Offline checks before you buy

Real estate is a big ticket item; a great deal of contemplation is required before you sign on the dotted line. A visit to past projects is a must and gauges the level of satisfaction of past buyers. Next, try to find if the developer has a strong intent to deliver the project on time. One can make a successful purchase decision only upon feeling the vibes you get after visiting the project site.

Check whether the builder has received all the approvals. A prospective buyer must insist on seeing all the relevant documentation related to a residential property purchase, including clear land title, development permits and the commencement certificate.

Before writing the first cheque, clarify all your doubts in a face to face meeting with the builder and take all his commitments in black & white. Ensure the price being quoted is all-inclusive.

What are the risks involved?

Online transactions in the real estate sector are different from those taking place in clothing, FMCG or electronics. You can go online and search for the price of a cell phone and the results will throw the best website to buy that phone with complete information on the product.

In the real estate space however, while some developers quote only the basic price, others quote the basic price with IDC and EDC (internal and external development charges), and some others quote it with the service tax and others without it. So, while you could get many price quotes, you can’t be assured that more charges will not be tacked on later.

It is therefore imperative that one does both a thorough online as well as offline scrutiny before inking any real estate deal via the online route.

IDBI Federal Life acquires commercial space worth Rs. 111 crore in Lower Parel

In an out-and-out real estate deal, which is the largest so far this year, IDBI Federal Life Insurance Company has bought office space worth over Rs 111 crore at Marathon Futurex complex at Lower Parel in Mumbai, according to sources familiar with the development.

Marathon Realty is developing this eight lakh sq ft office building in three phases, of which two phases up to 26 floors have already been completed. IDBI Federal Life has acquired around 62,000 sq ft space spread over two floors -22nd and 23rd floors -of the 26-storey tower.

The deal works out to approximately Rs 18,000 per sq ft which is within the range of current property rates for outright transactions. Office property rates in Mumbai’s secondary business district of Lower Parel are in the range of Rs 18,000-20,000 per sq ft basis the profile and facilities offered in commercial complexes in the locality.

“The deal is complete and registered last week. This office space can accommodate a total of 450 employees,” said a source.  “We have acquired the property in line with its growth strategy and plan to start operating from the new office in a few months.”

The complex, with multi-level car park, also houses offices of Tata Group’s consulting firm Tata Strategic Management, HDFC, India subsidiary of Paris-based global cosmetics major L’Oreal, and the Consulate General of Israel. The commercial project has already completed two phases of planned development; and the third phase is expected to finish in the next two years, which will take the tower to 38th floor, making it one of the tallest commercial towers in India.

SBI to buy property of Air India

India’s leading public sector bank, State Bank of India has received all necessary approvals from government opportunities to buy residential properties of cash-starved national carrier, AI (Air India) in south Mumbai for Rs. 90 crore.

As per the sources of PTI, “State Bank of India has got all the required approvals as it has conveyed its willingness to buy residential and commercial properties from Air India. Now State Bank of India is waiting for the approvals to complete the procedure from their side. Now this state owned bank is planning to allocate these flats or apartments to its top executives of the rank of general managers and deputy managing directors.

Now Air India had been looking for buyers who can buy their properties which contain their four flats at up-market in Peddar road at south Mumbai since last two years. In August 2013, the Air India has floated e-auctioning bids for four flats. However these 3-BHK flats measures 2,033 sq ft in carpet area. On proposed real estate deal while confirming the communication from the bank, an Air India official stated that Indian airline has sent the proposal to the Civil Aviation Ministry for its approval. The more they added that the proposal is now in the side of Ministry for its approval. Air India has some of the working capital which they have borrowed from SBI, besides long terms loan. it is expected that the funds raised from the sale would help them to reduce their working capital loan besides reducing the interest outgo.

The decision to sell these flats or property is the part of national carrier’s plan to unlock the value in its land assets. Under the land monetization plan, now Air India is planning to mop up Rs. 5,000 crore in the period of 10-year to match the balance between its revenue and expenditure.