Real Estate Investment – Page 11

The Changing NRI Real Estate Investor Landscape

Anuj Puri, Chairman – ANAROCK Property Consultants

When it comes to Indian real estate, the topic of NRI investments is pretty much an evergreen one. The fact that Indian developers had, in the past, launched and marketed projects with an almost exclusive eye on NRI customers is certainly no secret.

There were many reasons for this, but the primary one was that NRIs – especially NRIs based in the Gulf and the US – were seen as cash cows with more money than sense.

Time has proved this theory erroneous. NRIs are among the savviest property investors on the Indian market today. This is amply demonstrated by how adroitly they have gauged the new investment trends on the Indian real estate market.

For a long time, the returns on investments that NRIs could get on residential assets were extremely rewarding, considering the significant capital appreciation whilst the rental yields have always been low.

However, during the last couple of years, the market slowdown resulted in capital appreciation on residential assets no longer being as per NRI investors’ expectations.

In the current market conditions,

by Shobhit Agarwal

Shobhit Agarwal, MD & CEO – ANAROCK Capital

As India rises to greater prominence on the world map, global corporates are more eager than ever to participate in the country’s growth story.

A GDP growth rate of 7% plus, a population base of over 1.2 billion and an urbanization rate northward of 30% are irresistible investment magnets, and real estate development remains a key focus area.

India opened its doors to FDI way back in the 2000s, and since then not only much-needed capital but also critical expertise has flowed in. No doubt, the subprime crisis of 2008 led to a decline in foreign fund inflows; however, today the situation has turned and certainly looks upbeat.

The real estate sector was among the main beneficiaries of the opening up of FDI into the country and has transformed significantly as a result. In the past few decades, it has metamorphosed from an unorganized, closely-held business to an increasingly organized and a corporatized one.

The recent structural changes including demonetization, the crackdown of Benami transactions, RERA and GST may have had short-term negative impacts, but they also encouraged the inflow of foreign funding which always reacts favourably to signs of increasing transparency,

by Anuj Puri

The 14 spokes of RERA’s protective umbrella

Anuj Puri, Chairman – ANAROCK Property Consultants

The Indian real estate industry, particularly the residential sector, was in the past correctly characterized as being unregulated and unorganized with unreasonable project delays and poor quality of construction being definitive aspects.

The arrival of the Real Estate Regulatory Act (RERA) in March 2016 brought in a paradigm shift in the sector and metamorphosed it into a more mature, systematic and regulated one.

RERA came into force on May 1, 2017, and is meant to be a homebuyer-friendly regime which will address their grievances and promote transparency, efficiency, financial discipline and accountability in the sector.

Indeed, buying a home is not only the most cherished dream for many Indians but also one of the biggest long-term financial commitment in the buyers’ lifetime.

Considering this, there are 14 important guidelines incorporated in the RERA umbrella to prevent unscrupulous players from raining on consumers’ homebuying plans:

1. Enforcing timely delivery of projects

In case of project delays,

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

Buying a house is an important milestone and a lifetime decision for most Indians. After years of saving and diligent planning, one decides to purchase a house.

In addition to the increased social stature and financial security implied in home-ownership, a home purchase also helps in big-time tax savings. Also, instead of paying fat rentals, one creates an asset which will appreciate over the long term.

A cursory look at average property prices reveals that overall across the top 7 cities, there isn’t too much variation in 2017 as compared to the previous year.

Also, property prices differ in each city and also vary as per the location and its inherent growth drivers. Generally, developers are not in favour of visibly reducing the prices as it transmits negative sentiments in the market.

However, a deep-dive assessment of the market conditions reveals that a pseudo-price correction has come in the form of freebies, discounts, offers, schemes, etc. Also, buyers who sit across the table in a developer’s office with a token amount cheque, discounts and reduced prices are surely offered.

by Santhosh Kumar

Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

You read of it in advertisements and on hoardings, and hear of it in radio jingles and TV commercials – the ideal home, or ‘dream home’.

It makes you wonder if you’re living the lifestyle you truly deserve, if your previous home purchase decision was too hasty and if there is a chance you could do better.

The ‘ideal home’ is a ubiquitous marketing concept, and it haunts buyers before and after a property purchase. But is there really such a thing in India?

The ‘Ideal Home’ Paradox

By and large, the concept of an ‘ideal’ home is very relative in this country. While everyone carries a picture of their dream home in their hearts, that image usually cannot translate into reality in this country.

People long to stay close to nature, yet also close to the excitement and opportunities of the city. They long for a home in an environment unpolluted by noise and vehicle emissions, yet depend heavily on public transport and roads to use their personal vehicles for commuting to and from work.

by Prashant Thakur

Prashant Thakur, Head – Research, ANAROCK Property Consultants

Conceptualized as an industrial town, Sector 150 falls in the peripheral area of New Okhla Industrial Development Authority (NOIDA).

During the mid-2000s, Sector 150 evolved as an IT hub and subsequently attracted real estate developments primarily due to effectively-planned layouts.

Situated at the confluence of Yamuna and Hindon rivers along the bustling Noida-Greater Noida Expressway, Sector 150 is now one of the preferred residential destinations of Noida. The key factor which differentiates Sector 150 from other regions is the presence of massive green spaces.

The land use planning of Sector 150 has been undertaken in a pattern that ensures 80% of the 600-acre land parcel remains under greenery and only the remaining 20% is allocated for construction activities. Nearly 42 acres of land are dedicated specifically for parks and recreational facilities.

This micro-market is equipped with good social infrastructure including reputed educational institutions, hospitals and shopping complexes. Sector 150 is currently flourishing with real estate activity, and there is a visible rise in residential developments, integrated townships, commercial spaces and mixed-use developments.

Located strategically,

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

Since Mumbai is the commercial and financial capital of India, almost all major Indian corporates, as well as leading Indian PSUs and MNCs, have their offices set up in the city.

Traditionally, Nariman Point in South Mumbai (the traditional Central Business District) was the preferred location for high-grade office occupiers, and therefore commercial office space investors.

However, today Bandra-Kurla Complex (BKC) has emerged as an alternative location to the traditional CBD. It has become more acceptable to MNCs as it offers a better-built environment. The Suburban Business District (SBD) in the North of Mumbai is also a major commercial office market.

Geographically, this micro-market contains all areas in Andheri, Jogeshwari and Juhu. However, a lot of the Grade A office buildings are to be found in the Andheri East area.

In the past, Andheri was known as a ‘suburban district’ which was absorbed by Mumbai city as Greater Bombay. It emerged as one of the prime residential and commercial real estate destinations.

Andheri East is a mixed land use precinct with some of the most prominent hospitality and industrial developments in its vicinity.

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

Gurugram is home to around 1,500 start-ups and is the 4th largest start-up hub in India. As the city hosts the behemoths of the start-up industry, it makes sense to delve a little deeper into this fascinating new office space sector in Millennium City.

Emerging commercial office locations in Gurugram, as also in Bangalore, Navi Mumbai and Hyderabad, have benefited significantly from the Indian start-up euphoria. This trend is likely to continue for some time given the availability of large talent pool and availability of real estate spaces.

The start-up eco-system in India has been a key contributor to the rise in investments and job creation. Many start-ups that commenced operations in later part of the previous decade have already become medium-sized or large companies, particularly if we look at some of the popular e-commerce companies in India today.

From zero contribution to office space take-up, the e-commerce sector today contributes over 3% of the total office space absorption on an annual basis. We expect the growth in this sector to increase over time.

The government initiatives,

by Prashant Thakur

Prashant Thakur, Head – Research, ANAROCK Property Consultants

Gachibowli in Hyderabad is a market comprising of a 15 km stretch from Nallagandla-Tellapur along the Financial District, Nanakramguda, Kokapet, Narsingi, Raidurg up to Manikonda.

Recognized as one of the popular IT-ITeS and BFSI hubs of Hyderabad, Gachibowli has emerged as a sought-after destination for commercial office spaces as well as residential developments.

Gachibowli falls in the western periphery of Hyderabad and was once a far-flung region with minimal development and almost negligible residential activity.

However, it has witnessed a tremendous transformation in terms of commercial and residential real estate activity driven primarily by the many major IT-ITeS companies now operating there.

Only 6 km from HITEC City, Gachibowli has ICICI, CMC, Franklin Templeton, UBS, Cognizant, IBM, Microsoft, Infosys and many other large firms driving multi-faceted real estate demand. As a result, it has emerged as a top employment destination in Hyderabad and attracts working professionals from various parts of India.

These commercial office developments have attracted residential developers to come up with projects in the nearby micro-markets, and now the region is booming with massive real estate activity.

by Santhosh Kumar

Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

Chennai, the capital of Tamil Nadu, is one of the biggest cultural, economic and educational centres in South India.

Mercer’s Quality of Living Survey noted Chennai as the safest city in India and is exemplified by the fact that it has the third-largest expatriate population in the country.

Also justifiably called the ‘Detroit of India’, Chennai has over one-third of India’s automobile industry operating there.

Chennai has grown significantly in the last few years. Education prospects and employment opportunities, along with a decent lifestyle, are the key drivers that attract people to the city.

With increasing population, the city’s real estate landscape has also grown by leaps & bounds and is now spread across various zones of Chennai.

Whilst the real estate development paused momentarily due to massive floods of 2015, the fundamental demand drivers remain intact and the city is likely to continue on its growth trajectory in the future periods, reinforced by:

Diversified economic base

Chennai’s diversified economic base is anchored by the automobile,

The Changing NRI Real Estate Investor Landscape

Returning FDI Equity Scripting India’s Real Estate Revival?

How RERA Is Revolutionizing Indian Real Estate

The Logical Way of Seeing Real Estate Price Corrections

Busting the Myth Of The ‘Ideal Home’

Sector 150, Noida – Infrastructure Development Driving NCR’s Greenest Sector

Homing In On Andheri – East

Gurugram – The Start-up City

Hyderabad’s Gachibowli – from Anonymity to IT-ITeS / BFSI Hotspot

Chennai’s Hottest Property Investment Hotspots