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Coimbatore emerging as a lifestyle city

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Track2Realty Exclusive

Bottom Line: Coimbatore is no longer a property market for retired and budget conscious buyers; the lifestyle has gained ground in the city.

Coimbatore city, Coimbatore lifestyle, Coimbatore real estate, Coimbatore property market, Malls in Coimbatore, Multiplexes in Coimbatore, Coimbatore nightlife, India real estate news, Indian property market, NRI investment in Coimbatore, Track2Media Research, Track2Realty“Coimbatore is turning out to be a lifestyle city? You must be joking. Right?” Well, you will also have the same reaction if you are not keeping a close track of the developments in this part of the world. Contrary to the general perception that Coimbatore is a cost conscious city where realism is reflective at every level and per capita expenditure not very high; the city is slowly but surely emerging in an altogether different direction.

Coimbatore has today all the pre-requisite fundamentals of a lifestyle city that is high on the wish list of the corporate sector and the young professionals. The best part is that this development has happened in the last few years when the market conditions otherwise have been bearish; something that suggests the wave of change is here to stay.

Hence, it is important to understand that Coimbatore is no longer a city that can easily be defined by the given parameters of a tier II city. It is rather a hip and happening city where the multiple demand drivers are working in tandem to make sure it gives a tough competition to other metro cities of the country, most notably Bangalore and Hyderabad in the southern part of the country.

Developers active in the city are so confident with this growth of the market that they even suggest that Coimbatore has the potential to emerge as the best South Indian city and one of the best property markets across the country. An outside view may suggest otherwise, as the city still is an end user driven market and the demand drivers are need based and not speculative elements or investor groups.

However, a closer look at the upcoming projects across the major micro markets of the city suggests that the developers have already realised the change of mindset of the new age buyers. It is reflective in terms of the offerings also and affordable luxury as a concept that is a misnomer in other parts of the country is increasingly gaining ground in the city.

The residential offerings that always maintained the price band of below Rs. 5000 per sq feet has now breached that psychological barrier in the last over a couple of years. Coimbatore has been one property market which has been least affected by the overall economic slowdown. It has rather accelerated the pace of developments and the city clearly shows a tectonic shift in the market and reflects the buyers’ preferences for lifestyle driven apartments.

Analysts point out to the fact that Coimbatore is no longer just a retirement destination or the last choice of those buyers who could not afford the relatively costly markets of South India, like Chennai or Bangalore. As a matter of fact, the city has rather shaped up different than what it was actually thought of in the early stages of evolution of property market over here.

In order to understand the economy of the city in general and its property market in particular one has to find answer of certain pointed questions about the city. What has changed this thought process? Has the city’s economy reached its optimum level of boom? Whether there are more commercial activities in the city? Have big brands found a natural destination in Coimbatore the way they found cities like Gurgaon or Pune in the early stages of evolution?

The answer to most of these questions is behind the success of Coimbatore as an emerging lifestyle city. Most importantly, most of these answers are in affirmative, even though it may be just the first flush of aspiration for the city. The young expat professionals in Coimbatore coming from across the country have nevertheless changed the lifestyle choices and preferences in this rather conservative city.

Today, because of this working class expats Coimbatore no longer bears the look of a tier II city that has its economy dependant on the local small scale business. It is blossoming into a corporate city though the scale and volume has not reached to the peak level, compared to other big metro cities.

Ravindran P, a local property agent agrees that lifestyle choices are changing the city fast. He terms Coimbatore city as one of the new lifestyle cities which is growing at a fast pace. There has been a sea change in the kind of life people are living there. One of the recent trends which have risen exponentially is gymming.

“With numerous individuals looking to lead a healthy life, they have turned their attention to living a health life which has given rise to loads of new gymming enthusiasts. Secondly, various other activities like extracurricular activities and hobby perusal are also some of the new trends seen to be rising in Coimbatore. All these aspiration driven living are having their effect on the demand in the real estate market as well,” says Ravindran.

A spokesperson of CRISIL Real Estate Ratings finds a reason behind this growth of Coimbatore as the new lifestyle city. According to him, Coimbatore property market is tilting towards lifestyle options because the young professionals are opting for those.

“In recent times demand in the Coimbatore housing market has been triggered by the growth of the IT/ITeS and manufacturing industries in the city. Employees working in these companies, including migrants, are creating this demand, which is also paving the way for a lot of townships. Hence there are a number of townships under construction in the city. These young working professionals have fueled the consumption cycle of the city’s economy, which has had a corresponding effect in the growth of the property market, including retail outlets, malls and office spaces,” says the spokesperson.

The trend of lifestyle and aspiration driven developments are not confined to residential segment only. It is rather very much visible in the commercial properties as well. The growth of the business of the city beyond just Small and Medium Enterprises (SMEs) has ensured that quality office spaces are being developed and the mushrooming IT/ITeS sector has made sure that there are occupiers for these spaces as well.

The rental growth may not have been phenomenal but at least the spaces are being occupied at a time when the economy has been slow moving and commercial property has been worst hit in some other cities that are better positioned on the corporate aspiration level.

The brands across the segment are also nowadays flocking to the city; thus making sure that the growth of the retail space is steady, if not phenomenal. The young aspirational working class has made sure that these brands are not out of the business in the city. On a macro level it has made sure that the growth is heterogeneous and it is across the developments, including hospitality.

It is not just about the branded hotel chains but today there are entertainment and lifestyle options increasingly spreading in the city. Multiplex culture is also witness to a decent business. Coimbatore is increasingly scaling up on the index of aspiration level and lifestyle choices.

So, Coimbatore is no more a non-descript city on the real estate landscape that has only the occupiers driven by affordability. Nor is it a city which can just be termed as the tier II city waiting for its moment of growth.

The catalysts of the growth are already there and it is quite obvious that if the city could maintain its upscale momentum in a bearish market, Coimbatore can emerge as one of the key lifestyle markets once the overall economic sentiments are bullish. Coimbatore has indeed arrived with a bang on lifestyle and aspiration that is fuelling the corporate culture in the city.

Grounded marketing momentum in Coimbatore

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: Property analysts across the country refer Coimbatore as a market where the effects of slowdown is least visible. At a time when the other property markets across the country are reeling under slackening demand among other major worries, Coimbatore is proving to be a market where the property transactions are happening at a decent pace.

An outside view on the Coimbatore property market may find it bucking the trend due to various reasons, like local economy doing well, the proliferating Small & Medium Enterprise (SME) sector, infrastructure upgradation, best climatic conditions of South India and, last but not the least, the expat South Indians investing into Coimbatore property.

However, beyond the fact that the Coimbatore market has favourable socio-economic conditions lies the fact that there has been method in the way property market has been developed in this part of the world. If the real estate market in the city is grounded, it is more by design than by default. The developers in the local market are aware of the fact that the rise and growth of the city property market has to be in sync with the affordability index of the city. And hence, most of the launches are happening at a price point where the local demand exceeds the supply.

Even the developers from other markets across the country who are otherwise selling at a higher price point are maintaining this demand-supply equilibrium in the Coimbatore property market.   As a matter of fact, even the analysis on the triple measurement yardstick of the growth of the given property market—capital appreciation, rental appreciation and property transactions—Coimbatore may not give the fair assessment if only figure is taken into account without understanding the ground realities which are raw facts.

The fact, however, stand that if Coimbatore real estate market have kept the momentum going in favour, it is more by design than by default. While the property markets across the country have been subdued in the last couple of years, the markets across the city have actually bucked the slowdown blues. Yes, the property prices have not appreciated substantially but then the fact that there have been steady transactions at the right price point is enough to justify how the developers have been prudent in this market.

In terms of rental yields also, the markets across the city, both in residential as well as commercial segment, has been flat but occupiers interest has not gone down by any yardstick. Booming economy of the city and the migration of qualified professionals, particularly in the IT & ITeS segment, are cited to be reasons behind this.

Analysts tracking the Coimbatore market are of the view that the developers in this part of the world are grounded in terms of their project offerings as well. As a result, Coimbatore real estate has been flexible in terms of its marketing strategies and also constantly been innovating to keep the momentum going. And that is the reason why Coimbatore real estate seems to be best placed in today’s turbulent times, something that is a traction point for the developers from across the country.

Raj Kuneru, Regional Head, RE/MAX Rest of the Tamil Nadu maintains that Coimbatore is mushrooming as a corporate hub down South, due to which the realty market foresees a tremendous growth in this city. Apart from this the pleasant climatic conditions and many foreign residents settling in this city makes it a very attractive place for real estate due to which this area is shielded from the slowdown traumas.

“People often ask me how far the marketing innovations of the developers been responsible for the success of Coimbatore real estate. My answer to this is that overall innovation by developers has impacted to some extent. It has not changed the landscape of real estate, but in pockets it has improved the lifestyle,” says Kuneru.

A section of analysts insist that it is the state government’s policies that have helped the real estate sector to keep afloat in times of crisis. However, everyone agrees that the government can only provide a fair and conducive market with its policies, but the game changer moves have been made by the developers themselves. Even after the subvention scheme was withdrawn last year, when many of the realty markets across the country felt the heat, Coimbatore real estate market has been resilient. The fundamental reason behind this has been that that it is still the end-user driven market. Speculators and investors by and large avoid such realistic markets where the property appreciation is not a short term trading business.

Some of the prominent developers who have burnt their fingers in the high priced speculative markets are today entering into this market to reinvent themselves and get afloat in a realistic market. Also, many of the national players are not only learning with the grounded attitude of developers in this market, but carrying home a point to explore such marketing methodology in other markets as well.

Pricey dollars’ flirt with modest rupee in not-so-flaunting Coimbatore

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: While the real estate market in the metro cities have been flirting around with the NRIs to woo them with big-ticket investments, the discerning expat Indians had some other ideas. The destination to those desirable ideas was definitely not leading them to metro cities. So, at a time when the spate of luxury and super luxury launches were put on offer, the match makers of pricey dollars preferred to court the humble markets where the modest rupee was well grounded not to flaunt with pomp and show.

The discerning NRIs, many of them having been burnt their fingers in the Indian property market, were scouting for virgin territories and it seems Coimbatore market emerged as an ideal match for them. At a time when many of the analysts having grounded vision were questioning the extent of NRI investment in the Indian property market, and Indian expats by and large in a wait-and-watch mood, Coimbatore market had enough to offer. After all, this has been a market that by and large has been slowdown-proof and offering value for money.

Moreover, Coimbatore stands as a market that dispels the myth that NRIs are so bullish on the Indian realty, being carried by depreciating rupee against dollar, that they are just going to put money on all the high-end projects. The fact on the contrary is that the NRIs are so discerning in their investment pattern that they want to keep away from the speculative market and instead focus on the market that can weather any future slowdown. Coimbatore is hence poised as their choice of investment.

What makes the Coimbatore story all the more interesting is the fact that none of the projects in this property market projected itself much above the existing market price. Obviously developers resisted the temptations of living with a fantasy of packaging the projects for NRIs only. The interest level of NRIs in Coimbatore market has thus been a natural progression to enter into relatively new virgin territories with realistic price base.

After all, many of the Indian expats having roots in the city itself are also on the lookout for ideal property in the right price band for their parents. Needless to add, the climate of the city only adds zing to the property market, inviting even the NRIs from the neighbouring regions to invest for their ageing parents.

Purvankara does not find it surprising and believes there are reasons why investors will look towards Coimbatore market. Purvankara Group CEO, Jackbastian K Nazareth says the improved infrastructure is a traction point which is well connected with other cities. You have modern airport, a thriving IT/ITes in the city and brands and multinational corporations flocking in the city.

“Coimbatore traditionally had been hub of textiles, which for some reasons lost sheen for few years but is now back to business. Due to better climatic conditions the city’s property market has far and wide catchment area even from Kerala and Chennai. Though NRI investment as such is more of a myth in Indian real estate as of now, in the last couple of months we have seen euphoric buys by the NRIs who are mostly buying for their parents since it is also an affordable investment. Even in our project nearly 10 per cent of the buyers are NRIs,” says Nazareth.

The question is how much NRI investment is affecting Coimbatore property market. Bijay Agarwal, MD of Salarpuria Sattva says fFrom the enquiries and interest they have received for their soon- to- be launched Coimbatore project, there is a very high interest level from the NRI community.

“Our enquiries have come from across the world- and the larger numbers are from US, UK, Singapore and the Middle East. Coimbatore is a fast growing commercial hub, perhaps the most industrialised in Tamil Nadu. It is also the textile capital of South India. It has some very good infrastructure coming up, including a proposed mono-rail which will be a growth driver. Economy wise it has best jobs, schools and commercial establishments. Climate wise it is a good place to stay, surrounded by very peaceful natural settings,” says Agarwal.

Rajsheskhar Koneru – Regional Owner of RE/MAX says around 30 per cent to 35 per cent of investment in Coimbatore real estate is from NRIs. Also, with the setting up of IT firms and favourable weather conditions this place is foreseen to become a hub for NRI investors. With the falling rupee value NRI’s now find it a easy bait to invest in Coimbatore Property Market.

“Coimbatore realty market is affordable compared to other areas down South, which makes it in attraction for NRI’s to invest in. The city’s weather is an attraction for many categories of buyers such as IT companies, retirees and foreign firms. In addition to this lot many IT Firms like IBM, HCL have set up their offices in this city that makes it a healthy a market for NRI’s to invest in,” says Koneru.

Investment wise Coimbatore is attractive not only to NRIs but also people from across the country. Jones Lang LaSalle (JLL) had pitched Coimbatore as one among the 20 retail destinations worth exploring. Organised players find this market has great potential. Affordability of Coimbatore property also makes it ideal for NRIs than over-heated other markets.

The prices are very good for the opportunity and facility that this city offers. But prices are not just the reason. This city has a lot to offer and investing now is worth every penny. The city has thus found favour amongst non resident Indians from across Tamil Nadu who have invested quite heavily in residential properties in Coimbatore. Developers, encouraged by the trend, have scaled up a bit in project offerings of deluxe apartments and houses, yet not gone overboard to meet their needs.

So, NRI investment is neither surprising in Coimbatore market nor a sudden phenomenon that can surprise the analysts tracking the market in this part of the world. The expat Indians from the city and across Tamil Nadu had been investing in city property for quite some time. Now that the NRIs from other cities also looking for a safe haven to invest post the depreciation of rupee against dollar, Coimbatore has emerged as a better, safe and realistic market in the eyes of the Indian expats.

Moderate Coimbatore realty high on business confidence index

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: Highly speculative markets are always highly susceptible to speculation as such markets are mostly sentiment driven. These are the markets where investors are by and large the project riders and hence the movements in the power corridors do affect the market to a great extent. Coimbatore real estate, on the contrary, is a market which has traditionally been neither susceptible to speculation nor the investors have been on prowl.

Even the speculators who book properties for quick appreciation are not active in this market. Why then is Coimbatore suddenly showing signs of northwards curve post the General Elections? The formation of the new Government at the Centre seems to have made its impact felt in the city business community in general and the real estate developers in particular.

Business confidence index may be a very subjective metrics to evaluate the economic impact of any given market. They nevertheless provide a direction to the transaction movement as well as value of the product due to its inherent co-relation with the demand and supply cycle of the market. 

Analysts tracking the property market in Coimbatore are hence trying to find a method in the madness. What is making the Coimbatore property market so bullish after the General Election results? The analysts are also quite conscious of the fact that the business confidence index of the city and its realty market has suddenly gone up pretty high, even though any tangible difference is yet to be seen in the functioning of the authorities in terms of approvals and clearances. Not only that, the policies of the new government have not been rolled out as well that could indicate a positive shift in favour of the business.

The investors, mostly the end users, are yet finding the euphoria in the market and they are being made to believe that this is the right time to buy. They feel failing now the property prices may not again be at this level in near future. Once there is some stability in the market the prices, being at the moderate bottom level, are expected to rise. Also, if there is a reduction in the interest rates in the next two or three quarters the wait and watch buyers will be out in the market. 

Divyesh Shah, AGM, CARE Ratings, however, is not finding it unusual in the Coimbatore market. He rather finds a reason behind this euphoria at the macro level. According to him, the general business confidence has improved with full majority of the newly elected party in office. Hopes for improvement in infrastructure, corporate governance, speedy approvals will further aid growth in economy. The same will be reflected in real estate market across India, including Coimbatore which is a more realistic market for the buyers.

“Coimbatore has largely been end user market with majority of demand coming from NRI and retirement homes. The positive investment in the macro economy will augur well for the investment climate in the city. The city is witnessing supply of good office and retail spaces,” says Shah.

Raj Koneru, Regional Owner, RE/MAX Rest of Tamil Nadu agrees that the sentiments and business confidence of the Coimbatore real estate has definitely risen up post elections. He says the point can be assessed by the fact that investors have placed their trust again in the market by investing. The market sentiment has again become quite positive and is going to be the same due to the hope of rising value of the Coimbatore real estate. He, however, does not find any tangible in such a short period and is ready to wait for a long term reforms ahead.

Any tangible difference on the grass root level is yet to be seen as such changes can only be seen over a long period of time. With time the policies will roll out and it will then lead to a long term and sustainable change. In terms of the change in mindset, one change which can be seen clearly is the faster functioning at all levels which will improve the trust and faith of people and firms in the respective government bodies,” says Koneru.

Analysts maintain that the index of buyers’ and the investors’ sentiments have definitely gone up. However, the change in terms of actual percentage is yet to describe the exact mark. There has been an increase in the customer faith which can be seen by the rising investments in not only the real estate but the other investment instruments as well. The inquiry level with various developers in the city has suddenly seen a northwards curve and it is generally anticipated that it will further lead to improved sales figure for most of the developers.

At a micro level in the city property market, it is believed that now is the time for Coimbatore administration to take certain pro-active measures that can take this business confidence index to the next level of growth. Business confidence, after all, is all about a matter of sentiments which is more of intangible in nature. Only a healthy transaction rate of residential properties and higher occupancy level of the commercial properties can revive the real estate market in terms of tangible growth orientation. The growth has to be a sustainable growth and not speculation in the market, which has historically not been the trend in Coimbatore.

Many within the built environment of the Coimbatore property market are of the opinion that once the Metro Rail Project really takes off, it has the potential to change the dynamics of the city economy and its real estate market. It is one of the primary projects which everyone wishes to see in near future. This will raise the market value of the Coimbatore real estate market exponentially. Also, the emergence of satellite living where the lifestyle options are more contemporary is going to redefine the way Coimbatore real estate has been functioning. Of course, the satellite living needs good physical infrastructure; something that is expectedly on the priority list of the new Government at Centre, and it is a reason enough for taking the business confidence index of the city to the next level of optimism.

 

Stable Coimbatore property may get jitters of elections

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: A stable property market that has done reasonably well in 2013, why should the developers in down town south be bothered about the General Elections ahead, asks a property analyst. Well, the answer can not be in straight yes or no but the market trends indicate Coimbatore definitely will be less susceptible to the elections than many other property markets across the country.

However, it won’t be completely unaffected by election jitters. After all, regulatory changes have been a cause of concern for the developers in the in this market as well and the political uncertainty prior to the general elections definitely threatens to prolong the house buying decision in the realty market.

Elections and real estate have a symbiotic relationship where elections bring a kind of stasis that is unproductive. The business that is too dependent on the power corridors for each and every clearances and NOCs is always conscious of the paradigm shift in the policies if a new government takes charge. The general elections of 2014 hold more significance for the sector for reasons more than one. The sector that has been looking anxiously at the formation of next central government and its policies with reference to the pending bills like regulator bill and land acquisition bill is rather more worried with the emerging corridors of uncertainty at the political level.

The sector is also conscious of the fact that any policy advocacy for rationalisation of the bills holds no ground if an unstable government comes to power. Moreover, with the economy continuously sliding down and the prospect of an unstable government not being in a position to stem the rot, analysts believe in the short term there won’t be any significant impact on the sector.

That may be the reason why Anshuman Magazine, CMD of CBRE South Asia believes the sector should not bother too much about the outcome of elections at this point of time since the sentiments in the market are any way down. According to him, had there been a 2007 market with sentiments bullish there was reason to be concerned as any policy delay would have adversely affected the business. But today, when in any way there is an element of uncertainty with economy and with the outcome of the elections, may be it won’t affect as much.

“Frankly, I don’t think the political outcome of the elections should worry the sector as business goes on irrespective of which government comes to power. Of course, a stable government means fast track policies but at this moment I feel more than the government it is the market forces that is keeping the sentiments down and the impending elections are only keeping the developers anxious. But I don’t see any significant impact during and after elections as far as the fortunes of the sector are concerned,” says Magazine.   

Jackbastian K Nazareth, Group CEO, Puravankara says elections are a time of ambiguity and trepidation across many sectors.  But housing is unique in that it is a long-term purchase, therefore consumer decision making is unlikely to be overly influenced by the near-term political scenario. The property market in Coimbatore has remained relatively stable in 2013.  He expects that trend to continue the next year. The city is shoring up its credentials as a business-friendly destination and it is expected the property market to attract end-users and investors alike. 

“The Tamil Nadu government must be commended for its focus on infrastructure development across the state, Coimbatore included. As long as that commitment remains, the prognosis for real-estate is good. The impending elections could have a bearing on business-planning and decision making of developers. Political stability and proactive reforms are pivotal to real-estate sector growth. The residential real-estate segment is unique in that it is a long-term purchase; therefore decision making is unlikely to be overly influenced by the near-term political scenario. The residential real-estate market in the south has been relatively stable; prudent pricing and streamlined supply has led to a steady rise in absorption rates,” says Nazareth.  

Coimbatore remains relatively affordable; developers having adopted cautious pricing strategies. With the city fast-gaining cache’ as an investor friendly destination and the slew of infrastructure development, property prices are bound to escalate. The savvy investors would not put off their purchase decision during the elections, but may wait till the elections and hence affect the first part of 2014. Generally, the decision process is slow during the election period and majority of the key players of funds study the market, get their base strengthened and bring in money in a big way once a stable government comes into power.

Realty analysts otherwise are unanimous that this is not a normal election year where the sector will wait to see who is elected and gauge how that will affect their business, work, benefits, etc. This time it seems to be different, and it is having a very large affect. This is because the economy is the largest issue on voters’ minds, which makes it the most important topic for voters and anyone running for election/re-election. The housing sector is seen to be the key to the economy, if it goes up so will the economy. 

Anuj Puri, Chairman, CII WR Infrastructure, Real Estate & Construction Sub-Committee admits that the outcome of the general elections would definitely have some bearing on whether the market will pick up speed, continue at the current pace or slow down. The reason is that the political stability and proactive reforms that can come on the heels of a general election can render the real estate market more conducive to growth. In other words, the results of polls can therefore have a direct bearing on market sentiments.

“Important regulations related to the real estate sector are still hanging fire and awaiting full approval and implementation. The government is aware that these moves are crucial for the sector’s growth, which is hard-wired into the country’s overall economic growth as well. I am confident that the dire need for seeing these regulations through is recognized and acknowledged in the right quarters. The delays may be because every industry angle has to be considered in such regulations so that they are not overly skewed or draconian towards any side, but holistically oriented towards growth,” says Puri.

Given the fact that the political climate is election driven much in advance this time, it raises two schools of thought in the real estate market. Firstly, the prolonged political uncertainty will cause caution and hesitancy in the sector beyond a traditional election. Secondly, with the election mood so much in advance the marketplace will absorb the thought of an election and its likely impact much more easily.

It is not just the next government’s economic policies that will be a key driver of the health of real estate, but the new government’s policies with respect to the pending realty bills in the Parliament will also decide whether the houses will be affordable or the supply side constraint borne out of new policies will kill the golden goose that promises to contribute significantly to the state GDP. In any case, the new government has a couple of real issues of real estate to address, and that is what keeps the sector guessing as of now.   Elections or no elections, developers are always dependent on the authorities, who give approvals.  

Reasonable performance of Coimbatore real estate in 2013; 2014 looks promising

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By: Ravi Sinha

Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: The Coimbatore real estate has by and large outperformed the rest of the country. This better-than-national average performance during the year 2013  has been remarkable at a time when some of the matured property markets were witness to sales plummeting with stress both at the buyers’ as well as developers’ level.

What makes Coimbatore property market so bullish and, more importantly, how it is poised to shape up in 2014? The year ahead has to deal with a number of issues yet there is a general feeling that the window of opportunity to buy at a good price is between now and the next monsoon. Analysts maintain that political uncertainty will end with elections next year and with that the economy will also start to look up, hence chances of prices going up.

The property market in the city has remained relatively stable through 2013. The demand in residential market is being driven largely by the growth of IT/ITeS and flourishing textile industry. Coimbatore has already attracted potential investors from major cities such as Hyderabad, Chennai, and Bangalore due to its affordability. Salubrious climate year-round is the added draw-card. Tamil Nadu government initiatives to promote Coimbatore as a business friendly city will bode well for residential and commercial real estate segment prospects in the coming years.

Jackbastian K Nazareth, Group CEO, Purvankara believes the property market should continue to do well in the year ahead. The underlying thread of real-estate market attractiveness is accompanying social and infrastructure development. It is imperative that the elected government continues the good work of its predecessor and stays the course of planned development. It is incumbent upon the elected government to maintain political stability, progressive reforms and favourable business environment real estate and economic growth will follow.

“Despite the economic slowdown Coimbatore has gained a reputation as a preferred destination for businesses. Several multinational companies have relocated to the city, driving retail, hospitality and residential real estate sector growth. Over the next 4-5 years, Coimbatore is projected to add nearly one lakh jobs, which will fuel the city’s per capita income growth.  I expect the real estate market to capitalize on the opportunity. As a significant trend, retirement homes are gaining popularity in Coimbatore owing to the pleasant weather and leisurely pace of life that the city affords. While the market is largely end-use driven (60%), the property market is attracting NRIs and investors from other parts of the country as well,” says Nazareth.

Analysts are bullish over the Coimbatore property markets maintaining that the increase in the number of IT companies and infrastructure development in Coimbatore signals upward movement of prices in residential market.

Anurag Jhanwar, Director, CRISIL Real Estate Star Ratings says the Coimbatore real estate market has been stable in 2013. The market is primarily an end-user driven one. Therefore, on one hand, there is a steady supply of property for residential demand within a reasonable price. On the other hand, however, the market is largely driven by the economic scenario, and is linked to factors like purchasing power and employment prospects.

“At a micro level, the property market will see reduced momentum until general elections is over and policymaking gets back on track. At the macro level, the cloud of economic uncertainty will continue to affect decision-making towards investments involving larger financial commitments. Being end-user driven, the momentum in the Coimbatore real estate market will largely be determined by increase in economic activity which leads to more jobs and purchasing power. Given the looming elections, the momentum is expected to be a little subdued until the first half of 2014, after which industry-friendly policies and implementation will be critical to bringing back confidence and investor interest,” says Jhanwar.

However, there are some real issues to deal with that are likely to impact real estate market in 2014. Many of the issue are inter-related and impact the economy in general as well. The idea is to take a broad view and provide a context and perspective that can assist in making informed decisions in the sector.

Though a resilient market in Coimbatore all eyes are on the General Elections in 2014 as it affects the sector in various ways. The developers in the city are apprehensive that elections may aggravate the overall slowdown in economy and delay approval processes. The prospect of an unstable government is something that the sector is apprehensive with as it would amount to all legitimate demands of the sector put on the back burner in the absence of consensus.

Regulator Bill is something that everyone within the built environment of the business, including the buyers, has been waiting for long. However, the prospect of a fractured mandate makes the future of Regulator Bill hang in balance as even if it is cleared in 2014, the lack of political consensus and centre & state imbroglio is expected to keep the regulation and reforms waiting for quite some time.

Of course, the endeavour to create a consensus over the Regulator’s jurisdiction and draconian powers would be one of the major talking points of the year ahead. The track record of developers in Coimbatore has been by and large so commitment-driven that hardly anyone is bothered about the regulator in this market.

After the Regulator Bill, Land Acquisition Bill has weathered the most resistance by the developers in 2013 and the year ahead may see some industry/political mobilisation once it becomes a law. With land being a State subject and the election year expected to bring around political uncertainty the developers with deep pockets may get into land purchase before the new legislation is in place. This has not been the trend in Coimbatore market thus far.

The new RBI Governor has made it clear that he intends to tame the inflation and check the slide of Indian currency than infuse excess liquidity in the market and appease the home buyers and the developers. The year ahead promises to have no change in this stance and the sector will have reasons to feel the heat before every quarterly monetary policy review by the RBI. Unless there is a new Government with strong intentions to safeguard the interests of real estate, there seem to be no respite for the sector; chances of which are very less.

One strong hope of the sector is the SEBI’s endeavour to revive the Real Estate Investment Trust (REIT). When the banks are not willing to lend to the sector, PE funds deserting and capital market pretty uncertain, REIT is the only silver lining for the cloudy financial weather of the developers.

The optimism also stems from the fact that even the big-ticket private equity players who want to invest in the Indian realty but are apprehensive of opaque market are now planning to set up REIT. This is also good news for the retail investors since the real estate continues to be an attractive investment instrument, even for those who can not afford to buy properties.

FDI in retail was supposed to be a game changer for the commercial real estate, but has hardly made any difference in 2013. The government provided the much awaited clarity on 50 per cent investments to be made in the back-end infrastructure from the FDI being brought in by international multi-brand retailers.

Analysts maintain once macro-economy stabilises and new government is in office, this may spur international retailers who were keen on operating in India, but were looking to understand the restrictions imposed by the government on their investments and operations.

Social infrastructure driving Coimbatore market-II

Posted on by Track2Realty

By: Ravi Sinha

Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: Industry experts assert if the neighbourhood does not have the supportive social infrastructure, the demand will be less compared to the well-developed areas. The number of houses remaining vacant in a project in the core areas of the city is less compared to those outside the city.

Bijay Agarwal, MD of Salarpuria Sattva believes social infrastructure of Coimbatore is truly supporting physical infrastructure to make it an ideal property destination.

“Coimbatore has some of the best hospitals, schools and job opportunities due to its fast pace of industrialization. I would say it has a healthy combination of all that one seeks in a well- developed city-without the pollution. Almost like a metro. Since the government is also putting infrastructure development on the fast track it balances out very well,” says Agarwal.

Rajsheskhar Koneru – Regional Owner of RE/MAX Rest of Tamil Nadu believes Coimbatore has a well-developed social infrastructure including hotels, health services, recreational spots, research institutions, professional colleges, two universities and one deemed university and commercial complexes.

He, however, has a feeling that the city should have been much ahead on development map but Coimbatore has been hampered due to political negligence for a long time.

“The physical infrastructure needs to catch up a lot with social infrastructure. Coimbatore suffered huge losses due to lack of continuous supply of electricity and most of its industries have been shut down. Recently, the situation is little better with power supply fixed to a large extent. In broad perspective physical infrastructure has to improve a long way if Coimbatore has to grow to its full potential,” says Koneru.

A local property agent says in the last few years, many developers have been providing several amenities within their complexes, including schools, malls, clubhouses, swimming pools and sport facilities. And hence, the economic slowdown felt by the other industrial sectors in the country has not yet had an impact on the investments in the property market of Coimbatore.

The requirement for houses and commercial space continues. The only worrying factor is that rentals have not moved up much in the residential segment during the last couple of years, say representatives of the property industry. But then being an end-user driven market, rental properties any way are not as much in demand in the city, compared to other neighbouring cities.

The moot point is at a time when the property market in many of the tier-II and III cities across the country are stagnant, will the developers in other markets take a leaf out of the success story of Coimbatore? If yes, then the focus on social infrastructure might help them to beat the slowdown blues. At least, the success story of Coimbatore market seems to suggest so.

Can meat & eggs offered to God resolve realty crisis?

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyCan meat & eggs offered to God resolve realty crisis? Well, the real estate community in Coimbatore thinks so. More than 1000 members of the real estate sector, including key promoters, sought divine intervention on Wednesday, Sep 5, to bail them out of the crisis they were in, caused by decreasing demand and prices.

These realty revival seekers thronged the famous Vella Muneeswaran temple at Kavundampalayam on the outskirts of the city and attempted to appease the presiding deity, offering her 130kg of chicken meat, 100 kg of goat meat and 1200 eggs.

The present economic slowdown has drastically affected the realty sector and most companies are struggling to find buyers even for luxury villas. The gathering offered special prayers to facilitate another real estate boom in the city. The ancient temple is famous for ‘Kadavettu,’ a practice of sacrificing goats to press for divine intervention in a crisis. A total of Rs 3 lakh was spent on the ritual and feast for devotees.

Considered to be a form of Siva, Vella Muneeswaran is known to fulfill the wishes of devotees. “We firmly believe that our prayers would help us improve business prospects. Humans are limited in their capabilities so we seek God’s help,” said M Mohan Raj, a real estate promoter and one of the organisers of the ritual.

“This is the second time that such a pooja has been conducted. Last year, when we were in a similar situation, our prayers helped us revive our business. The response has been massive this year due to the severe business losses many of us are suffering,” Mohan added. On invitation, developers, builders and mediators from Edayarpalayam, Vadavalli, Thudiyalur, Vellandipalayam, Venketapuram, TVS Nagar and Kavundampalayam attended the pooja which began on Wednesday morning and ended by noon.

The real estate business is going from bad to worse. More than 100 projects in Edayarpalayam and Kavundampalayam areas remain static, said Kallimuthu, a builder from Edayarpalayam. “Increase in guideline value along with the government’s tough stand in regulating the sector has also contributed to the crisis created by the economic slowdown,” he said. “I was able to sell 70 houses last year. This year, selling even 10 houses has become a Herculean task,” he said. The increase in prices of raw material and labour charges have jacked up the overall cost, he added.

Middleclass families have been affected the most, said S S Shivakuma, a property dealer. Property prices have increased by 100 per cent compared to last year. We are planning to take up the issue with Coimbatore collector,” he said.

R Krishnaswamy, chairman, builders association of India, Coimbatore chapter, said that most buyers invest in land for resale. Consequently, they are finding it difficult to provide houses at an affordable cost. In addition, people prefer to buy land in the suburbs rather than the city. This has also slowed down the business, he said.

Purvankara revenue up 30% in Q1FY13

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyPurvankara Projects have reported its revenues at Rs. 248 Crores; up 30% in Q1 FY ’13. Profit After Tax (PAT) stands at Rs 50 Crores; up 61%, with EBITDA up 34% and EBITDA margin at 48%. Profit Before Tax (PBT) at Rs. 73 Crores; up 66%.

Commenting on the strong results, Ravi Puravankara, Chairman and Managing Director, Puravankara Projects, said “We have done extremely well. Absorption is improving with traction from sales arising out of completed projects. We expect the sales growth momentum to continue in the following quarters given our portfolio mix”.

Consolidated net profit after tax increased by 61% to INR 50 Crores from INR 31 Crores in the quarter ended June 30 2011.

Puravankara recorded a 30% increase in consolidated revenues, posting INR 248 Crores in the quarter-ended June 30, 2012 compared to INR 191 Crores in the quarter-ended June 30, 2011.

Purvankara ventures into the Kingdom of Saudi Arabia

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Coimbatore real estate, purvankara developers, Delhi NCR real estate, Bangalore Real Estate, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyPuravankara Projects Limited has ventured into the Kingdom of Saudi Arabia to cater to the Indian housing needs of NRIs residing there.  With the increasing interest among Indians in the Kingdom of Saudi Arabia to invest in luxury and affordable luxury homes back home in India, Puravankara is now well poised to tap this potential market with a permanent presence in the Kingdom of Saudi Arabia through its new branch office in Al Khobar, Dammam.

This strategic move is in line with Puravankara’s long standing history of being one of the first Indian companies to tap rising potential of emerging markets overseas. In an effort to reach out to NRI’s, the company has now also set up a 24/7 sales support desk in India.  Now Indians all over the world can reach out, at their convenient time irrespective of the time zones they live in.  The inauguration of this new office comes after establishing a prominent presence in the Middle East market, in Dubai for over two decades.

Commenting on the initiative, Jackbastian K. Nazareth, CEO, Puravankara Projects Limited, said “We continue to strive for excellence through highest levels of transparency and customer service. The office in Saudi and the 24/7 sales desk would pave a way for fulfilling the dreams of millions of Indian’s abroad who have always thought of owning a home in India, but have not had the time or the means to help them in the decision making.”

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