Tag Archives: Indian real estate market

Supertech 1st developer to face its Victims’ Forum

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News Point: In an unprecedented move, Outlook for Social Change (OSC), a collective of citizens, has launched a platform to unite home buyers in projects of Delhi NCR’s real estate giant Supertech Limited.

Supertech Sports Village. Sports Republik, Greater Noida West Property, Noida Extension property market, Greno West Real estate, RK Arora, Sports-themed housing projects, Indian real estate market, Indian property market, India real estate news, Track2Media Research, Track2RealtyIn order to bring the home buyer victims of Supertech Limited under a common umbrella, OSC has launched www.supertechvictimsforum.in which would be managed by volunteers of the Supertech Victims Forum.

Dedicating Supertech Victims Forum (SVF) to the public at large, the National Convenor of SVF said, “Real Estate Developers like Supertech have been blatantly victimizing hundreds of homebuyers in multiple ways. A customer is a king for real estate developers till signing of the agreement. After signing of the agreement and making payments, a customer is treated like a beggar. Our objective is to ensure that a home buyer is not shortchanged, oppressed and victimized by the powerful builders who more often than not enjoy dictatorial powers because individual customers in the same project have no structured way to unite till they are handed over possession and a Resident Welfare Association is formed”.

Based on numerous complaints and instances of blatant high handedness that have come to the notice of the now formed Supertech

Victims Forum, the largest number of complaints is of delayed possession. While a builder makes promise of delivery of goods (residential dwelling) in the agreement, they include clauses that virtually allow them to keep delaying the possession endlessly.

According to information received by Supertech Victims Forum, customers of Delhi NCR based builders like Supertech, Amrapali, Jaypee and Unitech form the largest number of home buyer victims. OSC during the course of coming months will launch forums for victims of Amrapali and Jaypee real estate projects.

“The launch of www.supertechvictimsforum.in is just the beginning. We will soon launch similar forums for homebuyer victims of other real estate developers like Amrapali and Jaypee so that the voices of homebuyer victims results in time-bound and expeditious resolutions”, said Professor Tripathi.

“All online advocacy platforms launched by OSC will solely before purpose of ensuring progressive changes in conduct of builders and in interest of public at large. At no given point of time we will allow any factually incorrect complaint or case to be highlighted”, he added.

OSC further said that the first recourse that would be attempted is to engage into a constructive dialogue with the real estate developer, like Supertech. In case, Supertech does not provide a reasonable resolution within 14 days of the case being shared with them, we will not waste any more time and seek redressal as deemed appropriate on a case-to-case basis.

The second most common complaint that has come to the information of OSC is lack of promised facilities and quality at the time of handing over possession.

“No builder can go scot-free after indulging into anti-consumer and unethical practices by greasing palms of government officials to get approvals or certificates. We will ensure that strictest of criminal action is taken on erring builders and government officials for conspiring against the interest of homebuyers, i.e. in public interest,” said a press release issued by the OSC.

OSC further added that many properties acquired by builders from Development Authority through an auction process smell of collusive bidding and cartelization. OSC has come across cases where auction of land parcels have been held by a Development Authority for a particular sector on the same day.

For example, auction of 5 residential housing plots were held by a prominent State Government authority on 12th March 2010. The 5 winning bidders had placed their winning bids which were a few hundred rupees over the reserve price. All the builders were allotted these prime plots barely a couple of hundred rupees more than the reserve price, with all winning bids of the 5 land parcels being in close proximity of each other.

“Should there be a probe in such cases? Or should such land parcels be auctioned in phases so that the government can maximize its earnings, or at least get a fair share of windfall gains made by private builders? These are pertinent points that have to be discussed, debated and decided upon by lawmakers. OSC would raise such issues in appropriate forums so that national, public and consumer interest do not get compromised in order to serve private interests of a chosen few,” Professor Abhilash Tripathi said.

Professor Tripathi added, “One of the most important aspect is formation of a Consumer Protection Mechanism by making it mandatory for every real estate developer to provide a bank guarantee for refunding the payments made by homebuyers in case of the builder not meeting the contractual commitments in reasonable time frame. We will propose formation of such a mechanism to Narendra Modi, so that a homebuyer opting for this option can encash the bank guarantee, subject to certain conditions. We know it well that we will face tremendous resistance from the powerful builder lobby. But the collective and collaborative voice of individual home buyers is powerful enough to make platforms like www.supertechvictimsforum.in to usher in a social change”.

By: Ravi Sinha

43-54 billion REIT eligible commercial property in India

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News Point: With 315 MSF office and 39 MSF mall stocks, value of REIT-eligible stock seen to be highest in Bengaluru, followed by Mumbai. Bengaluru, Mumbai and Delhi-NCR cumulatively account for over 67% of total REIT-eligible stock

Office space in India, Office space absorption, Commercial real estate in India, Commercial property trends, Indian real estate market, Indian property market, India office market report, Real estate news magazine, Real estate news portal, Real estate website, Track2Media Research Pvt Ltd, Track2Realty, NRI investment in IndiaIndian commercial real estate offers investment opportunity worth USD 43 – 54 billion (Rs. 2,88,758 crore-Rs. 3,60,948 crore) across the top 8 cities via REIT-eligible ready stocks as per and report entitled “Commercial Real Estate: Steering Growth in Indian Cities”.

The report was released at RICS Real Estate Conference 2016 – “Commercial Real Estate: Corporate Catalyst” with Cushman & Wakefield as research partners for the conference. A key focus of the conference discussions was evolving occupier demand, REITs and international standards.

The report estimates that the value of REIT-eligible stock is seen to be the highest in Bengaluru (USD 15.8 billion)/Rs. 1,05,213 crore) primarily due to the high volume of investible Grade developments. Mumbai (USD 14.5 billion/Rs. 96,461 crore) comes a close second due to higher capital values of commercial properties, despite having roughly half of Bengaluru’s REIT-able stock.

The estimated value of REIT –eligible stock in NCR is USD 11.04 billion / Rs. 73,423 crores which is the third highest. Further, it is estimated that approximately 315 million square feet (msf) of office inventory is eligible for REIT across the cities. The REIT-eligible inventory includes existing non-strata sold Grade A inventory, wherein Bengaluru, Mumbai and Delhi-NCR cumulatively account for over 67%. 

Delivering the keynote address, Barnali Mukherjee, Chief General Manager, Securities and Exchange Board of India (SEBI), said, “We have come out with the IPO guidelines for the issuance of units of INVits. On same lines, we are working on the IPO guidelines for units of REITs. Since there are no accounting standards for REITs and INVits, we have set up sub-committees looking at the financials to be brought out with the offer documents as also the continuous disclosure to be made; also set up a sub-committee for issuance of valuations, who will come out with their report. On the valuations side, a separate chapter has been included in REIT regulations where lots of rights and responsibilities have been given to the valuer who has to comply with International Valuation Standards.”

“We have already received 4 applications for infrastructure investment trusts (INVits), where two applications have been processed and two are registered. We have come out with amendments on REIT regulations to bring more clarity and make it more acceptable but as of now, we haven’t received any applications for REITs. Whatever SEBI could do has already been done, in terms of removing key roadblocks such as capital gains tax and DDT and now we are looking forward to applications for REITs so that the REIT market can take off,” she added.

Sachin Sandhir, Global Managing Director – Emerging Business, RICS said “Commercial real estate is expected to see continued demand, fueled by positive business sentiment (especially in IT/ITES and new age digital businesses) based on major policy reforms undertaken by the Government. There is also likely to be considerable international investor interest in income yielding assets and the first REITs and INVits are not far away. REITs will drive the need for Indian commercial real estate to speak the language of international investors which, in turn will create demand international standards and corporate governance; professionalism and skills – which are all the things that the RICS Stands for.”

Sanjay Dutt, Managing Director, India, Cushman & Wakefield said, “REITs can provide a huge opportunity for developers and investors in India given the potential in the . REITs would help developers resolve their fund-raising issues and allow them to focus on completing their projects in a timely manner. Apart from the top 3 cities, Chennai and Pune have immense scope for REITs with approximately 34 MSF each of REITS-eligible stock. Going forward, by the end of 2017, Hyderabad’s REIT-able stock is expected to reach approximately 41 MSF. This would place Hyderabad’s REIT-able stock at 4th place, surpassing that of Chennai and Pune. With investor and occupier interests rising in Hyderabad, a high number of Grade A projects are likely to be completed enabling high REIT-able stock.”

Apart from the office sector, the retail sector too has high potential to generate rental income for investors. Since last year, private-equity firms have shown interest in investing in malls in India, indicating that there is acertain attractiveness in the retail shopping centre space owing to future prospects.

Sachin Sandhir further added, “RICS will continue to work to promote International Property Measurement Standards (IPMS) a global collaborative initiative with 70 global professional bodies, which will bring in a common basis of measuring assets. RICS is also advocating International valuation standards (IVS) and the RICS red book as a basis for valuations of these REIT-able assets. With a common basis of measurement and a common basis of valuations and skilled professionals to undertake delivery of grade A office space coupled with ease of doing business initiatives of the Government, Indian commercial real estate will surely realize its true potential.”

Devina Ghildial, Managing Director – South Asia, RICS said – “2016 looks to be a bright spark for commercial real estate. The asset class looks to be on solid footing with all the policy reforms and initiatives from the Government. The industry will see the emergence of not only REIT’s and INVits but new asset classes including new suburban business districts which will propel commercial real estate to produce a lot more grade A office space in the times to come. In fact, in Q1 2016 alone, the market has seen absorption to the tune of approximately 5 MSF.

“Going forward, we will also see corporate occupiers and investors starting to demand international standards and focus on creating sustainable assets, which will create long term value for international investors in the form of higher yields. This would be a key expectation from the development community. Now more than ever, the potential of commercial real estate is apparent, and this makes it an opportune time for REITs to find their way into the market,” she added.

Of the REIT-eligible stock across the 8 cities, Bengaluru has over 100 MSF of REIT-eligible stock (33% of total REIT-able stock), more than double of that of Mumbai. Approximately 75% of the total (all grades) office stock in Bengaluru is eligible for REIT investments. Delhi-NCR (56 MSF) and Mumbai (51 MSF) are expected to follow Bengaluru in terms of REIT-able stock as of Q1 2016.

REITs once implemented in India would enable investors to generate a stable source of income and also earn profits by trading the units of REITs, thereby increasing the attractiveness of REITs as investing medium. With the government exempting Dividend Distribution Tax (DDT) for Special Purpose Vehicle (SPV) of REITS in the Union Budget, the investment vehicle is likely to be more attractive for investors.

Mall stock of 39 MSF eligible for REIT investment in India

The top 8 cities have REIT-eligible mall supply of approximately 39 MSF, with Bengaluru, Delhi-NCR and Mumbai together accounting for about 64% of the retail inventory. Owing to the presence of large mall developers in Delhi-NCR, Mumbai and Bengaluru that operate some of the best malls in India, investors are likely to concentrate their investments in these cities. Mumbai (11 MSF) has the highest stock of REIT-able malls i.e. non-strata sold grade A malls followed by Delhi NCR (7.4 MSF) and Bengaluru (6.5 MSF).

Supertech saga of flouting norms, buyers’ harassment & media management

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News Point: Supertech is a case study in flouting norms in connivance with officials, taking home buyers for a ride and media management to cover up its malpractices. 

Supertech Sports Village. Sports Republik, Greater Noida West Property, Noida Extension property market, Greno West Real estate, RK Arora, Sports-themed housing projects, Indian real estate market, Indian property market, India real estate news, Track2Media Research, Track2RealtyThe news about the forgery by serial offender Supertech leading to cancellation of its Yamuna e-way township plan has not come as a surprise. As a matter of fact, this is the third major instance, besides many instances of buyers’ harassment and flouting of norms, in recent times where the real estate developer has taken both the government authorities and the buyers for a ride.

In the latest instance of forging the document, in 2015 when Supertech sought the completion certificate for the project, the two successive CEOs of YEIDA – Santosh Yadav and Anil Garg – pointed out that building plans had been modified on the basis of a forged document.

One of NCR’s biggest real estate players by market size that claims to have delivered 16,000 apartments this year, Supertech has once again landed its buyers in a big mess. The building plan for its 100-acre township – Upcountry – on the Yamuna Expressway has been cancelled after two successive CEOs of the Yamuna Expressway Industrial Development Authority (YEIDA) pointed out that the builder had got a revised plan sanctioned on the basis of a forged letter. Both recommended that an FIR be lodged against Supertech.

This letter from 2011 paved the way for Supertech to increase its ground coverage at the cost of open area in the township. Supertech thus sold an extra 730 plots and villas for an estimated Rs 343 crore.

Supertech Upcountry, with 28 towers, each housing 120 residential units, 948 villas and plots, is almost ‘sold-out, at least the builder claims it on the official website.

Supertech was allotted a 100-acre plot – TS-1 – in Sector 17A along the 165-km Yamuna Expressway on June 14, 2010. The plot was registered in August. The then Chairperson and CEO of YEIDA Mohinder Singh sanctioned the layout plan of the residential township on January 25, 2011 as per YEIDA’s building bylaws of September 2009.

However, YEIDA received a letter (no: 2153/77-3-10-01) dated September 13, 2011, purportedly signed by ‘Secretary to the Government of UP, Alok Kumar’. The letter referred to Supertech Ltd’s proposed township, saying that since no construction had been carried out on the said plot, Supertech should be allowed to construct on TS-1 as per YEIDA’s new bylaws, which came into force in December 2010.

On a specific inquiry initiated in 2015 by the then YEIDA CEO, Santosh Yadav, the joint secretary of the UP government confirmed in writing that it had issued no such letter, which meant the September 13, 2011 letter was forged.

A senior YEIDA official told TOI, “Supertech had produced a letter from the government, which gave the builder the benefit of extra ground coverage due to implementation of the building bylaws of 2010. In 2015, the then YEIDA CEO Santosh Yadav was informed about the letter being fake after which a verification was carried out and the government confirmed that no such letter had been issued and that it was a fake. Yadav had then directed that a show-cause notice be issued to the builder and an FIR be lodged.”

“In compliance with Yadav’s directions, the sanctioned plan of the township has been cancelled. As far as the FIR is concerned, legal advice is being sought in the matter. In the meantime, the developer has made a representation to Noida Authority Chairman Rama Raman (he is also the YEIDA Chairman) that he be heard as the sanctioned plan was cancelled without a fair hearing. We then told him to approach the UP Government as the matter involved a fake letter. The developer has now represented to the government that his sanctioned plan was wrongly cancelled and he has asked for his plan to be reinstated after imposing a financial penalty on him.”

Supertech CMD R K Arora told TOI he “was not aware of any letter between YEIDA and the government”. “The plan for the township was sanctioned in November 2011 as per applicable bylaws and condition of lease deed. Ground coverage is as per applicable bylaws.”

History of default

This is not the first time that Supertech has been in trouble for flouting the norms. In April 2014, the Allahabad High Court directed two towers with 857 residential units at its Emerald Court project in Noida’s Sector 93A to be demolished for flouting building norms and violating provisions of the UP Apartments Act of 2010. The matter is pending before the Supreme Court.

In April this year, the Greater Noida Industrial Development Authority directed Supertech to seal 1,009 flats and villas at its Czar complex in Greater Noida for large-scale violation of the sanctioned layout plan.

In this case, the forged letter from 2011 paved the way for Supertech to increase its ground coverage at the cost of open area in the township. Supertech thus sold an extra 730 plots and villas for an estimated Rs 343 crore.

Many of the buyers of Supertech allege that the builder resorts to arm-twisting and pressure tactics to extract more money. In one such case (Track2Realty has recorded evidence of the discussion) the buyer was asked to pay Rs. 2 lakh as ‘facilitation fee’ or bribe to Noida Authority for property transfer even before the first buyer had got the registration done.

It is a common knowledge that Supertech has many such cases of default but is know to manage the media to the extent that the buyers’ grievances are often not heard.

The big question today is that whether the toothless industry body CREDAI with a holier-than-thou President, Geetamber Anand step in to take some action. Isn’t it a fit case to drop Supertech from industry body to improve the perception management of India’s dirtiest business?

By: Ravi Sinha

Track2Realty picks up top 100 projects of 2015

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Track2Realty Investment Magnet Report 2015, Track2Media Research Pvt Ltd, Indian property investment guide, Best housing projects in India, Top residential project in India, NRI investment choice, Indian real estate market, India property marketA house hunt has always been tedious and challenging for anyone in this country. Imagine the travails of finding 100 apartments to live in. Yes! This has been the thought process when the editorial team of Track2Realty embarked on a journey to find 100 best housing projects relevant for investment in the year ahead.

Like anyone else on a house hunt, we were also carried with mixed dose of emotion and rationality.  It has been an emotional journey as we had put ourselves into the shoes of an average investor. Of course, the journalistic rationality was always there to be objective.

We started the screening process with a carefully researched list of 500 projects. It was further narrowed down to 300 and then we did realise that an objective analysis would be heavily tilted towards a few best performing markets at this point of time. That would have probably defeated the very purpose of this study, as we wanted to come out with a pan-India report.

Therefore, an element of editorial discretion, which can be called subjectivity, was applied once the list was narrowed down to 200 housing projects. After a series of deliberations it was decided that in order to give a pan-India perspective it is imperative to put a cap over the number of projects that can be featured from one given market and projects of one particular developer. Failing this, the report might have given the impression of our endorsement to a few best performing developers at the moment.

Thereafter, it has been a challenge to define the scope of study. Being the first journalistic initiative of this kind, we did not have any precedence to look into. After rounds of discussion we could finally develop ten metrics that would be benchmark of evaluation. These are:

  • Location & Aspiration
  • Physical Infrastructure
  • Social Infrastructure
  • Appreciation Potential
  • Competitive Advantage
  • Rental Potential
  • Launch2Sales Ratio
  • Construction Quality/Timelines
  • Livability Index
  • ROI Cycle

Even though we practically covered all the aspects that a prospective investor or homebuyer would look for, we resisted the selection of top 100 at this point in an organic manner. We were conscious of the fact that statistics cannot be the only indicator. Reason being that an investment is a complex process in India’s housing market where the transparency is lacking and absence of reliable data adds to the confusion.

We rather felt that the ten metrics may or may not do justice to the actual performance of the project. Raw data can also be misleading when it comes to look & feel and usage of the high value product like a house.

For example, while launch2sales ratio is a metrics where we weighed lesser to the projects that are weathering slow sales, we have to be equally conscious of the fact that very high sales ratio to the extent of project being completely sold off would be of no interest to prospective investors. We are hence not claiming that our list of top 100 projects is top 100 at large. What we maintain is that in our study these are the top 100 projects worth investing as of now.

Similarly, since we are addressing more to the institutional investors, HNIs, NRIs and other financial institutions, our tilt has been slightly more towards the premium and high-end projects. It has been more so in those markets where the high-end investors are looking forward to invest for luxury living. In some of the performing Tier II cities, we have lowered this benchmark to weigh higher to affordable housing projects as well.

Another point of contention for us had been the challenge to deal with the pre-launched projects that are selling at a brisk pace. As a thumb rule, we decided to only consider those projects in pre-launch stage where the reliability of the developer has been pretty high; the kind of market credibility that manages to evoke confidence among investors’ to invest.

We have otherwise mostly focused on the projects that are close to completion, and have been witness to the first round of appreciation and high performance. The idea obviously has been to clear the clutter around execution risk.

It has indeed been a fascinating journey for our researchers. Never before in the history of Indian real estate such an analysis of housing market was done like this. Both the developers and the realty media are known to mutually appreciate each other with marketing supplements. Track2Realty has breached that convention and our top pick is purely on editorial merit; something that is now quite accepted (even though critically) by the sector.

Needless to say, Track2Realty does not look at the developers as their target readers. We are rather focused to have our readership base with the institutional investors, NRIs, HNIs, financial institutions etc. who are looking for reliable data and study on the Indian housing market. This study of 100 top projects is hence aimed at coming out with authentic housing market report in an information-starved sector.

Series of top 100 projects’ review to continue…

Supertech launches Sports Village at Noida Extension

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Superrich Sports Village. Sports Republik, Greater Noida West Property, Noida Extension property market, Greno West Real estate, RK Arora, Sports-themed housing projects, Indian real estate market, Indian property market, India real estate news, Track2Media Research, Track2Realty Under the UP Government’s scheme to develop sports-centric projects in the state, Supertech Limited has been allotted land to develop sports-centric development, Sports Village, in Knowledge Park, Greater Noida (West). The project is dedicated to the sports enthusiasts who want to learn sports while living there.

Supertech has partnered with sports stars to open up academies of different sports in the project – Tennis Academy by Sania Mirza, Cricket Academy by Shikhar Dhawan, Golf Academy by Jyoti Randhawa, Badminton Academy by Pullela Gopichand and Guns of Glory by Gagan Narang.

The academies will be set up as per the international standards providing world-class sports facilities, based on the global exposure of the players. The academies will be professionally run under the supervision of these players.

They will come on a time-to-time visit to the project to train the sports aspirants living in Sports Village. The quality management of these academies will be personally done by the players.

On this occasion, R.K. Arora, Chairman, Supertech Limited said, “We are extremely delighted to come up with an ultimate destination for sports lovers with our latest project Sports Village which aspire residents to learn and enjoy the opportunity to indulge in the games. Sports Village prides itself with a balance of contemporary styles, unique modern specifications and world-class infrastructure. The project offers world class sports academies, affordable units and luxury villas which bestow the breathtaking experience of healthy living”.

“The objective behind partnering with the best of the names in the sports is to promote sports in the area. There are many people who aspire to be great sports persons but lack of guidance confine them to shine. These academies will give an opportunity to such people to excel in the sports of their interest”, said Mohit Arora, Managing Director, Supertech Limited.

Sports Village is a part of Sports Republik, which is an integrated development spread across 175 acres of land. The township is 70% dedicated to sports activities and 30% to residential and commercial, which is very low density as compared to any other housing development.

The project comprises of low rise and high rise apartments, villas and sports academies. Sports Village has vast open spaces surrounded with greenery and all kinds of amenities.

The project boasts of an elegant and breathtaking living with lush green fields, world class sporting academies, modern sports amenities and infrastructure. This artistically designed venture is a tribute to sports determined and passionate customers. Sports Village is being designed world renowned architect, Hafeez Contractor.

Sports Village posses great connectivity as it is located on 130 meters wide expressway and just a few minutes walking distance from the last station of the under construction Metro Service Phase-III from Sector 71, NOIDA to Knowledge Park-V in Greater Noida.

The open space at Sports Village constitutes of a 9-hole golf course on approximate 20 acres of land, the landscaped area, lavish garden, pool, club, tennis court, shopping mall, banquet and plazas.

The changing phase of workplace utilization in India

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Office space in India, Office space absorption, Commercial real estate in India, Commercial property trends, Indian real estate market, Indian property market, India office market report, Real estate news magazine, Real estate news portal, Real estate website, Track2Media Research Pvt Ltd, Track2Realty, NRI investment in IndiaThe IT/ITeS sector has clearly been driving corporate real estate in the country; and consequently, much of the development in this space is being propelled by IT and back-office demand for workspaces, as per CBRE’s India report – Real Estate & Workplace Strategies of Shared Services Occupiers.

The report focuses on the remarkable growth of the outsourcing and technology industry over the last two decades; and how the sector has been implementing strategies for managing their real estate portfolios.

India’s status as a global outsourcing hub is also reflected by the fact that approximately 90% of total office space occupied in 2014 and during the first nine months of 2015 was for either back-offices or a combination of back and front-office operations of companies.

As shared services occupiers respond to the forces of globalization amid a backdrop of economic uncertainty and focus on cost optimization, their real estate portfolio strategies have varied.

Anshuman Magazine, Chairman & MD, CBRE South Asia said, “For most global corporate office occupiers setting up a shared services platform in the country, space take up strategies are tied with their overall corporate strategies. As such, parameters like space utilization, efficiency and productivity play a large role in revising real estate strategies. Going forward I believe that these larger aspects will dictate how global corporates expand their offices across key cities in the country.”

“While India remains the preferred destination for outsourcing, corporate occupiers have been growing in suburban and peripheral locations in the major Tier I cities. The emphasis on quality infrastructure, mass transit and rentals continues to play a key role in decision making,” said Ram Chandnani, Managing Director, Transaction Services, CBRE South Asia Pvt. Ltd.

Organizations are now under enormous pressure to drive down costs by increasing their workplace ‘static density’—the space per sq. ft. per workstation. Benchmarking metrics such as workplace density and space utilization are becoming more critical in helping corporate occupiers make informed workplace and real estate decisions, and manage their real estate as a strategic asset; however, this needs to be approached in the right way.

Focus on workspace density

Workspace density can be broadly classified into ‘static’ or ‘dynamic’ types. In a static density model, employees are assigned a fixed workspace as a primary work station. The dynamic density model allows staff to work flexibly by choosing different places to work around the office.

Static density across companies is based on factors such as the location of the office (e.g., whether an office is in a core or suburban area), size of operations, the use of space as reward (e.g., senior staff are often allocated larger spaces), whether it is a private or public sector company, and the nature of work (e.g., employees in the financial sector often have specialized spaces and work desks).

Space and Technology: Workspaces are getting smaller, and documentation is increasingly moving online, limiting storage needs. While the increased focus on effective space utilization has given birth to the concept of workplace strategy, technology is playing a pivotal role in successful implementation.

Space Utilization: Workplace strategy involves creating a healthy relationship between technology, space and people. However, space utilization has the most significant impact on commercial real estate dynamics. Firms have to accommodate growing headcounts amid a steady increase in real estate costs, which is a challenge in the cost-sensitive and high-headcount outsourcing industry.

Emerging workplace trends in India

Office space design has gradually moved from a rigid floor plan to one facilitating an open plan seating arrangement. Over the past decade or so, the share of cubicle spaces in the overall floor plan of a typical office has fallen from 23–25% to just 5% today. On the other hand, open plan seating, which comprised around 25% of the floor plan in the past, has increased to 45–50% today.

The share of open floor seating arrangements often varies across different floor plate sizes. For larger office spaces, companies have the flexibility to further increase the size of the area allocated to open plan seating while doing away with corner offices and limiting the space allocated for meeting rooms and circulation

“Corporate occupiers must develop a complete understanding of how their people work, and what their organizational objectives and imperatives are. It is only by aligning these two fundamental perspectives that companies can implement a workplace strategy capable of achieving cost effective business transformation,” Magazine added.

Safety concerns & compliances not strictly defined for earthquake

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Earthquake, Earthquake in India, Earthquake resistant houses, Earthquake safety in housing, Seismic compliant housing in India, Track2Realty, Track2Media Research, Indian real estate market, Indian realty news, India property marketImmediately after the earthquake in Delhi-NCR a builder sends a group WhatsApp message that says: Our project in Noida is NCR’s 1st and only earthquake resistant structure with seismic zone V compliance approved by IIT Bombay. Possession next month.” It does not go down well in the collective consciousness as an impression gains ground that the developers are evaluating the opportunity cost in times of a natural calamity. This message nevertheless raises more questions than it tries to answer that the given project is earthquake complaint.

If the sincerity of the real estate developers in this part of the world is that high then ideally they should incorporate it in their marketing brochure and project offer as to what is the safety methodology that has been applied in their project. After all, the Bureau of Indian Standards (BIS) that is the national standard body of India and is supposed to monitor and control that buildings are earthquake compliant admits that India is one of the most disaster prone countries, vulnerable to almost all natural and man-made disasters.

As per the BIS own admission, about 85 per cent area is vulnerable to one or multiple disasters and about 57 per cent area is in high seismic zone including the capital of the country. Disaster prevention involves engineering intervention in buildings and structures to make them strong enough to withstand the impact of natural hazard or to impose restrictions on land use so that the exposure of the society to the hazard situation is avoided or minimised.

Though the National Building Code (NBC) of India that mostly talks about the fire and life safety has also introduced a clause to restrict the use of foundations vulnerable to differential settlements in severe seismic zones, it is not intended to lay down regulation so that no structure shall suffer any damage during earthquake of all magnitudes. The NBC Code of BIS only says that it “has been endeavoured to ensure that as far as possible structures are able to respond, without structural damage to shocks of moderate intensities and without total collapse to shocks of heavy intensities.”

The larger question is whether that is enough in case of high intensity earthquake. The residents of Gurgaon who stay at 18-floor height do not think so. If a high intensity earthquake in a far off Nepal could jolt their apartment then they feel high intensity earthquake in this part of the world would collapse the building.

In terms of the reality check, most of the projects in high-rise cities like Mumbai and Delhi are being designed to be earthquake-resistant to a certain intensity of earthquake. These intensities vary with seismicity of a particular area. India is divided into 4 earthquake zones (from Zone II to Zone V). Mumbai and Delhi are in zones III and IV, respectively. Zones III and IV correspond to Richter Scale up to 6.5 and 7.5, respectively. The developers point out that the buildings that are designed worldwide are earthquake-resistant but not earthquake-proof.  Earthquake resistance may be enhanced by proper detailing of reinforcement, which is termed as ductile detailing. Some architects point out that higher reinforcement than required might lead to loss of ductility (or increase in brittleness), which in turn, might lead to collapse of structure.

From a policy standpoint, across the Indian cities there is no provision for structural safety and stability of existing building; there is no specified law for the redevelopment of old and depleted buildings. BIS has published a number of codes to ensure proper quantity of reinforcement and ductile detailing to achieve the desired level of earthquake-resistance. Compliance to these codes and their periodic checking by the concerned agencies is a missing link. Structural engineers suggest proper check from the respective authority official(s) should be there at construction site from time to time and issuing the projects test certificate for better confidence of the buyers.

The developers, meanwhile, would like us to believe that their projects are designed to be earthquake-resistant in all possible manners with the best structural engineers and designers of the country.

Mohit Goel, CEO of Omaxe admits that Delhi NCR falls in seismic IV which means it is highly prone to earthquake. The recent earthquake in Nepal and Bihar and the damage to life and property that it inflicted is a serious cause of concern for us in Delhi NCR to take corrective steps. He, however, maintains the assumption that all buildings will be impacted would be an over statement.

“This earthquake has made buyers more cautious in ensuring earthquake resistant structures and even questioning their builder to have the same and other precautionary measures. What needs to be curbed is the unorganised construction that is happening all across. Stricter compliance by authorities will instil confidence in the people. Besides, old housing societies must be encouraged for redevelopment. The authorities, developers and buyers have to cohesively work towards ensuring a safe zone,” says Goel.

Brotin Banerjee, MD and CEO of Tata Housing, however, believes that the recent earthquake has yet again brought to spotlight the need for strong buildings that can weather the natural calamity. He asserts the government has already set stringent policies for builders to use appropriate design and technology to make structures earthquake resistant.

“Our projects are the result of modern technology and in-depth research into the area and site. The earthquake disasters can be averted with the construction of seismic proof buildings. Each building has to be designed in such a way that it may withstand during earthquakes depending on the seismic zone it falls in,” says Banerjee.

Rattan Hawelia, Chairman & Founder, Hawelia Group points out that the construction industry has gone through major technological advancement. Of late, building design, especially for high rise and special buildings, has become a complex process, integrating many skills, products and techniques into its system.

“The major challenges to an earthquake-resistant building are right quantity of reinforcement design (that is, by avoiding excess reinforcement), detailing the reinforcement in a ductile manner and the most important of all is perfect execution of the design at project site with regular check on the same,” says Hawelia.

However, structural engineers have a different take. Dr Rajeev Dua, Head of Optimization Consultants recommends technology is essential that actually determines safety & security level of a high rise building. Developers should join hands with the best names of structural engineers from around the globe that has proven track record and required knowledge in designing of high rise buildings. Right from the soil investigation, wind stability conditions to the apt foundation design as per the height and shape of the building, these high rise structures can be made capable of taking all types of loads and deflections in case of an earthquake.

“The developers should make sure that the structural design should be with optimum level of reinforcement (that is avoiding higher consumption of reinforcement than desired) and with proper ductile detailing of reinforcement. Also the key for safety lies in implementing and executing at project site the correct usage of steel and RCC concrete in quantitative and qualitative terms as designed by the respective engineers,” says Dua.

The spotlight has suddenly been on the need for strong buildings that can weather the natural calamity. However, there is no standardised mechanism of due diligence for the buyers today to understand whether their high rise building is actually earthquake proof. Though ideally the recent calamity should have resulted in some learning for the Indian real estate, the focus of the developers is yet on lip service than preventive and corrective measures.

Globally, in Japan which is one of the most earthquake-prone country there has been extensive use of rubber padding and roller at foundation of the building so that in case of earthquake the building could roll up to 3 meters instead of bending which often leads to crack or collapse. That is a costly proposition in a country where there is no legal definition that if a building collapses in the earthquake the onus of responsibility will be on architect, engineer or the developer.

Land pooling policy promises to change Delhi-NCR property

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Delhi Land Pooling Policy, New Residential Property in Delhi, Future of Delhi Housing, Delhi real estate market, Housing supply in Delhi, Delhi housing inventory, Indian real estate market, Indian property market, Real estate news portal, real estate online, real estate website, Track2Realty, Track2Media ResearchWhy do you buy a house in Noida, Noida Extension, Ghaziabad, Faridabad or even non-descript & hard-to-commute locations of NCR when you work in Delhi? If affordability is not the issue, won’t you prefer to live in the capital Delhi and not the satellite cities of NCR?

The answer to this and many other compromised housing solution of most of the residents of Delhi-NCR lies in the land pooling policy of the Delhi Development Authority (DDA). The land pooling policy, which had been notified earlier in September 2013, has finally been approved by the city’s Lieutenant Governor (LG) recently. This policy will enable urban development in a speedy way where the role of the DDA will be that of a facilitator.

The land pooling policy will facilitate private developers to directly acquire land from farmers/landowners willing to participate in the land pooling scheme, where they will get back about 40–60 per cent of the developed land. DDA, in turn, is to develop the necessary support infrastructure and mass/EWS housing projects on the land, while developers are to receive a large portion of the same for further real estate development. With this policy there will be creation of additional 14 lakh residential units under the PPP model.

DDA in its meeting held on 7th of November this year has approved the regulations for operationalisation of this land pooling policy wherein public private partnership in land assembly and its development has been envisaged. DDA has acquired and developed 75,610 hectares of land till date. As per the Master Plan of Delhi-2021, Delhi still has 27,629 hectares (approx 70,000 acres of land.

The Master Plan of Delhi 2021 envisages development of about 24,000 hectares of land for accommodating additional 48 lakh population in the national capital by the year 2021. The total area of Delhi is 1483 sq mt, out of which built up area is 47.31 per cent, urban extension 14.83 per cent, natural features such as river, water bodies, ridge, forest and sanctuary 13.16 per cent and green belt is 24.25 per cent. Approx 220 sq km at 250 PPH (Person Per Hectare – city level density) would come under urban extension 2021 and average space would be 40 sq m for 230 lakh population in 2021.

Under the Master Plan – 2021, never in the history of urbanisation has any state released the entire land mass for 100 per cent urbanisation. Under the proposed plan, Delhi is unlocking 27,500 hectares of zoned land for residential development (Master Plan and Zonal Plan already notified) and there will be no agriculture land in Delhi by 2021; neither there will be any air polluting industry. Further, land will be available at cheaper cost within the NCR region and the last peripheral village of Delhi has been notified as the Green, which allows development of farm houses.

The likely localities to be applicable for such real estate and infrastructure development will be peripheral colonies and villages such as Mehrauli, Chhatarpur, Khanpur, Narela, and Najafgarh, among others. This policy is expected to prove to be positive for the National Capital Region in the long-term, since land prices in the suburban markets of Gurgaon and Noida would eventually rationalize with fresh housing supply coming into the Delhi market.

Calling it a game changer move, Anshuman Magazine, CMD of CBRE South Asia maintains that the Master Plan Delhi 2021 (MPD 2021) is arguably the largest real estate opportunity in terms of state assurance and demographic demand for urban growth and development in India; and the recently sanctioned land pooling policy is perhaps the first of many such state initiatives.

“Land pooling schemes, such as this, are expected to help solve issues related to the availability of land for necessary real estate development and infrastructure formation for our ever-increasing urban population—especially for the creation of urban green spaces, open public spaces and mass housing for EWS and low-income groups,” says Magazine.

Rahul Gaur, CMD of Brys Group maintains that this policy assures fun­da­mental changes in the way of acquis­i­tion and devel­op­ment of land in Delhi. He points out the DDA earlier used to acquire land from landowners, provide the infrastructure, and then auction it to developers. The price at these auctions ranged from 10-30 times the acquisition price. While the DDA made a killing, the landowners did not share the benefits. This led to criticism that the DDA was profiteering at their expense.

“Land pooling is aimed at countering the criticism of DDA profiteering out of an urban need. Now, the DDA, landowners, and developers will join hands. The landowners in an area will transfer their legal rights to a designated land pooling agency. In return, they will receive certificates that will entitle them to developed land in the future, its amount depending on a specified formula. The DDA will provide the infrastructure, and private developers will develop the projects. Once the development work is done, the land that the owners receive will command a higher price than their original holdings,” says Gaur.

Nikhil Hawelia, Managing Director of Hawelia Group finds the game changer move of DDA in sync with the emerging market realities. According to him, the first Master Plan of Delhi was for­mu­lated in the year 1961. The policy then of DDA was to acquire large chunks of land dir­ectly from the land own­ers at a price determ­ined by the DDA. DDA would then under­take the mas­ter plan­ning and then sell/develop the land, piece by piece.

“From the 1980’s, as the government body failed to keep pace with the urbanisation and housing needs the private developers, through their incre­mental abil­ity, right­fully star­ted seek­ing a lar­ger role. In the past couple dec­ades, the demand surge from the con­sumers actu­ally made the sup­ply from the gov­ern­ment agencies inad­equate. And hence, the major­ity of sup­ply was cre­ated by the private real estate players. Today, land pooling is also finding favour because land acquisition has become very difficult. Currently, a private entity acquiring land must obtain the consent of 80 per cent of the land-owning families in the area (70 per cent in the case of public-private partnership projects). Obtaining consensus is also difficult,” says Hawelia.

In a nutshell, land pooling will increase the supply of land, resulting in price moderation. Besides Delhi, there could be a ripple effect in the suburbs. With fresh supply coming into the Delhi market, land prices in suburbs like Gurgaon and Noida will also moderate eventually. As a result, the cost of built-up real estate in general and housing in particular will come down since land is the biggest cost component. However, analysts have a word of caution and they suggest prospective home buyers should temper their expectations. The prices will correct sharply only if supply increases drastically. If new supply enters the market slowly, as is likely, the prices may not fall much.

Office space strong catalyst to housing revival in Mumbai

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Office space in India, Office space absorption, Commercial real estate in India, Commercial property trends, Indian real estate market, Indian property market, India office market report, Real estate news magazine, Real estate news portal, Real estate website, Track2Media Research Pvt Ltd, Track2Realty, NRI investment in India In the evaluation of sustainability of a housing market, the absorption of office space is the prime indicator across the world. After all, it is the economic activity and the job magnet that fuels the demand for new houses. The city of Mumbai has always been blessed on that count due to demand and supply dynamics.

As a matter of fact, in Mumbai the stock of housing supply has been so less compared to the inherent demand that the city happens to be arguably the only city in the world where the best of residential properties are selling at higher price than the best of commercial spaces.

The slowdown and the resultant slow sales, of late, nevertheless started giving an impression of over-supply in the under-supplied housing market of Mumbai. However, the financial capital of India has time and again proved the prophets of doomsday wrong with its property market proving to be more resilient than any other market.

And hence, market analysts are not surprised with the fact that the dynamics is yet again changing and the office space absorption pattern has already indicated that the revival of Mumbai housing market is on the cards.

Facts speak for themselves. As per a report by Colliers International, the commercial capital of India registered a record over 2.93 million sq feet of office space absorption in April-June quarter this year, its best performance since January-March 2013.

It has also outperformed many other traditional cities known for high business activity, of late. More importantly, there are multiple demand drivers ranging from Banking, Financial Services & Insurance (FSI), IT/ITeS, Manufacturing, Pharmaceutical, Media & Entertainment sector that are bullish on the city. These are the sectors who are at the forefront of high occupancy across the city.

Does it sound like more job creation & economic activity ahead? Doesn’t it sound like more housing demand? Analysts tracking the city property market maintain the fundamentals are heavily loaded in favour of housing demand ahead. The developers also believe it is a matter of one more quarter and the sales figure during the festive season would give an altogether different statistics as far as housing absorption is concerned.

Brotin Banerjee, MD & CEO of Tata Housing agrees that there has been a revival in the fortunes of office space in Mumbai as the city has registered absorption of 2.93 million sq feet with industries like BFSI, IT/ITeS, Manufacturing, Pharma taking over office spaces in the city.  It is currently in sharp contrast to the residential real estate market which is witnessing lower absorption rates. However if commercial sales are to go by, this impetus is directly proportionate to the demand for residential developments.

“With the festival season around the corner in Mumbai, we are expecting an upswing in the property transactions as people prefer buying houses due to the auspiciousness of time. The real estate landscape in Mumbai has reached a plateau but with slew of measures like relaxation in the FDI norms followed by the interest rate cuts and the facilitation of REITs by Government of India and endeavors to introduce clarity through the ‘Real Estate Regulatory Bill’ will help to foster the comeback of housing market in Mumbai region. With festival seasons due to start from September, we are sanguine about the revival of the housing market in Mumbai,” says Banerjee.

David Walker, Managing Director, SARE Homes also points out to the recent report by property consultants JLL that says Mumbai will continue to see an increase in leasing activity by BFSI companies. Major activity will be seen in its sub-markets like the key commercial district, Bandra Kurla complex (BKC), and the western suburbs. Commercial development would continue to define the real estate market in Mumbai, creating a ripple effect on the growth of residential market.

“There is a huge unmet demand for affordable housing in Mumbai. Mumbai is growing in terms of infrastructure and connectivity, and has become a hub for media, entertainment, consultancy and financial services.  This has resulted in job opportunities. It would be prudent to say that demand surged but so have the prices. Looking at the current scenario with an already low profit margin, decline in prices is a farfetched reality. But developers are expected to come up with attractive offers and incentives to accelerate sales during the auspicious festive season,” says Walker.

Manju Yagnik, Vice Chairperson of Nahar Group welcomes the developments and calls it a positive indication that the market is gaining better traction. According to her, we can look forward to better conversions going forward. High absorption of office space indicates healthy outlook in economy and employment, which invariably trickles down to increase in demand for residential property. The important aspect here is revival of the market which bodes well for the entire real estate sector.

“In order to see a genuine housing revival, the government will need to take the initiative by introducing more industry friendly policies which will propel growth and have a ripple effect within the real estate sector. We hope to see some positivity this festive season but most importantly we need to create a conducive environment for growth of the real estate sector,” says Yagnik.

There is no denying that housing revival is directly proportional to the office space consumption. However, it is not just the raw statistics that is giving solace to the residential developers of Mumbai. There are actually three strong indicators that are lending credence to the revival theory of Mumbai housing.

First, it is not just the volume of absorption that is on the higher side; rather the fact that large companies are opting for bigger spaces and even the entire floor plates are being negotiated suggests that revival of housing demand is not far.

Secondly, this demand of office spaces is not single-sector driven but multiple demand drivers are in play today and that suggests the expected growth is not dependent on the fortunes of any one industry. And thirdly, the spirit of festive season with attractive deals and price points across the Mumbai market adds zing to the housing demand.

Homebuyers looking to western suburbs this festive season

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Western Suburbs of Mumbai, Mumbai property market, Property in western suburbs of Mumbai, Indian real estate market, India property market, Indian realty news, India real estate news portal, Indian real estate website, Track2Media Research, Track2Realty, NRI investment in Indian propertyWhen Roshan Abbas, a property broker operating out of Mira Road of Western Suburb, claimed that the region would be the catalyst of housing revival in the Mumbai Metropolitan Region (MMR), many thought this to be claims of a broker glorifying his catchment area. Some of the critics even dismissed it as another marketing stunt on the eve of the festive season of Navratra.

A closer look, however, confirms that the take of this property dealer has been firmly grounded with realities. Some research and bird’s eye view on the property landscape of the city would suggest that no other region has as much potential at this point of time as the property markets of Western Suburbs, both prime localities as well as the extended zones of the Western Suburbs.

The point is what makes Western Suburbs the investment magnet. Analysts point out that this suburb has got something for each and every segment of the buyers. If the region is home to some of the costliest properties of Mumbai in Bandra selling over Rs. 50,000 per sq feet, then there are most affordable properties like Virar selling at Rs. 4,000 per sq feet. In between there is something for each and every aspiration to own a house.

On this festive season, the icing on the cake for the property buyers is what could be conveniently termed as triple comfort. This is how Swati Prasad describes it when she talks about the better macro-economic outlook, attractive price point and better purchasing power of the homebuyers. According to her, this festive season is much better than the last four years when even those who could afford were pretty apprehensive to make a long commitment like a home purchase.

“With political stability there is better clarity of the way forward for the country which is clearly reflecting in the macro-economic outlook. Personally, I have been on a house hunt in the MMR region and today I can vouchsafe that price point is indeed attractive in many of the markets of Western Suburbs. There is better job stability in sight and that is leading to average working class like me to buy a house. Of course, what better time than on the occasion of Navratra,” says Swati.

Swati is not alone who feels comfort to buy a house in the festive season of Navratra. As a matter of fact, advertising professional Sumedh Varma finds even better reason to buy a house in the Western Suburbs now. He maintains that the Reserve bank of India has also encouraged property purchase this festive season with significant rate cut. More importantly, he maintains that the role of the developers also cannot be undermined, as they are increasingly understanding the wants and needs of the customers and customising their offerings.

“Gone are the days of unwanted freebies and symbolic discounts; today many of the developers in this region are sitting across the table with the homebuyers to understand their point of view, concerns and needs; and they are accordingly customising the offers to suit their budget. This way I think the developers in the Western Suburbs have a better understanding of their core market, compared to other markets. I personally feel that the bookings on this Navratra will be way higher than what we have seen in recent times,” says Varma.

Most of the analysts active in the region agree with the homebuyers in this part of the world. They maintain that since many of the affordable buyers who came to the region as tenants and have been witness to the growth of the area are convinced that the future belongs to the region, they are ready to invest in the region.

Also, despite of the property market turmoil in the last few years, low-cost extended zones of Western Suburbs, like Mira Road, Bhayandar, Vasai, Virar, Nalla Sopara etc have either been witness to the decent growth of prices or have been stagnant, and hence there is less risk to invest in the region.

Moreover, the homebuyers in the Western Suburbs are mostly the working class expat population and they have found employment in the vicinity, this area continues to grow. The infrastructure growth in the region has fuelled the job market of the region; something that gives a facelift to the entire stretch of Western Suburbs. The festive season has only brought the pent-up demand to the fore due to multiple of factors, like the growing economy, lower inflation, interest rate cut, better job prospects and overall anticipation of growth in the future.

The developers on their part know that this is one region where there are land parcels yet available and also there is huge demand; they are also increasingly getting bullish on the region. With many of the large ticket developers operating in the suburbs now, it is quite obvious that the competition brings to the open market not only quality housing but also value addition to the homebuyers.

On the eve of the Navratra 2015, the analysts anticipate better property transactions in the Western Suburbs, compared to any other part of the city. Most of the developers also admit that the sale enquiry prior to the festive season has been four to five times more this year. This is quite striking and definitely suggests that the homebuyers this year will take a plunge. The days of fence sitting in the housing market seems to be over in this part of the world.

The moot point remains as to whether Western Suburbs will be witness to the revival of Mumbai property market. Homebuyers’ optimism suggests so, analysts vouch for it, and the sales enquiry indicates that. The cost & benefit analysis suggests there are more advantages to invest in the region and the festive season is the right time to do so.

Real estate being a business that is largely guided by the sentiments, it is not surprising that the sentiments are bullish to invest in Western Suburbs this festive season. More importantly, even the critics of Mumbai property market are not complaining as property markets of Western Suburbs bridges the gap between emotional urge and rational needs.

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