Anuj Puri – Page 47 – Indian Real Estate Redefined

Why 2018 Will Be A Year of Consolidation for Smaller Developers

Anuj Puri, Chairman – ANAROCK Property Consultants

Consolidation is the process of combining a number of separate parts into a single, more effective or coherent one. Whenever there is consolidation in any sector, the general perception is that everything is going down the drain.

However, the reality is that this process usually happens at the fag end of an industry downturn and actually helps in catalyzing a much stronger come-back.

The real estate sector is a clear case in point. It is emerging from a prolonged slowdown coupled with landmark policy inputs which have begun to edge out the ‘small fry’ – essentially creating an environment of large-scale consolidation of tier II and III developers. This dynamic alone will define 2018 as a year of massive positive change for Indian real estate.

In 2017, the overall Indian economy and the real estate sector, in particular, were well and truly shaken up by a series of unprecedented reforms and structural changes.

Without a doubt, demonetization, RERA and GST will go down in the annals of Indian real estate history as the ‘trishul‘

by Sukhdeep Aurora

Sukhdeep Aurora, Chief People Officer – ANAROCK Property Consultants

As the oft-repeated saying goes – change is the only constant. The business environment is a constantly-evolving organism which, in the wake of its rapid progress, has started making new demands on its stakeholders.

Technology has emerged as the biggest change architect driving not only the way working styles have evolved, but also how the workforce needs to innovate.

In such a dynamic culture, it is imperative for any contemporary company to be able to attract the kind of talent that is extremely comfortable with technology. In fact, this comfort must go beyond just being able to use existing tech. The executive of today must have a driving curiosity for gaining new insights and adopting the latest technologies.

The ideal kind of questing mindset is not limited to using technology provided by the company he or she works for – it spills into all areas of life. Meanwhile, management teams must spearhead the adoption of new and innovative technologies to enhance workplace productivity.

What is needed is a symbiotic relationship between tech-enabled and tech-curious employees and management that actively encourages,

by Santhosh Kumar

Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

The built environment of any community is considered to be the reflection of regional architecture – and thereby a significant component of differentiation.

In the pre-Industrial Revolution phase, India’s built environment, as in the rest of the world, was shaped by certain values and cultural beliefs.

However, with tremendous urbanization and globalization after the Industrial Revolution, India’s rich cultural and architectural heritage is vanishing. This is primarily due to increased usage of industrially-produced and standardized materials.

With that, the dependency on locally-available materials has declined, transforming ‘vernacular architecture’ buildings to more standardized modern concrete structures.

Vernacular architecture refers to structures built indigenously to a specific time or place, taking into consideration the experience of centuries of community building. It depicts the characteristics of the local environment, technology and climatic conditions.

Importantly, buildings constructed through traditional techniques using natural, locally-sourced, non-toxic, renewable and biodegradable materials can also minimize negative ecological impacts.

Modern architecture, on the other hand, uses industrially-produced materials (such as steel and concrete) that possess a low thermal resistance and require high energy intensity,

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

The construction sector is one of the largest employment generators in India, and the country will need approximately 76.5 million workers in the building, construction and real estate sector by 2022.

Despite it being a job creation engine for people from the economically weaker section of society, the basic working conditions of construction workers have been long ignored.

Migrant workers are the most vulnerable – they are more often than not forced to work under inhuman conditions, and are simultaneously bereft of any real bargaining power.

Under the labour laws, migrant construction workers are entitled to housing and other social security benefits apart from minimum wages, overtime payments and weekly offs.

However, on the ground, the implementation of this clause of the labour law has been abysmal. In far too many cases today, it can be said that the bottom line literally consumes the bottom of the pyramid.

Without a doubt, a more humane approach needs to be taken towards migrant construction workers. It has previously been suggested that the amount collected through construction cess can and should be used for providing rental accommodation to migrant workers.

by Santhosh Kumar

Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

The Finance Minister’s fifth union budget on 1st February 2018 was probably one of the most closely-followed events for the Indian business community.

Not only was it the final budget before the 2019 general elections, but strong rumours of a populist Budget were sending all sorts of mixed signals to various industries.

In any case, all sectors – and specifically real estate – had harboured considerable hopes from this Budget. Battered and bruised after demonetization, RERA and GST, the sector looked forward to at least some major announcements that could re-inject the market into a growth trajectory.

Above all, real estate players fervently hoped for the long-awaited and long-elusive infrastructure status. The logistics sector and affordable housing had received it sometime back, but the market needs the benefits of infrastructure status on a much broader spectrum.

Expectations notwithstanding, the real estate industry got neither infrastructure status or, for that matter, any additional direct policy push from Union Budget 2018-19.

Why is infrastructure status so important for any sector?

How can this status impact the country’s economy at large?

by Anuj Puri

PRESS RELEASE

18% of MMR’s Housing Launches In 2017 Added In Thane – ANAROCK Report

53% of 70,000 units launched between 2012-2017 already absorbed

Mumbai, 8th February 2018: ANAROCK Property Consultants‘ latest research report ‘Thane – An Emerging Megapolis‘ highlights this city’s unstoppable rise to become one of the hottest real estate development and investment destinations in the Mumbai Metropolitan Region.

Launched at the MCHI CREDAI Thane Property Expo today, the data-driven report vouchsafes that Thane, driven by specific micro-markets, has not only shed its previous ‘industrial’ image but become a stand-alone real estate boom city.

“Thane’s emergence as a preferred destination for corporate office occupiers as well as homebuyers has been nothing short of spectacular, ” said Anuj Puri, Chairman – ANAROCK Property Consultants at the report’s unveiling. “Last year alone, the city contributed as much as 18% of the entire supply of housing project launches in MMR. Even more interestingly, of the 70,000 housing units that hit the Thane market in the last five years,

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

The Reserve Bank of India’s stance of keeping the repo rate unchanged at 6% is exactly along the lines of our expectations.

Considering that the inflation has inched up (Dec-17 CPI at 5.21%, up from 3.58% in Oct-17 and well above the target of 4%), crude oil prices are rising in the international market and the Government plans to increase the crop support price, maintaining the lending rates unchanged is justified.

We believe that the interest rates will soon start inching upwards, which is already being factored into the rising bond yields for the past few months.

The real estate sector can and should look at the long-term economic prospects and implications on which the monetary policy decisions are based, as these will dictate the growth trajectory for the sector.

by Prashant Thakur

Prashant Thakur, Head – Research, ANAROCK Property Consultants

Vartak Nagar is a residential suburb in Thane once known largely for its tapered roads and deplorable infrastructure. The residential market was predominantly defined by low-rise developments that housed industrial workers from the nearby manufacturing units.

Today, with the rapid urbanization of Thane and its surrounding precincts, Vartak Nagar has witnessed a significant upgrade in terms of both civic and social infrastructure, and its revamped market profiling has turned it into a promising real estate destination in the Mumbai Metropolitan Region (MMR).

It now has excellent road connectivity to the central and western suburbs via the Eastern Expressway and Western Express highway (via Ghodbunder road) respectively. Vartak Nagar is also well-connected through an established rail network.

Its proximity to the serene Upvan lake and exquisite view of the scenic Yeoor hills have become the major drivers of consistent real estate growth in Vartak Nagar.

Moreover, it still has an abundant supply of land parcels (primarily through the redevelopment model) available at competitive prices. This is a major draw for developers of residential projects since the lower land prices allow them to sell their properties at attractive rates.

by Prashant Thakur

Prashant Thakur, Head – Research, ANAROCK Property Consultants

Pune, known as an education hub and a prominent location for manufacturing industries, has evolved as an information technology hub during the last few decades.

Spread across 244 sq. km. and with a population of over 3 million, the city has rapidly transformed from a pensioner’s paradise to a bustling economic centre of India.

Well-connected to Mumbai – the financial capital of India – Pune is also well-networked to other major cities across the country, as well as the world.

In terms of Gross Domestic Product (GDP), Pune is ranked 6th in the top 10 wealthiest cities in India and the second-highest in Maharashtra (after Mumbai) in terms of GDP contribution.

The major sectors contributing to the city’s growing economy include manufacturing, education, tourism, and culture. The Mercer 2017 Quality of Living Rankings evaluated living conditions in more than 440 cities across the world and ranked Pune at 145 – second in India after Hyderabad, which ranked 144.

As per the same ranking, Pune featured among evolving business centres and nine emerging cities around the world,

by Anuj Puri

Anuj Puri, Chairman – ANAROCK Property Consultants

All eyes were on the Finance Minister as he delivered his fifth full Union Budget – the last one before the general elections in 2019.

As expected, the budget turned out to be populist and sounded excessively cautious while the need of the hour was to provide a positive boost to the economy, which is reeling under the pressure of structural changes and policy reforms.

The Budget did not offer any substantial incentives to individual taxpayers, with slabs remaining constant. A change in the standard tax deduction in lieu of transport and medical expenses, which now stands at INR 40,000, was the only gift to the salaried class.

There was no change in tax savings on home loans, nor were the 80C limits raised. While this put paid to any hopes for significantly increased home buying appetite, there were some notable announcements with positive implications for the real estate sector:

The continued push for affordable housing

As many as 51 lakh houses in rural areas are to be built in 2018-19.

Why 2018 Will Be A Year of Consolidation for Smaller Developers

How Tech-Savvy Talent Drives Today’s Business Environment

Sustainable Building In India: Integrating Traditional And Modern Architecture

Housing India’s Construction Workers

Budget Blues: Infrastructure Status For Real Estate Could Have Saved The Day

18% of MMR’s Housing Launches In 2017 Added In Thane – ANAROCK Report

Monetary Policy – Lending Rates Unchanged, But May Inch Upward Soon

Thane’s Vartak Nagar – A New Real Estate Hotspot Emerges In MMR

Pune Real Estate – The Calm Eye Of The Storm

Budget 2018-19: Balanced But Not A Boon For Real Estate

The continued push for affordable housing