Mistry to launch real estate fund in Singapore

To unlock Tata Realty investment in IT parks and road projects
The $100 billion Tata group, now headed by real estate and construction baron Cyrus Mistry, plans to float a real estate investment trust or a business trust in Singapore.

The idea is to unlock a closely held subsidiary’s investment in projects such as IT parks, malls and roads already built or under construction assets such as IT parks, malls and road projects.

The subsidiary, Tata Realty & Infrastructure (TRIL), also intends to buy some smaller IT parks in India.

“We plan to float a real estate investment trust (REIT) in Singapore which will pool our completed IT parks… The REIT will helps us unlock capital from built and leased out assets and re-deploy it for infrastructure projects such as the Mumbai trans-harbour link which we have bid for,” a top official of the subsidiary told Financial Chronicle.

For the Mumbai harbour link, TRIL has formed an equal partnership with the Italy-headquartered, ¤8 billion Atlantia, one of the world’s largest operators of motorway infrastructure, and the ¤36.95 billion Vinci of France, a big construction company.

If the consortium manages to win the Mumbai bid, the planned REIT will help fund the equity contribution required for the project without a big cash infusion from Tata Sons, the parent firm.

The IT parks include Chennai’s Ramanujam IT special economic zone (SEZ) which plans a processing zone of 3.5 million sq ft of built-up area and a non-processing zone consisting of Cambridge Green a high-end residential enclave, a retail mall, service apartments and an international convention centre.

In March 2011, the company purchased a 700,000 sq ft greenfield IT park from Kotak India Real Estate Fund I for Rs 525 crore. It also plans to build a 600,000 sq ft IT park in Bangalore.

At the Ramanujam IT city 1.2 million sq ft of space has already been leased out to firms including HCL, Cognizant and TCS. In all 2.8 million sq ft will be ready for occupation by March.

Besides, the company plans to build mixed-use 1.3 million sq ft of space for retail and residential use, the Tata Centre in Bangalore, and is in the process of acquiring three toll road projects at a cost of Rs 600 crore.

“We are evaluating whether to float an REIT or a business trust in Singapore. A business trust will allow us to have a mix of both completed and leased assets as well as under development assets. An REIT can only be for completed assets such as toll roads and leased office space,” said the TRIL official.

If the company goes in for a business trust it could potentially fold in its 700,000 sq ft Trilium mall in Amritsar; the under construction Tritvam residential complex in Kochi and Capital Height, its 10 acre integrated residential and retail complex.

It also plans to pool in its subsidiary TRIL Roads that has been awarded the Rs 1,371 crore project of four-laning a 110 km stretch of the Pune-Solapur highway.

“We will take a call on which of the two routes to adopt depending on the valuation and advice from merchant bankers,” said the TRIL official. The business trust will target investors who are keen to have a rental base and a development play that generates capital appreciation albeit at a slightly higher risk of project execution.

The REIT, on the other hand, will target investors such as sovereign wealth funds and pension funds interested in a steady rental income.

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India realty sector to get $4-5 b investments

India’s realty sector is set for inflows of $ 4 to 5 billion from global investors in the next couple of years, with Bangalore, Delhi and Mumbai emerging as favourites, according to the  Asia Pacific CEO of global real estate consultancy firm Jones Lang LaSalle (JLL).

“The early foreign investors in India, who came in around 2006-07, did not have very good experience, partly because of their inexperience in doing business in India and partly because of global financial crisis,” Alastair Hughes said at the World Economic Forum (WEF) Annual Meeting.

They don’t seem to be perturbed by it as India’s growth rate is still an attraction, according to him. “Foreign investors are now looking with a renewed interest at India, given its still robust economic growth rate as that bodes well for good returns to their investments,” Hughes said.

He  added that there is more international money today waiting to be invested in India than any of the last five years. Overseas investors have invested $ 14 billion into the Indian real estate sector over the period from 2006 to 2012.

In the last two years, foreign investment into Indian real estate has been around $ 1.2 billion per annum.

Around half of all transactions were invested in residential property, a quarter in the offices sector and the remaining quarter was split among other sectors.

According to him,  2013 and 2014 look more promising from an investment standpoint and the realty sector would get about $ $ 4-5 billion, mainly to buy income yielding SEZ assets at a capitalisation rate of 10.75 per cent.  Globally, Hughes said, there was a boom in 2007, followed by a bust in 2008, in the realty sector, while there has been a gradual recovery since the end of 2009.

Investments into Asia Pacific commercial real estate market fell around 10 per cent in 2012, from $ 98 billion to about $ 92 billion. “It was because of a sense of caution prevailing in different countries. But now we are seeing a change in the sentiments,” he said.

“One of the reasons for that is people looking to divert their investments from bonds to equities and other asset classes and that include real estate. Therefore more money is coming to real estate and a bigger proportion of that we see coming to Asia Pacific,” he added.

He said that in the retail sector, a very high growth is expected with the (likely) entry of foreign retailers.

Besides, manufacturing and industrial sector would also benefit a lot as retailers would need to set up logistics facilities. The residential space is also set for growth, he added.

Mumbai, Kolkata top in adding new homes in 2012: Report

At a time when the real-estate sector across the country is witnessing a slowdown, Kolkata, Mumbai and Pune recorded significant growth in new residential units, in 2012.

According to study released by real estate consultants Cushman & Wakefield, the total new units launched across eight cities went down by approximately 16 per cent (to 162,000 units) in 2012 when compared to 2011.

Mumbai, Pune and Kolkata were the exceptions with 72 per cent, 34 per cent and 19 per cent increase.

The study was carried out across eight cities — Delhi & NCR, Ahmedabad, Bangalore, Hyderabad, Chennai, Mumbai, Pune, and Kolkata.

While Bangalore saw the highest decline of nearly 50 per cent (16,543 units), Mumbai witnessed the maximum growth of 72 per cent (22,423 units).

Of the total number of units launched, majority were in the mid-end segment, which comprised approximately 83 per cent of the total launches.

According to the report, a total of 8,900 units were launched in Kolkata in 2012.

Nearly, 62 per cent of these units were in the mid-end segment (5,535 units) and priced between Rs 36 lakh and Rs 60 lakh. This was followed by the high-end segment, priced upwards Rs 60 lakh, which accounted for another 38 per cent of the launches.

On a year-on-year basis, supply of mid-level homes increased by 26 per cent to 5,535 (from 4,372). Similarly, high-end home launches too increased to 3,360 units – 17 per cent up from the 2,863 units launched in 2011.

Interestingly, supply of luxury homes dipped drastically in 2012. The number of units launched dipped from 280 (2011) to just 23 (2012) — a near 92 per cent fall.

“Cash-strapped developers were not willing to take up projects that may fall short in interest from end users, thereby keeping their risk exposure minimum,” Sanjay Dutt, Executive Managing Director, South Asia, Cushman & Wakefield says.

According to the report, the short term outlook of the city suggests a cautious approach by end-users in the wake of high home loan rates coupled with inflation.

13 insights for India real estate in 2013

The year 2012 closed with a few notes of positivity as the inflation was below the Reserve Bank of India’s (RBI’s) projected levels and the Index of Industrial Production (IIP) growth increased in the last two months of the year, giving new hopes for 2013.

Overall, 2012 remained inactive, affecting all the major sectors in real estate. Office space absorption remained lower compared with 2011. Meanwhile, retail faced challenges of quality supply, affecting the overall absorption. The residential demand improved; however, developers continued to struggle with unsold inventories. With the expected moderation in inflation and strengthening policies, we have gathered few interesting insights for 2013 from real estate experts.

1. Economy – As per RBI, the policies will focus towards growth in 2013, although risks of inflation will continue to remain. Interest rates are expected to witness a downward correction of 100 to 150 bps in 2013. The softening of interest rates is expected to reduce the home loan rates, in turn increasing the buying of real estate assets. Increasing urbanisation and consumption despite the slowdown in GDP growth will be the key drivers of the economy in 2013.

2. Policies – The recent policy initiatives are expected to improve the investment climate and business environment, and they are likely to benefit the real estate sector in 2013. Few policies to look at in 2013 are: the Real Estate Regulation Bill, likely to be tabled in the upcoming winter session of the parliament; the real estate investment trusts (REITs) or real estate mutual funds (REMFs), expected to get launched in 2013; and the Land Acquisition and Rehabilitation and Resettlement Bill, likely to be tabled in the upcoming budget session in 2013.

3. Infrastructure – The infrastructure sector achieved a substantial FDI of USD 2.8 billion, accounting for a notable 7.7% of the total FDI inflow in FY 2012. In the year 2013, the relaxation of FDI policies in multi-brand retail is expected to surge the investment in back-end infrastructure development such as logistics. Moreover, an FDI of up to 100% is also permitted under the automatic route in built-up infrastructure and is likely to surge the development of the city and the regional level infrastructure in 2013.

4. Office Real Estate – Office space absorption in 2013 is likely to remain equal to that in 2012. Supply correction will lead to fewer options for occupiers, and steady absorption will decrease vacancy levels. Competition for space in prime buildings in prime locations is expected to increase in 2013, and these spaces will start earning a premium. Rents are expected to increase from 2H13 onwards as fewer new projects are being launched, and vacant spaces are steadily filling up. Decisions on occupying special economic zone (SEZ) spaces will be taken by occupiers who are sure of taking a position in India as they have to go live by March 2014 to avail the benefits.

5. Retail Real Estate – The relaxation in FDI policies in multi-brand retail interestingly has surged aggressive growth amongst Indian retailers to take the first-mover advantage. This is expected to drive the demand in 2013. However, as supply of retail malls remains a challenge, retailers are likely to opt for built-to-suit (BTS) options or high-street properties. As most developers are focusing on residential developments, the supply of malls will reduce in the major cities over the year. In 2013, retailers will be cautious and take more time to execute agreements as they will do a detailed analysis before closing transactions. Retailers will commit to space only if they see approvals in place and the construction of the space in progress.

6. Residential Real Estate – REITs in India allowing investments in rental housing is a new trend worth watching. The framework and details of REITs, once formulated, are likely to drive the investor demand across the prime cities in India in 2013. Another interesting trend observed in the last two years was that the stock in the range of INR 2,000-3,000 per sq ft was fast sold out. In 2013, this range is likely to shift to INR 3,000-5,000 per sq ft with the increase in inflation and construction costs.

7. Industrial Real Estate – Sale-cum-leaseback of exiting industrial assets by existing companies is likely to increase in 2013. MNCs testing the waters in India are likely to focus on BTS industrial properties. Warehousing companies are now preparing for the goods and services taxes (GST) and are slowly moving from godowns to distribution centres. The growing trend in e-retailing and FDI in multi-brand retail is expected to surge the demand for warehousing spaces in 2013.

8. Education and Health Care – There are aggressive growth plans in K-12 and skill-space educational institutions in 2013, particularly in the non-metro cities of India, where there are large opportunities. In the health care segment, hospital chains, along with day care centres, are expected to expand aggressively in 2013. Both these segments are expected to attract private equity investment in 2013.

9. Investment Sentiments – Debt capital is likely to increase in 2013. Banks are expected to be more flexible in lending. Most of the realty funds are close to their exit periods as they were invested around 2006-2007. Therefore, the exit of real estate funds is expected to increase in 2013. Meanwhile, interest on income-producing assets by institutional investors is likely to increase over the year. However, the availability of such assets will continue to remain a challenge. Assets will witness a softening of yield rates amidst increased liquidity.

10. Delhi – Most of the absorption in Delhi NCR is likely to focus around Gurgaon and Noida, with the exception of Delhi International Airport Limited (DIAL) and few select stand-alone Grade A projects of Delhi. As the demand supply gap of quality office space is expected to increase because of the supply constraints in select precincts of Delhi NCR, rents are expected to increase in certain micro-markets by 2H13. Developers will focus on delivery of the products.

11. Mumbai – Office absorption and residential demand will continue to increase in Mumbai. The trend of completion of highquality new office projects pushing up Grade A office vacancy levels and providing tenants with greater bargaining power will reduce in 2013. With banks drastically reducing lending activities over the last two years, resulting in debt remaining a constraint, not much of new  commercial supply (except spill over from 2012) is expected to be completed in 2013 and 2014. Residential launches are expected to increase; however, price drop is unlikely to happen over the year. Amidst constrained supply of quality retail malls, rental gap between Grade A malls and Grade B malls will further widen in the year.

12. Bangalore – In terms of office space, Outer Ring Road will continue to be the sought-after destination in 2013. For residential real estate, North Bangalore is expected to continue to remain as the best performing region in the city with strong infrastructure development, increased demand and price appreciation in 2013. Meanwhile, Whitefield will continue to retain its sheen for both office and residential real estate because of affordability, proximity to key work places and good social infrastructure.

13. Other Cities – Chennai, which witnessed a historical high number of residential launches in 2012, is likely to slow down in 2013. This trend is also expected in Pune. Meanwhile, Kolkata and Hyderabad are likely to witness increased launches. Prices of residential units are likely to increase in all the cities because of the increased construction costs. Ahmedabad, Bhubaneswar Kochi and Coimbatore are other cities in India that are likely to witness immense development activities in 2013.

Carlson Rezidor looking to open mid-market hotels

The Carlson Rezidor’s first Radisson Blu Plaza Hotel in Banjara Hills, Hyderabad

After Carlson Rezidor Hotel Group formed a joint venture with Bestech Hospitalities to develop Park Inn hotels in north and central India, the company is looking at similar alliances in the south, west and east.

Last year, Carlson Rezidor Hotel had sealed a strategic deal with Bestech to develop a network of 49 ‘Park Inn by Radisson’ hotels in north and central India by 2024. The alliance partners had decided to jointly invest $42 million to develop the first two hotels at Gurgaon and Mohali.

Simon C. Barlow, President-Asia Pacific, Carlson Rezidor Hotel Group, said: “We are looking to put in seed funding to create an investment vehicle that will build multiple hotels for the Southern, Western and Eastern regions, and strike strategic alliances with partners, just as we did for the North and Central regions.”

SCOUTING FOR ALLIANCES

He said these alliances would also be for the Park Inn Hotel brands that the company believed would drive growth. “Gone are the days when hotels could charge inflated room tariffs. The name of the game is to build and run hotels more efficiently that give good returns on investment for developers,” Barlow said about his company’s focus on the mid-market opportunity in India.

The hotel chain plans to touch the 100-hotel mark by 2015. “Despite various economic and regulatory challenges, we have been constantly delivering. We opened 13 hotels in 2012, as planned. In 2013, too, we expect to open about 13 hotels under all our brands,” said Barlow. These 13 properties will come up at locations that include Mumbai, New Delhi, Mysore, Bhatinda, Gurgaon, Jaipur, Udaipur and Guwahati. The company runs brands that include Radisson, Radisson Blu, Park Inn, Park Plaza and Country Inn & Suites. It operates 63 hotels. The last 12-18 months have been challenging for the hotel industry with a funds crunch in the real estate sector as well as delays in getting permissions for hotels.

Asked if the company had plans to bring in its Hotel Missoni brand to India, Barlow said: “Missoni is a fashion brand and our strategy is to take this brand to some key city centres and resort locations in India. We see potential for the brand in New Delhi and Mumbai.”

The Hotel Missoni brand has been developed in partnership with the Italian fashion house of the same name.

JLL Makes India Property Predictions for 2013

According to global real estate consulting firm Jones Lang LaSalle (JLL), India’s property markets closed 2012 with a few notes of positivity as the inflation was below the Reserve Bank of India’s (RBI’s) projected levels and the Index of Industrial Production (IIP) growth increased in the last two months of the year, giving new hopes for 2013. Overall, 2012 remained inactive, affecting all the major sectors in real estate.

Office space absorption remained lower compared with 2011. Meanwhile, retail faced challenges of quality supply, affecting the overall absorption.

The residential demand improved; however, developers continued to struggle with unsold inventories, yet expect moderation in inflation and strengthening policies.

jll-asia-pacific-report-chart-2.jpg

Below are 13 interesting India property and market insights for 2013 from various Jones Lang LaSalle India analysts.

1. Economy – As per RBI, the policies will focus towards growth in 2013, although risks of inflation will continue to remain. Interest rates are expected to witness a downward correction of 100 to 150 bps in 2013.The softening of interest rates is expected to reduce the home loan rates, in turn increasing the buying of real estate assets. Increasing urbanisation and consumption despite the slowdown in GDP growth will be the key drivers of the economy in 2013.

2. Policies – The recent policy initiatives are expected to improve the investment climate and business environment, and they are likely to benefit the real estate sector in 2013. Few policies to look at in 2013 are: the Real Estate Regulation Bill, likely to be tabled in the upcoming winter session of the parliament; the real estate investment trusts (REITs) or real estate mutual funds (REMFs), expected to get launched in 2013; and the Land Acquisition and Rehabilitation and Resettlement Bill, likely to be tabled in the upcoming budget session in 2013.

3. Infrastructure
 – The infrastructure sector achieved a substantial FDI of USD 2.8 billion, accounting for a notable 7.7% of the total FDI inflow in FY 2012. In the year 2013, the relaxation of FDI policies in multi-brand retail is expected to surge the investment in back-end infrastructure development such as logistics. Moreover, an FDI of up to 100% is also permitted under the automatic route in built-up infrastructure and is likely to surge the development of the city and the regional level infrastructure in 2013.

4. Office Real Estate
 – Office space absorption in 2013 is likely to remain equal to that in 2012. Supply correction will lead to fewer options for occupiers, and steady absorption will decrease vacancy levels. Competition for space in prime buildings in prime locations is expected to increase in 2013, and these spaces will start earning a premium. Rents are expected to increase from 2H13 onwards as fewer new projects are being launched, and vacant spaces are steadily filling up. Decisions on occupying special economic zone (SEZ) spaces will be taken by occupiers who are sure of taking a position in India as they have to go live by March 2014 to avail the benefits.

5. Retail Real Estate
 – The relaxation in FDI policies in multi-brand retail interestingly has surged aggressive growth amongst Indian retailers to take the first-mover advantage. This is expected to drive the demand in 2013. However, as supply of retail malls remains a challenge, retailers are likely to opt for built-to-suit (BTS) options or high-street properties. As most developers are focusing on residential developments, the supply of malls will reduce in the major cities over the year. In 2013, retailers will be cautious and take more time to execute agreements as they will do a detailed analysis before closing transactions. Retailers will commit to space only if they see approvals in place and the construction of the space in progress.

6. Residential Real Estate
 – REITs in India allowing investments in rental housing is a new trend worth watching. The framework and details of REITs, once formulated, are likely to drive the investor demand across the prime cities in India in 2013. Another interesting trend observed in the last two years was that the stock in the range of INR 2,000-3,000 per sq ft was fast sold out. In 2013, this range is likely to shift to INR 3,000-5,000 per sq ft with the increase in inflation and construction costs.

7. Industrial Real Estate
 – Sale and leaseback of exiting industrial assets by existing companies is likely to increase in 2013. MNCs testing the waters in India are likely to focus on BTS industrial properties. Warehousing companies are now preparing for the goods and services taxes (GST) and are slowly moving from go-downs to distribution centers. The growing trend in e-retailing and FDI in multi-brand retail is expected to surge the demand for warehousing spaces in 2013.

8. Education and Health Care – There are aggressive growth plans in K-12 and skill-space educational institutions in 2013, particularly in the non-metro cities of India, where there are large opportunities. In the health care segment, hospital chains, along with day care centers, are expected to expand aggressively in 2013. Both these segments are expected to attract private equity investment in 2013.

9. Investment sentiments
 – Debt capital is likely to increase in 2013. Banks are expected to be more flexible in lending. Most of the realty funds are close to their exit periods as they were invested around 2006-2007. Therefore, the exit of real estate funds is expected to increase in 2013. Meanwhile, interest on income-producing assets by institutional investors is likely to increase over the year. However, the availability of such assets will continue to remain a challenge. Assets will witness a softening of yield rates amidst increased liquidity.

10. Delhi
 – Most of the absorption in Delhi NCR is likely to focus around Gurgaon and Noida, with the exception of Delhi International Airport Limited (DIAL) and few select stand-alone Grade A projects of Delhi. As the demand supply gap of quality office space is expected to increase because of the supply constraints in select precincts of Delhi NCR, rents are expected to increase in certain micromarkets by 2H13. Developers will focus on delivery of the products.

11. Mumbai
 – Office absorption and residential demand will continue to increase in Mumbai. The trend of completion of high-quality new office projects pushing up Grade A office vacancy levels and providing tenants with greater bargaining power will reduce in 2013. With banks drastically reducing lending activities over the last two years, resulting in debt remaining a constraint, not much of new commercial supply (except spillover from 2012) is expected to be completed in 2013 and 2014. Residential launches are expected to increase; however, price drop is unlikely to happen over the year. Amidst constrained supply of quality retail malls, rental gap between Grade A malls and Grade B malls will further widen in the year.

12. Bangalore
 – In terms of office space, Outer Ring Road will continue to be the sought-after destination in 2013. For residential real estate, North Bangalore is expected to continue to remain as the best performing region in the city with strong infrastructure development, increased demand and price appreciation in 2013. Meanwhile, Whitefield will continue to retain its sheen for both office and residential real estate because of affordability, proximity to key work places and good social infrastructure.

13. Other Cities – Chennai, which witnessed a historical high number of residential launches in 2012, is likely to slow down in 2013. This trend is also expected in Pune. Meanwhile, Kolkata and Hyderabad are likely to witness increased launches. Prices of residential units are likely to increase in all the cities because of the increased construction costs. Ahmedabad, Bhubaneswar Kochi and Coimbatore are other cities in India that are likely to witness immense development activities in 2013.

Places you can buy a house in 2013 and gain from price appreciation

If you are looking to buy a house for investment in 2013 and are not sure where you can earn the best returns , don’t worry. We bring you what experts say about real estate destinations that will give good returns over the next three-five years.

New Ground

In the last couple of years, the real estate market has changed remarkably in both metro cities and small towns. Prices have crossed the peaks reached before the 2008 economic slowdown.

However, in 2012, the companies grappled with economic uncertainty, low demand, fund crunch and high inflation. “High inflation and interest rates dealt a double blow to developers by increasing input and debt costs. Sales fell as buyers became wary of rising interest rates,” says Shveta Jain, executive director, residential services, Cushman & Wakefield (C&W) India, a property consultancy firm.

Still, the mid-end residential segment continued to generate buyer interest. This, and increase in prices of raw materials, pushed up prices in most cities.

Realtors will grapple with a lot of inventory and debt in 2013, say experts. “In 2013, developers will price projects more judiciously and offer a lot more pre-launch benefits. Those with large projects and inventory will be under more pressure to give discounts,” says Anuj Puri, chairman and country head, Jones Lang LaSalle India, a property consultancy.

The Union Budget can also be a milestone as the sector looks forward to big policy decisions and reforms, including the grant of industry status.

DELHI-NCR

The Delhi-NCR is the favourite of property consultants. With massive infrastructure works in the pipeline, locations such as Dwarka Expressway, Noida Extension and New Gurgaon are likely to attract a lot of buyers-both investors and end-users.

“The market, once driven by investors, has slowly shifted towards end-users, as the former’s cash position worsens and end-users step in to capitalise on low prices,” says Aniruddh Wahal, co-head, occupier services, DTZ India, a real estate consultancy.

Dwarka Expressway:

Since 2009, developers have started residential development along the upcoming Dwarka Expressway, an eight-lane expressway that will provide an alternative link between Delhi (Dwarka) and Gurgaon. New projects, expected to be ready by 2015, cater to the middle and high-end segments.

“Its proximity to the capital city and the international airport gives it an edge over other emerging destinations such as Noida-Greater Noida Expressway, Yamuna Expressway, Bhiwadi and Dharuhera,” says Wahal.

The area is divided into two parts-the northern region on the side of Dwarka and the southern region closer to Gurgaon. The north (Sectors 103, 106, 109-113) is expected to surpass the south in returns due to proximity to Dwarka and the international airport.

DTZ India says prices in the region will go up by 25-30 per cent per year over the next five years. Knight Frank has forecast an annual return of 16 per cent during the period.

Noida Extension:

Though developers recognise Noida Extension as a separate location, it comprises Sectors 1, 2, 4, 16B, 16C, 16D and Knowledge Park V of Greater Noida. It is close to Noida (10km from Noida City Centre) and 18km from Connaught Place, New Delhi’s prime business location. A proposed metro rail link will improve connectivity between Noida and Delhi.

“It is the most attractive location in the NCR for affordable housing and is expected to see yearly growth of 15-20 per cent in the next five years,” says DTZ’s Wahal. Knight Frank says properties in Noida Extension will give an annual return of 16 per cent over the next few years.

 

Quote:With options ranging from Rs 3,200-15,000 per sq ft and returns of 18-30%, residential real estate looks promising over the next five years.

SAMANTAK DAS Director, Research & Advisory Services, Knight Frank India

Greater Noida:
Situated around 40km from the south-eastern part of New Delhi, Greater Noida is emerging as an industrial region and an educational hub.

It has good infrastructure and is home to several big companies. It is connected to Noida by a six-lane highway operational since 2002. You can drive from Noida to Greater Noida in 15-20 minutes. The Yamuna Expressway, which has also become a property hotspot, connects it with Agra via Mathura. A metro link will connect it with Noida, Ghaziabad and New Delhi.

Greater Noida is an attractive location for mid- and high-end residential segments. “Though there was not much activity in last 15-17 months due to land acquisition and master plan issues, things are expected to pick up. The area may witness a year-on-year price increase of 20-25 per cent,” says Wahal.

MUMBAI

The Mumbai market was subdued in 2012 with prices rising just 2-7 per cent. The demand is expected to pick up in 2013, mainly in the mid-end segment. The eastern suburbs of Mumbai (mainly Chembur, Kurla and Wadala) are expected to provide good returns on account of lower prices compared with areas in central Mumbai and western suburbs.

Ulwe:

Ulwe is an emerging location south of the Panvel creek. It is connected with the Uran Road that connects it with the Thane-Belapur Road as well as the JNPT Road to Jawaharlal Nehru Port. While Ulwe is just 7km from Belapur, a commercial hub, five other office destinations are within the 22km radius. Once the Nerul-Seawood-Uran rail network is ready, Ulwe will be connected with major office locations through a mass rapid transport system. At Rs 4,000 per square foot, one can buy a one-bedroom flat here for Rs 20 lakh. Ulwe is the most attractive destination in the Knight Frank report, which says it may give an annual return of 20 per cent in the next five years.

Quote: In 2013, developers with large projects and inventory will be under more pressure to give discounts than those with smaller projects and limited inventory.

ANUJ PURI Chairman and Country Head, Jones Lang LaSalle India

Chembur:

Located in the Mumbai Metropolitan Region’s central zone, Chembur’s proximity to the Bandra-Kurla Complex and other office destinations will fuel demand for residential properties here, say experts.

The upcoming rail, metro and road networks such as the Eastern Freeway, the Santacruz Chembur Link Road and the Chembur-Wadala-Jacob monorail will boost connectivity to the area.

Limited land availability will limit new construction and keep supply under control here.

Knight Frank says prices here are expected to rise from the current Rs 12,000 per square foot to Rs 27,000 per square foot by 2017. This comes to an annual return of 18 per cent.

Wadala:

Strategically located in the MMR’s central zone, Wadala is at a comfortable distance from the MMR’s main employment centres. The Eastern Expressway connects it with other regions of the central zone as well as business hubs in the island city. It is also connected through the suburban train network. It will also benefit from the under-construction Chembur-Wadala-Jacob monorail project as the Wadala-Chembur part is expected to be ready in 2013.

The regional development authority’s plan to develop Wadala on the lines of the Bandra-Kurla Complex may add to its appeal. Knight Frank says the area may give an annual return of 18 per cent over the next five years.

 

BANGALORE

This information technology (IT) hub saw steady sales in 2012, prompting developers to launch new projects. Prices in under-construction projects in growing submarkets have risen by 10-30 per cent in the past one year.

“The demand for houses is expected to remain stable or grow moderately in 2013,” says Wahal.

Bangalore is expected to offer an annual return of 15 per cent over the next five years.

“The city is the lowest in terms of capital values (compared with Delhi and Mumbai) and has seen moderate price appreciation,” says Jain of C&W.

The international airport and other infrastructure projects have shifted momentum towards the northern and eastern regions.

Kanakpura, Sarjapur Road, Bannerghatta Road, JP Nagar, Jaya Nagar, Whitefield, Varthur, Mahadevapura, CV Raman Nagar, Uttarahalli, KR Puram and Electronic City have emerged as the city’s main residential markets.

Hebbal:

The Bangalore international airport has made Hebbal an important destination. It has also emerged as an IT hub with several technology parks and companies.

Quote: In 2013, the demand for residential units in the top eight cities is expected to be 3.3-3.5 lakh as against the supply of 2.2-2.3 lakh units.

SHVETA JAIN Executive Director, Residential Services, Cushman & Wakefield India

KR Puram:

Closeness to the IT hub of Whitefield and Manyata Tech Park makes it a desired residential destination for IT professionals. KR Puram is located on the National Highway 75. The Baiyappanahalli metro station is just 3km away. The proposed Peripheral Ring Road and widening of the Old Madras Road will improve connectivity.