Tag Archives: Jones Lang LaSalle India

Affordable housing steals the show in 2017

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Bottom Line: After recognizing a massive gap of housing in India, the Union Government had announced ‘Housing for All’ by 2022 in July 2015 to achieve the staggering target of bridging a gap of more 1.9 crore houses.

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Anuj Puri, JLLM, Jones Lang LaSalle Meghraj96% out of these houses are required for the Lower Income Groups (LIG) and Economically Weaker Sections (EWS) groups. In India, while the population is growing at more than 2.1% every year and may touch 1.51 billion by 2030, growth in housing has been unable to keep the same pace.

The Central and States governments are now contemplating many ways and means to provide access to housing for all. Affordable housing will not only fill the housing gap but be the next major economic growth driver by creating more than 2 million jobs during the period till 2022.

To fill the massive gap of affordable housing in India, the government has come up with a spate of many initiatives:

To encourage the PPP (Public Private Partnerships) module which can amplify affordable housing, the Union Budget 2016-17 announced that developers would be exempt from paying tax on profits in this segment for five years starting 2016

The Government has increased the time limit to complete affordable housing projects from 3 to 5 years. Now, developers will have more time to complete affordable projects

The Central Government has raised the budget allocation under Pradhan Mantri Awaas Yojana from INR 15,000 crore in 2016-17 to INR 23,000 crore in 2017-18

The National Housing Bank, which is a subsidiary of RBI, has announced that it will refinance individual housing loans worth INR 20,000 crore in 2017-18

Affordable housing was given the vital infrastructure status in the union Budget 2017-18. Now, developers will have diverse and cheaper sources of funding, including External Commercial Borrowings (ECBs)

Financial Support and Subsidies 

To promote affordable housing, the Government has announced several financial schemes to make housing loans in this segment cheaper:

A 6.5% subsidy on interest on housing loans up to INR 6 lakh can be availed for 15 years

Government assistance of INR 1.5 lakh is extended for each beneficiary under EWS & LIG

A 4% and 3% subsidy on interest for loan amounts of INR 9 lakh and INR 12 lakh respectively

The Government is mulling the waiving Stamp Duty charges and reducing their impact

The middle-income group (MIG) of buyers with annual incomes above INR 6 lakh to INR 18 lakh is also included in the interest subsidy

The affordable price segment dominated the residential units supply in H1 2017. The recent new launches trend shows that demand for affordable housing with ticket sizes in the range from INR 5 lakh to INR 40 lakh is continuously growing. During the 1st half of 2017, the top cities (Bangalore, Chennai, Hyderabad, Mumbai, Delhi-NCR, Pune and Kolkata) recorded more than 60% of total residential units supply in the affordable segment.

The majority of projects in the affordable housing segment were launched in the peripheral boundaries of the top cities, largely due to non-availability of contiguous land parcels for large-scale mass housing developments and skyrocketing property prices in the central locations of our cities.

In H1 2017, the share of the affordable housing segment in new launch supply increased by 16% over the 2nd half of Year 2016. On the other hand, the mid and luxury segments witnessed a decrease of 4% and 9% percent respectively in the same duration.

By: Anuj Puri, Chairman – Anarock Property Consultants

NB Group and BridgeStreet Global Hospitality partners with three developers

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News Point: Global hospitality major enters Indian market for serviced residences; developers sense big business. 

Real Estate Fund, Delhi NCR real estate, Bangalore Real Estate, JLLI, Jones Lang LaSalle India, Track2Media, Track2Realty, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, indianrealtynews.com, indianrealestateforum.com, Property, Track2Media, Track2Realty, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India PropertyJNB Group and BridgeStreet Global Hospitality have forged partnerships with three Indian real estate developers; IDI, AIPL and CHD.  This collaboration will provide quality assurance, marketing and global sales benefits for guests, developers and investors.

With these new partnerships, JNB and BridgeStreet will be co-branding 183 units of IDI in Noida, 100 units of AIPL in Sector 66A, Gurgaon and 364 BHK units of CHD in Sector 106,Gurgaon.

BridgeStreet has already signed with developers like Silverglades, V Square, Homestead and Logix for 1600 units in Delhi and the National Capital Region of India and will have 500 functional units by the end of 2016.

“We plan to have 5000 fully operational units within five years in pan India, adding to the 50,000 BridgeStreet units worldwide,” said Sean Worker, president and CEO of BridgeStreet Global Hospitality.

JNB and BridgeStreet have been working together in India since 2012.  “This collaboration is key to BridgeStreet’s development of franchise and management opportunities, “ said Sean. “We are working together with JNB to build further investment and development projects in India.”

Elaborating about BridgeStreet’s brands, Worker explained, “Our family of brands includes six-star Exclusive, five-star Residences, four-star Mode Aparthotels and Living, three-star Places and two-star Studyo—offering the convenience of apartment living with a variety of service packages to match guest needs based on location, price point and individual preferences. We are looking to replicate the same experience here in India.”

“We feel that the Indian real estate market is one of huge promise as there is little in terms of supply of serviced apartments.  Increasing demand from IT, consulting, banking, financial and automobile sectors will only create more opportunities. What is required is the right branding, quality assurance and on-time delivery. This will not only lead to price appreciation, but will also ensure growth,” says TJ Barring, President, JNB Group.

“Pure commercial and residential projects won’t do well in the coming years, a hybrid version which supports serviced apartments would have a much higher demand,” says Taran Kaur, Director JNB Group. “The benefits of JNB Group and BridgeStreet are regular rental income,  high occupancy,  fully-furnished apartments with contemporary décor, well-equipped kitchens to prepare your own meals, personal service  with 24/7 emergency support, convenient monthly invoice that includes utilities and housekeeping, Internet access and concierge service.”

JLL partners with Snapdeal to market houses online

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JLL launching e-commerce platform for residential real estate

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Affordable luxury—contrasting match or confusing mate?

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Call it contrasting match of the two extreme ends or just the confusing mate living together, but affordable luxury has gained ground in Indian realty, finds Track2Realty.

Real Estate Fund, Delhi NCR real estate, Bangalore Real Estate, JLLI, Jones Lang LaSalle India, Track2Media, Track2Realty, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, indianrealtynews.com, indianrealestateforum.com, Property, Track2Media, Track2Realty, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, indianrealtynews.com, indianrealestateforum.com, Mumbai Real Estate, India Property“Hey you better be clear in mind. You want to go for a luxury apartment or an affordable flat? You cannot get both and are actually getting confused with the two.” Well, most of the Indians would have the same reaction if asked about affordable luxury. Worse even, most of the Indians would rather dismiss it as a marketing gimmick of the developers. However, a few discerning home buyers who are keeping a close track of the emerging trends and concepts in the Indian real estate are today exposed to the fact that affordable luxury too is an emerging reality in the property market.

What was a norm in the tier-II and III cities where the land prices were less, expectations moderate and luxury quotient a way of attracting the residents to switch from plotted developments to apartment culture has today emerged as a project differentiator and USP in many of the periphery locations of the metro cities. Satellite living is thus getting redefined in many of the cities across the country and the buyers are not complaining to travel an extra hour or so if they are compensated with quality living and lifestyle driven homes in exchange.

Explaining the concept Surabhi Arora, Associate Director, Research with Colliers International says that luxury at most times represents one’s ability to use excessive space or an otherwise scarce or expensive resource. Investing in luxury is usually driven by emotional appeal of social esteem. With increasing purchasing power, the concept of luxury is constantly evolving in Indian markets.  She believes the quest for luxury is scaling down the value chain nowadays.

“The demand of luxury projects has been gradually shifting from the social elite to the middle class signifying the huge potential of affordable luxury concept in Indian. To cater this demand developers are coming up with affordable luxury projects which target this growing middle class with increased spending power,” says Arora.

A Harikesh, Senior Vice President, Marketing and Sales, Tata Housing agrees that with the rapid urbanisation and disposable income, the demand for middle income housing is growing rapidly and is all set to expand in the years to come in India. Citing the Cushman & Wakefield report that claims the total new housing demand across India will be nearly 12 million units by 2016, he reminds that the top 8 cities will constitute about 23 percent out of the total demand.

“The growth drivers of this segment are majorly the Millennials. The Millennials are popularly known as Gen Y or Gen Next. This set of consumers is better educated, more tech-savvy and adaptable. They refuse to blindly conform to traditional standards and time honored institutions. With regards to home buying, the Indian Millennials especially newlyweds are forming the modern India as families have double incomes, which is another compelling factor in pushing the purchasing power of this generation. Furthermore, this generation firmly believes in luxury amenities and aspires for a higher standard of living and is therefore creating further demand for affordable luxury,” says Harikesh.

The Cushman & Wakefield report also says that of the total demand in top 8 cities, Middle Income Group (MIG) and Higher Income Group (HIG) categories will constitute majority of the demand at 2.5 million units. Furthermore, the NRI population are also driving this demand for affordable luxury properties in India. According to a survey by Sumansa Exhibitions, the organisers of the Indian Property Show in Dubai, 52.57 per cent of NRIs are looking at settling down in India and want to acquire homes in the mid segment range of Rs. 26-75 lakhs.

Surjit Singh, Marketing President of RNA Corp finds affordable luxury as a bridge between the standard product and the aspiration to the next level, which could be classified as affordable luxury. He asserts that the product is certainly improving in terms of quality, offering and the service.

“To elaborate today developers are focusing on quality aspects of the project, the offering in totality–internal, external and infrastructure and the service. Differentiators are being created along these parameters which may be classified beyond the standard. As far as feasibility of affordable luxury is concerned, the feasibility of any project is a combination of many factors, namely locality, location, project specifics, apartment size & the developers’ credentials,” says Singh.

Rajesh Turakhia, Director, Pashmina Developer endorses the concept of affordable luxury real estate market in India as emerging dynamic segment. He feels with the growing demand for lifestyle living, the new buyers are looking for recreational facilities within their apartment complex. Although there is a rise in the disposable income, a generic mindset is to gain more at a lesser price point. The demand potential for this segment is untapped and massive leading several big brands to enter this segment aggressively.

“Today affordable luxury, is not restricted to only lifestyle living, it extends beyond that to efficiency in planning, minimal wastage of space, and well planned and well fitted apartments coupled with modern amenities. Luxury is no longer associated with large spaces and has translated into a project that offers good planning and set of amenities. If an individual is able to achieve these aspects within the current prevailing market rates or even lower, the project can be termed as an affordable luxurious project,” says Turakhia.

Independent market watchers maintain that India’s housing market is struggling with the dual challenge of slow sales and missing project differentiator. And hence, the quest on part of the developers is to respond to the needs and requirements of the end consumers. It is not uncommon nowadays to see the developers conceptualise a theme with every new project which then gets expanded at every stage of development. It factors in the choice of site architects, planning the project layout, internal planning of the building, construction, and finishing. This approach makes for some of the finest real estate developments.

Moreover, the consumers nowadays are well informed about Indian and global tastes, technologically sound and much flexible in their approach. As the young professionals and well travelled buyers have a very clear idea of what they want, the fringe benefits such as parking space, modular kitchens, swimming pool, gyms, theatre and central air-conditioning is tagged as a necessity; something which was seen as luxury till very recently. This set of home buyers is looking to purchase the dream home which not only reflects the financial but also the social standing of the individual.

The mid segment consumers with global exposure and evolved tastes are today opting for affordable projects with premium facilities. Hence, the real estate developers are coming up with various properties which cater to this segment of buyers. Nevertheless, this segment is still in its nascent stage and will take some time to emerge as a standalone segment within the sector and in the collective consciousness of the buyers. For an outside view, it may continue to baffle for some more time with two seemingly contrasting concepts of affordable and luxury.

JLL closes transaction mandate for upscale hotel in Ahmedabad

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JLL India to offer certificate program in facilities management

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Approximately 22% drop in absorption for office space in Q1 2015 over Q1 2014: CBRE

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Global Real Estate News, Jones Lang LaSalle India, Track2Realty, India real estate news, Indian realty news, Property new, Home, Policy Advocacy, Activism, Mall, Retail, Office space, SEZ, IT/ITeS, Residential, Commercial, Hospitality, Project, Location, Regulation, FDI, Taxation, Investment, Banking, Property Management, Ravi Sinha, Track2Media, Track2RealtyFollowing a particularly strong fourth quarter of 2014, the first quarter of 2015 reported comparatively slow activity on the office market front across leading cities. This apparent demand drop was largely because most corporate space occupiers were still strategizing their real estate plans for the year during the period, with fewer transaction decisions being implemented in the first quarter.

According to CBRE’s India Office Market View for Q1 2015, which reports on the status of Grade A office space across the country’s leading cities, total office space take up in Q1 2015 stood at more than 5 million sq. ft.—a drop of approximately 50% quarter-on-quarter (q-o-q) and a 22% drop year-on-year.

It is also worth noting that a number of corporates pre-committed to office space in leading under construction properties across the metros, which positively supported transaction activity during the quarter. In terms of transaction activities, therefore, it is the forthcoming months and quarters that will see the fruition of stratagems and negotiations made during the first quarter.

Commenting on the findings of the report, Anshuman Magazine, Chairman and Managing Director of CBRE, South Asia said, “Demand for prime office space is expected to pick up in forthcoming months as occupiers implement their business plans across cities. The quantum of pre-commitments made during the first quarter is likely to boost space take up, going forward. An emerging trend likely to gain momentum is that of tier II cities, such as Chennai and Hyderabad, attracting demand for bespoke solutions from large corporate occupiers for their real estate requirements.”

More than 8 million sq. ft. of fresh investment-grade office space was completed across key cities during the quarter, meanwhile, indicating a q-o-q increase of around 4%. In line with trends observed during the second half of 2014, the first three months of the year saw completion of a number of large-sized office projects across the Delhi National Capital Region (NCR), Mumbai, Bangalore, Hyderabad, and Pune. New phases of existing SEZ projects were also completed in Gurgaon.

It was observed during the quarter, that pent up supply delayed from previous quarters had started to exert pressures across markets—particularly in the case of NCR, which led project completions, and contributed to around 53% of the total supply released during the quarter. Bangalore, Hyderabad, Pune and Chennai also reported fresh project completions. A subdued demand climate together with the significant supply addition of new office space led to an increase in vacancy rates in Delhi NCR; while vacancy levels in Mumbai and Bangalore inched downwards.

On the supply front, it is also worth noting that the slippage rate in prominent cities such as Bangalore and Mumbai was particularly high, with more than 80% of the supply that was initially lined up for completion during the first quarter getting pushed further into 2015. This was largely because most of this supply was located in far flung peripheral locations; and occupiers continued to adopt a cautious approach while considering such locations for their future operations.

Industry sectors such as IT/ITeS and banking / financial services are likely to remain the dominant demand drivers for office space, with engineering / manufacturing, e-commerce, telecommunications and pharmaceuticals being the other active sectors driving demand in this real estate space in India.

Rental values remained largely stable across most centralized office locations, with the exception of Bangalore where rentals appreciated by 5–6% q-o-q in core office locations due to strong occupier demand. Sustained occupier interest in well-leased IT and IT SEZ projects also led to a q-o-q rental appreciation of 5–6% across select micro-markets in Gurgaon, Bangalore, Chennai and Pune.

Source: Track2Realty

West Bangalore – A real estate investment snapshot

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By: Srinivasa Reddy, Associate Director – Research & Real Estate Intelligence Services, JLL India

 Srinivasa Reddy JLLI, Jones Lang LaSalle India, IPC, Property consultants, Indian real estate news, Indian realty news, Indian property market, Track2Realty, Track2Media ResearchTrack2Realty: The West Bangalore sub-market covers the areas and projects around Tumkur Road NH-4 towards the Yeshwanthpur and Malleswaram junction, the Rajajinagar Industrial Area, Yeshwantpur, and Tumkur Road and its surroundings (which has a high-density population and has traditionally been the primary industrial hub of the city).

Industrial and commercial profile

  • At present, West Bangalore is surrounded by vacant land parcels and is predominantly an industrial area dominated by warehousing and industrial activities. These industries comprise of large public sector units and various small-scale industries.
  • The area is being promoted as one of the large industrial hubs in the city, especially Peenya Industrial Area (IV Phase III stage) which is home to industries like Parle G, ABB Limited, Bosch, Jindal and Volvo Construction Equipment, to name a few.
  • There are currently no graded major operational commercial/office buildings in the micro-market. The commercial base in West Bangalore has predominantly consisted of government offices, training institutes, small industries and warehouses. Many government offices also have their own residential colonies, for example HMT Colony, Air Force Camp, ITI Training Institute colony, etc.

Residential profile

  • The key residential projects in West Bangalore currently include Temple Bells, Prestige Wellington Park, Gateway, Kensington Garden, Golden Grand, Garrison Vaishnavi Nakshtra, Prince Town, Sobha Aspire and Shoba Elite.
  • Capital values for high-end residential projects range from Rs. 3800–6500./sq.ft. Buyers from the affordable housing matrix in West Bangalore are mainly small business owners and employees working in industries and the services sector.
  • The upcoming areas in West Bangalore include Karivobanahalli, Handrahalli, Laggere, Jalahalli, Hasarghatta, HMT Housing Colony, BHEL Colony, Peenya, Chikkasandra, Nagasandra and Dasarhalli.

The many infrastructure projects that are taking place in the direction of West Bangalore will lead to improved connectivity and increase residential values in the future. The upcoming residential projects there will attract buyers from the immediate surroundings due to improvements in the social infrastructure.

Investment profile

  • As of now, investors and speculators in West Bangalore are still scarce on the ground. This sub-market is growing at a slower pace when compared to other markets of the city, mainly because of its industrial characteristic and also lack of MNC-type commercial activities.
  • There is now a gradual opening up of land for real estate development as small and medium industries that have existed In West Bangalore for a long time are shutting down or relocating.
  • Currently, land values are comparatively low in this part of the city, and this provides a very favourable entry point for long-term investors.

Tips for property investors into West Bangalore

  • This region holds immense potential for further real estate development. Apart from the comparitivelycompetitive land values, many infrastructure projects will benefit this micro-market. These include thePeripheral Ring Road (PRR) which will lead to improved connectivity reduce travel time towards important parts of the city. The commute to Bangalore International Airport (BIAL) from Tumkur Road will be reduced by 50% from current levels once the PRR become operational.
  • There is high possibility of locations between Bangalore West and Tumkur City to be considered for Smart City benefits via the recently proposed 100 Smart Cities programme by the NDA government. Factors that will work in these locations’ favour on this front are availability of land for development and strategic presence between two growing cities.
  • This will lead to short-to-medium for residential assets. Long-term appreciation is assured as West Bangalore strengthens its value proposition as a growth corridor.
  • Investors should look at capitalizing on the West Bangalore housing market for medium-long term gains and maintain a period of 4- 5 years as the minimum investment horizon for affordable to mid-end residential developments.
  • Investments into high-end to luxury residential developments in this micro-market should not be the first option for risk-averse investors at this point of time. This is because the buyers in this sub-market are predominantly employees working industries and the services sector who are looking for affordable to mid-end residential options in the price range of Rs. 3500-4500/sq.ft.

Tracking Ahmedabad real estate in PM Modi’s era

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By: Vivek Sahasrabudhe, Analyst – Research & Real Estate Intelligence Service, JLL India

Vivek Sahasrabudhe, JLLI, Jones Lang LaSalle India, Indian real estate news, Indian realty news, India Property market, Track2Media Research, Track2RealtyTrack2Realty: Over the past couple of months, no other Indian state has been talked about as much in the Indian media as Gujarat. Be it about Narendra Modi, former Chief Minister of Gujarat who is now Prime Minister of the nation or the growth model of the state.

This fast developing province has seen the decade-long efforts start to bear fruit in the area of infrastructure development especially in Ahmedabad, the commercial capital of the state. In recent times, the city has become the symbol of the state’s progress story.

The uninterrupted electricity and water supply, the wider roads and the rapid bus transit system have helped Ahmedabad to cement its position as a manufacturing hub. In the past, despite the city being known for its industries, particularly its textile and pharmaceutical enterprises, it did not create a sector-specific demand for real estate, unlike the IT/ITeS sector did for Bangalore and Pune. Up until recently, the city produced mostly blue-collar jobs and those employed preferred affordable housing, particularly in the unorganised real estate sector.

To attract the participation of the organised real estate sector, affordable and well-connected real estate developments were on the checklist of the Ahmedabad Urban Development Authority. The planning resulted in well-rounded growth as Ahmedabad, unlike other cities, did not have any geographical constraints on expansion. Also, the committee refrained from giving any specific city node an undue advantage, due to which capital value appreciation was held in check for many years!

Nonetheless, in recent quarters, noteworthy growth was registered in residential real estate prices. Residex, the index published by the National Housing Bank covering price movements in urban and semi-urban areas, showed that Ahmedabad residential real estate prices have grown faster than other major Indian cities over the past four quarters.

It is true that current market sentiment has turned positive following the country’s recent general election but physical indicators have played a vital role too. The employment opportunities generated by the industrial/manufacturing segment have contributed most to the evolvement of real estate activity in recent times.

With improved infrastructural facilities, many new manufacturers of automobiles, engineering and instruments have established themselves in the city and existing industries have been expanding their plants, especially on the outskirts of Ahmedabad in Sanand and Changodar. To support the manufacturing hubs, logistics activity has also been growing fast.

Newly generated employment has looked at organised real estate to fulfil its housing needs as prominent developers have been offering small ticket size affordable dwellings in the outskirts of the city.

Another growth driver relates to the fact that Gujarat is part of the Delhi Mumbai Industrial Corridor (DMIC), which is an ambitious project aimed at developing industrial zones. Ahmedabad is anticipated to be an important link in this corridor. The city is expected to create more jobs, attract investment and ultimately generate greater housing needs. There will be no surprise if other cities in Gujarat follow Ahmedabad’s example in the coming years.

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