to rent a three-bedroom flat in Vijaynagar, a student-friendly locality. All facilities were available at reasonable rates, and most of the colleges were located close by. It was as close to perfect as it gets, despite teething troubles with the cook and the maid.

The boys have appointed Alam as the `flat accountant'. He looks after all the expenses of the little group and sees to it that everyone puts in their share. Agarwal looks after the cleanliness and maintenance of the flat. The others help with getting provisions and look after various other needs of this `household'. Since the cook is of the same age as the boys, they are good friends with him and he understands their needs.

With a neat system in place, the boys have been able to stay within their budget of Rs 4,000 a month each, aside from spending on fridge, TV and basic furniture.

They call this flat "a mini India". Says Alam, "We are proud to be together and helpful to each other." In their free time, they sometimes cook, drink beer and party. A Playstation in the flat and extra-curricular activities in college take care of recreation. Their motto has been `sursum corcla', meaning `lift up your hearts'. "We've learnt this from school and apply it in our flat," says Ritesh.

One advice from this `veteran' group to other students is that those who live in a rented flat should keep their eyes and ears open and not be too trusting of strangers.

Courtesy:- HT dt:- 15-08-09

posted by zameenkaushar2009 on Aug 21, 2009 11:51 AM Permalink | 0 comments
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TOP RETAILERS TEAM UP TO FIGHT SLOWDOWN

Cut-throat competition in India's organised retail industry seems to have given way to harmony, with top players such as the Future Group, Aditya Birla Retail, Spencer's and Reliance Retail coming together to cut operational costs and improve margins. The retailers have formed a rainbow coalition that will align their sourcing operations and share private labels, logistics, warehouses and hiring details on a transactional payment basis, said top executives with some of the largest players in the sector. The move mirrors a similar step taken by manufacturing firms in the late 90s to share markets and cut costs.

Courtesy:- ET dt:- 14-08-09

posted by zameenkaushar2009 on Aug 19, 2009 10:38 AM Permalink | 0 comments
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INCHING UPWARDS

Office real estate is making steady recovery after hitting an all time low during the market slowdown. ET Realty gives a low down, Namrata Kohli

Call it recession or an oversupplied market (in terms of office space), or the general negative sentiment prevailing in the market - office real estate hit an all time low with values nearly bottoming out as compared to its peak around 8-12 months ago - in fact, the commercial real estate values dropped by an average of 25% in all markets and touched 50% in some.

The transactions were few and far between as majority of the corporates postponed their business expansion plan and were downsizing - as most were not sure if they would be able to sustain themselves, leave alone embark upon any expansion plans, while those who were earlier looking at expansion/relocation fell in a wait-and-watch mode, in anticipation of further correction.

Giving a sense of the depreciation in commercial real estate values, specifically office space, Arjun Kumar, director of AsiaPac International India says, "Commercial and IT space has witnessed almost 40-50% correction compared to rates 6-8 months ago, across NCR." He quotes the lease rent in Gurgaon for warm shell as anything between Rs 60-75/sq ft/month and Noida (on the expressway and Sector 62) as Rs 45-55/sq ft/month while one can get a steal at Sectors 63, 64 (which are primarily industrial sector but IT/ITeS are allowed to operate) at Rs 25-30/sq ft/month for warm shell space, and here additional space is being added almost every day.

Delhi CBD (Connaught Place) also witnessed correction of 40-50%. Says Kumar, "One can have space here between Rs 100-175/sq ft/month depending on the building (A or B Grade) and mainten a n c e , upkeep of the respective buildings. In South Delhi, Saket and Jasola District Centre in particular, have been witnessing almost 30-45% correction in lease rent as well as capital value. The lease rent being quoted in Jasola is Rs 140-175/sq ft/month wherein capital value is anything between Rs 11,000-13,000/sq ft for commercial office space."

Apart from the values dropping, there has been a substantial drop in transactions. If at all transactions were happening, they were restricted to the suburbs such as Gurgaon's Udyog Vihar, as well as builder sectors and Noida - on the expressway, Sector 62, 63, 64. Says a broker, "The companies which are sure of their business plan and think that market will improve sooner or later are moving forward with their plans, especially, the major Indian corporates, which are catering to the domestic market. These include primarily telecom and software companies."

What is the exact situation in Delhi CBD and secondary micromarkets - Samantha Jerath of Jerath Properties says office transactions have slowed down, undoubtedly. "But it will be wrong to say the values have come down by 50%. This is because even though a rate of Rs 350/sq ft/month was quoted earlier, no actual transactions were recorded at the value. The highest was Rs 250 and I would say office space values in CP have come down from Rs 175-250/sq ft/month to Rs 120-150/sq ft/month. In secondary micromarkets, it has depreciated from Rs 175/sq ft/month to around Rs 110/sq ft/month. There has been correction at least to the tune of 20-25% in the entire Delhi NCR region."

But the good news is that revival is on its way in commercial real estate. Says Anurag Bhatnagar, associate director at DTZ, an international property consulting firm, "Commercial real estate was suffering from lack of transactions till Q4 '08, but Q1 and Q2 '09 have witnessed absorption of a million sq ft each. Rentals across Delhi NCR had already corrected by 10-20% in Q4 '08 from peak asking rates in Q2 '08. Values corrected further marginally, by 4-5% across all micromarkets from Q1 to Q2 '09."

So far, companies with expansion plans stayed on the sidelines anticipating bottoming out of the market. Citing the reason for lack of transactions, Mathur says lack of absorption/transactions till Q1 '09 was due to the general negative sentiment in the market, the cut on global-IT spend for companies and the delayed decision making process. During this period, companies adopted various strategies like renegotiation of contracts along rationalization of their current space layout resulting in higher efficiency. Q1 2009 witnessed a revival in demand with companies closing out deals due to good rates due to broader market being close to bottom. Q2 2009 again maintained the absorption levels of Q1 2009, primarily due to companies getting corrected rates in various micromarkets. Delhi witnessed the lowest number of transactions in office space in the last one year, while the maximum transaction in office space took place in Gurgaon in Delhi NCR. Gurgaon witnessed majority of the absorption due to availability of Grade A office space in prime areas, available at attractive rates.

Courtesy:- ET dt:- 14-08-09

posted by zameenkaushar2009 on Aug 19, 2009 10:36 AM Permalink | 0 comments
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NOIDA READIES FOR Y2K+10

In view of the 2010 Commonwealth Games in the national capital, Noida is gearing up to improve its infrastructure. Mohinder Singh, chief executive officer of Greater Noida Industrial Development Authority (GNIDA), in a conversation with A K Tiwary

What is Noida doing to spruce up its basic infrastructure to meet challenges of hosting the 2010 Commonwealth Games ?

We have planned a number of flyovers and underpasses, on the basis of a RITES traffic study for Master Plan (MP) 2021. They are being constructed along various routes, T-junctions and crossings across all sectors for smooth flow of traffic. Some of these are coming up at Sector 60, 61’s T-junction; Sector 51, 52, 71 and 72 crossing; Sector 32, 35 and 38 a crossing; Kalindi Kunj Sector 94’s T-junction and Sector 62 Khoda and NH-24 T-junction.

Despite all these, the authority has a lot more plans for territorial advantages like privatized power and reliable water supply, which will be in place very soon. The Metro work from Connaught Place to City Centre via Mayur Vihar Phase 1, Akshardham and New Ashok Nagar is already done and trial runs are in progress. To handle the multiplicity of vehicles on road, we are trying to systemize traffic controls.

Rickshaws and carriage autos (Maxi cabs) will be allotted a different route to avoid congestion. We are strengthening transportation by constructing 150 new bus stops and plying adequate number of city buses, which will be monitored through GPS (global positioning system) tracking. Volvo-type buses will also be soon introduced. To free bumper-to-bumper traffic, widening of internal roads that connect various sectors and sectors to main roads, are being taken up.

Demands for industrial and residential space in the suburbs has already triggered a phenomenal growth. What is the authority doing to put in place support infrastructure?

A number of industrial, institutional, commercial and residential schemes have been launched to meet the demand, in the past few months. For commercial plots, tenders have been invited. To meet the power demand, GNIDA is all set to install two power stations, one a 220 KV and another 330 KV power station. The authority has asked UPPCL (Uttar Pradesh Power Corporation Limited) to increase the power loading to requirement. Meanwhile, both Noida and Greater Noida will have a new 400 KV power substation. To increase the power load a 220 KV substation in Noida and two 120 KV and 132 KV substations in Greater Noida are being installed. As far as 24x7 water supply is concerned, we are already committed to supply 100 cusecs Ganga water from Upper Ganga Canal (Dehri dam). For this an MoU has already been signed with Jal Nigam. The concerned departments are looking after the day-to-day maintenance of sectors

What are your plans to make Noida a preferred destination for thousands of families who wish to partake of all the advantages of a metropolitan city?

Noida authority is committed to providing all the facilities that are normally associated with a major metropolis. Noida will become an ideal city with a full complement of infrastructure befitting a metropolis in time for the 2010 Commonwealth Games. Today, this emerging sub-city is known as an institutional, industrial and IT hub. Many MNCs and domestic companies are coming up every year. GNIDA has earmarked ample land for developmental works to which will attract MNCs and a number of proposals have already been received from MNCs. Some proposals have already been finalized and others are in the pipeline. South Korean, German and Thai-based companies are keen to set shop here.

What are you doing to keep pace with the mission of changing the very face of this smart city?

Builders and developers are competing in the real estate market here and the authority has allotted a lot of institutional, residential, group housing and commercial plots; sites for a number of hotels and institutions have also been earmarked. Appu Ghar in Sector 18 is the largest shopping-cum-entertainment and amusement centre, and is already operational. The coming of The Spice, Shopprix, and other malls, lifestyle of residents has transformed like never before. Now, Noida authority is developing new sectors like 76, 78, 79, 101, 102, 104, 107 in a very innovative way. This is a reason behind the fast development in the suburbs and the improvements seen day by day.

Undoubtedly, the city is competing well in the NCR. People from Delhi prefer to shift and settle here because better facilities and job opportunities. Infact, these days it has become an industrial hub because of MNCs and foreign investors flocking the place.

With the worldwide financial crisis, what is the authority doing to meet demand and supply in the realty sector?

A lot of initiatives are being taken up. To meet the demand and supply we have not reduced the price of the land and others given the great relaxation like density, which has been increased to 1,600/hectare. The FAR has also been increased to 2.57.

And coverage area has also been increased from 25% to 30% in up to 10 acre, and for more than 10 acre, the coverage area will be 40%. One of the major relaxations is that now there is no height restriction. I think developers and builders will be get benefited by these major initiatives to meet the demand and supply in the housing segments.

And what about the much awaited project, Sports City?

Noida Authority plans to develop a world-class Sports City spread over 311 hectare across Sectors 76, 78, 79, 101, 102, 104, and 107. We hope to make it a landmark project with state-of-the-art design backed by top architectural consultancy.

Courtesy:- TOI dt:- 08-08-09

posted by zameenkaushar2009 on Aug 13, 2009 9:15 AM Permalink | 0 comments
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REFINEMENT GRACE & BEAUTY TAKE THE SHAPE OF A HOME

A home is where you unwind, enjoy and amuse yourself. It’s also a place where you world comes alive. And where your dreams are born. Therefore, we have designed homes that are rich in refinement, grace and beauty. These apartments spell comfort in tasteful interiors, opulent look and have luxuries that make them a joy to live in. and the location is equally great! Exotica Eastern Court are located in Crossings Republic, which is India’s first global city.

· Parking facility

· Golf course

· Sports Stadium

· Shopping Complexes

· Malls clubs

· Amphitheatre

· Lake hospitals

· Schools

· 100% power back-up

· 24 securities

· Fire fighting system

· Situated strategically in Crossings Republic

· State-of-the-art architectural designs

Courtesy:- TOI dt:- 08-08-09

posted by zameenkaushar2009 on Aug 13, 2009 9:14 AM Permalink | 0 comments
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GOVT SHOULD APPOINT REAL ESTATE REGULATOR

Industry body Assocham today said the government should appoint a real estate regulator to help expedite the redressal of consumer grievances. “There is a need for an efficient and focused regulatory body to overlook functioning of the real estate sector in order to insure the industry development and safeguard of consumer interests in line with international benchmark,” the chamber said.

The real estate regulator would ensure that the consumer grievances against developers, development authorities, real estate agents and financial institutions are addressed without any delay, it said.

Courtesy:- ET Realty dt:- 07-08-09

posted by zameenkaushar2009 on Aug 10, 2009 2:55 PM Permalink | 0 comments
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A TIME TO LEARN!

Recession was necessary in our overindulgent times, and has done a great deal of good to the real estate sector in India. The end user has benefited the most during this period. ET Realty argues

Arti Khanna, a senior executive with a leading MNC, equates recession with the medicine that people initially complain 'is bitter', but in the end, come out far healthier and are better off for it. More cautious spending and greater saving by consumers, more prudence by lenders, shift in focus from premium to lower- and mid-end segment of housing by developers, is exactly what our economy needed for its long-term health and recession is having the desired impact.

Arti reminisces how they saw bad times during the dot-com bubble in 2001, and yet how the younger generation continues to be over indulgent, leading a hedonistic way of life and not paying heed to saving money. Arti says, "In many ways it brings the much needed discipline to people's way of life, while for corporates across various sectors, there are many positive ripple effects - for instance it allows people to analyse and identify their core competencies. It also helps in rebuilding focus, pruning tangential activities to achieve cost controls, which help in creating more effective systems and processes. And, it forces people to come up with innovative ways of handling problems, something mandatory for survival."

Among the three most affected - end users, investors, developers - surely, the end user has benefited the most during this period.

The end user has benefited as, finally, the supply chain started addressing the real demand in market - mid-end and affordable housing. Earlier, developers in their greed to garner higher profit margins, focused primarily on premium housing. But now, suddenly, the supply is shifting where the demand is. Even well known developers like Unitech, DLF, Raheja, Jaypee and Omaxe, primarily engaged in raising high-end homes, have begun talking of affordable options.

Recession has also been a time to introspect for everybody. "It has been a good learning experience, though not a pleasant one," says Samir Chopra, CMD of RE/MAX India, (RE/MAX is a global network of real estate agents operating in 70 countries). "There have been things to learn, relearn and unlearn for all the three - end users, investors and developers. Consumers have become more vigilant in transactions, and they are more thorough about both the market situation and their own needs. They are beginning to learn how to investigate and research before spending their lifelong savings. Investors have also become more conscious. They are more careful about spending huge sums of money in development and are looking for other avenues for investment in the real estate sector. They have become more delivery oriented, innovative and price conscious in this volatile market. They have learnt from the difficult times, reduced prices, and learnt to make more beneficial offers to consumers."

While at a superficial level investors may seem to be winners with recession giving them an opportunity to pick investments at more realistic prices, recession has also seen them investing less. According to investor Shalabh Bhasin, director of Kshitij Portfolio Services Pvt Ltd, "The recession period has seen me investing less in property market because the previous prices where unduly inflated and even now it can't be said with surety that the prices have bottomed out. Also, most of the investors were already stuck with loads of investment at higher prices, so there was not enough liquidity for further purchases."

Citing examples, he says he had invested in Parsvnath Panchkula flats at Rs 3,250/sq ft and Parsvnath Dharuhera flats at Rs 1,800/sq ft, but there is no buyer in these projects and three years on, the builder is yet to start construction. But on the upside, the investor is now carefully assessing a project and is no longer fooled by lucrative promos and advertising of the property.

As for developers, on the face of it, they may seem to be the biggest losers with the fund flow nearly stopping and sales drying up. But recession has been a blessing in disguise as it has forced them to innovate to cut costs, improve sales and raise funds. Recession has seen developers changing their product and strategies.

According to Mohammad Asif, chief operating officer of High Street Capital, "The shift in strategy is in terms of market focus, product size, pricing and promotion. In residential sector, they have started focusing more on affordable and mass housing. Today's market is customer driven and developers are offering suitable payment plans and other freebies like sharing of stamp duty and housing loan EMI burden to ensure transactions. In commercial segment, the decline in demand from IT/ITeS sector has forced them to look at other business sectors such as logistics, biotechnology, hardware, pharmaceuticals, tourism and education. In the retail segment, instead of fixed rentals, revenue sharing model is becoming a common practice. Developers have also been forced to work out an optimal tenantmix strategy and work on new project design to reduce operating costs. In hospitality sector, the focus now is more on budget hotels and services apartments."

Overall, recession has been a time to innovate. In a price sensitive market, the effort has to be to reduce cost, and to achieve this, both the construction cost and land cost have to come down.

Courtesy:- ET Realty dt:- 07-08-09

posted by zameenkaushar2009 on Aug 10, 2009 2:55 PM Permalink | 0 comments
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DLF IN TALKS TO SELL WIND ENERGY BUSINESS

Discussions At Advanced Stage With Gaz de France Suez and Akuo Energy

Two Euporean companies, including the world’s second largest energy utility, are in advanced discussions with DLF to buy the property developer’s wind energy business, a person familiar with the development said.

Gaz de France (GDF) Suez, which has a market capitalisation of $80 billion, and renewable energy group Akuo Energy have completed due diligence and a final decision on pricing will be taken by the end of this month, the source added.

While the size of the deal is not known, DLF hopes to raise at least Rs 900 crore from the transaction which is being advised by Ernst & Young. A DLF representative told ET NOW that several bids have been received, but declined to disclose the identity of prospective buyers. Akuo Energy and GDF Suez did not reply to emails.

Last month, DLF created a separate subsidiary called DLF Wind Power for its wind energy business as a precursor to the sale.

The sale of the business is part of DLF’s efforts to reduce its debt, which totalled around Rs 14,000 crore at the end of March. Earlier this year, vice chairman Rajiv Singh said DLF plans to raise Rs 10,000 crore through asset sales over 2-3 years. It recently completed the sale of assets worth Rs 1,000 crore and sold its stake in the joint venture with Ackruti City for Rs 200 crore. It is also negotiating a land sale deal which is expected to yield Rs 1,000 crore this fiscal.

Apart from the sale of land and other non-core assets, the company has received Rs 336 crore from the West Bengal government after it exited the Dankuni township. The management had also indicated that DLF will be refunded Rs 850 crore from the Delhi government for exiting the Delhi Convention Center project.

DLF has been hit hard by the slowdown in the real estate market, forcing it to sell assets and generate cash to meet funding needs. The company has also been forced to scale down its development plans.

DLF’s total developable area has fallen by more than 40%, from 751 million sq ft to 425 million square feet, mainly due to its exit from the Bidadi township project in Karanataka and the Dankuni project.

The area under development has fallen from 61.4 million sq ft to 36 million sq ft, with DLF putting several of its office building projects on hold. The company plans to resume these after demand picks up.

Courtesy:- ET dt:- 18-07-09

posted by zameenkaushar2009 on Jul 21, 2009 9:43 AM Permalink | 0 comments
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L A CITY SPA TOWNSHIP IN DEHRADUN

LA City is the first government approved Spa township in Dehradun. It is a township setup in the foothills of the Himalayas 19 kms away from Mussoorie - the Queen of the Hills, and surrounded by hill stations. LA City's closeness to nature does not compromise its accessibility, as it is well connected by rail, air and roads. This well-planned township, 250kms from New Delhi shares it's neighbourhood with some of the most esteemed institutions in the country. The state capital of the newly formed Uttrakhand, Dehradun is known for its cool climes and warm people. Rapid and exponential development has made Dehradun a much sort after location. LA City provides a unique combination of untouched nature and luxurious living. Meticulous planning and attention to details pamper the citizens of LA City. Amenities in this urban space cater to a broad spectrum clientele. Elders can relax at the Yoga and Meditation centre and find comfort in the knowledge that LA City has its very own mini hospital.

For more info log in to http://www.zameen-zaidad.com

& http://www.propertycafeteria.com

posted by zameenkaushar2009 on Jul 21, 2009 9:43 AM Permalink | 0 comments
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ANSAL HOUSING & CONSTRUCTION LTD

Ansal Housing & Construction Ltd. has been amongst the first to recognize the demand for modern residential and commercial space. In its endeavour to provide a world-class living, working and shopping environment to people, Ansal Housing has several new mega residential and commercial projects in Tier II and Tier III cities of India and beyond national boundaries as well. It has already launched a series of townships branded as 'Ansal Town' in cities like Alwar, Karnal, Agra, Indore, Rewari and Muzaffarnagar. These residential townships are complete entities on their own having a commercial space within the township and one can find several world-class amenities like clubhouse with swimming pool, gymnasium, restaurant, medical centre, schools, landscaped parks and gazebos, children play area, branded street lights, to name just a few.

Courtesy :TOI DT 11/7/09

posted by zameenkaushar2009 on Jul 18, 2009 1:43 PM Permalink | 0 comments
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UNITECH

Established in 1972, Unitech's developments have the most diversified product mix comprising residential, commercial, retail, IT Parks, SEZs, hotels, schools and amusement parks. Their well-managed architectural and engineering teams have closely worked and partnered with internationally acclaimed architects such as Callison (the USA), RMJM (the UK), SWA, HOK (the USA) and many others, to achieve both aesthetic and efficient design and adopting best practices that exude superior quality of construction in our developments.

Courtesy :TOI DT 11/7/09

posted by zameenkaushar2009 on Jul 18, 2009 1:42 PM Permalink | 0 comments
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DLF TO SELL HALF ITS HOTEL PLOTS, WIND POWER BIZ

DLF, the country’s largest property developer, today said it would raise Rs 1,900 crore through the sale of hotel plots and its wind power business by the fiscal-end.

“The sale of our land parcels has already fetched us Rs 1,000 crore and we expect another Rs 1,000 crore in the coming months. Talks for selling our wind power business are also on track and we should be able to get Rs 900 crore through its sale,” Rajeev Talwar, group executive director said .

DLF has 40 hotel plots, of which 21 have been put on the block for sale to raise money. The company plans to raise Rs 5,500 crore by the end of this fiscal through the sale of non-core businesses, including land parcels.

The company had accumulated debt of over Rs 14,000 crore by March 31. It is repaying Rs 600-1,000 crore every month, to reduce the debt by half by the fiscal-end.

Talwar, while speaking at a CII conference, told reporters DLF had sold over 2,500 housing units in the first quarter of the current fiscal and demand had picked up in the past few months. “The measures taken by the government, such as reduction in the home loan rates, has helped developers sell their projects,” he added.

DLF has reduced the selling prices of their projects by 25 per cent in recent months and will not hike prices in the near future. “We will stick to our current prices, as we want to support the government’s attempt to provide homes to more and more people,” Talwar said.

Courtesy:- BS dt:- 15-07-09

posted by zameenkaushar2009 on Jul 17, 2009 11:57 AM Permalink | 0 comments
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ILD TRADE CENTER SOHNA ROAD GURGAON

Welcome to India's most elite business address 'ILD Trade Center' an exclusive retail cum office complex at Sec-47 Sohna Road, Gurgaon. The complex promises trendy and unique blend of retail and commercial floors so that there are numerous choice for customers. Ground and first floor shall be meant for retails and 2nd floor to 9th floor for office units. The retail space is dedicated for reputed brands in clothing, stationery, fashion, health and beauty products, home appliances, electronics, gifts, craft and souvenir, groceries and eatables, kids stuff etc.

For more info log on to http://www.zameen-zaidad.com.

And http://www.propertycafeteria.com

posted by zameenkaushar2009 on Jul 17, 2009 11:56 AM Permalink | 0 comments
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NORMS LIKELY FOR GOVT BODIES TO BUY UNSOLD HOUSING UNITS FRO...

REALTORS TEMPTED TO TOE GOVT LINE IN HOUSING SECTOR

The government is considering a proposal that seeks to boost the public-private partnership model to the housing sector, encouraging state-run institutions such as National Housing Board (NHB) and the Delhi Development Authority (DDA) to tie-up with private realty developers to ensure that projects are executed in time and the supply of new houses remain intact regardless of fluctuations in the market.

According to a person involved in the process, the scheme will work the same way financial intermediaries underwrite corporate bonds and initial public offers in case there is a shortfall in subscription by the targeted investors.

India already has a shortfall of 20-25 million housing units in urban areas, which is expected to go up as the country gets more urbanised regions. Public agencies such as DDA and Haryana Urban Development Authority (HUDA) sit on huge land tracts and tapping the private sector will be beneficial for both parties as well as the common man, goes the reasoning behind the proposal.

The person, who wanted to remain anonymous since the draft needs to be cleared by the Planning Commission and the Urban Development Ministry before it is put out for an open feedback from the private realty players, said the scheme would apply to only those projects where government agencies have a role to play.

According to the plan, an agency like HUDA, instead of constructing projects on its own, will sell off the land for a private developer with a rider: the maximum price the developer can charge from buyers will be fixed by the agency. Alternatively, it will assure the developer that it will buy the unsold flats, if any.

The scheme, once approved, will be run on a trial basis with a state government that is not constrained by the Fiscal Responsibility and Budget Management norms. R V Verma, executive director of NHB, told SundayET that the PPP model would result in higher efficiency, sustainability of funding and construction with the 'backstop' underwriting facility extended by the public agencies with government support.

"The whole efficiency of the structure would lie in the clarity around the role of each actor, commonality of objective and performing to scales in a partnership mode," he said.

KPMG's executive director and head of infrastructure and government practice Jai Mavani said the proposal may result in credit enhancement but cautioned that developers should not be completely insulated from the risks involved in projects.

"Underwriting could certainly be a carrot for developers but it can backfire if they have no skin in the game. Complacency could result in lowering of the quality standards and timeliness of the delivery," he said. According Mr Mavani, underwriting ideally should cover only costs and not the margins, otherwise it would operate as a subsidy. "This is not necessary given the maturity of the industry and existence of a number of players," Mr Mavani said.

A high-level committee comprising various stakeholders will soon be set up to fine tune the proposal.

Courtesy:- ET dt:- 12-07-09

posted by zameenkaushar2009 on Jul 16, 2009 7:17 AM Permalink | 0 comments
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LOW’S ON A HIGH

Consumers are turning to low-rise apartments owing to their cost effective advantage as well the independent space that they offer. Developers too see it as an opportunity to beat slowdown blues, says

Are you one of those who have always wanted to own an independent house? If ample space and a private dwelling are topmost on your mind, then there are options galore for you.

Low-rise apartments are the latest trend to catch on in the real estate market. Typically, lowrise apartment units are built on Ground+ 2 floors or a maximum of Ground+3 floors. These are fast becoming a consumer preference owing to their cost effective advantage as well as the independent space that they offer.

No surprise then that a lot of developers are seeking an opportunity aggressively in this segment. Realty players such as BPTP, Vatika Group, Raheja Developers and Assotech are coming up with projects which cater to this inherent demand in the market.

And if you are wondering why would a developer want to build a low rise apartment vis-a-vis a big volume one, then there is a good enough reason. Here’s how this model works: The cost of construction is lower, more maintenance equipment costs are saved and developers tend to operate on a high volume strategy.

Says Venu Gopal, senior professional, real estate practice, Ernst & Young, “The cost efficiencies are on account of lower cost of base foundation construction, lower municipal fees/charges, limited need of amenities such as lifts etc. Generally, for such projects as the developer is not able utilise the full floor space index (FSI) available to them, the ground coverage is higher than high-rise buildings. The margins for projects depend upon a number of factors, including cost of land, amenities provided, prevailing market price etc, but generally such projects can achieve comparable margins as big volume projects.”

Now in a slow market, these formats of construction have been picking well. And that’s a reason why many developers have chosen the current time to tap the opportunity.

Delhi-based Raheja Developers, for instance, is coming up with a plotted development in Sohna(Gurgaon). There are also developments coming up at Sector 109 in Gurgaon priced in the range of Rs 2,575-2,775 per sq ft area, Dharuhera; Bawal (Haryana) and other parts of northern India. Harinder Dhillon, GM (marketing), Raheja Developers, feels this trend is now coming up since there is a set of customers in the market who prefer the privacy and space which independent floors offer. “Consumers prefer it as additional costs such as lifts, greater common areas and more maintenance equipment costs are saved in the case of low-rise development. Also, one gets the benefit of adequate space which may be a constraint in high-rise apartments.”

Vatika Group too had launched low-rise apartments within Vatika City in 2005 called Iris Rows and Laurus Apartments comprising a total of 300 units. While possession for Iris Rows started two years back, Laurus would be complete in 5-6 months. Market rate for it is 4,000/sq ft for an area of 2,160 sq ft. And the response to that, they say, has been rather encouraging. “In North India, a large percentage of apartment buyers have retained their traditional and psychological preference for being as close to the ground as possible. In addition, low-rise developments entail lower costs. From the site planning perspective, low rise housing implies spread of population on a larger area as compared to high-rise and results in smaller and more compact communities,” says Pankaj Pal, president, sales and marketing, Vatika Group.

Ditto is the case with BPTP which recently launched its independent floors in the price bracket of Rs 16-25 lakh in Faridabad. Amit Raj Jain, vice-president, marketing, BPTP, says lowrise apartments are far more affordable as compared to group housing projects. “Looking at the demand in the market, BPTP recently launched Park Elite Floors at Parklands Faridabad which received tremendous response with over 5,000 bookings.”

Many also feel that independent floors are paying off in this market as they fall within the concept of ‘right price housing.’ According to Rohit Malhotra, CEO of Realtech Developers, independent housing is one of the concepts in a mid-sized housing development project and it seems to have taken off well. Citing a survey of 40 new residential projects during the last six months in Delhi NCR, he says, 28% of the units were in the form of individual floors in low rise, as compared to only two villa projects that were launched.

But don’t just go for a low-rise without looking at the basics. Follow some dos and don’ts. Rajeev Rai, V-P, corporate, Assotech, says basics such as land title, background of the developer, quality and type of construction, maintenance charges after possession and delivery schedule need to be borne in mind for these apartments as well. However, some things which need to be checked are the security aspect as you will be living in an independent house. Checking on power back-up availability is equally important. Buyers should also look for projects that offer easy accessibility, connectivity and safety.

With buyers increasingly looking at low-rise purchases, this segment is expanding its scope in the market. So if you want to buy a home, don’t forget to look at this choice. It could well turn out to be your preference too!

Courtesy:- ET dt:- 12-07-09

posted by zameenkaushar2009 on Jul 16, 2009 7:17 AM Permalink | 0 comments
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IVA OFFSHOOT PICKS 49% IN AAMBY VALLEY

Majority Control Stays with Sahara Group

An Investment arm of C Sivasankaran, the non-resident Indian businessman better known as Siva in India Inc circles, has emerged as a significant shareholder in Aamby Valley—the company floated by Sahara Group to develop Aamby Valley City—a famous up market township project in Maharashtra.

According to documents available with ET, Siva Ventures (SVL)—a whollyowned subsidiary and the principal investment offshoot of Sterling Infotech Group promoted by Mr Sivasankaran—owns a 49% equity stake in Aamby Valley.

In a recently-prepared information memorandum, Siva Ventures said it “has a significant presence in infrastructure and township building business by way of 49% ownership in the equity share capital of Aamby Valley, owners of Aamby Valley City”.

The information memorandum was prepared last month when Siva Ventures raised Rs 435 crore through private placement of non-convertible debentures. ET has a copy of the memorandum.

The majority control in Aamby Valley remains with Sahara Group, which owns a 51% equity stake.

The story was first reported on ET NOW, this daily’s business channel.

A senior official said Sterling Infotech Group was a “private equity investor” in Aamby Valley”.

“The deal is between two private parties, viz., Sahara Group and Sterling Infotech Group. Whatever is required to be disclosed to the statutory authorities by Sterling Infotech Group is alone permitted to be disclosed and the same, as you are aware, is available for the asking. The two parties have entered into this deal after signing appropriate non-disclosure and confidentiality agreements. I am afraid the details, except for statutory and regulatory purposes, cannot be revealed by either party,” said K Sethuraman, vicepresident (legal), Sterling Infotech Group.

Mr Sethuraman was responding to questions from ET on the holding structure of Aamby Valley.

The Sahara spokesperson did not respond to a set of emailed questions. The spokesperson said he was not in a position to comment at this point in time.

In a detailed email response to ET late on Wednesday evening, Mr Sivasankaran, the chairman of Siva Ventures, appeared to deny that any transaction had taken place, describing the information available with this paper as “untrue” and “unreliable”.

Flurry of deals in recent times

“I would like to bring to your notice that the information is absolutely untrue, without any basis and if there is anything, it is a separate matter which is private. It has no relevance to be published,” Mr Sivasankaran said.

The origin of the transaction, valuation of the deal and the exact timing are not known. A number of sources familiar with the matter said Sahara had borrowed a substantial amount from Mr Sivasankaran’s group by pledging shares of Aamby Valley, though this could not be ascertained from the Group. Subsequently, SVL became a shareholder in the company, though the precise sequence of events by which this occurred could not be ascertained. The sources familiar with the deal referred to earlier said it could have happened as long ago as 2007—the same year Sahara had sold its airline business to Jet Airways.

Aamby Valley City is Sahara’s flagship realty project. It is planned over 10,000 acres and has been positioned as an upmarket hill township with ambitions of figuring among the top five destinations in the world. Celebrities like Russian tennis player Anna Kournikova, actor Amitabh Bachchan and daughter-in-law Aishwarya Rai own villas in this township.

Siva Ventures has taken 171 timber chalets in Aamby Valley on lease for 997 years, according to the memorandum. These are valued at around Rs 15 crore each.

Mr Sivasankaran has aggressively entered the Indian realty market this year. In May, he bought a 66% stake in a realty project in Mumbai from DLF for Rs 310 crore. The reality project is on land occupied by the nowclosed Hindoostan Mill in Central Mumbai.

Besides the realty sector, he has also entered the telecom space by buying a 51% stake in S Tel, a Chennai-based telecom company that has licences to operate in several northern and eastern states. Mr Sivasankaran bought the stake from two private equity firms—Skycity Foundations and Telecom Investments. Post the transaction, S Saravana, his 22-year-old son and V Srinivasan, Group CEO, Siva Ventures, have also joined S Tel’s board of directors.

Courtesy:- ET dt:- 09-07-09

posted by zameenkaushar2009 on Jul 14, 2009 12:38 PM Permalink | 0 comments
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THE BEST DEALS

More than 65% of the newly launched residential units in the NCR are priced below Rs 30 lakh, and there are ready buyers for them. ET Realty reports

Affordable housing is the new mantra in the real estate sector and has increased the affordability quotient of middle class end users in their quest for their own sweet homes. The fall in the interest rate to around 9.5% on home loans up to Rs 30 lakh has further added to this factor.

According to a survey conducted by global realty research firm DTZ, affordable houses of less than Rs 30 lakh have shown a robust demand with most of the newly launched units, during the last six months, recording absorption in the range of 30-50%.

The survey says out of 29,367 residential units launched during the period, 82%, or 24,118 units were priced in the range of Rs 1,500 to Rs 3,000 per sq ft in the National Capital Region of Delhi. According to DTZ, this makes an average housing unit of around 1,000 sq ft cost less than Rs 30 lakh, fitting the budget of the middle-income buyer. To be even more specific, DTZ said more than 65% of the newly launched residential units are priced below Rs 30 lakh.

The main reason behind the launch of such a large number of units in the price range of Rs 30 lakh is the overwhelming demand in the 'budget' segment. This is clearly indicated in the sale of apartments recently launched in Noida, Gurgaon, and Faridabad by JP Green, Mahagun, Gaursons, Assotech, Supertech, Purvanchal and BPTP. In some cases, the entire projects were sold out within a couple of days - and, now, a developer is even considering allotment of the flats to applicants through a lottery system, as the number of applicants are almost double the number of apartments on offer.

There is a huge rush to buy houses by the middle class people, who till six months ago found it almost impossible to do so. However, the research firm says the affordable homes are coming with riders, which every prospective buyer must take note of. Not only has the average size of housing units been decreased in the first half of 2009, as compared to the size of units launched a year ago, the amenities provided by developers have also been curtailed.

For 2-BHK units, size it has come down by 14% - to 1,080 sq ft. For 1- and 3-BHK units, the size has decreased by 5% and 12% - to 720 sq ft and 1,493 sq ft, respectively.

In the budget segment, only basic amenities like car parks, security, power back up, and lifts for highrise apartments are being provided. In many cases, even amenities like swimming pools and a gym, which had become a common features in the condominiums being developed for the last five years, are not being provided. Therefore, while selecting an apartment, a buyer must be clear as to what he is buying.

Developers have again shifted their focus in developing independent floors. The report says developers have indicated a preference for constructing independent floors in low-rise housing units and apartments of less than 1,000 sq ft in high-rise buildings because of the cost advantage they offer. According to the report, in the last six months, 28% of the units launched were in the form of individual floors in low-rise housing, as compared to only two villa projects, which were launched. However, the buyer must check it before buying, as half of the independent-floor projects do not provide even power back up.

Apart from that, in the condominium of affordable apartments, the density of flats is higher than that in the premium apartments. This will certainly put extra pressure on the common area. But, still, the price at which they are being offered is certainly a good value for money.

Courtesy: - ET dt: - 10-07-09

posted by zameenkaushar2009 on Jul 14, 2009 12:38 PM Permalink | 0 comments
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NOW, THEME HOUSING

Ever dreamt of spending your time among the quaint and mysterious landscapes of an English hamlet, or silently enjoying the mystical oriental charm of Bali, or living in sylvan surroundings amidst verdant greens and rolling hills, allowing winds to rustle your thoughts and flowers and butterflies cheering you to yet another world? Don’t worry! You can turn your dreams into reality now — that too while still in India or, better still, in your hometown!

In fact, faced with similar-looking projects as well as hit by economic downturn, real estate developers have for some time forayed into theme-based projects to differentiate product offerings and bolster revenues streams.

Take, for example, Tuscan City, which has been designed around the theme of Italy. The housing project, just launched by TDI Infrastructure Ltd in TDI City in Kundli, boasts of bringing to India the look and feel of Italian lifestyle, known for its panache, design and architecture. TDI claims international architects from the beautiful region of Tuscany in Italy have designed the township. Spread over 40 acre of land, the township will offer plots, row houses, independent floors and villas, and true to the Tuscan style, will have classic fountains, water bodies, cobbled pavements and central piazzas. Tuscan City will also include a commercial space in the shape of an Italian marketplace, where people can shop for their daily needs.

Kamal Taneja, MD of TDI Infrastructure Ltd, says, “Seeing the growing aspirations of the people and in an effort to offer something new and unique to our customers, we decided to create the look and feel of Europe in India. And there is no better example of the continent than Tuscany, known as the largest open-air art gallery in the world. Our effort would be to create a slice of Tuscany (home to beautiful cities like Florence, Pisa and Siena) in Kundli.”

Similarly, Bangalore-based Vakil Housing Development Corporation’s theme-based projects include Vakil Hamlet, Moghul Garden City, and Whispering Woods. The specialty of all these projects is that they revolve around certain themes. For instance, Vakil Hamlet aims at capturing the mystery, romance and grandeur of medieval English lifestyles. It is a township, sculpted to the last detail, like an European fortress - right from its impressive entrance arch, water walls with thematic murals, down to its exquisite layout and ornate design. Vakil’s Garden City, on the other hand, replicates the Shalimar Baug and aims at providing the beauty of the well laid-out gardens, while its Whispering Woods project is a getaway from the hustle bustle of the urban metropolis, into a quiet rustic and fairy-tale setting.

Mumbai-based developer, Purvanakara Builders, is also developing ‘Purva Venezia’ at Yelahanka in Bangalore. The project, likely to be completed in 2010, offers a slice of Venice in Bangalore. Delhi-based real estate major Omaxe Ltd also has several theme-based housing projects to its credit, including NRI City in Greater Noida and The Nile in Gurgaon. It is also constructing a theme township in Naya Raipur, the capital city of Chhattisgarh.

Explaining the rationale behind the introduction and success of theme-based projects, Ramesh Kumar, managersales & marketing of Vakil Housing, says, “Theme-based houses are positioned to tap the new Indian buyer who wants a residential address that matches his changing lifestyle and aspirations. Today’s customers, in fact, are globetrotters. Having been abroad and seen the world, they want to have something of that when they return home and a theme-based project gives them that opportunity.”

Kumar says all their themebased projects have been completed and are 90% occupied. Having seen the grand success of their projects, Vakil Housing is now contemplating two more theme-based projects, although their unique theme concepts have not been decided yet.

“While theme projects are on the rise, another trend that developers have been offering is adding a theme to a part of usual housing project. Vakil has, for instance, given its projects a ‘butterfly park’, an orchard, a kiddies corner or clubhouse facilities,” says Kumar. “Everywhere theme housing is based on the size of niche markets and their potential to pay. This explains why most developed real estate markets have a strong theme-based segment. In India, however, their success lies in their ‘pricing’, at least in the present market conditions. Therefore, if a project is good and is offered at an attractive price, then only will that sell well,” says Vineet Singh, business head of 99acres.com.

Courtesy:- TOI dt:- 04-07-09

posted by zameenkaushar2009 on Jul 11, 2009 12:28 PM Permalink | 0 comments
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VALUE FOR MONEY

More than 65% of the newly launched residential units in the NCR are priced below Rs 30 lakh, and there are ready buyers for them, says

The main reason behind the launch of such a large number of units in the price range of Rs 30 lakh is the overwhelming demand in the ‘budget’ segment. This is clearly indicated in the sale of apartments recently launched in Noida, Gurgaon, and Faridabad by JP Green, Mahagun, Gaursons, Assotech, Supertech, Purvanchal and BPTP. In some cases, the entire projects were sold out within a couple of days — and, now, a developer is even considering allotment of the flats to applicants through a lottery system, as the number of applicants are almost double the number of apartments on offer.

For 2-BHK units, size it has come down by 14% — to 1,080 sq ft. For 1- and 3-BHK units, the size has decreased by 5% and 12% — to 720 sq ft and 1,493 sq ft, respectively.

Developers have again shifted their focus in developing independent floors. The report says developers have indicated a preference for constructing independent floors in lowrise housing units and apartments of less than 1,000 sq ft in highrise buildings because of the cost advantage they offer. According to the report, in the last six months, 28% of the units launched were in the form of individual floors in lowrise housing, as compared to only two villa projects, which were launched. However, the buyer must check it before buying, as half of the independent-floor projects do not provide even power back up.

Courtesy:- TOI dt:- 04-07-09

posted by zameenkaushar2009 on Jul 11, 2009 12:27 PM Permalink | 0 comments
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CENTURY TEXTILES TO DEVELOP WORLI MILL LAND FOR RS 625 CR

Century Textiles and Industries, a part of the BK Birla group of companies, will spend nearly Rs 625 crore in the first phase of Century Mill's land development in Mumbai, according to information put out by the company.

Currently, the company is in the process of demolishing the old buildings and is expected to start construction work on the mill land by the year-end, a top company official said. The company plans to build a hotel and a commercial complex for IT and ITeS (IT-enabled Services) companies on the 20-acre land.

"Right now, we are in the planning stage and putting together the designs. We have obtained permission to start the work. Hopefully, we will start the work by the year-end," RK Dalmia, senior president, Century Textiles, said.

The land will be developed in three phases and the first phase will comprise of development of a commercial complex and rehabilitation of around 850 workers according to law, Dalmia said. The company will float a tender soon to select a construction company for developing the land, he said.

The 30-acre Worli mill land was in the news earlier due to reports of contention between the BK Birla group, which owns the 20-acre free-hold land, and the Wadia group, promoters of Bombay Dyeing, who own the rest. The Birlas have lease rights for 999 years.

Some former workers, who did not accept the voluntary retirement scheme (VRS) after the mill got closed in 2006, also agitated against the company management and held protests.

"We can start the work on the free-hold land and resolve the disputes with Wadias in due course of time," Dalmia said.

According to the succession plan of BK Birla, the patriarch of BK Birla group, Century Textiles is expected to come into the fold of Kumar Mangalam Birla, who is the chairman of the Aditya Birla Group.

The plans for Century Textiles come at a time when office rentals have fallen by over 50 per cent in various places, such as Nariman Point, Bandra Kurla Complex and Lower Parel in Mumbai, which are key business hubs.

The Lower Parel-Worli area, where Grade A office rentals hover around Rs 170 a square foot, is expected to see a further fall in rentals due to an oversupply of office space. Indiabulls Real Estate is developing Indiabulls One Centre in Jupiter Mills complex and Elphinstone Mills Project in Lower Parel, while the country's largest realty company DLF and the Wadia-promoted Bombay Dyeing are developing a commercial complex in the same locality.

When asked about falling rentals, Dalmia said: "Real estate is very cyclical and now it is in a downward cycle. In due course, we expect it to improve."

Courtesy:- BS dt:- 04-07-09

posted by zameenkaushar2009 on Jul 9, 2009 1:45 PM Permalink | 0 comments
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HTL SLIPS ON DEBT PAYMENT, SBI TAKES OVER LAND

State Bank of India (SBI) has taken possession of prime properties in Chennai, owned by Hindustan Teleprinters (HTL) after the company and its guarantor, Mahendra Nahata failed to pay debt of over Rs 103 crore in time.

In a public notice issued by SBI’s stressed assets management branch in Chennai on Tuesday, the bank said that it issued a demand notice on April 18, 2009 asking the borrower HTL and its guarantor Mahendra Nahata to repay the amount within two months. The noticed has been issued to inform the public about SBI’s takeover of the properties, the bank said.

The properties include 11.02 acres of developed plot in Guindy Industrial Estate and 2.48 acres at the Lucky Bungalow premises within the Guindy Industrial Estate. A bank can stake claim to a borrower’s collateral by invoking the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) act of 2002, if the borrower defaults on loan payment.

In 2001, Mahendra Nahata’s Himachal Futuristic Communication (HFCL) pipped other suitors including Wipro and picked up the Government’s majority stake (74%) in the then public sector HTL for Rs 55 crore. HTL was incorporated in 1960 to manufacture teleprinters, later diversified into making modems, data networking products and switching accessories. Due to the financial crisis, the company has stopped production. HFCL chairman Mahendra Nahata said, “I am surprised by SBI’s action, especially when it is aware of our efforts to sell the 11 acre property and use the proceeds for settling the dues and reviving HTL,” Mr Nahata told ET.

Mr Nahata added that HTL had invited bids to buy the land a couple of years ago. At that time, RMZ Corp Bangalore won the bid quoting Rs 297 crore.

Courtesy:- ET dt:- 02-07-09

posted by zameenkaushar2009 on Jul 9, 2009 1:45 PM Permalink | 0 comments
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GOVT TO DEVELOP SIX PORT PROJECTS WORTH RS 3,319 CR

Under the much-hyped 100-days programme of the UPA government, the shipping ministry has proposed to award a contract for six port projects costing Rs 3,319 crore on a public private partnership (PPP) basis. It will seek the Cabinet Committee on Economic Affairs’ (CCEA) approval for setting up mechanised iron ore handling facility at New Mangalore Port (NMPT) in Karnataka in the next few weeks.

“The six projects are expected to add a capacity of 31.23 million tonnes and 1.97 million TEUs (twenty-foot equivalent units),” shipping minister GK Vasan said while unveiling the ministry’s 100-day agenda.

The proposed projects include development of a deep draught iron ore berth and a coal berth with a capacity of 10 million tonnes each at a cost of Rs 591.35 crore and Rs 479.01 crore respectively at Paradip port. A container terminal with a capacity of 1.5 million TEUs at Ennore port is also planned at an estimated cost of Rs 1,407 crore.

The shipping minister also said the government was looking into the possibility of disinvesting Shipping Corporation of India (SCI).

“The ministry is examining the economic climate and we will take a view on this,” Mr Vasan said, adding that the financial health of the public sector company needs to be improved. The ministry is examining a proposal for financial restructuring of Hindustan Shipyards and transfer of its assets to the ministry of defense. It has also decided to strengthen the Indian Maritime University in Chennai with campuses at Kolkata, Mumbai and Visakhapatnam.

Meanwhile, the ministry has proposed to declare Andaman & Nicobar Islands and Lakshadweep as major ports. It would soon approach the Cabinet seeking its approval for the same.

Courtesy:- ET dt:- 02-07-09

posted by zameenkaushar2009 on Jul 8, 2009 8:32 AM Permalink | 0 comments
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IRDA BARS INSURANCE COMPANIES FROM INVESTING IN IDRS

Says Buying IDRs Amounts To Indirect Investment In Foreign Companies

Insurance regulator Irda has prohibited Indian insurers from investing in Indian Depository Receipts (IDRs), saying the insurance law does not allow investment of policyholders’ funds directly or indirectly outside the country.

In an IDR issue, foreign firms are allowed to mobilise funds from Indian markets by offering their equity shares in the form of rupee denominated receipts. They are listed on the Indian stock exchanges and are freely transferable. These receipts are issued to investors in India against underlying equity shares of the issuing company based out of India.

An investment in an IDR by insurance firms would amount to indirect investment made outside the country. This will not be in compliance with the existing provisions of the insurance legislation that debars insurers from investing policy holders’ funds overseas, said Irda in a communication to chief executive officers (CEOs) of insurance firms. “In view of the extant statutory restrictions on overseas investments, it would not be in order for insurers to invest in IDRs,” Irda said.

Section 27C of the Insurance Act bars investment of insurance funds outside India.

Insurers said the Irda move would not affect them much, but stock analysts said the decision would diminish the attractiveness of the IDR market. Reliance Life Insurance Director Malay Ghosh said, “As we have many other avenues of investment, it won’t impact much.”

However, SMC Capitals equity head Jagannadham Thunuguntla said the ability to raise IDRs will be reduced to certain extent and might affect their issue size.

Courtesy:- ET dt:- 02-07-09

posted by zameenkaushar2009 on Jul 8, 2009 8:32 AM Permalink | 0 comments
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GET YOUR HANDS ON A HOME

If you have identified a suitable property and have the means to take the plunge, you should do so now. A deferred decision might mean forgoing the best price.

The realty market is showing signs of revival again. With prices rationalizing in many pockets across the country and interest rates finally conducive to taking a home loan, the dream house is now affordable for a significant corpus of homebuyers. This is no longer the annus horribilis for property buyers. So those who have identified a suitable property and have the financial means to take the plunge should do so now. A deferred decision might mean passing over the best price. Or as they say, “Tomorrow will be too late, it’s now or never.”

Realty prices jumped to unrealistic levels between 2003 and 2007. The rise in interest rates and the global financial crisis resulted in transactions virtually grounding to a halt adding to the pain. Elections last month have improved sentiment significantly giving the much-needed confidence to buyers. Also, the recently launched projects with repackaged pricing have instilled hope among prospective home buyers, a majority of them end users. Those waiting in the wings are now ready to close the deal, thanks largely to attractive pricing and affordable projects. The end of pain is near!

THE THAW HAS SET IN

The end-user is back in business and customer is king once again. The slowdown has forced developers to correctly identify end-user needs and reposition products keeping affordability in mind. They are customizing products for buyers and targeting across segments instead of merely looking at high-end housing. On the platter are new launches, properties under construction for which possession is due in the next 3-9 months and ready-to-move-in homes in the secondary market. The choice entirely depends on a buyer’s investment appetite and his needs. Right pricing has been the key to the positive response received for several new launches recently. These have been launched across the country and their prices range from Rs 10 lakh to Rs 30 lakh. Affordable housing is the flavor of the year and accounts for around 90 per cent of the new projects being launched. Those sitting on the fence are now faced with the right product mix and price points and are, therefore, more than eager to get off now.

Most of these new launches in the affordable category are up for delivery in 2011 and 2012, years that will see the real estate growth story bouncing back at realistic levels. A gaze into the crystal ball reveals the following truths confronting the realty sector then – a movement towards a landscape where supply will be aligned to prevalent demand, a capital appreciation of 10-15 per cent and a distinctive shift to Tier II and Tier III cities.

CASHING ON THE OPPORTUNITY

The consumer today is willing to take the risk of timely construction thanks to the “good price and a good opportunity” on offer. If a buyer signs in for a brand new launch by a builder of repute, he can expect reasonable returns in the next few years as the market would be up and moving by the time he gets possession. A new launch would also offer better rates and terms such as a construction linked payment plan or payment of EMIs after possession.

TOUCH AND FEEL

Secondary stock (re-sale stock in ready buildings) is largely an end-user market and decisions are driven mainly by location preference. If the purchaser zeroes on a particular loacation, he is likely to opt for the product even at slightly premium rates.

The options may be limited but the comfort level is slightly higher for this segment as there is a touch-and-feel factor which lends greater confidence and any ambiguity with regard to possession being delayed is ruled out.

Other options are unsold stock that can be a good option if one can get a other factors consultant such as track record and reputation of the developer. The homebuyer never had it so good. For the times surely, “they are a changin’!”

CHECKLIST

IF GOING FOR PRIMARY SALE CHECK:

Ø Credentials of the developer

Ø Track record of earlier projects delivered

Ø Payment plan to suit ones financial position

Ø Special offers which a developer is ready to give

Ø One’s own requirement for the property – move in immediately or wait for the project to be delivered

Ø Layout plan and area as per ones own requirements

Ø Location of project

Ø Development of neighborhood and potential for escalation

IF YOU ARE GOING FOR SECONDARY SALE CHECK:

Ø Location and neighborhood where the property is located

Ø Title search-establishing ownership details

Ø Get confirmation on any encumbrances on the property

Ø Age of property

Ø Status of construction quality

Ø Understand why the current owner is selling the property

Ø Electricity load available

Ø Area specifications to suit your requirements

Ø Mode of payment acceptable by the seller

Ø Whether one can get a loan on the property

EDITOR’S NOTE

Greetings potential home buyers. The past few months have been extremely trying for both developers, property sellers as well as buyers. The global economic crutch has bit deeply and made many reconsider their development or purchase plans.

However the market is now turning around and everything points to this being the right time to buy.

HT Estates is proud to bring you this special edition of Hot New Properties in Delhi and NCR- a compendium of ready-to-move-in and upcoming residential projects so that you have a range of options before you to help guide your purchase. The profiles of new developments covered in this special edition have been sourced directly from the developers and Hindustan Times bears no responsibility for the information contained in the advertorials in this special issue.

Courtesy: - HT Estates dt: - 13^th June 2009

posted by zameenkaushar2009 on Jul 4, 2009 1:42 PM Permalink | 0 comments
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ZYLOG LOOKS TO THE US, EUROPE FOR ACQUISITIONS

Chennai-Based Zylog Systems is believed to be in talks with three companies in the US and Europe for acquisitions. According to people familiar with the development, the deal is in the range of $20-40 million and likely to be concluded over the next three months. It was learnt that Zylog, which provides technology solutions to Wi-Fi businesses, had formed an mergers & acquisition team, which has identified these companies. The company’s MD & COO, Ram Sesharathnam, confirmed that Zylog is looking at the possibility of acquiring companies, but declined to divulge further details citing non-disclosure agreements with these prospective targets. On Wednesday, Zylog shares ended 0.5% higher at Rs 196.10.

Courtesy:- ET dt:- 02-07-09

posted by zameenkaushar2009 on Jul 4, 2009 1:41 PM Permalink | 0 comments
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MAKING RENTALS AFFORDABLE

After affordable property comes rental housing, which seeks to serve two categories — the migrants and the not-so-creditworthy populace, says VANDANA RAMNANI

After combating the economic slowdown for months, the developers finally zeroed on a fast moving realty product - affordable housing. Eureka! The volume of sales shot up by25 per cent. The success with the right product mix at the correct price point prompted them to continue the good work at the bottom of the realty pyramid to revive the much-needed cash flows. The task this time round is enormous — to work in tandem with the government to decongest the main cities and halt the proliferation of slums through the mechanism of rental housing.

Taking the lead is Housing A Development and Infrastructure Limited (HDIL) and Mumbai Metropolitan Region Development Authority (MMRDA).The two have come together combating the economic slowdown for months, the developers finally zeroed together to build Mumbai’s biggest rental housing project, perhaps the first in the country. Both entities will develop 525 acres of land in Virar and build rental houses for about 43,000 low-income families. HDIL will also be free to build another 90,000 houses that it can sell at market price to recover costs. The first 10,000 units will be ready by March 2011.Each house will be of 160 sq ft carpet area and will be built in self-contained units in 14 storied quake-resistant buildings. The rental houses will be allotted to interested candidates through a lottery system. The monthly rent will range from Rs 800-Rs 1,500, depending on the location.

Realty experts point out that rental housing schemes can be replicated in other cities too, especially in areas where migration takes place in large numbers both in the case of students and labourers. The scheme can also go a long way in serving two categories — the migratory and the not-so-creditworthy populace. Besides, it can only be successful through the private-public partnership model as the resources to sustain the huge volumes are available only in the public domain.

Incentives can ensure its success

According to Sanjay Dutt, CEO (Business) JLLM, it all started with new launches in the affordable segment followed by low-cost housing projects launched by some developers. This created vibrancy in the realty market.

The rental housing scheme could be launched in Mumbai because there are benefits unique to Maharashtra. There is a significant population that migrates to the state and can not afford Mumbai rentals. This scheme will benefit the lower income and the lower mid-income group.

Major metro cities such as Bangalore, Pune, Chennai and Kolkata are hubs for progressive states and absorb about 2030 per cent of the migrant populace. The government facilitates land and creates a pull through incentive structures. One will find more private developers taking advantage of such opportunities if the government takes the lead in terms of incentives and facilitation. The rental housing scheme is a pilot project and if regulated the right way, it can be a huge success, adds Dutt.

PPP the right engine to sustain high volumes

Adds Paresh Chawla, Associate Director, Real Estate Practise, E & Y, the intention of the Maharashtra Government through this scheme is to provide land and housing structures to be put in place by the private developers where migrant labour can stay. If any other state government decides to plan something of this magnitude, it can be successful only through public-private partnerships, necessary to sustain the volumes.

This initiative is particularly useful for providing temporary accommodation to the people who get displaced during redevelopment or slum rehabilitation projects.

Arrests proliferation of slums

The concept can work only in cities where the migrant population is large and in townships or cities where a huge amount of labour is expected. It can be set up in states where there are general manufacturing industries such as Gujarat, the outskirts of Delhi and Kolkata. Rental housing townships help in absorbing labour better and arrest the volume of slums by providing alternate accommodation.

Concurs Amit Bhatt, Town Planner, “The concept is good. It is likely to be successful in magnet towns where people come to reside on a temporary basis, primarily because of a job or to acquire good quality education. This is a new trend and a fantastic opportunity to be tapped. This can be successful only through a public private partnership model as resources for a large scale project are available only in the public domain.”

Serves the not-so credit worthy

In the current market scenario, developers need a mechanism to generate revenue and hence the emphasis on affordable housing. Rental housing goes a step further. It not only offers immense opportunities but also brings in the much needed revenue, he adds.

Dr P S Rana, former chairman, HUDCO, is of the view that rental housing is a must for two sections of society the migratory and the not-so credit worthy populace who cannot get a loan from financial institutions. The large community of migrants, those with transferable jobs, migrant workers and students need affordable renting accommodation.

If fiscal incentives on rental income are provided, fresh rental stock can emerge for this segment as well.

The government can con tribute by providing fiscal incentives, increase the supply of service land through proper rules and decontrol, he adds.

Engagement a must

However, it is essential that realty players do not go on a rental housing overdrive. Proper planning, consent and engagement of the populace their product will serve is important.

Points out Rumjum Chatterjee, Managing Director, Capacity Building Division, Feedback Ventures, “When we relocate people, they need not be bundled 40 kms away as their livelihood is impacted.

Planning, consent and engagement is necessary to ensure that they are not worse off than before. It is important to ensure that rental housing seeks to improve their lives and not the other way round.”

Courtesy:- HT dt:- 27-06-09

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LIC Housing Finance’s Expo a hit

The ‘Homes for all expo’, a mega real estate exhibition focused on residential properties organized by LIC Housing Finance Ltd. (LICHFL) proved to be a major hit with over 25,000 visitors thronging the venue for three days and making substantial number of bookings.LIC HFL disbursed on-the-spot home loans worth over Rs.125 crores at the expo.

Courtesy- HT dt:- 27-06-09

posted by zameenkaushar2009 on Jul 3, 2009 12:05 PM Permalink | 0 comments
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SOPS MUST FOR REALTY GROWTH

Tax sops to the realty sector will have a cascading effect on the overall economy and boost growth with a human face, says Prabhakar Sinha

For the first time in three years, houses have come within affordable range of the middle class whose income is in the range of Rs 3 lakh per annum.

With the turmoil in financial market, the real estate sector witnessed one of the toughest times in recent times. But, now, as interest rates have fallen to a single digit, and the developers have cut prices by almost 30- 40% from the peak rates of 2008, a two-bedroom apartment is available for an EMI of as little as Rs 13,500 per month.

In the National Capital Region (NCR), a number of developers like JP Green, DLF, Unitech, Mahagun, Purvanchal, Assotech, Supertech, SVP, and A s h i a n a , among others have l a u n ch e d t wo - b e d - room apartments in the price range of Rs 16 lakh to Rs 35 lakh depending on the area and specifications. Till six months ago, nothing was available for less than Rs 30 lakh.

As interest rates are likely to fall further, an EMI on a loan required to buy these newly launched apartments could further go down. In the last six months, interest rates on home loans have fallen by almost 2 percentage points, from 11.25% to 9.25%. Besides this, the tax benefits on repayment of home loans bring down effective rates even lower.

At present, up to Rs 1,50,000 interest paid on home loan is allowed to be deducted from one’s taxable income. With this, even for a person whose income is less than Rs 5 lakh per annum, and who pays tax at the rate of 20.60% including surcharge, the effective interest rate on a Rs 15 lakh loan to be repaid in 15 years comes down to 7% from 9.25% in the first year. In subsequent years, the effective rates go further down.

However, if he borrows a higher amount of say Rs 20 lakh, the present limit of Rs 1,50,000 on interest payment, which could be deducted from one’s taxable income, is not good enough as the total tax payment for the first year would be Rs 1,85,215 at the interest rate of 9.25%.

To encourage people to invest in a house, Confederation of Real Estate Developers’ Association of India (CREDAI) has suggested the government increase the deduction on interest paid on self-occupied residential house property, which is currently restricted to Rs 1.5 lakh per annum, to the entire interest on funds borrowed for acquisition of self-occupied residential house property in the affordable housing category. In other category, CREDAI said deduction up to Rs 5 lakh per annum should be allowed in Tier 1 cities and up to Rs 3 lakh per annum in other cities.

If the government adopts these measures, the effective interest rates on a loan of Rs 20 lakh loan for 20 years will come down to 6.95% from 9.25%. Developers and consultants feel these measures will increase affordability of houses and will spur their demand.

S K Sayal, director and CEO of Alpha G: Corp, says the construction is an integral part of infrastructure sector and comprises commercial, residential, roadways, waterworks, ports, airports and SEZs.

He argued that its growth will provide impetus to the entire economy. In 2005, realty sector generated around 31 million jobs, out of which the organized sector generated 1.2 million jobs. In the next five years, 2.5 million new jobs per annum are expected to be generated.

In order to bring down the cost of construction, CREDAI has also demanded the reintroduction of a tax holiday under Section 80-IB (10) for housing projects approved after March 31, 2007. A renewal of section 80-IB, which gives tax waivers to a housing unit built on less than 1,000 sq ft in Metro Cities and 1,500 sq ft in other cities would provide a fillip to the construction of much-needed small and affordable homes. This concession was available before 2007. Under this, profit made by developers in developing small dwelling units is exempt from tax. Re-implementation of Section 80-IB (10) will greatly help in developing affordable housing in the country.

CREDAI, in a presentation said realty sector influences 4.5% of India’s GDP and employs 7% of the total work force. Therefore, if the government wants to give stimulus package to the economy to counter the present slowdown, it must provide tax relief to encourage investment in the housing sector. As a spurt in real estate activities leads to creation in assets with the creation of huge employment, any encouragement to the sector fulfils the government goal to achieve high growth with a human face.

Developers feel the present spurt in demand will be sustainable if the economy continues to grow at least at 7%. And, for this, the government must work out a package to insulate Indian economy from the global slowdown. And, in this, real estate could be the best bet, as demand for housing is perennial - of course, provided the government makes it affordable.

Courtesy:- TOI dt:- 27^th June 2009

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JOINT LOAN AND TAX BENEFITS

In case both husband and wife are working or have separate sources of income, they can go in for a joint loan, says Times Property Team

While purchasing property, you can opt for a joint loan with your spouse. In case both husband and wife are working or have separate sources of income, they can go in for a joint loan. This way the loan amount also increases. Under the Income Tax Act, tax benefits are available on home loans and the interest paid on them. In case of joint loans also, all the co-borrowers can get tax benefits. A bit of documentation and planning can go a long way in avoiding hassles at a later stage. You can also take the maximum advantage of the available tax provisions and benefits.

It needs to be ensured that both should be co-owners of the property. A co-owner of a house must be a co-borrower as well. It is essential for a co borrower to be a co-owner in order to claim tax benefits. You cannot get tax benefits if you are only a co-borrower and not a co-owner.

Co-borrowers, who are also co-owners, are eligible for the tax rebate in the proportion to their share in the loan. The repayment capacity of each spouse will be taken into account while arriving at the share of the loan. The shares of the loan may be in any ratio. The tax benefits would be shared in that proportion only. You have to specify the share of the property and other loan details on a stamp paper.

In case a husband and wife pay Rs 1 lakh as interest and Rs 25,000 as principal, each has an equal share in the borrowing, and each can claim Rs 50,000 towards interest and Rs 12,500 towards principal in their respective income tax returns. The maximum tax deduction for a single borrower is Rs 1.5 lakhs. This deduction would apply to each borrower.

In case one of the co-owners does not have any income, the other co-owner should enter into an agreement with the spouse. The agreement should state that the entire repayment is met by only one borrower’s income. This would ensure that the main applicant will have 100% beneficial home ownership, and consequently, he can avail all the tax benefits applicable to a single borrower.

As far as repayment of the loan is concerned, it may be repaid from a joint bank account, where both the husband and wife share funds. Another option, although less popular, would be to share out the EMIs between the husband and wife, and both issue a specified number of cheques towards the loan repayment. It would need to be ensured that the repayment of the loan is made in the same ratio as the joint borrowing. Further, each of the borrowers should have a demonstrable source of income to justify the repayment of loan.

Each borrower needs a copy of a borrower’s certificate. It has to be provided to claim their respective tax relief. A co-borrower should enter into a simple agreement with the spouse on stamp paper of Rs 100.

This agreement should basically contain the shares of the ownership along with that of the home loan availed by the couple.

The borrowers should take two copies of the interest and principal paid certificates from the bank and each can submit a copy of the certificates along with a copy of the agreement signed between them.

Couertesy:-TOI dt:- 27^th June 2009

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SMALL TOWN AND BIG RETURN

Demand for houses in small towns have witnessed a spur in economic activities leading to hike in the rental incomes, examines Vivek Shukla

For three years, Sunil Negi, a banker, has been trying to fulfill his long cherished dream of purchasing a house of his own, either in Delhi or in Bhopal, the city of where his in-laws reside. But his budget of Rs 25 lakh was not enough for his dream to take shape in reality.

But he looked beyond these two cities to make his dream come true. Negi finally zeroed in on a property in Rudrapur, a small town in Uttarakhand. In the process, he has become one of the many buyers who are purchasing houses in smaller cities.

Rudrapur is among a host of towns like Almora, Bhiwadi, Neemrana, Ghaziabad, Haldwani, Meerut, Moradabad and Karnal that have started attracting new home buyers. Such small cities are closer to all the big cities. These cities are responsible for revival in the realty market, albeit slowly. “My budget was very small to buy a house in Delhi or Bhopal. Even a one bedroom apartment was not available in a decent colony. Now, I will own a decent house and also manage to save some money for other investments,” Negi said.

According to Sanjeev Shrivastava, director of Assotech group, their projects in Gwalior, Rudrapur and Bhubaneswar are getting huge response. Developers who are building projects in smaller cities are getting positive response. After the great success of these projects, they are thinking of launching more such projects in other small cities. Talking about Rudarpur, Shrivastava said that as it is closer to Delhi and Nainital, many large companies have set up their units in this town. In these circumstances, it would continue to witness flurry of activities in realty field.

“In places like Meerut, Rudrapur and Haldwani, a two bedroom apartment costs Rs 15 lakh to Rs 18 Lakh. It is within reach for working people,” said Sanjay Shrivastava, a Delhi based journalist, who has recently booked a flat in Meerut. “The main reason for realty development at these places is that metro cities and many big cities have reached the saturation point,” said Devinder Gupta, CMD, global realty consultancy Century 21 India .

“Property prices in larger cities have gone beyond the reach of the middle class. So people are looking at new destinations. Prices are reasonable, where the pace of development is fast and it is also good future investments,” said Gupta.

Experts say that in smaller places, land is still available at reasonable rates. Industries are coming up. There is overall development. Hence, one should not think twice to book flats in small towns. Those fetch good returns.

Sunil Jindal, CEO of SVP builders says, “It is high time that those who only search for their houses in metro cities should think of smaller towns. Even in Ghaziabad, where we have some housing projects, one can buy good house at the cost of less than Rs 25 lakh. The very same flat you would not get less than Rs 50 lakh in Delhi.” Interestingly, rather than the big players, the smaller developers are the ones that are benefiting from the realty boom in smaller cities and towns, which have shown no sign of being affected by the slowdown that has otherwise gripped the country’s realty sector.

“The slowdown is helping us. The big developers are staying away from these cities. They are selling land to smaller players so that they can raise cash for bigger projects in large cities,” said Pankaj Tyagi, director, Bhanu Infrastructures.

According to one such survey by Ficci, next few years would see massive investments in smaller cities than metros and other big towns. Realty companies also know very well that selling their apartments or flats in big cities would be very tough task due to rising cost. That is why they are changing their strategy and moving towards small towns to make it big.

Courtesy:- TOI dt:- 13^th June 2009

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ROAD TO RECOVERY

After a long lull, housing sector is back in business, writes Sanjeev Sinha

Spurred by price corrections, new launches, lowering of interest rates, increase in sales inquiries and, more importantly, the newfound mantra of ‘affordable housing’, the real estate industry has started showing signs of recovery. Industry body Assocham has gone to the extent of saying that the real estate recovery is possible in the coming three months.

A recent Assocham Business Barometer (ABB) survey has found that anticipating strong policy measures for the real estate in the forthcoming Budget, embattled realty majors see positive signs of recovery taking place within the next three months as affordable housing projects rev up demand and improved cash flows address their liquidity concerns.

As per the survey, a whopping 92% of the respondent developers considered affordable housing as the most dominating segment to shore up the demand in real estate sector. And the policy actions supplementing the robust demand in the housing sector are likely to hold the key for a speedy recovery phase in the sector.

Although the findings of this survey may seem to be too optimistic, particularly in view of the prolonged slowdown in the industry, but taking the current positive signs in the property market into account, both industry majors as well as experts feel the real estate recovery is not a distant dream. And they have ample reasons to believe this.

Firstly, after a gap of more than a year, some real ‘actions’ are being witnessed in the realty market, including the high-profile launches of some major projects coupled with increased sales inquiries. Along with that, some realty majors are also said to have recorded an overwhelming response for their upcoming projects. For instance, the Jaypee group claims to have booked all the 3300 apartments of Jaypee Greens Aman, its new residential project in Noida, within 24 hours of their launch, while Capital Greens, DLF’s first residential project in Delhi, is claimed to have showed bookings of 1,400 flats on the first day itself. Such instances only prove that buyers and strategic investors are once again warming up to the sector, though in a restricted manner. Secondly, the Indian economy recorded a better-than-expected growth rate of 6.7% in 2008-09. “The GDP growth rate, clocked in tumultuous times of global financial crisis, lends credibility to the presence of real domestic demand and consumption continuing to fuel the economy, though albeit at a reduced growth rate,” says Neeraj Bansal, associate director - advisory services, KPMG.

Thirdly, sensing a near-term economic recovery and, resultantly, expecting the realty sector to outperform other sectors in the months to come, fund managers are reposing their faith in real estate. This explains why in the month of April, mutual fund houses increased their exposure in the realty sector to Rs 308.16 crore as against Rs 98.76 crore in March, translating into a whopping 212.03% rise in the exposure.

Fourthly, there is a renewed faith of overseas investors also, stemming from the series of steps taken by developers to improve their financial position.” Unitech has, for instance, cut debt by Rs 2,000 crore while DLF has repaid Rs 1,700 crore of loans in the past year. And similar is the case with lots of other large and mediumsized developers,” says Bansal.

Fifthly, home loan disbursements by the country’s top lenders, which signal the actual demand for homes, is also improving. HDFC saw its fourth quarter disbursals going up by 17.5% at Rs 12,400 crore, while LIC Housing saw an increase of 42% and 22% in March and in Q4, respectively. Moreover, a general softening of interest rates has also helped developers cut their borrowing costs by as much as 300 basis points.

However, more than anything else, affordable housing is believed to have currently taken the industry by storm. “Affordable housing will play a significant role in the real estate recovery over the next few months as developers are now connecting with ‘real buyers’ for the ‘real prices’ and are pricing projects more competitively,” says Bansal.

Brotin Banerjee, MD & CEO, Tata Housing, agrees. “The demand for new homes has picked up in the second quarter of 2009 from the previous one. Increasing interest in affordable and low-cost housing is widely expected to help India’s real estate market make a recovery in 2009 to 2010,” he says.

Another important thing is that the government intends to focus on the construction of affordable housing for the poor and middle class people across the country by involving the private sector, and has assured that emphasis will be placed to facilitate the flow of institutional funds for affordable housing.

However, apart from a combination of all these factors, the industry needs further stimulus to move ahead on the road to recovery. “The pace of introduction and implementation of favourable government measures, ‘better pricing’ and ‘innovative product & schemes’ by developers supported by ‘lowered interest rates’ by banks will chart the course towards recovery in its true sense. An overall improvement in investment climate is essential for recovery,” says Bansal.

Courtesy:- TOI dt:- 13^th June 2009

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REALTORS CASH IN ON THE GREAT INDIAN AFFORDABLE HOME RUSH

A fortnight ago, Jaypee Greens started bookings for its housing project — Aman — at the 70-acre residential township on the Greater Noida Expresssway. All the 3,000 flats, priced at Rs 2,100 a sq ft, were sold out by the first day. Exactly a year ago, the Jaypee Group company was offering flats along the same expressway for Rs 4,500-6,000 a sq ft.

Two days later, another Delhi-based developer, BPTP, announced that it had received bookings nearly four times more than its offer of 1,000 flats at its 1,500-acre township at Faridabad.

Welcome to the great Indian home rush at a time when the glitter of the premium segment has faded. Real estate companies are now going to the other extreme and falling over each other to offer affordable housing at a price range of Rs 5 lakh to Rs 50 lakh.

The varied pricing is a function of affordability being a relative term, depending on the location. For instance, a Rs 50 lakh apartment in Mumbai is considered affordable housing. In a city like Nagpur, the same price will qualify for premium housing. There is no confusion, however, with the huge target consumer base: 23 million Indians earning at least Rs 5,000 a month who do not own a house but aspire to do so, according to a study by Asish Karamchandani, CEO of Monitor India, a management consultancy firm.

That’s a good enough reason for Unitech’s GM (Corporate Planning) R Nagaraju to say the company would be “churning out affordable flats just like a factory produces goods”.

The country’s second-largest developer has shelved all premium housing projects for now. Poor response from buyers also prompted the company to recently convert its luxury project, Unitech Grande in Noida, to a mid-income project.

If Jaypee and BPTP hit the jackpot in the National Capital Region, others weren’t far behind. The Lodha Group, for example, has broken the sub-Rs 2,000 per sq ft price barrier in Mumbai by launching a 6,500 unit affordable home project at Dombivli at Rs 1,998 a sq ft. The integrated township will be spread over 125 acres with 3,500 houses.

The scene is the same elsewhere in the country. Bangalore-based CSC Constructions has launched three projects in the IT city, offering 2,000 apartments at Rs 5-13 lakh. Encouraged by the response, CSC has six more such projects in the pipeline.

Chennai hasn’t escaped the low-cost housing bug either. A subsidiary of Puravankara Projects, for example, sold 2,500 such homes in the Tamil Nadu capital within days and is now planning to develop 60 million sq ft of such properties over five years across five cities.

There are no firm estimate of the total number of such affordable flats on offer, but back-of-the-envelope calculations show top developers such as DLF, Unitech, HDIL and others are planning over 55 million sq ft of new launches this financial year, around 90 per cent of their total number of new projects.

According to a study by PropEquity Research, 74 per cent of residential apartment sales in Mumbai in the first quarter of 2009 came from the low-cost segment. The trend was the same in Gurgaon and Chennai, too, where the corresponding numbers were 60 and 58 per cent. In all these cases, the apartment sizes were reduced and the average prices corrected 15-25 per cent, PropEquity data show.

This shift towards low-cost or affordable housing started after home sales fell up to 70 per cent in the early part of this calendar year from their peak in 2007-08. “People were earlier going for aspirational houses, as their salaries were going by 20 to 25 per cent every year. But now they have realised that salaries are not going to go up any time soon and those who have reached the top levels have already bought houses,” said Anshul Jain, chief executive officer, India, DTZ International Property Advisors.

courtesy- BS dt:- 09-06-2009

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TRANSFER OF PROPERTY IN SOCIETY

There are some conditions to be met in order to make a valid transfer of property in a housing society. Ashish Gupta explains

In order to transfer a flat in a cooperative society, some formalities need to be complied with. A housing society is a society with the objective of providing its members with plots, houses or flats. It can also be existing to provide its members with amenities and services. A society can be a co-operative society that is registered or deemed to be registered under the Society Registration Act.

A member of a housing society is a person joining in an application for the registration of a co-operative society that is subsequently registered, or a person duly admitted to membership of a society after its registration, and includes a nominal, associate and sympathiser member. An associate member jointly holds a share of a society with others, but his name does not stand first in the share certificate.

A member wanting to transfer his shares and interest in the capital or property of a society should give 15 days notice of his intention to do so to the secretary of the society in the prescribed form, along with the consent of the proposed transferee in the prescribed form. On receipt of this notice, the secretary of the society will place it before the meeting of the committee held next, pointing out whether the member is prima facie eligible to transfer his shares and interest in the capital or property of the society or not.

In the event of ineligibility of the member to transfer his shares and interest in the capital or property of the society, the committee will direct the secretary to inform the member accordingly within three days of the decision of the committee. If the committee is satisfied that the member is prima facie eligible to transfer his shares and interest in the capital or property of the society, it will direct the secretary to inform the member within three days.

Procedure to transfer interest

• An application for transfer of shares and interest in the capital or property of the society should be made in the prescribed form, along with the share certificate

• An application for membership of the proposed transferee should be made in the prescribed form

• Valid reasons for the proposed transfer should be furnished

• All the liabilities of the society should be discharged

• Transfer fee should be paid

• Entrance fee of the proposed transferee should be paid

• Premium (to be fixed at the general body meeting) has to be paid. This will not apply to transfer of shares and interest of the transferor in the capital or property of the society to a member of his family, his nominee or his legal representative

• No objection certificate required under any law, an order or sanction issued by the government or a financing agency should be furnished

The managing committee or the general body cannot refuse any application for admission to membership or transfer of shares and interest in the capital or property of the society except on the grounds of non-compliance of the provisions of the Act.

If the decision of the committee or general body meeting, on the application for the transfer of shares and interest in the capital or property of the society is not communicated to the applicant within three months of its receipt, the transfer application will be deemed to have been accepted and the transferee will be deemed to have been admitted as a member of the society. Any transfer made in contravention of the Act, rules or the bye-laws will be void and will not be effective against the society.

The transferee will be eligible to exercise the rights of membership on receipt of a letter in the prescribed form from the society.

Courtesy:- ET dt:- 07-06-09

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REAL ESTATE DEVELOPERS HOMING IN ON RESIDENTIAL PROJECTS

While the sudden rise in demand for affordable residential housing in the last couple of months has given the much-needed relief to real estate developers, commercial and retail segments continue to face the heat of oversupply, combined with declining rental rates and lower demand from investors.

As a result, developers have deferred a majority of the ongoing commercial and retail projects, which were scheduled for completion in 2009-10, and are instead focusing on the residential market. In fact, according to real estate consultants Cushman & Wakefield, developers will be forced to defer 41 per cent of the projected office space supply in 2009.

“Out of 76 million sq ft of commercial (office) space projected across eight cities by many developers, only 45 million sq ft is expected to be completed in 2009. In the retail segment, out of the 14.5 million sq ft of projected space, only 3.6 million sq ft is expected to enter the market,” Cushman & Wakefield’s Executive Director Kaustav Roy said.

The supply overhang in commercial and retail segments is expected to continue for another 12-18 months, feel experts. At the same time, a sharp decline in the price of residential units — in terms of per sq ft rate as well as size — has resulted in a sharp increase in demand. As per conservative estimates, 60 million sq ft of residential space has been lined up for launch in 2009.

One of the key reasons for this poor demand in commercial and retail segments is the non–availability of Real Estate Investment Trusts (REITs), which could not take off because of complex legal hurdles and the sudden crash in the stock market in 2008.

While many of the real estate companies — such as DLF Asset Ltd, Unitech, Indiabulls Real Estate and Purvankara, among others — were planning to raise resources through REITs’ listing, only Indiabulls successfully raised $286 million by listing its REITs on the Singapore Stock Exchange. The failure of REITs to take off has affected the financial position of developers and, in turn, further delayed the completion of ongoing retail and commercial projects.

“In the past one year, everything has been against the commercial real estate. Private equity vanished from the markets, while the government increased risk rating on the real estate sector. The failure of REITs to pick up added to the financial crunch of the developers,” commercial real estate services company CB Richard Ellis’ Chairman and Managing Director Anshuman Magazine said.

“Developers are not in a position to complete their commercial projects due to a lack of funds, a demand-supply mismatch and falling rentals,” he added.

The country’s largest developer, DLF, has already received an approval to denotify four of its SEZs. In addition, it has also temporarily stopped construction work on nearly 16 million sq ft of office and retail mall space out of the 62 million sq ft of planned construction.

Courtesy:- BS dt:- 06-06-2009

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