Track2Realty Exclusive: Slow economic growth affecting housing market
The recent Indian economic growth has been hampered by several domestic and global factors, resulting in the GDP growth plunging to 3 years low at 5.3% in 2QFY13[1]. Factors such as weak global economy, high interest rates, high inflation, high fiscal deficit, and lack of reforms were the primary reason affecting the GDP growth.
Track2Realty Exclusive-Yearly Analysis: The unprecedented restructuring of project portfolio, selling of land bank, exiting non-core business and the job cuts have yet not led the Indian real estate into the desired comfort zone. The realization to shed the flab has on the contrary left some of the developers to outsource the project execution and pay more.
Track2Realty Exclusive Yearly Analysis: Experts say there are liquidity concerns…
Track2Realty Exclusive-Yearly Analysis:During the boom, many developers dreamt of transforming the urban landscape with millions of square feet of homes, offices and malls and set off on an aggressive expansion financed with debt that at 6 per cent interest was cheap by Indian standards. When the going was good, they went overboard with over ambitious big-ticket projects in various cities, many of which still remain stalled.
Track2Realty: Cushman & Wakefield has expanded into the Philippines with a new office in Manila, its 5th new office in Asia Pacific so far in 2012.
Track2Realty: Office space absorption witnessed a 14% q-o-q decline during the 3rd quarter of 2012, according to the findings of CBRE’s latest report, India Office Market View Q3, 2012. Prime office space absorption across the 7 key cities reviewed decreased to about 6 million sq ft in the third quarter, compared to more than 7 million sq ft in the previous quarter.
Leasing of prime office space across key cities in India witnessed an increase in the second quarter of 2012 with over 7 million sq.ft. of office space being absorbed across key cities.
The office market is likely to observe steady demand, especially in prime locations in leading cities like NCR, Mumbai and Bengaluru.
Replicating global trends, the Indian economy is looking towards an impending slowdown in growth due to decline in consumption expenditure, repeated hikes in interest rates and consistently high inflation.
With slowdown signs looming large over the Indian economy, the effect on the job market and its subsequent effect on office space is getting visible now.