Download - Pune Realestate Report
PUNE RESIDENTIAL REAL ESTATE REPORT
ASK group has a heritage dating back to 1983. It is a diversified Financial Services group renowned for its strong research infrastructure and investment advice. Our group is accredited with having launched the Portfolio Management Services (PMS) in India.
Our group, which pioneered the concept of equity research in India, is today a leader in the areas of portfolio management and investment advisory services and manages the portfolios of some of the most affluent families in India. With two and half decades of presence in capital markets, ASK group has been a true believer in the India growth story and over the years has grown hand-in-hand with its clients across the globe. Integrity, Reputation & Relationship with clients are the critical pillars on which the group has based its foundation. These values testify a distinctive corporate culture.
ASK group manages assets of more than US $1 Bn for its clients in Equity PMS, Wealth Advisory and Real Estate PMS.
ASK Property Investment Advisors (ASK PIA) is a venture of the ASK group set up to manage and advise real estate dedicated funds. This initiative of the group rests on the backbone of extensive investment and asset management expertise backed by a strong research focus. The real estate team has over ten decades of cumulative experience and comprises some of the best professionals with risk management, corporate lending, real estate advisory, construction and asset management experience.
ASK Property Investment Advisors
AAbout ASK Group
Funds Under Management:
ASK Group had raised US$ 75 mn (Rs 3260 Million) under tough
market conditions (March 2009-December 2009) and has
committed 90% till date. The capital has been committed in seven
residential projects covering four cities- National Capital Region
(NCR), Pune, Bangalore and Chennai.
ASK Real Estate Special Opportunities Fund has so far raised
Rs. 625 crore ($125 million) for its second real estate fund and is
targeting Rs 1,000 crore by March 2012.
ASKPIA has also announced its first investment in Mumbai from
its second real estate fund.
Pune Residential Real Estate
December, 2011
Key conclusionsŸ
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Pune’s population has seen a gradual shift
towards higher proportion of Service
professionals
Improving income profile driven by IT,ITES, Bio-
Technology & Engineering to improve
affordability
Annual requirement of houses to remain in the
range of 45,000-55,000 per year over next two
years
Real estate prices expected to remain
firm/marginally rise with low vacancy levels and
steady absorption trends
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Indian Real Estate Sector – An Overview
Pune
Demographic and economic profile
Housing demand estimation and outlook
Supply situation and pricing outlook
Micro – market wise analysis
North-East region
North-West region
South-East region
South-West region
Pune Central region
Upcoming Supply trends
IIndex
Indian Real Estate scenario
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Investments in Real Estate led to higher growth rate as compared to overall GDP
FDI in Real estate led to strong inflow providing additional funds to developers; however FDI flows showed signs of slowdown during 2010-11
High GDP growth led to rising incomes during 2002-03 to 2007-08, however recovery post 2008 global financial crisis has been anemic
RReal estate GDP grew at higher pace than overall GDP
Note 1 includes Real estate, ownership of dwellings & business services Real estate GDP growth for 09-10, 10-11 are estimated based on GDP growth QE- Quick Estimates, RE-Revised EstimatesSource: MOSPI (Ministry of statistics and programme implementation)
Note : Annual data is for financial year (Apr-Mar)Source: Department of Industrial Policy & Promotion, RBI
Real estate GDP growth higher than overall GDP
5.8
3.8
8.5
7.5
9.5 9.69.3
6.8
8.0
8.5
5.95.4
8.38.6
10.810.1 10.5
7.1
8.4
8.9
3.0
5.0
7.0
9.0
11.0
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 (QE)
2010-11 (RE)
per
cen
t
GDP at constant prices Real estate GDP 1
Rising FDI equity investment in Housing and Real Estate
16,000
14,000
12,000
30,000
8,000
6,000
4,000
2,000
Rs. crore
2,121
8,749
12,62113,586
5,149
2006-07 2007-08 2008-09 2009-10 2010-11 2011 (Apr-Sept)
2,043
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Housing loan grew at CAGR of 75% during 2002-03 to 2005-06; Rising real estate prices, interest rates and economic slowdown led to
decline in subsequent years with recovery starting from 2009-10
Growth in residential demand (end user and investment) led to sharp rise in real estate prices
SStrong demand led to high loan disbursal and rise in prices
Trend in Housing loans Trend in Residential Real estate prices
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Rs. crore
Note: Data relates to select 47 banks accounting for 95% of total non-food credit given by all scheduled commercial banksSource: RBI annual reports
Note: H1: Jan-Jun; H2: Jul-Dec; Q1: Jan-Mar; Q2: Apr-Jun; Q3: Jul-Sep; Q4: Oct-DecSource: National Housing Bank - Price Index
Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 (Apr-Oct) 2011
Mar-11
0
50
100
150
200
250
300
Index
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Ÿ Draft Real Estate (Regulation and development) Bill 2011 introduced for suggestions
Ÿ The Land Acquisition, Rehabilitation and Resettlment Bill introduced in 2011
Regulatory measures introduced by RBI since November 2010 and National Housing Bank in 2011:
Cap on LTV (Loan to Value) to 80%
Increase in risk weight for loans more that Rs.75 Lacs to 125% : Higher provisioning is likely to lower further loan disbursement
Increased Standard asset provisioning to 2% for teaser loans
Increased provisioning from 1 to 2 percent with respect to Real estate loans
NHB has raised the provisioning requirement for doubtful assets up to 100% & asked to set aside 0.4% of the total outstanding "standard"
loans as a buffer
Public sector banks have been given a strong message from the regulator after the recent exposure of a scam between an intermediary and
public sector housing finance company
Increase in Minimum Capital Adequacy ratio for deposit-taking non-banking financial companies (NBFCs) from 12 per cent to 15 per cent
Focus on monitoring of end-use of funds given to the developers
Home loan for the third house to be treated as commercial property
To attract higher risk weight of 100% compared to 50% for residential real estate
CCurrent Scenario…. Regulatory Changes
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Planning Commission expects India’s GDP growth of 8.5-8.7
per cent during the 12th Five Year Plan period (2012-17)
Domestic demand, Large growing young population,
robust consumption and investment rates
Prospects of rise in salaries and improvement in affordability
Ramp-up in hiring by IT /ITES sector expected in 2012-13
Infosys to hire 23,000 engineers (plans to hire local
overseas staff)
TCS plans to add around 45,000 employees
Incentives for affordable housing projects introduced in
Union Budget 2011-12
Existing scheme of 1% interest subvention has now been
extended to Rs 15 lakh for house costing up to Rs 25 Lakh
CCurrent Scenario…. Positives
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Rise in interest rates by 350 bps since March-09 and
requirement for higher contribution (LTV at 80%) by the home
buyer has resulted in further deferral of demand
Despite rising incomes and jobs, home seekers waiting for
prices to decline
Stringent norms to delay availability of funds to real estate
developers; strict monitoring of end-use of funds by Banks
Higher provisioning requirement to lock up funds and restrict
credit to the Real estate sector
Tightening liquidity forcing developers resorting to high cost
funds; developers with severe liquidity crunch likely to offer
waiver on other charges, stamp duty etc..
Global financial stress may impact job hiring outlook which
may be a cause of concern in the short term
IImpact on the Real Estate Sector
Pune Real Estate
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Population-5.7 mn (Est.) 2011- includes area of PMC, PCMC,
Khadki and Pune cantonment
Leading education hub with 150 plus colleges
IT/ITeS, Engineering, Auto& Auto components and Forging
are the key industries
Pune district has per capita income of Rs 111,637 in 2009-10,
second highest in Maharashtra
PPune Urban Agglomeration
Note: PMC-Pune Municipal Corporation area, PCMC- Pimpri-
Chinchwad Municipal Corporation
Proposed Metro Line
Proposed Metro Stations
PMC Boundary
Cantonment Area
Existing Highways/Expressways
Existing Secondary Roads
Railways Line
River / Canal
Proposed High Capacity Bus Route
Proposed Bus Rapid Transit
City Bus Station
Railway Station
Existing / Proposed AirportSource : Propequity, ASKPIA
PPune City -Demography
Location map of Pune city
Source : Census of India, State economic survey
Key Facts of Pune City
Area
Total Population (2001)
Total Population (2011) (Est.)
Decadal Growth Rate
Density (2011)
Literacy Rate (2001)
Per Capita Income (INR) (2009-10)
Workforce Participation Rate (Census 2001)
Sex Ratio (1000/males)
Major Industries
430 Sq.Km.
25,38,473
40,95,340
61.3%
9,524 Persons/Sq.Km.
71%
1,11,637
34.08%
922 Females
IT/ITeS, Bio-TechnologyAuto, auto ancillary and
Engineering
PPune City – Profile and Connectivity
Ÿ Pune- Cultural capital and leading centre of education in Maharashtra
Ÿ Well established manufacturing base of Auto, Auto-Ancillary , Forging and sugar
industries
Ÿ Leading region in IT/ITeS sector with more than 1,000 units operating in the STPI
Ÿ Pimpri-Chinchwad is a major industrial hub and is one of the biggest industrial zones in
Asia.
Ÿ Major software companies in Pune include Accenture, Infosys, IBM India, Persistent
Systems, Wipro, TCS, Cognizant, Symantec, Tech Mahindra and Syntel
Ÿ Leading companies in the manufacturing sector include Bajaj Auto,Telco, Kinetic
Engineering,Thermax,Bharat Forge, Mercedes-Benz India , Volkswagen, Lupin Labs,
Suzlon
Source : ASKPIA, Propequity
Connectivity
By Air
By Rail
- Pune International Airport- Able to handle an average of 125,000 passengers per month- Well connected to all major Indian airports within two hours flying time
Details
- One of the main stations on the Central railway for trains that travel to Mumbai- Connected to Pimpri-Chinchwad by local trains- Daily express trains connect Pune to all major stations
By Road - National Highway 4 (NH 4) connects it to Mumbai, Bangalore, Sangli and Kolhapur- NH 9 to Solapur and Hyderabad, NH 50 to Nashik
Air Connectivity
International
Pune - Dubai, Frankfurt and Singapore
Pune - Delhi, Mumbai, Chennai, Ahmedabad, Bangalore, Goa, Kolkata
National
PPune City –Key Infrastructure Initiatives
Description
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Construction of 9 railway over bridges, 2 river over bridges,
15 flyovers
The project cost is estimated to be Rs. 260 crore
Flyovers at Hadapsar Saswad, road widening at Baner Road, Flyover at University, Wakad Aundh Road widening
Flyover at Chinchwad- Chaphekar Chowk
Flyover joining Nashik Phata & Chakan
Two metro routes being planned in first phase
The Metro Corridors planned within Pune would reduce road traffic and improve connectivity within various regions, which are currently not easily accessible.
It would benefit both Pune and Pimpri-Chinchwad by reducing the congestion on major arterial roads and improving connectivity within the city
It will be a major link connecting the software parks development in the east and north east of the city
Connectivity to areas like Undri, Pisoli, Katraj,Kondhwa Budhruk
Subway have been planned to avoid congestions at Highway junction
MIDC areas of Talegaon, Chakan (location for proposed international airport)
Projects
Pune city Integrated Road project
Flyovers
Metro Rail
90 feet Ring Road project
Old Mumbai-Pune Highway Widening project
Development Agency
MSRDC
PCMC
PMC
PMC
MSRDC Ÿ All work completed
Ÿ Project approved by Municipal Corporation in March-11
Status
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Work of flyover in progressWork on Nashik Phata & Chakan flyover began in March-10
Ÿ Project approved by State Govt in Feb-11
Source : Propequity, ASKPIA
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road widening nearing completionConstruction of Flyovers completed, Kharadi Bypass
SShift in demographic profile in last 2 decades
Regions (Population)
PMC
PCMC
Pune cantonment
Khadki cantonment
Total
Decadal growth rate
1971
8,56,105
98,572
77,774
65,497
10,97,948
1981
12,03,363
2,51,769
85,986
80,835
16,21,953
48%
1991
16,91,430
5,20,639
82,139
78,323
23,72,531
46%
2001
25,38,473
10,06,417
1,01,723
98,090
37,44,703
Decadal Growth Rate
50%
93%
24%
25%
58%
2011P
40,95,340
14,77,986
1,06,925
1,03,106
57,83,357
Decadal Growth Rate
61%
47%
5%
5%
54%
Source: Pune CDP, Pune Metro Rail report
Ÿ 1991-2001 - An era of manufacturing led population growth in PCMC area due to growth in Auto and Auto ancillary industry
Ÿ 2001-2011 – Ushered IT/ITeS led growth with setting of STPI in Hinjewadi
Ÿ New regions – Kharadi, Baner emerged as IT Hubs
Ÿ PCMC region witnessed relocation of companies for operational efficiencies
The demographic profile of Pune saw a gradual shift towards higher proportion of
Service professionals with higher income range compared to the Working class profile of the 1990’s
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Per capita income much higher than State due to strong economic growth primarily from IT/ITeS industry
Increasing growth of IT /ITeS industry has provided strong growth in job opportunities in past few years
IIT industry growth propelling high rise in incomes
Source: Maharashtra Economic survey Source: Industry , STPI
52,811 59,992
71,073
96,541
1,11,637
36,090 41,144
49,058
64,238
74,027
20,000
40,000
60,000
80,000
1,00,000
1,20,000
2005 -06 2006 -07 2007 -08 2008 -09
Provisional Est.
2009 -10
Preliminary Est.
Rupees
Per capita income at current prices
Pune District Maharashtra
45%
03 -04 04 - 05 05 - 06 06 -07 07 - 08 08 -09 09 - 10 10 - 11E
Pune STPI Maharashtra % share
48% 50%10,000
20,000 52%
55%
55%
55%
59% 58% 60%
55%
60%
65%
70%
30,000
40,000
50,000
60,000 Rs crore
Pune share in IT exports
Demand estimation approach and outlook
SStable growth in population will moderate demand for houses
2001
25,38,473
10,06,417
1,01,723
98,090
37,44,703
8,28,890
4.5
2011P
40,95,340
14,77,986
1,06,925
1,03,106
57,83,357
14,45,839
4
6,16,949
61,695
Note: The average household size is assumed to decline with growth in nuclear families
Source: CENSUS, RITES, PMC and ASKPIA
Ÿ Annual requirement for houses expected to grow annually by 56,000 units based on population estimated as per Pune development plan
Ÿ Growth in population expected to moderate on higher base
(Population)
PMC
PCMC
Pune cantonment
Khadki cantonment
Total
Number of households
Average Household Size(per Household)
Incremental Households in a decade
Annual requirement for Houses - (Assuming equal absorption)
2021P
52,41,758
17,78,293
1,12,394
1,12,182
72,44,627
20,12,396
3.6
5,66,557
56,656
Census data based on growth expected in households and houses
OOffice space absorption indicate sustained hiring
Office space absorption (sq. ft)
2,252,600
612,000
596,950
832,450
1,123,100
1,304,600
1,782,300
984,400
1,120,550
1,356,100
1,448,825
1,994,625
Note: Average office space has been assumed to be 150 sq ft per employee with 2 shifts
Source : Propequity, ASKPIA
Ÿ Existing employment leading to an estimated need of 45,000 houses annually
Ÿ Office space availability of 11 mn sq. ft. during next two years indicate a potential requirement of 47,000 houses leading to sustained
demand for houses (rental or owned houses)
Quarter
Jul-Sep-08
Oct-Dec-08
Jan-Mar-09
Apr-Jun-09
Jul-Sep-09
Oct-Dec-09
Jan-Mar-10
Apr-Jun-10
Jul-Sep-10
Oct-Dec-10
Jan-Mar-11
Apr-Jun-11
Estimated employment based on Office space absorption
Annual addition
46,154 (9 months)
67,233
65,465
Estimated employee addition
30,035
8,160
7,959
11,099
14,975
17,395
23,764
13,125
14,941
18,081
19,318
26,595
TTrend in sales registration in line with demographic growth
Note :Sale agreement data includes – Land sale, commercial sale and residential sale (New homes & Re-sale). Registration of property is with a lag of 3-6 monthsCertain months are considered inauspicious for any new purchases ( 15 day before Dashera ~ Sept-Oct period ) depending on Hindu calendar
Source: Stamp duty Registrar, Maharashtra
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
Apr -08 Jul -08 Oct -08 Jan-09 Apr -09 Jul -09 Oct -09 Jan-10 Apr -10 Jul -10 Oct -10 Jan-11 Apr -11
Units
42,485
Trends in registation of Sale agreement
71,601
78,948
{Ÿ Residential new homes registration agreements estimated to be
45,000 in 2009-10 and 50,000 in 2010-11
Ÿ Sharp recovery in demand in 2009-10 has been sustained in
2010-11
New Home registrations estimated to be
around 63% - of total sale agreements
{
{
SShift in income profile to reflect in demand for houses
Note :1. Gross annual income for manufacturing and services sector have been sourced from primary sources2. Obligation percent has been based on loan norms followed by private sector banks3. Rate of interest has been assumed to be constant across loan slabs4. Floating rate of interest is as of December, 2011
Particulars
Gross annual Income per employee
Person earning per family
Monthy Gross Income of family
Obligations (Tax, monthly exp) %
Income available for EMI (Rs per month)
Term in years
Rate on interest
EMI for Rs 1,00,000
Loan eligibilty (Rs lakh)
Loan to value
Property cost (Rs Lakh)
Income profile and Property cost affordabilty
Manufacturing Sector
Working class
3,00,000
1
25,000
58%
10,500
20
10.75%
Rs. 1,015
10
80%
13
Executive level
6,00,000
1
50,000
58%
21,000
20
21
80%
26
10.75%
Rs. 1,015
Services sector
Entry Level
3,00,000
2
50,000
58%
21,000
20
10.75%
Rs. 1,015
21
80%
26
Middle Level
12,00,000
2
2,00,000
58%
84,000
20
83
80%
103
10.75%
Rs. 1,015
Senior Mangtt. Level
25,00,000
2
4,16,667
58%
1,75,000
20
172
80%
215
10.75%
Rs. 1,015
Shift in income profile with higher proportion of service professionals to result in change
in Pune real estate market in terms of preference for apartment size and facilities
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Based on the two approaches projected demand for houses will be :
Source: ASKPIA
Estimated new home registrations at 50,000 is line with above estimations; we expect demand to grow at an average of
50,000 units annually
Shift in income profile to result in change in demand profile of houses as more service professionals are added to existing
population- the mix of service professional is expected to be 65% of the working population
KKey Conclusions
Demand estimation
Demographic
Commercial space
Houses
56,000
47,000
Pune City Residential supply –Trends and outlook
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Pune has estimated - 468 builders; 296 builders registered with CREDAI, Pune
Builders bound by code of ethics to promote highest standard of promotion, development and construction activities
Integrated township projects like - Magarpatta, Blue-ridge, Nanded city, IVEN township, Megapolis, KUL Ecoloch and
Amanora on outskirts
Applicable FSI in the PMC and PCMC limits is 1.0. In addition a TDR of 0.6 is given for PMC and 0.4 for PCMC area
SSupply – Real Estate Landscape
PPune- Key Regions And Micro-markets
South-West Region BavdhanDhayariErandwaneKarve NagarKothrudSinhagadh RoadSinhagadhVadgaon BudrukWarje
North- East RegionAirport RoadKalyani NagarKharadiKoregaon ParkLohegaonNagar RoadParvatiVadgaon-SheriVimannagarVishrant WadiWagholiYerawada
North-West Region Akurdi Aundh Baner Baner- Pashan Bhosari Chinchwad Hinjewadi Kalewadi Nigdi Pashan Pimple Saudagar Pimpri Rahatani Sus Road Wadgaon Wakad
North -West
South – West
North- East
South-East RegionCampFursungiHadapsarKondhwaManjariMundhwaNIBM RoadSalisbury ParkSholapur RoadUndriWanowrie
South- East
Central PuneBund gardenS.B. RoadShivajinagarUniversity roadDeccanShanivar pethTilak roadPrabhat RoadKarve RoadStation Road
Pune Central
Source : ASKPIA,Propequity
12,667
9,144
4,539
6,724
3,593
8,100
3,510
3,022
1,370
3,589
7,983
10,718
14,586
8,061
1,506
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000Units
Quarterly Trends of New Project Launches
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0
10000
20000
30000
40000
50000
60000
2008 2009 2010 2011 2012 2013 2014
per centUnitsTrend of Supply - Absorption in Pune
Supply Absorption Cumulative Availability %
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Low cumulative availability of 19% till 2014 indicates healthy absorption trends
Increase in projects launches and low availability indicate healthy demand trend
HHigh absorption of existing stock and new launches indicate sustained demand growth
Q1-20
08
Q2-20
08
Q3-20
08
Q4-20
08
Q1-20
08
Q1-20
09
Q2-20
09
Q3-20
09
Q1-20
10
Q2-20
10
Q3-20
10
Q4-20
10
Q1-20
11
Q2-20
11
Q3-20
11
Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.
Source : Propequity, ASKPIA
Source : Propequity, ASKPIA
SSupply in tandem with demand……..
Source : Propequity, ASKPIA Note: Absorption includes units launched in previous yearsSource : Propequity, ASKPIA
Fresh Supply 24,159 units in Jan-Jul 2011
1 BHK
2 BHK
3 BHK
4 BHK
5 BHK
4 BKH
2.2%
5 BKH
0.3%
1 BKH
14.0%
2 BKH
49.6%
3 BKH
33.9%
Total Absorption - 27,175 units in Jan-Jul 2011
4 BKH
2.3%
5 BKH
0.3%
1 BKH
13.6%
2 BKH
51.1%
3 BKH
32.7%
1 BHK
2 BHK
3 BHK
4 BHK
5 BHK
Segment-wise supply-absorption has been balanced leading to stable movement in prices;
Higher absorption number has lowered the existing stock levels
Region-wise analysis
NNorth-East Pune
North- East RegionAirport RoadKalyani NagarKharadiKoregaon ParkLohegaonNagar RoadParvatiVadgaon-SheriVimannagarVishrant WadiWagholiYerawada
North - East
Ÿ Location of Airport in the region was
conducive for growth of Commercial
office driven by IT parks
Ÿ Leading IT parks in the region are
Pancshil, Raheja, EON
Ÿ Widening of Nagar Road improved the
connectivity and led to higher office
space demand
Ÿ Premium areas of Pune like Boat club
road, Koregaon park and Kalyani nagar
are located here
Source : Propequity
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
2008 2009 2010 2011 2012 2013 2014
per centUnits
Trend of Supply - Absorption in North East Pune
Supply Absorption Cumulative Availability %
367
2,098
1,031
2,511
773
279
1,416
1,381
236
760
1,2041,295
1,229
2,694
1,953
853
0
500
1,000
1,500
2,000
2,500
3,000 Units
Trend of New launches in North East Pune
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This region accounts for 14% of Pune’s supply with overall vacancy at 18%
These region with elite residential localities has lower quantum of launches, however new regions are witnessing higher launches in past
6 mths
Proximity to airport, SEZ space and connectivity to other parts of city has led to growth of commercial space in this region; Residential
demand growth is thus expected in region like Kharadi which has larger land parcels and comparatively lower rates in the region
SSupply in upcoming areas with high absorption
Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.Source : Propequity, ASKPIA
Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec
Source : Propequity, ASKPIA
Q3
07
Q4
07
Q2
08
Q1
08
Q3
08
Q4
07
Q1
09
Q2
09
Q3
09
Q4
09
Q1
10
Q2
10
Q3
10
Q4
10
Q1
11
Q2
11
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Region witnessed steady appreciation in prices except weakness during Q4,2009
Prices are expected to remain stable in premium areas, while they will rise in upcoming areas
SStable to steady price rise scenario expected during 2012
Source : Propequity, ASKPIA
2,000
2,750
3,500
4,250
5,000
5,750
6,500
7,250
Rs per sq ft
kalyani nagar Kharadi Vimannagar
Source : Propequity,ASKPIA
PPrice trends in micro-markets
Quarter
Q3-2007
Q4-2007
Q1-2008
Q2-2008
Q3-2008
Q4-2008
Q1-2009
Q2-2009
Q3-2009
Q4-2009
Q1-2010
Q2-2010
Q3-2010
Q4-2010
Q1-2011
Q2-2011
Q3-2011
Weighted average prices (Rs. per sq. ft)
Kalyani Nagar
5,085
5,182
5,341
5,558
5,802
5,926
5,843
5,830
6,126
6,471
6,741
7,150
6,929
6,400
6,500
6,750
6,750
Kharadi
2,946
3,116
2,972
3,049
3,020
3,001
3,298
3,363
3,135
3,211
3,270
3,073
3,423
3,694
3,857
4,022
4,069
Vimannagar
2,981
3,122
3,685
3,744
3,783
3,660
3,436
3,419
3,464
3,418
3,406
3,655
3,743
3,975
4,745
5,054
5,100
NNorth-West Pune
Ÿ Pimpri-Chinchwad and Hinjewadi are the
two main growth corridors of the region
Ÿ Hinjewadi- started in 1998 has ushered
the IT growth in Pune region
Ÿ Prominent IT players like Infosys, TCS,
Wipro, IBM have set up centres at
HinjewadiNorth -West
Source : Propequity
North-West Region Akurdi Aundh Baner Baner- Pashan Bhosari Chinchwad Hinjewadi Kalewadi Nigdi Pashan Pimple Saudagar Pimpri Rahatani Sus Road Wadgaon Wakad
4,775
9,863
6,558
3,814
2,164
3,142
1,008
2,1292,394
1,645
4,258
3,245
6,937 7,722
4,784
3,054
0
2,000
4,000
6,000
8,000
10,000
12,000 Units
Trend of new launches in North West Pune
Ÿ
Ÿ
Ÿ
North-West region accounts for highest share of supply at 45 % - main region being PCMC and IT hub of Hinjewadi
The region has low vacancy level at 19% due to growth in new residential areas with upcoming IT locations
Saturation of residential area in the existing IT belts will lead to development of areas with better connectivity and proximity to offices -
Residential demand in the region to see strong growth in regions like Baner and Wakad
RRegion with highest supply share at 45%
Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-DecSource : Propequity, ASKPIA
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0
5000
10000
15000
20000
25000
30000
2008 2009 2010 2011 2012 2013 2014
per centUnits
Trend of Supply - Absorption in North West Pune
Total Supply Total Absorption Cumulative Availability %
Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.Source : Propequity, ASKPIA
Q3
07
Q4
07
Q2
08
Q1
08
Q3
08
Q4
08
Q1
09
Q2
09
Q3
09
Q4
09
Q1
10
Q2
10
Q3
10
Q4
10
Q1
11
Q2
11
Ÿ
Ÿ
Prices have been in affordable range for middle income groups
Region is expected have continued demand; prices to remain firm in 2012
SStable to steady price scenario expected during 2012
Source : Propequity, ASKPIA
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
Rs per sq ft
Aundh Baner Hinjewadi Pimple Saudagar
Q3-20
07
Q4-20
07
Q1-20
08
Q2-20
08
Q3-20
08
Q4-20
08
Q1-20
09
Q2-20
09
Q3-20
09
Q4-20
09
Q1-20
10
Q2-20
10
Q3-20
10
Q4-20
10
Q1-20
11
Q2-20
11
Q3-20
11
Source : Propequity,ASKPIA
PPrice trends in micro-markets
Quarter
Q3-2007
Q4-2007
Q1-2008
Q2-2008
Q3-2008
Q4-2008
Q1-2009
Q2-2009
Q3-2009
Q4-2009
Q1-2010
Q2-2010
Q3-2010
Q4-2010
Q1-2011
Q2-2011
Q3-2011
Weighted average prices (Rs. per sq. ft)
Aundh
4,262
4,300
4,405
4,591
4,778
4,667
4,671
4,687
4,680
4,875
4,839
4,857
5,019
5,323
5,539
5,784
5,825
Hinjewadi
3,462
3,465
3,370
3,364
3,454
4,000
3,768
4,049
3,689
3,578
2,661
2,775
3,053
3,126
3,041
3,266
3,301
Baner
3,463
3,466
3,448
3,776
3,934
3,944
3,838
3,222
3,516
3,566
3,613
3,768
3,824
3,974
4,045
4,175
4,443
Pimple Saudagar
2,682
2,787
2,897
3,093
3,182
3,151
2,871
2,868
2,955
3,146
3,304
3,536
3,554
3,664
3,934
4,089
4,169
SaSouth-East Pune
Ÿ Magarpatta- the integrated township
project changed the profile of the region
Ÿ NIBM region has witnessed growth due
to better educational facilties
Ÿ Higher migrant population has led to
demand growth in less preferred
locations
South-East RegionCampFursungiHadapsarKondhwaManjariMundhwaNIBM RoadSalisbury ParkSholapur RoadUndriWanowrie
South- East
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0
2000
4000
6000
8000
10000
12000
14000
16000
2008 2009 2010 2011 2012 2013 2014
per centUnits
Trend of Supply - Absorption in South East Pune
Total Supply Total Absorption Cumulative Availability %
Ÿ
Ÿ
Ÿ
One of the upcoming regions with the success of integrated township model-Magarpatta, leading to improved profile of the region
Vacancy of 18% for projects launched indicate healthy demand trend
Quantum of new launches has been improving in past three quarters
26% of Pune’s supply expected in the region
Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-DecSource : Propequity, ASKPIA
Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.Source : Propequity, ASKPIA
2,569
2,632
3,049
3,115
1,896
3,544
1,774
1,747922
384 1,271
1,649
2,571
2,869
2,561
3,197
0
1,000
2,000
3,000
4,000 Units
Trend of new launches in South East Pune
Q3
07
Q4
07
Q2
08
Q1
08
Q3
08
Q4
08
Q1
09
Q2
09
Q3
09
Q4
09
Q1
10
Q2
10
Q3
10
Q4
10
Q1
11
Q2
11
Ÿ High absorption to result in increase in prices as eastern corridor is preferred over other regions
HHigh absorption to drive prices
Source : Propequity, ASKPIA
2,700
2,900
3,100
3,300
3,500
3,700
3,900
4,100
4,300
Rs per sq ft
Hadapsar Kondhwa NIBM Road
Q3-20
07
Q4-20
07
Q1-20
08
Q2-20
08
Q3-20
08
Q4-20
08
Q1-20
09
Q2-20
09
Q3-20
09
Q4-20
09
Q1-20
10
Q2-20
10
Q3-20
10
Q4-20
10
Q1-20
11
Q2-20
11
Q3-20
11
Source : Propequity,ASKPIA
PPrice trends in micro-markets
Quarter
Q3-2007
Q4-2007
Q1-2008
Q2-2008
Q3-2008
Q4-2008
Q1-2009
Q2-2009
Q3-2009
Q4-2009
Q1-2010
Q2-2010
Q3-2010
Q4-2010
Q1-2011
Q2-2011
Q3-2011
Weighted average prices (Rs. per sq. ft)
Hadapsar
3,210
3,360
3,206
3,324
3,210
3,199
3,123
3,016
3,029
2,894
3,078
3,023
3,090
3,261
3,636
3,972
3,963
NIBM Road
3,349
3,460
3,619
3,593
3,459
3,332
3,612
3,420
3,172
3,282
3,498
3,580
3,695
3,686
3,880
4,141
4,020
Kondhwa
3,191
3,256
3,608
3,581
3,752
3,216
3,190
2,915
3,022
2,832
2,938
3,119
3,299
3,371
3,468
3,572
3,630
SSouth-West Pune
Ÿ Region has concentration of Banks, Insurance
and other service sectors offices
Ÿ Nanded city – New township project could
change profile of the area
South-West Region BavdhanDhayariErandwaneKarve NagarKothrudSinhagadh RoadSinhagadhVadgaon BudrukWarje
South – West
Source : Propequity
Ÿ
Ÿ
85% of the expected supply has been absorbed with very low vacancy in near term
New launches have been consistent with the exception in Q2’09 due to launch of Nanded city township project
15% of Pune’s supply expected in the region
Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-DecSource : Propequity, ASKPIA
Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.Source : Propequity, ASKPIA
1,011
1,980 2,030
1,557
5291,174
1,416
4,352
220
927
1,290 1,270
676
2,274
5,204
951
0
1,000
2,000
3,000
4,000
5,000
6,000Units
Trend of new launches in South West Pune
0%
5%
10%
15%
20%
25%
0
1000
2000
3000
4000
5000
6000
7000
8000
2008 2009 2010 2011 2012 2013 2014
per centUnits
Trend of Supply - Absorption in South - West Pune
Total Supply Total Absorption Cumulative Availability %
Q3
07
Q4
07
Q2
08
Q1
08
Q3
08
Q4
08
Q1
09
Q2
09
Q3
09
Q4
09
Q1
10
Q2
10
Q3
10
Q4
10
Q1
11
Q2
11
Ÿ Upcoming regions of Sinhagad road, Vadgaon budruk, Dhayari to see appreciation in prices in 2012
NNew regions to witness price appreciation in 2012
Source : Propequity, ASKPIA
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
Rs per sq ft
Bavdhan Kothrud Sinhagad Road
Source : Propequity,ASKPIA
PPrice trends in micro-markets
Quarter
Q3-2007
Q4-2007
Q1-2008
Q2-2008
Q3-2008
Q4-2008
Q1-2009
Q2-2009
Q3-2009
Q4-2009
Q1-2010
Q2-2010
Q3-2010
Q4-2010
Q1-2011
Q2-2011
Q3-2011
Weighted average prices (Rs. per sq. ft)
Bavdhan
3,122
3,246
3,306
3,334
3,380
3,389
3,110
3,268
3,284
3,323
3,383
3,588
3,793
3,956
4,095
4,273
4,435
Sinhagad Road
2,915
3,236
3,253
3,293
3,297
3,517
3,606
3,517
3,518
3,420
3,519
3,721
4,221
4,383
4,216
4,383
5,893
Kothrud
3,901
4,105
4,379
4,458
4,417
4,799
3,748
3,874
3,737
3,960
3,953
4,195
4,441
4,852
5,063
6,496
6,436
CCentral Pune
Ÿ The oldest and central most part of Pune
Ÿ Known for Historical monument like
Shaniwar Wada
Central PuneBund gardenS.B. RoadShivajinagarUniversity roadDeccanShanivar pethTilak roadPrabhat RoadKarve RoadStation Road
Pune Central
Source : Propequity
Ÿ
Ÿ
Being the prime region it has almost full absorption ; mostly resale transactions are prevalent in the area
Scarcity of space has led to very less launches; exception has been due to launch of Damodar VI project in Q2,2009
LLess than 1% of Pune’s supply expected in the region
Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-DecSource : Propequity, ASKPIA
Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.Source : Propequity, ASKPIA
0%
2%
4%
6%
8%
10%
12%
0
200
400
600
800
1000
1200
1400
2009 2010 2011 2012
per centUnits
Trend of Supply-Absorption in Central Pune
Total Supply Total Absorption Cumulative Availability %
0
1,216
0
1,000
2,000
3,000
4,000
5,000
6,000Units
Trend of new launches in Central Pune
Q3
07
Q4
07
Q2
08
Q1
08
Q3
08
Q4
08
Q1
09
Q2
09
Q3
09
Q4
09
Q1
10
Q2
10
Q3
10
Q4
10
Q1
11
Q2
11
0 0 0
540
3016 0 0 00 0 0 00
Ÿ Region to command premium due to its central location and scarcity of supply, hence expect prices
to appreciate
CCentral Pune region will continue to command premium
Source : Propequity, ASKPIA
5,000
7,000
9,000
11,000
13,000
15,000
Rs per sq ft
Shivajinagar Deccan
Q3-20
07
Q4-20
07
Q1-20
08
Q2-20
08
Q3-20
08
Q4-20
08
Q1-20
09
Q2-20
09
Q3-20
09
Q4-20
09
Q1-20
10
Q2-20
10
Q3-20
10
Q4-20
10
Q1-20
11
Q2-20
11
Q3-20
11
Source : Propequity,ASKPIA
PPrice trends in micro-markets
Quarter
Q3-2007
Q4-2007
Q1-2008
Q2-2008
Q3-2008
Q4-2008
Q1-2009
Q2-2009
Q3-2009
Q4-2009
Q1-2010
Q2-2010
Q3-2010
Q4-2010
Q1-2011
Q2-2011
Q3-2011
Weighted average prices (Rs. per sq. ft)
Deccan
8,600
8,600
8,600
8,600
8,600
8,600
8,000
10,666
11,199
11,199
13,000
13,000
13,000
15,000
15,000
15,000
15,000
Shivajinagar
10,000
10,000
10,000
10,000
10,000
7,688
8,520
8,613
9,417
9,125
8,250
8,750
8,750
11,000
11,000
11,000
11,000
SSupply trend in Pune region
Region
North-East
North-West
South-East
South-West
Pune Central
Total Units
Trend in Region-wise supply (% Share)
2008
14%
43%
29%
14%
0%
21,588
2009
12%
44%
25%
19%
1%
30,669
2010
16%
41%
23%
18%
2%
29,605
2011
12%
41%
32%
13%
3%
47,206
2012
16%
48%
25%
10%
0%
52,374
2013
14%
44%
20%
22%
0%
30,279
Ÿ Large share of supply in North-west region is expected to result in saturation of Residential space
Ÿ However regions with connectivity to city could see potential for growth- regions like Balewadi, Wakad and will
continue to see growth and price appreciation
Ÿ – Which includes regions in South and North east are expected to be preferred locations due to proximity to
airport, improved connectivity and competitive real estate rates
Ÿ Regions like Hadapsar, and Airport Road are expected to see residential growth
Baner
Eastern corridor
Kharadi
Note: The analysis is based on year of completion of the projects. Source : Propequity, ASKPIA
R Research Team
MR. RAMAN IYER
MR. DEEPAK RATHI
MR. JITESH KARLEKAR
Director – Asset Management
E-mail ID: [email protected]
Vice President - Asset Management
E-mail ID: [email protected]
Senior Research Analyst
E-mail ID: [email protected]
DDisclaimerŸ This document is being communicated to you solely for the purposes of providing our views on current market trends. This document is being communicated to
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Ÿ No reliance may be placed for any purpose whatsoever on the information contained in this document or on its completeness. The information set out herein may
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Ÿ The analysis / interpretation of data is purely the work of ASK Property Investment Advisors Ltd. and does not necessarily reflect PropEquity views as the market.
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