Small houses back in trend

Owing to sky-rocketing property prices, luxury apartments are losing their charm among the middle classes and small houses are gaining popularity again. Due to the massive slump in real estate market since the last couple of years, developers are now reducing the size of houses instead of decreasing the prices.

Top developers like Hiranandani, Kalpataru, Radius, Sai developers and Prajapati developers are coming up with projects having a large number of small apartments, industry observers report.

Pankaj Kapoor, MD at Liases Foras, a property research firm said, “The small size of flats gives dual benefit to the developers;  first , it helps them get tax benefit as developers constructing 30 sqm houses in non-metro locations are eligible for certain exemptions as per tax laws. Besides, the price of these apartments fits in the buyers’ budget.”

“There is a huge demand for smaller affordable houses. In a property exhibition held in Navi Mumbai recently, we received very good response from home buyers. We have to meet the demands of the people to survive and succeed in this kind of market,” said Harnam Singh of the Sawan Group.

Real estate agents are also disconcerted with the fact that people come to see the properties & make site visits, but once they start calculating, deals get aborted.

Further, vice-president of the Maharashtra Chamber of the Housing Industry (MCHI), Navi Mumbai, Manohar Shroff says that the demand for huge luxury apartments has fallen. Builders now have to construct houses in accordance with buyers’ demand. While many young couples prefer buying small houses in the beginning, most bachelors desirous of investing in property also find small houses the best option.

Two bids worth $ 1bn for property in Powai received by Hiranandani

It is heard that two bids totalling $ 1bn have been received by real estate giants Hiranandani for its property in Powai. As per sources, the bids have been received from an Indian PE Firm and Canadian Firm. Hiranandani is, apparently planning to sell commercial property measuring 4.5 million sq. ft in Mumbai’s suburbs. The process of reforging the company’s ownership to sell the Powai property has been initiated by the Hiranandani brothers. The idea being mooted is that the property sale is part of the company’s plans to convert itself from a partnership firm to a private limited company.

Hiranandani leases 19lakh sqft to TCS at Thane

Signaling the revival of the sluggish commercial real estate sales in the city, the largest deal in the office space has just concluded between TCS and Hiranandani. Software giant Tata Consultancy Services has signed on the dotted line to pick up 19 lakh square feet for its biggest office under one roof at Hiranandani Estate in Thane.

The parties have signed a 15-year contract with the option of a reset clause every three years. The monthly lease rental for the space is between Rs 50 and Rs 55 per sq ft. the annual lease rental for the entire 19 lakh sqft will be in the range of Rs 120 to Rs 130 crore. Hiranandani Constructions expects to deliver the office in the next 18 months which will have the capacity of accommodating over 30,000 TCS employees under one roof.

“We have given 19 lakh sq feet to Tata Consultancy Services on a long lease where they will set up a single beam IT Park. This will be the largest one in the country owned by a single company. The collaboration promises to generate employment for nearly 25,000 people,” said Niranjan Hiranandani while confirming the high profile transaction.

TCS has 19 offices in Mumbai and adjoining areas which include its headquarters, and 10 delivery centres and Thane.

Porperty Channel – MagicBricks Now

OK

Times Network is ready to launch India’s first housing and property channel known as “MagicBricks Now” and it is going on air from November 1, 2015.

On last Wednesday, officials from Times Network formally announced in New Delhi that they are ready to launch India’s first property channel “MagicBricks Now”. It is all set to go on air from November 1, 2015, and announcement was made in the presence of Union Minister of Urban Development, M Venkaiah Naidu.

According to M Venkaiah Naidu, “I am happy that now onwards there will be more focus on real estate sector and first time investors or buyers will have place to learn something in real estate sector. News and views should remain separate and it is expected that it will help to create the platform for the housing sector and it will help to tie up the government and real estate builders with an aim to create houses for all segments, to get succeed in central government’s mission “Housing for all by 2022”.

Why property channel?

In present the advertising market of real estate in India is about Rs 2,500 crore of which more than Rs 900 crore is garnered by the Times Group itself, especially in the print segment. And now by launching new channel MagicBricks Now”, the Times Group is attempting to increase the market share of real estate advertising as well as want to educate people about real estate trends and pricing factor. Faye D’Souza, the channel’s editor explained that how this new channel will focus on the end consumer with an aim to serve as a platform for the real estate development and infrastructure sector. The more he added that MagicBricks Now” will have singular focus i.e. to educate the end consumer.

How this new channel will deliver information and analysis?

This new channel will showcase rich array of programs which will range from debates to news bulletins and leadership insights to experts views and all about real estate market. These things will help the Times Group to keep the end consumer informed and on the same time to serve as a common meeting ground for experts, first time buyers, sellers, big investors, and real estate developers  who are looking for serious business in real estate sector.

MK Anand, MD and CEO of Times Network stated while explaining the positioning of the channel, “MagicBricks Now has been launched with sole ambition to guide the consumer through process and decision making process with the help of views, analysis and debate of real estate leaders and experts. In present, real estate is of paramount importance in the life of normal people and real estate market is full of jargon, confusion and complexities. “MagicBricks Now” will be first and best unbiased, trustworthy and most authoritative property channel in the Indian property market to help the consumers”.

Channel Programs:

The channel programs will include The Home Buyer’s Guide, The Vastu show, Real Estate Tycoon’s, The Property Guide, Property Hotline, The Interiors Show, of course, ‘The News’, every hour. However; the main spotlights of the channel will on the relevant issues such as; local civic amenities, national property, sustainability, and environment issues will make the channel accessible to all. The marketing campaigns for channel will be unfold post Diwali and MK Anand expects that there will be more viewership for MagicBricks Now in comparison of other English News channels. He expects the channel to reach on the break even in next 4 to 5 months.

While speaking about the association with Times Network to create new channel “MagicBricks Now” Sudhir Pai, CEO of MagicBricks.com stated that “Now onwards we will be the part of MagicBricks Now and we are delighted to be a part of this initiative. Our endeavor is to make our brand ubiquitous across media with an aim to provide real and trustworthy analysis and in-depth information to the consumers. And with this association we will leverage the visual appeal of television to communicate with end users through rich data and experts view”.

The channel will have four partners; Hiranandani, Magicbricks, Mantri and Lotus Green.

Global Rentals Chart

Owing to a vigorous demand from start-ups and e-commerce business, office rentals in major cities of India are experiencing a significant surge. The rising appetite for Indian commercial properties is attributed to about 67% of investments flowing into Indian real estate market from overseas which has been noted to be the highest among all other countries.

Indian cities of Mumbai, Delhi and Bangaluru have topped the global commercial property market with regards to annual rental yields as demand for commercial spaces has picked up in recent times. While Bengaluru topped the list with 10.5% annual yield, other cities like New York, Singapore, London, Tokyo and Hong Kong ranged between 2.9% and 7%, indicates a global survey of property consultant Knight Frank. Mumbai and Bengaluru have also featured among the list of top 5 global cities for future rental growth and the anticipated growth is nearly 22% and 16% for both cities respectively.

Currently, these cities are facing severe paucity of good quality office space in the face of strong demand which is creating an upward pressure on office rentals that is expected to scale up in the range of 6-7% in the next six months year-on year,” says Samantak Das, Chief Economist & National Director of Research, Knight Frank India.

Although the aggregate vacancy level of commercial spaces is at 17%, occupiers and investors are facing a challenge in procuring quality office spaces across prime business districts in the country where vacancy is in single digits.

The Indian commercial real estate sector is making a comeback after experiencing massive slump for over three years.  With a healthy pipeline and recent large ticket transactions, early signs of revival are being observed.

Big corporate occupiers are returning to the market hinting at an improved business sentiment. Bengaluru and Mumbai have been leading with these large transactions.   In May this year, while Tata Consultancy Services leased over two million sq ft of built-to suit space at Hiranandani Estate in Thane in Mumbai, Flipkart hired a 2-million sq ft custom-built office campus in Bengaluru.