india residential property market overview november 2013

Accelerating success.

INDIA

QUARTERLY UPDATE | NOVEMBER | 2013

Residential Property Market Overview

www.colliers.com

reseArch & forecAst reportSYDNEY CENTRAL BUSINESS DISTRICT

IndIA resIdentIAL mArketRESEARCh & foRECAST REpoRT

INDIA | NOVEMBER 2013 | residential

www.colliers.com

1SBI Home Loan Rate for Loan upto INR 30 Lakhs2SBI Fixed Deposit rate for a period of more than one year and amount below INR 1 Crore3Realty Index is a free float weighted index, comprised of real estate development companies in the BSE-500 Index.

ECoNoMIC BARoMETER

RETURN oN ALTERNATIvE INvESTMENTS

oct-12 oct-13

repo rAte 8.00% 7.50%

reVerse repo rAte 7.00% 6.50%

crr 4.25% 4.00%

InfLAtIon 7.32% 7.00%

home LoAn rAte 10.00% 10.10%

oct-12 oct-13 YoY %

Change

GoLd 30,922 30,063 -2.78%

sILVer 59,853 45,917 -23.28%

fIxed deposIt 8.50% 9.00% 5.58%

eQUItY 18,714 20,548 9.80%

reALtY Index 1,879 1,328 -29.33%

2

3

1

repo rate cash reserve ratio Wholesale price Index

ECoNoMIC INDICAToRS

In p

erce

ntag

e

MACRo ECoNoMIC ovERvIEW

Gdp growth estimates for the period that lasted from April to June 2013 were around 4.4%. •this was the slowest growth rate recorded in the last four years.

Based on the wholesale price index, the headline inflation of october 2013 was at 7.00%, which •marked an increase over the 6.46% headline inflation of september 2013. the reserve Bank of India (rBI) increased the repo rate and reverse repo rate by 25 basis points to 7.50 and 6.50 respectively.

the Indian rupee plunged further compared to the Us dollar and the euro in the quarter that •spanned from July to october 2013 and closed at Inr 61.07 against the Us dollar on 31st october 2013.

demand for residential units in both the primary and secondary markets remained subdued. •pressures of increasing unsold inventory and a liquidity crunch resulted in fewer project launches. there was an increase in the incentives being offered to sell property, such as easy payment plans, discounts and free gifts with bookings.

coLLIers VIeW: end Users and buyers will continue to be cautious due to the current uncertain •economic and political conditions; coupled with high residential prices. capital values across most micro-markets in almost all the major cities will remain stable, even though transaction volume will remain constraint. Importantly, the current oversupply in the market will get mitigated in the coming quarters, as very limited new projects are being launched.

4.0

3.0

6.0

5.0

8.0

9.0

7.0

11.0

10.0

12.0

Apr

‘09

feb

‘09

dec‘

09

Apr‘1

1

Apr‘1

2

Jun

‘13

Aug

‘13

oct

‘13

Apr

‘13

feb‘

11

Jun

‘09

Jun‘

10

Apr‘1

0

feb‘

10

Jun‘

11

Jun‘

12

Aug’

08

jun’

08

Apr

‘08

Aug‘

09

Aug‘

10

Aug‘

11

Aug‘

12

dec’

08

oct

‘08

oct

‘09

dec‘

10

oct

‘10

oct

‘11

oct

‘12

feb‘

12

feb‘

13

dec‘

11

dec‘

12

2.0

1.0

0.0

-1.0

-2.0

Source: Goverment of India, Colliers International India Research

CoLLIERS INTERNATIoNAL | p. 3

mUmBAI

seleCt neW PrOJeCts

proJect nAme LocAtIon deVeLoper nAme tentAtIVe possessIon* rAte (per sQ.ft.)**

Bay one prabhadevi hubtown Ltd. 4Q 2017 45,000

new cuffe parade codename metropolis Wadala Lodha Group 4Q 2015 18,700

princess prabhadevi sumer Group 4Q 2016 27,000

the park Worli Lodha Group 4Q 2017 24,470

sapphire powai sai Group of Industries 4Q 2015 10,500

CITY RESIDENTIAL BARoMETER

3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace

Note: Ongoing Price (P.S.F): Indicative asking price for premium residential properties per sq.ft.

MUMBAI

mumbai’s residential property market •witnessed low transaction volumes, despite the expected demand boost due to the festive season. this is attributed to various reasons, such as high price tags, making most projects unaffordable and reserve Bank of India’s directive to discontinue the popular 80:20 financing scheme.

the launch of new projects remained limited. •only a few premium projects were launched in locations, such as prabhadevi, Wadala and Worli. these projects were priced in the range of Inr18,000 - 45,000 per sq ft. due to lack of capital, most of the residential projects in the luxury sector have been significantly delayed.

the average rental values across the city •did not change during the quarter. similarly, capital values also remained unchanged in most of the city’s micro markets, except in a few of West mumbai’s precincts where marginal increases in the range of 1 - 3% QoQ were recorded.

coLLIers VIeW:• during the next few quarters, the city’s residential markets are expected to remain stagnant due to low liquidity and high price points. Absorption in the luxury segment will remain under pressure. the pre-launches in the mid and low end segment will continue to have traction at the introductory prices. the recent hike in the floor space index of 3 for the redevelopment of cessed buildings is expected to boost the city’s redevelopment projects to some extent and improve the overall supply situation over the long term. overall capital values in the primary and secondary sales markets are expected to be under pressure in the short to medium term.

0

10,000

20,000

30,000

40,000

60,000

70,000

50,000

80,000

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth

1Q20

08

3Q20

08

3Q20

09

1Q20

09

1Q20

10

3Q20

10

1Q20

12

3Q20

12

1Q20

13

3Q20

13

3Q20

14f

1Q20

14f

1Q20

11

3Q20

11

80,000

40,000

50,000

70,000

60,000

10,000

20,000

30,000

0

Micro Market ongoing price (p.S.f)

thane-kalyan 4,000 - 8,000

navi mumbai 3,500 - 7,500

Virar- Boisar 3,000 - 5,500


prab

hade

vi

colaba, cuffe parade

sout

h m

umba

i

malabar hill, Altamount road, carmichael road

Worli

Wor

li

Breach candy, napeansearoad, peddar road

prabhadevi

Band

ra

Bandra

sant

acru

z

santacruz

Andh

eri

Andheri

pow

ai

powai

khar

khar

Juhu

Juhu

200

150

100

50

0

powai

khar

prabhadevi

Breach candy, napeansea road, peddar road

malabar hill, Altamount road, carmichael road

colaba, cuffe parade

Bandra

Juhu

Andheri

Worli

santacruz

Inr

per

sq.ft

.

Note:Average Capital/Rental Value Range: Indicative asking price for premium residential properties on per sq.ft. basis.

Note: * As mentioned by developer ** Base selling price as quoted by developer

AvERAGE CApITAL vALUE RANGE

AvERAGE RENTAL vALUE

AvERAGE CApITAL vALUE TRENDS

INvESTMENT oppoRTUNITIES

p. 4 | CoLLIERS INTERNATIoNAL

DELhI

demand in the secondary sales market for •premium residential properties have come down significantly this quarter, however due to the continual interest of expatriates and hnI’s in the prime locations of south and central delhi, the demand for leasing remained stable for premium properties.

the new supply remained limited and primarily •in the form of small redevelopment projects in areas, such as Vasant Vihar, Anand niketan and safdarjung enclave.

due to the decisions of a number of mncs / •embassies to attempt to contain their costs in the wake of the current economic scenario, rental values declined by 5 - 14% across the micro markets.

there is a downward pressure on capital •values as the asking price for prime residential properties in delhi has come down by approximately 10 - 15%. however, not many deals have been concluded in the market.

A number of infrastructural projects are taking •place in the city simultaneously and causing traffic problems in select locations. this may cause the leasing demand to temporarily shift from these areas to other locales.

coLLIers VIeW:• currently, Investors are holding for their decisions due to economic and political uncertainties. the activity in premium residential market will remain sluggish till the election. however, considering the fact that delhi’s lease market is primarily driven by the officials of mncs and expatriates that are currently trying to optimize their costs, rental values may further decline.

3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace


deLhI

seleCt OnGOinG PrOJeCts


capital Greens shivaji marg dLf Ltd. 2Q 2015 14,000

castlewood okhla Indiabulls Ltd. 4Q 2013 12,800

kings court Greater kailash- II dLf Ltd. 1Q 2015 36,000

Queens court Greater kailash- II dLf Ltd. 1Q 2015 36,000

Winter hills dwaraka morh Umang realtech 4Q 2013 10,250


15,000

0

30,000

45,000

75,000

90,000

105,000

60,000

120,000

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth

Inr

per

sq.ft

.

1Q20

08

3Q20

08

3Q20

09

1Q20

09

1Q20

10

3Q20

10

1Q20

12

3Q20

12

1Q20

13

3Q20

13

3Q20

14f

1Q20

14f

1Q20

11

3Q20

1140,000

50,000

60,000

70,000

80,000

100,000

90,000

30,000

20,000

10,000

0

Anan

d ni

keta

n,

Vasa

nt V

ihar

Anand niketan, Vasant Vihar

panc

hash

ila, A

nand

lok,

niti

Bagh

, sdA

panchashila, Anandlok, niti Bagh, sdA

frie

nds

colo

ny,

mah

aran

i Ba

gh

friends colony, maharani Bagh

shan

ti ni

keta

n,

Wes

tend

shanti niketan, Westend

Grea

ter

kaila

sh

I & II

, sou

th

exte

nsio

n

Greater kailash I & II, south

extension

Golf

Link

s, J

or B

agh,

su

nder

nag

ar

Golf Links, Jor Bagh, sunder nagar

chan

akya

pur

i

chanakya puri

prith

vira

j roa

d,

Aura

ngze

b ro

ad

prithviraj road, Aurangzeb road

200

160

120

80

40

0

Golf Links, Jor Bagh, sunder nagar

panchashila, Anandlok, niti Bagh, sdA

Greater kailash I & II, south extension

chanakya puri shanti niketan, Westend

friends colony, maharani Bagh

prithviraj road, Aurangzeb road

Anand niketan, Vasant Vihar







3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace


GUrGAon



0

5,000

15,000

10,000

20,000

25,000

30,000

35,000

45,000

40,000

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth

Inr

per

sq.ft

.

3Q20

08

3Q20

09

1Q20

09

1Q20

10

3Q20

10

1Q20

12

3Q20

12

1Q20

13

1Q20

14f

3Q20

14f

3Q20

13

1Q20

11

3Q20

11

6,000

8,000

10,000

12,000

14,000

16,000

18,000

4,000

2,000

0


Golf course extension road 7,500 - 9,000

sohna region 4,000 - 5,000

pataudi road 4,500 - 5,500

new Gurgaon 4,000 - 5,000

80

60

40

20

0

Golf

cour

se r

oad

Golf course road

sohn

a ro

ad &

ext

sohna road & ext

dLf

phas

e I

dLf phase I

sush

ant L

ok

sushant Lok

nh -

8

nh - 8

dLf phase Inh-8

Golf course road sushant Lok

sohna road & ext

seleCt neW PrOJeCts


dLf camelias Golf course road dLf Ltd. 4Q 2018 25,000

Isle de royale Gwal pahadi Asf Group 4Q 2017 6,500

m3m escala sector 70A m3m 4Q 2017 6,250

microtek Green Burg sector 86 microtek 4Q 2017 6,950

tangerine sector 89A Ats Group 4Q 2017 6,750







GURGAoN

Gurgaon’s residential market remained •stagnant for a second consecutive quarter.sales volumes have reduced significantly, primarily because investors aren’t purchasing. however, the market continues to see robust demand for projects close to completion.

At the end of the quarter, with the start of •the festive season, developers made lucrative offers to purchasers of residential real estate to revive demand. the various offers made by developers include deferred payment plans and waived charges on amenities such as free car parking, power back-up, club membership and freebies, such as microwave ovens, Lcd tVs and washing machines, etc.

during 3Q 2013, two premium projects / parts •of projects were launched in Gurgaon – dLf camelias on Golf course road and microtek Green Burg, by microtek – which were priced at Inr25,000 per sq ft and Inr16,950 per sq ft, respectively. A few more affordable projects were launched in the recently notified sohna region in the price range of Inr 4,000 - 5,000 per sq ft. construction activity was slow and resulted in the completion of only a few premium residential projects / phases of projects, such as spaze privy, a property developed by the spaze Group at sector 72.

the capital values of prime residential •properties declined marginally by 1 - 3% QoQ in almost every micro market. however, they remained stable in a few locations, such as sushant Lok and nh-8.

coLLIers VIeW:• end-users activity is expected to remain restricted primarily due to high price points and relatively very less options available for mid-segment housing. Looking ahead, we expect demand for prime residential properties to remain stable. capital and rental values both will remain under pressure and may decline by 2-4% in near term across all the micro markets.


3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace


noIdA


1,500

3,000

0

4,500

6,000

10,500

9,000

7,500

12,000

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth

3Q20

09

1Q20

10

3Q20

12

1Q20

13

3Q20

13

3Q20

14f

1Q20

14f

1Q20

11

3Q20

10

1Q20

12

3Q20

11

12,000

10,500

9,000

7,500

6,000

4,500

3,000

1.500

0


noIdA expressway 4,000 - 7,000

sector 71 to 83 4,500 - 5,500


40

30

20

10

0

sect

or 2

8, 2

9, 3

0

sector 28, 29, 30

sect

or 9

2/93

sector 92/93

sect

or 6

1, 62

., 63

sector 61, 62., 63

sect

or 5

0

sector 50

sect

or 4

4

sector 44

sector 61,62,63

sector 92 / 93 sector 28,29,30

sector 50 sector 44

Inr

per

sq.ft

.







seleCt neW PrOJeCts


Antriksh Aralias sector 150 Antriksh Group 4Q 2016 4,700

the downtown sector 98 sikka Group 4Q 2015 18,415 - 18,610

mirabella sector 79 mahagun Group 4Q 2016 4,650

saha Amadeas sector 143 saha Group 4Q 2016 6,500

Wave Livork sector 32 Wave Group 4Q 2017 8,850

NoIDA

the noIdA residential market witnessed •comparatively fewer launches in 3Q 2013 than in the previous two quarters and the higher cost of debt compelled over-leveraged developers to try to liquidate their land-banks and existing projects. As a result, developers refrained from launching new projects and concentrated on selling their unsold stock.

A number of developers offered various •giveaways such as gold coins and electronic gadgets, subvention in the emI, special cash discounts, free car parking, power backups, etc. to attract customers. customers responded well to these offers and the market witnessed marginal increase in sales activity.

the city did not witness any major completions •this quarter as those projects scheduled to complete this quarter were delayed until early 2014.

despite a revival in demand, overall capital •and rental values remained stable due to the high stock level. however, projects nearing completion witnessed a 5-10% increase in capital values due to high-end user demand.

coLLIers VIeW:• the market is expecting the completion of various projects that were launched during 2009-2010 and which have already been delayed from 1-2 years. this additional supply will keep rental values stable. capital values will also remain stable across all the micro markets although projects nearing completion may see marginal increases.


3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace

seleCt neW PrOJeCts


Imperia nungambakkam Adroit Urban developers 4Q 2014 23,000

Ingai poonamallee Vasavi housing & Infrastructure 4Q 2015 3,950

Lalique r.A.puram etA star property developers 4Q 2015 18,500

navarathina Ambattur Barath Building construction 4Q 2015 4,200

republic kovur Akshaya homes 4Q 2016 4,250

Whiteberry moolakadai navin housing & properties 4Q 2015 4,900


chennAI


Adya

r

Anna

nag

ar

nung

amba

kkam

Alw

arpe

t / r

A p

uram

Vela

cher

y

shol

inga

nallu

r

siru

seri/

ka

zipa

ttur

t na

gar

Beas

ant

naga

r

Boat

clu

b

6,000

2,000

10,000

18,000

14,000

22,000

26,000

38,000

34,000

30,000

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth

sholinganallur

Velachery

Alwarpet / r A puram

t nagar

Beasant nagar

Adyar

Anna nagar

nungambakkam

Boat club

siruseri/ kazipattur

Boat club

siruseri/ kazipattur

Velachery

sholinganallur

Anna nagar

t nagar

AdyarBeasant nagar

nugambakkam

Alwarpet / r A puram

1Q20

08

3Q20

08

3Q20

09

1Q20

09

1Q20

10

3Q20

10

1Q20

12

3Q20

12

1Q20

13f

3Q20

13f

1Q20

14f

3Q20

14f

1Q20

11

3Q20

11

25,000

21,000

17,000

13,000

9,000

5,000

1,000


Velachery 5,000 - 7,000

sholinganallur 3,500 - 4,200

siruseri/ kazipattur 3,000 - 4,000

kelambakkam 3,000 - 4,000

Inr

per

sq.ft

.

75

60

45

30

15

0








ChENNAI

during the quarter, increased traction was •witnessed in chennai’s residential market. the demand for premium and mid-segment projects remained upbeat. due to the area’s proximity to the Anna nagar & chennai bypass road, a lot of investment activity was witnessed in kolathur in north chennai. moreover, the completion of the perambur flyover helped to improve the access to this emerging location.

In 3Q 2013, numerous new projects were •launched in the city. Locations, including r.A. puram, nungambakkam, poonamallee, r.k. salai, moolakadai, Ambattur, kovur and polivakkam, had the largest number of new launches. most of these projects were priced in the range of Inr3,950 - 4,900 per sq ft. the premium projects that were launched in these areas had prices in the range of Inr18,500 - 23,000 per sq ft.

the average capital and rental values of the •prime residential market increased by 2 - 9% QoQ. however, as buyer sentiment remained subdued in response to the prevailing high mortgage rates, the capital values of mid-range properties remained stable during the quarter.

the state Government imposed an additional •charge of 2% on registration and made it mandatory that construction agreements signed between builders and buyers be registered. currently, the buyer of a new apartment that is under construction must pay 8% (5% stamp duty, 2% surcharge and 1% registration fee) to register the property.

coLLIers VIeW:• Adequate growth has been observed in the premium residential market over the last few quarters. considering the upright demand from end users and investors, capital and rental values are expected to increase by 2 - 5% in the near term.


3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace


BenGALUrU

seleCt neW PrOJeCts


purva skydale sarjapur road puravanakara Ltd. 4Q 2016 5,200

Unishire terraza thanisandra road Unishire projects 4Q 2016 4,300

pueblo off sarjapura road Lalith Gangadhar constructions 4Q 2016 7,500

raffles park Whitefield raffles residency 4Q 2015 7,500

nitesh British columbia kanakapura road nitesh estates 4Q 2016 3,900

sobha paldium Yemalur road sobha developers 4Q 2016 8,210




BENGALURU (BANGALoRE)

the Bengaluru residential market recorded •increased transaction volumes in both primary and secondary markets. high demand has been observed in the mid-segment residential projects from the It/Ites workforce. the micro-markets, which attracted significant interest from buyers were outer ring road (orr), Whitefield, Jakkur and koramangala.

A few national-level developers such as •puravankara projects Ltd, nitesh estates, sobha developers, raffles residency, Unishire and LGcL. developers launched their new projects in micro-markets like sarjapur, Whitefield, kanakapura, thanisandra and Yemalur. projects were launched in the price range of Inr4,000 to 8,000 per sq ft.

capital values witnessed an increase in the •range of 3 - 10% QoQ in select precincts of Jayanagar, Bannerghatta road and Yelahanka, while capital values in all other micro-markets remained stable.

rental values remained stable in almost •all micro-markets barring cooke town, Jayanagar and Yelahanka where rental values have increased in the range of 6 - 7% QoQ.

the karnataka stamps and registration •department has increased the guideline value for properties in the Bangalore Urban, Bangalore rural and ramanagara districts. the guideline values have been revised to the tune of 40 - 100% in selected areas.

coLLIers VIeW: Going forward, we expect •capital values in both the primary and secondary sales markets to remain stable considering the huge supply in the pipeline and the continuous addition of new projects. the It/Ites sector will remain the primary demand generator for mid-range residential properties.

4,000

0

8,000

16,000

12,000

20,000

24,000

28,000

32,000

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth


25,000

20,000

15,000

10,000

5,000

0



Airport road 5,000 - 7,000

Bannerghatta road 4,200 - 6,000

Whitefield 4,400 - 6,000

Yelahanka 3,500 - 5,000

Yela

hank

a

Yelahanka

Bann

ergh

atta

roa

d

Whitefield (Appts)

Airp

ort r

oad

Airp

ort r

oad

koramangala

Whi

tefie

ld

Bannerghatta road

Jaya

naga

r

Indiranagar

cook

e to

wn

Airport road

kora

man

gala

palace orchard

Indi

rana

gar

Jayanagar

pala

ce o

rcha

rd

cooke town

cent

ral

central80

60

40

20

0

1Q20

08

3Q20

08

1Q20

10

1Q20

09

3Q20

09

3Q20

10

1Q20

11

3Q20

12

1Q20

13

3Q20

13

1Q20

14f

3Q20

14f

1Q20

12

3Q20

11

central

Yelahanka

koramangala

Indiranagar

Jayanagar

Bannerghatta road

palace orchard

cooke town

Airport road

Whitefield

Inr

per

sq.ft

.





3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace

koLkAtA

seleCt neW PrOJeCts


merlin crest d h road merlin Group 4Q 2016 4,150

happy Villa rajarhat siddha Group 4Q 2016 3,000

siddha Water front khardah siddha Group 4Q 2016 2,300

north city Barrackpore Vibgyor Group 4Q 2015 2,615

sukhobristi phase III rajarhat shapoorji paloonji 4Q 2015 3,375

swarnalata Baruipur Apni dharti developers 2Q 2016 2,165





koLkATA

during 3Q 2013, micro-markets like dum dum, •sonarpur, rajarhat, Behala and regent park remain more active in terms of absorption in both primary and secondary markets. Various developers offered discounts in the range of 5 - 9% on the basic sales price to lure customers during the festive season.

numerous new launches were witnessed in •micro-markets like rajarhat, Barrackpore, khardah, Baruipur and d h road, where developers like Apni dharti developers, shapoorji paloonji, siddha Group, Vibgyor Group and merlin Group launched their residential projects in the price range of Inr2,165 - 4,150 per sq ft.

this quarter saw the completion of few •residential projects / parts of projects in micro-markets like narendrapur and rajarhat.

despite new launches and fair absorption, •capital values for the prime residential properties remained stable across all micro-markets. however, rents rose by 4 - 9% QoQ in micro-markets like tollygunge, Behela, Ballygunge, salt Lake, em Bypass, VIp road and new town – rajarhat.

the centre has approved the master •plan presented by the West Bengal state government to develop rajarhat new town as a solar city. the master plan proposes an investment of Inr 400 cr; has been prepared to reduce the projected energy demand from conventional power.

coLLIers VIeW:• demand in the kolkata market is primarily driven by the mid- segment; due to this, capital values in the middle and affordable segments are likely to see marginal appreciation. A number of developers are planning to develop premium properties in prime locations of south central kolkata.

3,000

1,000

7,000

5,000

11,000

9,000

13,000

15,000

17,000

19,000

21,000

Inr

per

sq.ft

.


2,000

4,000

0

6,000

8,000

10,000

12,000

14,000

16,000

18,000



tollygunge 3,600 - 4,800

Behela 2,900 - 3,700

salt Lake 4,000 - 6,000

em Bypass 4,000 - 7,000

new town -rajarhat 3,200 - 4,600

Alip

ore

Bhawanipur

Bally

gung

e

pA shah road

Bhaw

anip

ur

tollygunge

em B

ypas

s

Loudon street

pA s

hah

road

Behela

Loud

on s

tree

t

Alipore

new

tow

n -r

ajar

hat

em Bypass

salt

Lake

Ballygunge

tolly

gung

e

salt Lake

VIp

road

VIp road

Behe

la

new town rajarhat

Bhawanipur

em Bypass

Ballygunge

Behela

tollygunge

p A shah road

new town - rajarhat

Loudon street

Alipore

VIp road

salt Lake

1Q20

08

3Q20

08

1Q20

10

1Q20

09

3Q20

09

3Q20

10

1Q20

11

3Q20

12

1Q20

13

3Q20

13

1Q20

14f

3Q20

14f

1Q20

12

3Q20

11

Inr

per

sq.ft

.

50

40

30

20

10

0


Inr

per

sq.ft

. per

mon

th




3Q 2013 4Q 2013f

capital Value

rental Value

new project

construction pace

pUne

seleCt neW PrOJeCts


castel royale excellente Bhosale nagar ABIL Group 2Q 2016 6,000

elite silverio chikali-moshi elite Landmarks 4Q 2015 3,750

riviera Valentina Baner skywards developers 4Q 2015 8,500

rohan kritika sinhagad road right choice Builders 4Q 2015 8,600

sky Line Wakad Adi Group 4Q 2014 5,100

Water Bay kalyani nagar Brahma corporation 4Q 2016 5,200





pUNE

In 3Q 2013, fewer new residential projects •and new phases of on-going projects were launched in pune due to subdued demand. most of the developments are mainly located in areas such as kalyani nagar, Wakad, kharadi, hinjewadi, Wagholi and pimpri. new launches were priced, on average, from Inr 3,600 to 5,500 per sq ft, and Inr 8,500 to 13,000 per sq ft for premium projects, which are scheduled to be completed after 2016.

during 3Q, capital values in pune registered •a slight increase in the eastern and western blocks primarily in mid-segment projects; however, average capital values have remained almost unchanged in the main micro-markets.

parallel to capital prices, rental values have •marked a slight increase in main residential hubs including central areas of Boat club road, camp and deccan, as well as eastern suburbs, such as magarpatta, hadapsar, and western areas namely Baner, hinjewadi, pashan and Wakad.

In this quarter, the national Green tribunal •has approved the on-going construction of a 2.35-km road from Vithalwadi to the nh-4 bypass with a reduction in the width of the road from the proposed 30 m to 24 m and elevating it in the blue line area. In addition, the central government has approved a proposal to facilitate smooth transfer of government land for speedy execution of metro projects across the country.

coLLIers VIeW: Although a general •slowdown has been registered this year, with the onset of the festive period, developers are upbeat about the sales prospects in the upcoming quarter. new project launches will be lesser than in the previous year. rents and capital values are likely to remain stable across micro-markets.

1,000

3,000

7,000

5,000

9,000

13,000

11,000

15,000

Inr

per

sq.ft

.


11,000

10,000

8,000

9,000

7,000

6,000

5,000

4,000

3,000

2,000



kalyani nagar/Viman nagar/kharadi 5,000 - 12,000

Baner/hinjewadi/Wakad/pashan 3,800 - 6,000

kothrud/Bavdhan/Wajre 3,800 - 6,000

nIBm/Undri/kondhwa 3,800 - 5,000

pimpri/chinchwad/chakan 3,000 - 4,500

kaly

ani n

agar

/Vi-

man

nag

ar/k

hara

di

Bhaw

anip

ur

kalyani nagar/Viman nagar/kharadi Bhawanipur

decc

an/c

amp/

Boat

clu

b

deccan/camp/Boat club

Bane

r/h

inje

wad

i/W

akad

/pas

han

Baner/hinjewadi/Wakad/pashan

mag

arpa

tta/h

adap

sar

magarpatta/hadapsar

nIBm

/Und

ri/ko

ndhw

a

nIBm/Undri/kondhwa

koth

rud/

Bavd

han/

Waj

re

kothrud/ Bavdhan/ Wajre

pim

pri/c

hinc

hwad

/ch

akan

pimpri/chinchwad/chakan

30

25

20

15

10

5

0

1Q20

09

3Q20

09

1Q20

10

3Q20

10

1Q20

11

3Q20

11

3Q20

12

1Q20

14f

3Q20

14f

1Q20

13

3Q20

12

1Q20

12

kalyani nagar/Viman nagar/kharadi

kothrud/Bavdhan/Wajre

nIBm/Undri/kondhwa

pimpri/chinchwad/chakan

deccan/camp/Boat club/central pune

magarpatta/hadapsar

Baner/hinjewadi/Wakad/pashan

Inr

per

sq.ft

.In

r pe

r sq

.ft. p

er m

onth






Mumbaithe high-end residential real estate markets in mumbai include malabar hill, Altamount road, carmichael road, napean sea road, Breach candy, colaba, cuffe parade, prabhadevi, Worli, Bandra, khar, santacruz, Juhu and powai.

delhithe prime residential areas in delhi are in the south region and comprise Vasant Vihar, Westend, shanti niketan, Anand niketan and central delhi locations. these areas enjoy proximity to embassies, the airport and central commercial areas - connaught place.

Gurgaonthe prime residential locations of Gurgaon include Golf course road, dLf phase I, sushant Lok and sohna road. the delhi- Jaipur highway (nh-8) is also emerging as a preferred residential location owing to its proximity to the national capital.

nOidanoIdA premium residential market is comprised of sectors 44, 50, 92, 61, 62, 63 , 28, 29, 30 and taj express highway.

Chennaithe prime residential areas in chennai include thiruvanmiyur, Valmiki nagar and Besant nagar, r.A puram, mylapore and Adyar in south chennai, nungambakkam, chetpet, poes Garden, egmore, Alwarpet, t. nagar in central chennai; and Anna nagar, kilpauk in north West chennai.

Bengaluru (Bangalore)the residential market of Bengaluru comprises both apartments and independent residences. currently, high-end residential developments are mainly concentrated along the cBd, and eastern and south precincts of the city. recently, northern Bengaluru has also witnessed a spree of realty activity facilitated by the new International Airport at devanhalli.

Kolkatathe prime residential areas in kolkata include pA shah road, tollygunge and Bhawanipur in south kolkata, Alipore and Behala in south-west kolkata, Loudon street and Ballygunge in central kolkata; and salt Lake, em Bypass and VIp road in north kolkata.

Pune the prime residential areas in pune include kalyani nagar, Viman nagar, Boat club road, nIBm road, magarpatta, hadapsar, koregaon park. recently, increased activities has been witnessed in pimpri-chinchwad, Baner-pashan and kondhwa.

RESIDENTIAL SUBMARkETS

CITY BARoMETERS

Increasing as compared to previous quarter

decreasing as compared to previous quarter

remained stable from previous quarter

colliers International (India) provides property services to property Investors and occupiers. We deliver customised service solutions utilising local and global knowledge in partnership with our clients via our property Investment and occupier service lines. these service lines include - office services, facility management, project management, residential services, Investment services and Valuation & Advisory services.

www.colliers.com/india

for national residential services related queries please contact:

poonam mahtani, national director residential services & knowledge systems [email protected]: +91 22 4050 4551

This book is printed on 100% Recyclable paper

india | NOVEMBER 2013


aUtHOrs

amit Oberoi MriCsnational director, Valuation & Advisory; researchemail: [email protected]

surabhi arora MriCsAssociate director, researchemail: [email protected]

sachin sharmaAssistant manager, researchemail: [email protected]

Heliana ManoAssistant manager, research email: [email protected]

for general queries and feedback :[email protected] tel: +91 124 456 7580

this report and other research materials may be found on our website at www.colliers.com/India. Questions related to information herein should be directed to the research department at the number indicated above. this document has been prepared by colliers International for advertising and general information only. colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from.

© copyright 2012 - 2013 All rights reserved.

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$2.0 billion in annual revenue 1.1 billion square feet under management

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mArket

OFFICE PROPERTY MARKET OVERVIEW INDIA

QUARTERLY UPDATE | OCTOBER | 2013

Accelerating success. Accelerating success.

INDIA

QUARTERLY UPDATE | AUGUST | 2013

Residential Property Market Overview ASIA PACIFIC

OFFICE MARKET OVERVIEW1Q 2013


Trade Flows Bolster Industrial Demand in Asia and the Americas> Despite anemic U.S. job growth, demand for North American industrial

warehouse space and modern distribution centers remains strong. In Q1 2013, the North American vacancy rate declined for the eighth straight quarter, down 20 basis points to 8.20%. Canada’s vacancy rate stands at 4.13%.

> Thanks in part to a recent drop in exports to the United States, Mexico has seen slowing economic growth. In Q1 2013, several Mexico City industrial warehouses were vacated, slightly increasing the vacancy rate to 3.49%.

> While occupier demand for industrial property in Brazil remains strong, the market now appears to have stabilized into a more rational mode of sustained growth. São Paulo has seen positive net absorption, in spite of the final tally in 2012 showing a 23% decrease over the previous year.

> Demand for Beijing’s logistics properties remained as strong as it has been since 2011. Rents grew by 11.41% year-over-year as of the end of Q1 2013. Shanghai’s industrial sector remained stable, with average asking rents for ground floor premises of high quality facilities in both the logistics and workshop sectors unchanged.

> In Hong Kong, high quality warehouse buildings are nearly fully occupied. Those users seeking to expand or rationalize their real estate costs have had to consider the option of split operations in lower quality buildings.

> Indian economic growth remained sluggish through the end of 2012, however we expect industrial activity to improve, thanks to recent government actions. These include the government-proposed National Investment and Manufacturing Zones and the newly approved 51% foreign direct investment in multi-brand retail trading.

Global | Industrial | Midyear 2013HIGHLIGHTS

* December 2013 Rent (USD/PSF/YR)** Local currency

Global Top 10 Industrial Warehouse Rents*

6-Month Change in Rent**

LONDON (HEATHROW)

HONG KONG

SINGAPORE

TOKYO

OSLO

GENEVA

PARIS

HELSINKI

MINSK

SYDNEY

21.95

21.83

21.02

20.61

20.04

16.20

14.70

14.70

13.23

13.23

MINSK

OSLOSINGAPORE

SYDNEY

11.1%

3.9%

2.2%

12.5%

PARIS

HELSINKI

GENEVA

TOKYO

HONG KONG

LONDON - (HEATHROW)

LEGEND

EMEA

APAC

THE INTERNATIONAL INDIAN THE INTERNATIONAL INDIAN 5756

REAL ESTATEColliers International India Research

PUNE RESIDENTIAL MARKET LUXURIOUS YET AFFORDABLE

Factors Driving Growth· Rising per capita income

reflects in demand for houses

· Gradual shift in the

demographic profile with more

service professionals with higher

income range

· Falling Rupee making NRI

investments more lucrative

· High commercial absorption

indicates sustained demand

growth

Source: Maharashtra Economic Survey, RBI, Colliers International India Research

Pune is a classic example of the real estate market where commercial activities lead the residential development

in the city. Pune has a large manufacturing base, with many manufacturing as well as automobile companies having large plants. In last one decade the city has also emerged as a prominent IT/ITeS destination. Residential demand in the city is mostly from the large population of working professionals and the older generation retired from the mid-management cadre from Mumbai who find this place attractive due to affordability, peace and proximity to Mumbai. The

Colliers’s Pick: “The areas that will witness maximum uptake would be those having commercial or industrial activities such as Hinjewadi, Magarpatta, Viman Nagar, Kharadi, Wagholi, Chakan, Pimpri, Bavdhan, Warje & Talegaon”.

city also attracts students who are compelled by the city’s offering of quality education.

A large share of the upcoming premium residential space in Pune is in the form of township developments, the majority of which is concentrated in and around the IT and industrial hubs. In the past,

the city has seen considerable appreciation in property values. The government is also actively participating in the economic growth of the city by undertaking various infrastructure projects such as Pune Metro, Bus Rapid Transit (BRT) and High Capacity Bus Route.

Markets to witness residential real estate growth

For investment purpose, the new residential developments located in peripheral areas alongside the

commercial developments are most attractive. Pune witnesses multi-directional growth of residential projects in various locations such as Pimpri, Chinchwad, Chakan & Talegaon in North Viman Nagar

Kharadi & Wagholi in East, Baner, Hinjewadi, Wakad & Pashan, Kothrud, Bavdhan & Wajre in west and Undri & Kondhwa in the South.

Upcoming Infrastructure Driving City’s Growth

Tourists and Brands Flock to High Streets> Slower economic growth in China did not make a lasting dent on

tourist spending in Hong Kong. Retail sales have rebounded from the lows of Q3 2012. The latest figures from the Hong Kong Tourism Board show that Hong Kong received a total of 12.5 million inbound visitors during the three-month period ending May 2013, an 11.8% year-over-year increase. Nine million of those visitors were from Mainland China.

> Combined with the arrival of international brands such as Apple, Zara, and Topshop, in addition to luxury brands expanding their presence, the Australian CBD is once again a popular shopping destination. Pitt Street Mall in Sydney was ranked the 8th most expensive in Colliers’ High Street survey.

> Demand for flagship space in London continues to exceed supply, driven largely from international retailers seeking a share of the spoils. This is leading to some notable rental growth in the West End’s core locations, with Regent Street witnessing double digit annual rental growth.

> São Paulo and Rio de Janeiro remain leaders in shopping quality and diversity, achieving the most expensive rents and the focus of growth for luxury brands. Brazil’s High Street rents are the most costly in Latin America. São Paulo’s luxury shopping street Rua Oscar Freire saw a 15% growth in asking rents over the previous year. Rua Garcia D´Avila in Rio de Janeiro saw rents grow by 6.7%.

> Most U.S. high street rents grew over last year. In New York, Fifth Avenue rents grew by 11 percent. At $3,052 per square foot, Fifth Avenue rents are the most expensive in the world. On Las Vegas Boulevard, asking rents grew by 25 percent. Philadelphia’s Walnut Street showed the biggest gains in the U.S., with 33.8 percent growth.

Global | Retail | 2013HIGHLIGHTS

All Rents in USD* Exchange Rate as of March 31, 2013

$836 Milan, Via Monte Napoleone

$871 Sydney, Pitt Street Mall

$930 Zurich, Bahnhofstrasse

$1,114 Hong Kong, Causeway Bay

$1,994 Hong Kong, Canton Rd, Tsim Sha Tsui

$2,087 Hong Kong, Queen’s Road Central

$3,052 New York, NY, Fifth Avenue

$834 Paris, Champs Élysées

$1,325 New York, NY, Madison Avenue

$1,223 London, Old Bond Street

Top Ten Global Retail Rents - USD/SqFt/Year

Mumbai : raghavendra prabhu, office director [email protected] IndiaBulls finance centre, 1701-A, 17th floor, tower 3, elphinstone mills, senapati Bapat marg, mumbai, India - 400 013. tel : +91 22 4050 4527, fax : +91 22 2351 4272

delhi nCr : Ajay rakheja, office director [email protected]

new delhi : statesman house, 4th floor, Barakhamba road, connaught place, new delhi, India - 110001 tel : +91 11 3044 6423, fax : +91 11 3044 6500

Gurgaon : technopolis Building, 1st floor, dLf Golf course main road, sector 54, Gurgaon, India - 122002 tel : +91 124 456 7500, fax : +91 124 456 7502

Bengaluru : Goutam chakraborthy, office director [email protected] prestige Garnet, Level 2, Unit no.201/202, 36 Ulsoor road, Bengaluru, India - 560 042 tel : +91 80 4079 5500, fax : +91 80 4112 3131

Pune : suresh castellino, office director [email protected] hotel Le meridian, 101, r.B.m. road, pune, India - 411 001 tel : +91 20 4120 6438, fax : +91 20 4120 6434

Chennai : kaushik reddy, office director [email protected] heavitree complex, Unit 1c, 1st floor, 23, spurtank road, chetpet, chennai, India - 600 031 tel : +91 44 2836 1064, fax : +91 44 2836 1377

Kolkata : soumya mukherjee , office director [email protected] Infinity Business centre, Infinity Benchmark, room no 13, Level 18, plot G - 1, Block ep & Gp, salt Lake sector V, kolkata - 700 091 West Bengal, India tel : +91 33 2357 6501, fax : +91 33 2357 6502

THE INTERNATIONAL INDIAN July - August 201358

BENGALURU RESIDENTIAL MARKETHEAT’S UP

REAL ESTATECOLLIERS INTERNATIONAL INDIA RESEARCH

Over the last two decades, Bengaluru has cemented its position as the leading IT/ITeS. destination amongst

top Indian cities. In 2012, Bengaluru commanded a 30% market-share of all of the commercial (office) real estate absorbed across the top seven cities (Delhi NCR, Mumbai, Pune, Chennai, Hyderabad and Kolkata). Bengaluru’s commercial absorption share was greater than Mumbai and Delhi NCR. The increase in jobs has been the primary growth-driver for residential real estate. The city’s population is expected to exceed 12 million by 2020, as compared to 8.5 million in 2011.

Now of course the city is experiencing a surge in investors buying real estate. In spite of increasing prices, the city still is comparatively affordable compared to other major cities such as Mumbai and Delhi. With its higher rental yields and favourable currency exchange rates, Bengaluru is emerging as one of the most promising markets in the country for Residential investment. Moreover, the professional approach of developers is also providing much needed comfort to investors as well as end users. Considering the demand potential, it is not only Bengaluru-based developers that are investing, but many national level developers are also entering in this market.

The government is also actively participating in the

Colliers Picks:“The latest Colliers International research unvails top investment destination in Bengaluru (Bangalore)”

Office Absorption in Million sq ft among major 7 cities in India

Favorable exchange rate (INR/USD) 1 $ = INR 56.45

BenGALUrU resIdentIAL mArket

india residential property market overview november 2013

Real Estate