residential property market overview nov 2012
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Accelerating success.
Residential Property Market OverviewINDIA
QUARTERLY UPDATE | NOVEMBER | 2012
www.colliers.com
SBI Home Loan Rate for Loan Amount upto INR 30 Lakhs. SBI Fixed Deposit rate for a period of more than one year and
amount less than INR 1 Crore
ECONOMIC BAROMETER
RETuRN ON AlTERNATIvE INvEsTMENTs
Oct-11 Oct-12
REPO RATE 8.50% 8.00%
REVERSE REPO RATE 7.50% 7.00%
CRR 6.00% 4.25%
INFLATION 9.87% 7.45%
HOmE LOAN RATE 10.00% 10.00%
Oct-11 Oct-12 YoY %
Change
GOLd 26,887 30,961 15.15%
SILVER 53,371 59,921 12.27%
FIxEd dEPOSIT 8.25% 8.50% 3.03%
EQUITY 17,025 18,713 9.92%
REALTY INdEx 1,836 1,879 2.36%
RESEARCH & FORECAST REPORTsYDNEY CENTRAl BusINEss DIsTRICT
INdIA RESIdENTIAL mARkETREsEARCh REpORT
3Q 2012 | RESIDENTIAL
2
2
1
1
Repo Rate Reverse Repo Rate Cash Reserve Ratio Wholesale Price Index
ECONOMIC INDICATORs
In P
erce
ntag
e
MACRO ECONOMIC OvERvIEW
India’s GdP growth has slowed to a 3 year low at 5.3% in the April-June quarter of the current •fiscal. The wholesale price index reached 7.45% in October this year much above the RBI’s expected range.
As the inflation remained higher, the central bank did not provide any repo rate cut this quarter. •However, in October 2012, the RBI did reduce the (CRR) Cash Reserve Ratio by 25 basis points to induce immediate liquidity in the market in its mid-year policy review. Earlier, in July 2012, the RBI also reduced its SLR (Statutory Liquidity Requirement) by 1%.
Foreign direct investment (FdI) in India was around $1.76 billion in July 2012. Sectors which •received large FdI inflows were Services, Pharmaceuticals, Construction and Power.
during this festive season the Indian banking sector offered cheaper home loans rates and lower •processing fee to boost the sagging housing market across the country. For example State Bank of India reduced its processing fee by half across all loans volumes till 31 december 2012. Similarly, Punjab National Bank offered full waiver on processing fee till Nov 2012. Other banks like ICICI, Federal Bank and Bank of Baroda are providing concessional interest rates during this season.
The Finance minister has announced a slew of reform measures such as diesel price hike, cap •on the number of subsidised cooking gas cylinders per family, liberalising foreign holding norms in aviation, multi-brand retail, non-news broadcasting and power exchanges sectors, and divesting its stake in five companies. However, most of these reform measures faced strong opposition and implementation of these measures is still uncertain.
4.0
3.0
6.0
5.0
8.0
9.0
7.0
11.0
10.0
12.0
Feb
‘08
Feb
‘09
dec
‘08
Oct
‘09
Feb
‘11
dec
‘10
Apr
‘08
Apr
‘09
Apr
‘10
Feb
‘10
dec
‘09
Apr
‘11
Jun
‘08
Jun
‘09
Jun
‘10
Jun
‘11
Oct
‘08
Aug‘
08
Augt
‘09
Oct
‘10
Aug‘
10
Aug
‘11
Feb‘
12
Apr
‘12
Oct
‘12
AUg
‘12
Jun
‘12
dec
‘11
Oct
‘11
2.0
1.0
0.0
(-1.0)
Source: Colliers International India Research
CApITAl vAluE TRENDs
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
09
1Q20
10
2Q20
10
3Q20
11
2Q20
11
1Q20
11
4Q20
10
3Q20
10
2Q20
08
1Q20
08
INR
per
sq ft
75,000
5,000
25,000
35,000
15,000
45,000
65,000
55,000
3Q20
08
malabar Hill, Altamount Road, Carmichael Road
Powai
khar
Prabhadevi
Colaba, Cuffe ParadeBandra
Andheri
Worli
Juhu
Breach Candy, Napeansea Road, Peddar Road
3Q20
12
2Q20
12
1Q20
12
4Q20
11
2Q20
08
3Q20
08
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
08
1Q20
10
2Q20
10
3Q20
10
COllIERs REsIDEX 3Q 2012 - MuMBAI
50
60
70
100
90
80
120
140
150
130
110
Santacruz
Rebase to 100 in 4Q 2008
COllIERs INTERNATIONAl | p. 3
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Crescent Bay Parel L&T 4Q 2017 17,500
New Cuffe Parade (New Tower) Wadala Lodha Group 4Q 2017 16,500
New Vinay Santacruz kabra & Associates 4Q 2014 16,000
Venezia Parel Lodha Group 4Q 2017 19,980
CITY REsIDENTIAl BAROMETER
mUmBAI
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
Cola
ba, C
uffe
Para
de
INR
per
sq ft
mal
abar
Hill
, Alta
mou
nt
Road
, Car
mic
hael
Roa
d
Wor
li
Brea
ch C
andy
, Nap
eans
eaRo
ad, P
edda
r Ro
ad
Prab
hade
vi
Band
ra
Sant
acru
z
Andh
eri
Pow
ai
khar
Juhu
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
Prabhadevi
Colaba, Cuffe Parade
Breach Candy, Napeansea Rd.,
Peddar rd.
malabar Hill, Altamount Road, Carmichael Road
200
150
100
50
0
Powai
Andheri
Juhu
khar
Santacruz
Worli
Bandra
INR per Sq ft Per month
MuMBAI
during 3Q 2012, mumbai’s residential •market witnessed the launch of several new projects, such as “New Vinay” by kabra & Associates at Santacruz; “Crescent Bay byL&T at Parel; "Venezia” and a new tower in “New Cuffe Parade” by Lodha Group at Parel and Wadala, respectively. All of these projects were priced in the range of INR 16,000 per sq ft to INR 20,000 per sq ft.
during the last 2 quarters, construction •activity remained slow and no new residential projects/phases of projects completed in mumbai.
Capital values in the western and central parts •of mumbai increased in the range of 1-2% QoQ. However, in south-central locations, such as malabar Hill, Altamount Road, Carmichael Road, Breach Candy, Napeansea Road, Peddar Road, Colaba and Cuffe Parade, and central locations, such as Powai, capital values remained stable.
The rental values of premium residential •properties remained stable in almost all of the micro markets, except in those, such as Worli, Prabhadevi and Powai, where rents increased by 1%, and those micro markets in south-central locations, where rents declined by 1%.
The State Government of maharashtra passed •the maharashtra Housing Regulation and development Bill 2012. The aim of the bill is to bring transparency to the realty sector and empower end-users by protecting their interests from the objectionable practices of builders.
Note: * Base selling price as quoted by developer
140
p. 4 | COllIERs INTERNATIONAl
ONgOINg pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Capital Greens Shivaji marg dLF Ltd. 2Q 2015 14,000
Castewood Okhla Indiabulls Ltd. 4Q 2013 12,800
kings Court Greater kailash- II dLF Ltd. 1Q 2015 36,000
metro Park dwaraka morh Umang Realtech 4Q 2014 8,500
Queens Court Greater kailash- II dLF Ltd. 1Q 2015 30,000
Winter Hills dwaraka morh Umang Realtech 4Q 2013 7,000
DElhI
during 3Q 2012, limited new supply was •added to the city’s premium residential inventory; only few small-scale redevelopment residential projects were ready for possession in locations such as Anand Niketan, defence Colony, Vasant Vihar and Shanti Niketan.
No new premium residential project was •launched during this quarter.
In 3Q 2012, capital values for premium •residential properties increased marginally in almost all the micro markets, a few micro markets like Shanti Niketan, Anand Niketan, Friends Colony and Greater kailash, where capital value increased in the range of 3 to 8% QoQ. This could be attributed to the new construction happening in these micro markets, which in turn pegging up the capital values.
Rental values for premium residential •properties appreciated in the range of 3 to 7% QoQ across all the micro markets. The rentals increase was primarily attributed to the limited supply of prime residential properties.
In this quarter, the delhi State Government •has started allocating the first batch of 500 low-cost flats in Bawana to the slum dwellers. The entire project consists of 14,000 low-cost flats in eight slum clusters in West and South delhi, which are expected to be ready by the end of 2012. Correspondingly, flats will be allotted to the slum dwellers.
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
CApITAl vAluE TRENDs
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
dELHI
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
90,000
100,000
80,000
Anan
d Ni
keta
n,
Vasa
nt V
ihar
Panc
hash
ila, A
nand
lok,
Niti
Bagh
, SdA
Frie
nds
Colo
ny,
mah
aran
i Ba
gh
Shan
ti Ni
keta
n,
Wes
tend
Grea
ter
kaila
sh
I & II
, Sou
th
Exte
nsio
n
Golf
Link
s, J
or B
agh,
Su
nder
Nag
ar
Chan
akya
Pur
i
Prith
vira
j Roa
d,
Aura
ngze
b Ro
ad
INR
per
Sq F
t
10,000
0
20,00030,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
1Q20
08
2Q20
08
1Q20
09
2Q20
09
3Q20
09
1Q20
10
3Q20
08
4Q20
08
4Q20
09
2Q20
10
3Q20
10
4Q20
10
3Q20
11
1Q20
11
2Q20
11
Golf Links, Jor Bagh, Sunder Nagar
Shanti Niketan, Westend
Friends Colony, maharani BaghPanchashila, Anandlok, Niti Bagh, SdA
Greater kailash I & II, South Extension
Chanakya Puri
Prithviraj Road, Aurangzeb Road
Anand Niketan, Vasant Vihar
INR
per
Sq F
t
Golf Links, Jor Bagh, Sunder Nagar
Chanakya Puri
Prithviraj Road, Aurangzeb Road
Anand Niketan, Vasant Vihar
Greater kailash I
& II, South Extension
Friends Colony, maharani Bagh
Shanti Niketan, Westend
Panchashila, Anandlok, Niti Bagh, SdA
200
160
120
80
40
0
3Q20
12
2Q20
12
1Q20
12
4Q20
11
COllIERs REsIDEX 3Q 2012 - DElhI
50
60
70
80
90
100
110
120
150
130
1Q20
08
2Q20
08
3Q20
08
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
INR per Sq ft Per month
Note: * Base selling price as quoted by developer
Rebase to 100 in 4Q 2008
CApITAl vAluE TRENDs
COllIERs REsIDEX 3Q 2012 - guRgAON
Rebase to 100 in 4Q 2008
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
2Q20
12
3Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
0
20
40
100
80
60
140
200
180
160
120
COllIERs INTERNATIONAl | p. 5
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Golf Avenue Sector 106 CHd developers 4Q 2015 5,450
Gurgaon Greens Sector 102 EmAAR mGF 4Q 2015 6,500
Heritage max Sector 102 Conscient 4Q 2015 6,200
The Summit Sector 104 Godrej Properties 4Q 2015 5,350
Wind Chants Sector 112 Experion developers 4Q 2016 6,500
COllIERs INTERNATIONAl | p. 5
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
guRgAON
In this quarter several premium projects •were launched on dwaraka Expressway in Gurgaon, including: “Golf Avenue” by CHd developers at Sector 106, “The Summit” by Godrej Properties at Sector 104, “Gurgaon Greens” by EmAAR mGF and “Heritage max” by Conscient, both of the projects were located at Sector 102, and “Wind Chants” by Experion developers at Sector 112.
Construction activities were slow and no •premium residential projects/phases of the projects were ready for possession in Gurgaon during the quarter.
due to the festival season a number of •developers offered attractive offers like discount on the base per sq.ft. price and interest free period and free EmIs for 1 to 2 months.
In 3Q 2012, capital values for premium •residential properties remained stable in almost all the micro markets, barring a few micro markets like “dLF Phase I” and Sohna Road and its extension road, an increase in the range of 2 to 4% was registered on quarter on quarter basis.
during the same quarter, rental values for •premium residential properties remained stable in all micro markets. This is due to ample supply available in location like Golf Course Road Extension and Sohna Road.
In this quarter the Punjab and Haryana High •Court has restrained the Haryana Urban development Authority (HUdA) from issuing new licenses to developers in Gurgaon unless they give an undertaking that groundwater would not be used for construction work. This decision was comes after the water scarcity arose in the city this summer.
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
GURGAON
Sohna Road & Ext
Golf Course Road
NH-8
Sushant LokdLF Phase I
80
60
40
20
0
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
09
1Q20
10
2Q20
10
1Q20
11
2Q20
11
3Q20
11
4Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
10
3Q20
10
18,000
16,000
14,000
2,000
0
4,000
8,000
6,000
10,000
12,000
3Q20
08
NH-8
Sushant Lok
dLF Phase I
Golf Course Road
Sohna Road & Ext
INR
per
sq ft
Golf
Cour
se R
oad
Sohn
a Ro
ad &
Ext
dLF
Phas
e I
Sush
ant L
ok
NH -
8
0
3,000
6,000
9,000
12,000
18,000
15,000
INR
per
sq ft
INR per Sq ft Per month
Note: * Base selling price as quoted by developer
INR per Sq ft Per month
p. 6 | COllIERs INTERNATIONAl
NOIDA
In 3Q 2012, several premium projects were •launched including “Ajnara Ambrosia” by Ajnara Group at Sector 118; “Jaypee kasablanca” and “Jaypee kristal Court”, both by Jaypee Group at Sector 128; “Lotus Peak” by 3C Group at Sector 100; and “Prateek Edifice” by Prateek Group at Sector 107.
Construction activity during this quarter •remained slow, resulting in only a few projects being completed these includes “34 Pavilion Aristo” by Supertech Ltd at Sector 34. The project was priced at INR 6,650 - 7,000 per sq ft.
In order to boost sales during the festive •season many developers are offering like LCd/LEd TVs or a trip abroad or wavier of additional charges over the basic sales price.
during the same quarter, capital values in •NOIdA appreciated in the range of 1 to 5% QoQ in almost all of the micro-markets; however, Sector 44 remained stable.
Rental values were stable in most of the micro •markets but it is evident that values in more favorable locations such as Expressway and the Institutional sectors. continue to show an upward trend. demand for newly completed apartments was strong as tenants have become more discerning and are looking for residential facilities with amenities such as allocated parking, green areas, swimming pools, etc.
In order to ease the traffic conditions in •NOIdA, the Authority (NOIdA) has planned eight flyovers, 13 foot over bridges, multi-level car parking, 2 major roads and 6 elevated roads. This will further improve the real estate sentiment in the city.
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
NOIdA
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
0
2,000
4,000
6,000
8,000
10,000
Sect
or 2
8, 2
9, 3
0
Sect
or 9
2/93
Sect
or 6
1, 62
., 63
Sect
or 5
0
Sect
or 4
4
INR
per
Sq F
t
3Q20
09
0
2,000
4,000
6,000
12,000
10,000
8,000
1Q20
10
2Q20
10
3Q20
10
4Q20
09
1Q20
11
2Q20
11
3Q20
11
4Q20
10
Sector 61,62,63
Sector 28,29,30
Sector 44
Sector 92 / 93
Sector 50
INR
per
Sq F
t
Sector 50
Sector 44
Sector 28,29,30
Sector 92/93 Sector 61,62,63
40
30
20
10
0
CApITAl vAluE TRENDs
3Q20
12
2Q20
12
1Q20
12
4Q20
11
COllIERs REsIDEX 3Q 2012 - NOIDA
0
20
60
40
80
120
100
140
180
160
200
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Ajnara Ambrosia Sector-118 Ajnara Group 4Q 2015 4,200
Jaypee kasablanca Sector-128 Jaypee Group 1Q 2014 9,000
Jaypee kristal Court Sector-128 Jaypee Group 1Q 2016 8,100
Lotus Peak Sector-100 3C Group 4Q 2014 7,750
Prateek Edifice Sector-107 Prateek Group 1Q 2015 6,500
Note: * Base selling price as quoted by developer
Rebase to 100 in 4Q 2008
CApITAl vAluE TRENDs
COllIERs REsIDEX 3Q 2012 - ChENNAI
Rebase to 100 in 4Q 2008
1Q20
08
2Q20
08
3Q20
08
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
20
80
60
40
100
140
160
180
120
INR per Sq ft Per month
COllIERs INTERNATIONAl | p. 7
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
CHENNAI
Adyar
Anna Nagar
Nungambakkam
Boat Club
Siruseri/ kazipattur
Sholinganallur
Velachery
Alwarpet / R A Puram Beasant Nagar
T Nagar
75
60
45
30
15
0
1000
5,000
13,000
9,000
21,000
25,000
17,000
3Q20
08
4Q20
08
2Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
09
1Q20
10
2Q20
10
3Q20
11
3Q20
12
2Q20
12
1Q20
12
2Q20
11
1Q20
11
4Q20
10
3Q20
10
1Q20
08
Boat ClubBeasant Nagar
NugambakkamSiruseri/ kazipattur
Velachery
Sholinganallur
Alwarpet / R A Puram
Anna Nagar
T NagarAdyar
INR
per
sq ft
Boat
Clu
b
Nung
amba
kkam
Anna
Nag
ar
T Na
gar
Beas
ant N
agar
Adya
r
Shol
inga
nallu
r
Alw
arpe
t / R
A P
uram
Vela
cher
y
Siru
seri/
kaz
ipat
tur0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
22,000
24,000
20,000
INR
per
sq ft
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Atlantis Nelson manickam Road Ramky Wavoo 4Q 2013 12,500
Auburn Perungudi, OmR Casa Grande 1Q 2014 7,000
Prince Courtyard Poonamallee High Road Price Foundations 1Q 2014 14,000
Quadrant Adyar TVH 2Q 2014 13,500 - 14,000
Space Aura Navalur, OmR Evocon 4Q 2013 3,750
Tropicana Residences kanathur, East Coast Road Rajeshwari Founda-tions 2Q 2014 10,500
4Q20
11
ChENNAI
during this quarter, a number of projects / •phases of projects were completed, including “Fair deal” by Fair deal Construction at Adyar; “Tivoli” by Landmark Construction at mogappair; “Bhandari” by Sterling Builders; “Hillside” by Bolliineni developers at Sithalapakkam; “Akarshana” by Royal Splendour and “Step Stone” by Step Stone Builders, both at Tambaram; “Atvarika” by Asvini Builders at kelambakkam; “Home dale” by ICIPL Projects; and “Golden County” by Hallmark Infrastructures, both at maraimalai Nagar; “Summit” by Chaitanya at Shastri Nagar; and “Varuna” by Radiance Realty at Alwarpet.
In 3Q 2012, the residential real estate market •remained active and several new projects were launched during this festive season. most of these projects were launched in the price band of INR 10,000 - 14,000 per sq.ft., except few projects like “Space Aura” and “ Auburn” which were laucnhed at a price of INR 3,750 and INR 7,000 per sq.ft. respectively.
In this quarter, some developers offered •waivers of pre-EmI interest during the project implementation stage. This was part of their strategic alliance with financial institutions.
In 3Q 2012, capital values for premium •residential properties appreciated in the range of 3 to 7% in almost all micro-markets . This is due to new projects, being launched at a higher price than the prevailing market rate.
during the same quarter, rental values for •premium residential properties appreciated in the range of 4 to 9% in almost all micro-markets, barring Nungambakkam, Anna Nagar, Adyar, Velachery and Sholinganallur where rents remained stable.
Note: * Base selling price as quoted by developer
p. 8 | COllIERs INTERNATIONAl
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
02,000
4,000
8,000
6,000
10,000
14,000
16,000
22,000
20,000
18,000
12,000
Yela
hank
a
Whi
tefie
ld (A
ppts
)
kora
man
gala
Bann
ergh
atta
Ro
ad
Indi
rana
gar
Airp
ort R
oad
Pala
ce O
rcha
rd
Jaya
naga
r
Cook
e To
wnIN
R pe
r Sq
Ft
Cent
ral
1Q20
08
2Q20
08
3Q20
08
INR
per
Sq F
t
0
2,000
5,000
10,000
15,000
20,000
25,000
2Q20
10
4Q20
09
1Q20
10
4Q20
08
1Q20
09
2Q20
09
3Q20
09
3Q20
10
4Q20
10
1Q20
11
2Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
3Q20
11
Central
Yelahanka
koramangala
Indiranagar
Cooke Town Jayanagar
Bannerghatta Road
Palace Orchard
Airport Road
Whitefield
CApITAl vAluE TRENDs
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
Palace Orchard
Jayanagar
Cooke Town
Central
Yelahanka
Whitefield (Appts)
koramangala
Bannerghatta Road Airport Road
Indiranagar
80
60
40
20
0
BENGALURU
COllIERs REsIDEX 3Q 2012 - BENgAluRu
60
70
80
90
100
110
120
140
130
1Q20
08
2Q20
08
3Q20
08
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Bangalore West One Rajaji Nagar Phoenix 4Q 2015 8,500
East Parade Old madras Road Jains Heights 4Q 2015 4,950
mantri Harmony kanakpura Road mantri developers 4Q 2015 4,490
Prestige Ferns Residency Haralur Road Prestige Constructions 4Q 2015 4,550
Prestige misty Waters Hebbal Prestige Constructions 4Q 2015 5,500
INR per Sq ft Per month
BENgAluRu (BANgAlORE)
In 3Q 2012, several premium projects were •launched including “Bangalore West One” by Phoenix Group at Rajaji Nagar; “Prestige misty Waters” and “Prestige Ferns Residency” by Prestige Construction at Hebbal and Haralur Road, respectively; “mantri Harmony” by mantri developers at kanakpura Road; and “East Parade” by Jains Heights at Old madras Road. most of these projects are priced in the range of INR4,500 to 5,500 per sq ft.
during the same quarter, a number •of projects / part of the projects were completed including “Salarpuria Greenage” by Salarpuria developers at Bomannahalli; “Golden Grand” by Golden Gate Properties at Tumkur Road; “Arun Patios” by Arun Shelter at Yelahanka; “Windmills of your mind” by Total Environment; “Park View Apartment” by Parkway developers; and “Rakesh Heights” by Rakesh developers, all of which are located at Whitefield.
Capital values in Central, Palace Orchard, •Bannerghatta Road and Whitefield appreciated in the range of 2 to 6%; however, at a few micro-markets like “Cooke Town”, “Airport Road” and “Yelahanka”, values declined in the range of 3 to 8% QoQ. The rest of the micro-markets remained stable.
On the contrary, rents declined in the range of •3 to 9% in almost all micro-markets, except for Central, Airport Road, Bannerghatta Road and Yelahanka, which remained stable.
In this quarter, The National Highways •Authority of India (NHAI) and the State Public Works department (PWd) has initiated the Satellite Town Ring Road (STRR). With the improvement in connectivity the project will further boost the real estate activities in these locations in the near future.
Note: * Base selling price as quoted by developer
Rebase to 100 in 4Q 2008
Rebase to 100 in 4Q 2008
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
COllIERs REsIDEX 3Q 2012 - KOlKATA
50
60
70
120
110
90
100
80
140
150
130
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Astitva kankurgachi mCk PGE Projects 4Q 2014 9,500
Avani Estates Em Bypass Avani Group 4Q 2014 5,040
Ideal Aqua view Salt Lake, Sector 5 Ideal Group 4Q 2015 3,800
Ideal Grand Howrah Ideal Group 4Q 2015 6,000
magnolia Skyview Rajarhat magnolia Infrastructure 4Q 2015 2,500
mani Imperial Ultadanga mani Group 4Q 2014 8,750
COllIERs INTERNATIONAl | p. 9
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
CApITAl vAluE TRENDs
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
kOLkATA
Alipore
Tollygunge
PA Shah Road
Bhawanipur
New Town - Rajarhat
VIP Road
Em Bypass
Ballygunge
Salt Lake Behela
Loudon Street
40
30
20
10
0
3Q20
08
4Q20
08
2Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
09
1Q20
10
1Q20
11
2Q20
10
2Q20
11
3Q20
10
3Q20
11
4Q20
10
3Q20
12
2Q20
12
1Q20
12
4Q20
11
2,000
0
4,000
8,000
6,000
10,000
12,000
14,000
1Q20
08
Bhawanipur
Em BypassBallygunge Loudon Road
Behela
Alipore Tollygunge
P A Shah RoadNew Town - Rajarhat
VIP RoadSalt Lake
INR
per
sq ft
Bhaw
anip
ur
PA S
hah
Road
Tolly
gung
e
Loud
on S
tree
t
Behe
la
Alip
ore
Em B
ypas
s
Bally
gung
e
Salt
Lake
VIP
Road
New
Tow
n Ra
jarh
at
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
INR
per
sq ft
INR per Sq ft Per month
KOlKATA
In 3Q 2012, the projects/phases of projects •that were completed include “Fortune Township - Phase II” by Fortune Realty at Barasat and “merlin Cambridge” and “merlin Trinayoni” by merlin Group at Prince Anwar Saha Road and Behala, respectively. “mayfair Palms” by mayfair Group at Harinavi and “meena Residency” by Gm Group at Rajarhat were also completed.
during the quarter, a number of new projects •were launched including “Astitva” by mCk PGE Projects at kankurgachi, “magnolia Skyview” by magnolia Infrastructure at Rajarhat”, Avani Estates” by Avani Group at Em Bypass, “Ideal Grand” and “Ideal Aqua view” by Ideal Group at Sector 5 and “Panchasheel Vatika” by mk Group at Birati. All of these projects were launched in the price range of INR 5,000-9,500 per sq ft, except for “magnolia Skyview” and “Panchasheel Vatika”, which were priced at INR 2,500 per sq ft.
during the quarter, a healthy absorption rate •for residential developments was witnessed across kolkata. On a quarterly basis, capital values appreciated in the range of 4-7% in almost every micro market. However, micro markets, such as Behela, Salt Lake and New Town – Rajarhat, remained stable.
Following the trend of capital values, rents •appreciated in the range of 2-6% in almost every micro market, except in a few locations, such as Behela, Salt Lake and V.I.P Road, where rents remained stable.
The kolkata municipal Corporation (kmC) •has mandated that the groundwater of all proposed building sites be tested for arsenic before the building plans are submitted. If the test results are positive, kmC will not allow the project to proceed. This rule applies to housing projects on the Em Bypass, dum dum, Cossipore, Behala, Jadavpur and parts of Tollygunge.
Note: * Base selling price as quoted by developer
p. 10 | COllIERs INTERNATIONAl
magarpatta/Hadapsar
deccan/Camp/Boat Club
kalyani Nagar/Viman Nagar/kharadi
Pimpri/Chinchwad/Chakan
NIBm/Undri/kondhwa
kothrud/Bavdhan/Wajre Baner/Hinjewadi/Wakad/Pashan
30
25
15
10
5
0
INR per Sq ft Per month
CITY REsIDENTIAl BAROMETER
2Q 2012 3Q 2012
RENTAl vAluE
CApITAl vAluE
INDIA | 3Q 2012 | REsIDENTIAL
3Q 2012 pREMIuM REsIDENTIAl AvERAgE CApITAl vAluE
CApITAl vAluE TRENDs
3Q 2012 pREMIuM REsIDENTIAl AvERAgE RENTAl vAluE
PUNE
1Q20
09
2Q20
09
3Q20
09
4Q20
09
1Q20
10
2Q20
10
3Q20
10
2Q20
11
1Q20
11
3Q20
11
3Q20
12
2Q20
12
1Q20
12
4Q20
11
4Q20
10
3,000
2,000
4,000
7,000
8,000
9,000
6,000
5,000
10,000
kalyani Nagar/Viman Nagar/kharadi deccan/Camp/Boat Club/Central Pune
magarpatta/Hadpsar Baner/Hinjewadi/Wakad/Pashan/Balewadi
kothrud/Bavdhan/Wajre NIBm/Undri/kondhwaIN
R pe
r sq
ft
kaly
ani N
agar
/Vi-
man
Nag
ar/k
hara
di
Bhaw
anip
ur
decc
an/C
amp/
Boat
Clu
b
Bane
r/H
inje
wad
i/W
akad
/Pas
han
mag
arpa
tta/H
adap
sar
NIBm
/Und
ri/ko
ndhw
a
koth
rud/
Bavd
han/
Waj
re
Pim
pri/C
hinc
hwad
/Ch
akan
0
2,000
4,000
6,000
8,000
10,000
INR
per
sq ft
COllIERs REsIDEX 2Q 2012 - puNE
Rebase to 100 in 4Q 2008
60
70
80
90
100
110
140
130
120
4Q20
08
1Q20
09
2Q20
09
3Q20
09
4Q20
10
1Q20
11
2Q20
11
3Q20
11
2Q20
12
3Q20
12
1Q20
12
4Q20
11
4Q20
09
1Q20
10
2Q20
10
3Q20
10
NEW pROJECTs
PROJECT NAmE LOCATION dEVELOPER NAmE TENTATIVE POSSESSION RATE (PER SQ.FT.)*
Alkasa mohammadwadi majestique & mantra 3Q 2014 3,400
Alpine Aura moshi Alpine Homes 4Q 2014 3,000
Audumbar Warje GPL Sankalp Associates 4Q 2014 5,000
Blue Ridge Phase-2 Tathawade Paranjape Schemes 4Q 2016 5,800
Citron Wagholi Vascon Engineers Ltd 4Q 2015 3,100
Ela The Earth Hadapsar Vascon Engineers Ltd 4Q 2013 4,650
Note: * Base selling price as quoted by developer
puNE
In 3Q 2012, several premium projects were •launched in locations like kalyani Nagar, Baner, Hadapsar, Bavdhan, NIBm, Wakad, Hinjewadi, Wagholi and Taleagon. New launches are priced between INR 3,000-5,000 per sq. ft. for projects located in North (East and West) and West areas of Pune; INR 4,300 – 5,100 per sq. ft. for projects located within South area; and a prime rate of INR 11,000 per sq. ft. for a premium project located along kalyani Nagar.
In this quarter, construction activities picked •up from previous quarter enabling few ready possession buildings within residential projects and townships located in Wakad, Aundh and Baner with a range of quoted prices between INR 5,200 – 6,000 per sq. ft.
Capital values in Baner Hinjewadi, Wakad, •kothrud, Bavdhan and Warje have experienced a marginal increase of 1-2% from previous quarter. Parallel, areas such as magarpatta, Hadapsar, NIBm, Undri, Pimpri-Chinchwad and Chakan have contributed with a marginal increase between 6-9% quarter on quarter. This change is attributed mainly to steady demand and fast developing areas particularly within North and South. Capital values remained stable in all other micro markets in Pune.
during 3Q 2012, rental values remained stable •in almost all the micro markets in Pune due to stable demand.
Reliance Infrastructure Ltd has got approval •from the National Highway Authorities of India (NHAI) to improve the 140-km stretch of Pune-Satara highway (from dehru Rd in Pune to Shindewadi in Satara) by way of construction of 13 flyovers; as 29 vehicular and 16 pedestrian underpasses and 3 major bridges (2 in Satara and 1 in Pune).
COllIERs INTERNATIONAl | p. 11
INDIA | 3Q 2012 | REsIDENTIAL | sUBMARkETs
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
COllIERs REsIDEX
Increasing as compared to previous quarter
decreasing as compared to previous quarter
Remained stable from previous quarter
Colliers Residex represents the average secondary sale prices of high end properties. Residex has been derived by rebasing the capital values as 100 as on 1Q 2008.
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.
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For national residential services related queries please contact:
Poonam mahtani, National director Residential Services & knowledge Systems Poonam.mahtani@colliers.comTel: +91 22 4050 4551
Mumbai : Vaibhav kumar Vaibhav.kumar@colliers.com 31/A, 3rd floor, Film Center, 68, Tardeo Road, mumbai, India - 400 034. Tel : +91 22 4050 4500, fax : +91 22 2351 4272
Delhi NCR : Ajay Rakheja, Office director Ajay.rakheja@colliers.com
New delhi : Statesman House, 4th Floor, Barakhamba Road, Connaught Place, New delhi, India - 110 001 Tel : +91 11 3044 6423, fax : +91 11 3044 6500
Gurgaon : Technopolis Building, 1st floor, dLF Golf Course main Road, Sector 54, Gurgaon, India - 122 002 Tel : +91 124 456 7500, fax : +91 124 456 7502
Bengaluru : Goutam Chakraborthy, Office director Goutam.chakraborthy@colliers.com 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 Suresh.castellino@colliers.com 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 kaushik.reddy@colliers.com 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 Soumya.mukherjee@colliers.com 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
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INDIA | 3Q 2012
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AUTHORS
Amit Oberoi MRICSNational director, Valuation & Advisory; ResearchEmail: Amit.oberoi@colliers.com
Surabhi Arora MRICSAssociate director, ResearchEmail: Surabhi.arora@colliers.com
Sachin SharmaAssistant manager, ResearchEmail: Sachin.sharma@colliers.com
Heliana ManoAssistant manager, Research Email: Heliana.mano@colliers.com
For general queries and feedback :India.Research@colliers.com 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.
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Recent Reports : GLOBAL RETAIL INdIA OFFICE INdIA RESIdENTIAL APAC OFFICE GLOBAL OFFICE INdIA BUdGET 2012-13
OFFICE PROPERTY MARKET OVERVIEW INDIA
QUARTERLY UPDATE | OCTOBER | 2012
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Residential Property Market OverviewINDIA
QUARTERLY UPDATE | AUGUST | 2012
ASIA PACIFICOFFICE MARKET OVERVIEW3Q 2012
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HIGHLIGHTSGLOBAL OFFICE
WWW.COLLIERS.COM
SECOND HALF 2011 | OFFICE
JAMES COOK Director of Research | USA
Global Office Trend ForecastGlobal office vacancies will continue their decline, due to steady demand and low levels of new construction in North America and Europe. The “flight to quality” trend will continue in many major markets, with occupiers trading up to higher-quality space or a better location as their leases expire.The European sovereign debt crisis will likely push the Eurozone into a mild recession in early 2012. This contraction will be felt most profoundly in a handful of commercial property markets within the most troubled nations.
Economic prospects in the Eurozone have slightly reduced overall positive global expectations for market performance in 2012. We expect continuing modest demand for office space, with most cities seeing a drop in vacancy rates. But global averages do not speak to the nuances of individual markets, and—while we expect positive absorption due to business growth and expansion in the United States, China and Australia—some Eurozone countries may see negative absorption and increased vacancy as the region enters a mild recession.
Global Office Demand Growth Slow and Steady
GLOBAL CAPITALIZATION RATES /PRIME YIELDS: 10 LOWEST CITIES
MARKET (Ranked byDec 2011)
DEC 2011
JUNE 2011
DEC 2010
Taipei �.�� �.�� �.�� Hong Kong �.�� �.�� �.�� Vienna �.�� �.�� �.�� London – West End �.�� �.�� �.�� Zurich �.�� �.�� �.�� Singapore �.�� �.�� �.�� Geneva �.�� �.�� �.�� Beijing �.�� �.�� �.��Paris �.�� �.�� �.��Munich �.�� �.�� �.��Tokyo �.�� �.�� �.��
GLOBAL OFFICE OCCUPANCY COSTS:TOP 10 CITIES
MARKET (Ranked byDec 2011)
DEC 2011
JUNE 2011
DEC 2010
Hong Kong ���.�� ���.�� ���.�� London – West End ���.�� ���.�� ���.�� Paris ��.�� ���.�� ��.�� Rio de Janeiro ��.�� ��.�� ��.�� Moscow ��.�� ��.�� ��.�� London – City ��.�� ��.�� ��.�� Perth ��.�� ��.�� ��.�� Singapore ��.�� ��.�� ��.�� Geneva ��.�� ��.�� ��.�� São Paulo ��.�� ��.�� ��.��
CBD CAP RATE (%)
Latin America Boasts the Tightest Office MarketsSome of the world’s lowest office vacancy rates are found in Latin American cities. Santiago, Chile; Rio de Janeiro, Brazil; São Paulo, Brazil; and Lima, Peru all have vacancy rates below three percent, resulting in a market that strongly favors landlords, prompts new construction and might squeeze some tenants that desire to expand. For the most part, we expect the strength of these markets to persist. While decreases in European demand for its commodities will likely hurt Latin America, this will be tempered by continued demand from China. In São Paolo, heightened demand has spurred the highest rates of new development in the region, which will eventually put downward pressure on asking rents.
Select Asia Pacific Markets See Big Vacancy DropsThe global trend in dropping vacancy rates should be evi-dent in Asia and continue through 2012. Markets that saw a drop in vacancy in the second half of 2011 outnumbered by a two-to-one margin those where vacancy increased.
Of the world’s most populous markets, those with the most significant declines in six-month vacancy rates were nearly all in the Asia Pacific region. Chengdu, propelled by its strong manufacturing sector, saw its vacancy rate drop by 7.8 percent in the period, and Shanghai saw a 3.2 percent drop in vacancy.
Two other large Asian markets saw vacancy rates drop by 1.5 percent or more: Jakarta, which has also seen sustained growth in CBD rental rates and renewed global investor interest; and Singapore, where occupancies are expected to stabilize.
Marquee Markets See Rent DeclineWhile Hong Kong, London’s West End and Paris command the top three highest asking rents for Class A office space,
each has shown apparent decline in rents between June and December of 2011, when quoted in U.S. dollars. Substantial declines, in fact: led by a $10.87 USD drop in Parisian Class A rents.
But how significant are these figures? The change in London and Paris rents is due to the strengthening dollar relative to the euro and pound sterling. In local currency, prime rents in these markets are holding ground. Although smaller, the decline in Hong Kong of $7.56 USD ($5.10 HKD) per square foot may be a more important indicator of things to come, as demand from the banking and financial sector continue to weaken.
EMEA and Asia Pacific Lead Global ConstructionA significant percentage of the office space under construction is in Europe, the Middle East and Africa (EMEA), and much of that is occurring in Moscow and Dubai. While both of these markets should expect strong economic growth in 2012, the fact that Dubai—with a vacancy rate of 50 percent—is constructing at such a pace leads us to expect that supply will continue to outpace demand in that market.
The other two top markets for office construction are in the Asia Pacific region. Guangzhou—China’s leading commercial port city—and Tokyo have 19.6 and 15.6 million square feet under construction respectively. Asian economic growth rates will remain strong in the coming months, with China and India leading the pack. Rents are on the rise in most cities in the region. However, dropping rents in Seoul and Hong Kong are a potential indicator of global economic uncertainty. In Tokyo, where new supply has been increasing for the past three years, we expect construction to peak and begin to decline in the coming year.
CLASS A / NET RENT (USD/SQ FT)
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Budget Highlights | Real Estate
Finance Minister Pranab Mukherjee started his budget speech 2012-13 in the backdrop of challenging macroeconomic scenario. The finance minister projects the economy to grow by 7.6% in the next fiscal up from 6.9% in 2011-12. He mentioned that due to adverse global economic sentiments there has been a slowdown in the Indian Economy but the fact is India still remains among the front runners in the economic growth in any cross country comparison. The budget aims at faster, sustainable and more inclusive growth across sectors emphasizing on five focus areas including revival of domestic consumption, rapid revival of high growth in private investment, removal of supply bottlenecks, addressing malnutrition in 200 high burden districts and expedite improvement in delivery system, governance and transparency.
From a real estate perspective, the budget remained silent on most of the major issues including status of STPIs (Software Technology Parks of India), Real Estate Regulatory Bill, Land Bill etc. however, it mentioned that efforts are on to arrive at a political consensus on the issue of allowing 51% Foreign Direct Investment (FDI) in multi-brand retail.
THE KEY HIGHLIGHTS OF THE BUDGET WHICH MAY IMPACT REAL ESTATE SECTOR ARE AS FOLLOWS:
- External Commercial Borrowings (ECB) for low cost affordable housing projects. Impact: Real estate companies developing large affordable housing projects with large fund requirements will benefit the most from the easing of external commercial borrowing (ECB) norms as interest rate charged is lower in case of external borrowings in comparison to rates charged by domestic institutions.
- Increase in provision under Rural Housing Fund to INR 4,000 crore from the existing INR 3,000 crore.Impact: It will provide housing finance to targeted groups in rural areas at competitive rates.
- Extension of the existing scheme of interest subvention of 1% on housing loans up to INR 15 lakh where the cost of the house does not exceed INR 25 lakh for another year. Impact: This will boost the affordable housing segment by providing cheaper loan to the end users.
MARKET REACTION TO BUDGET
Q1 2012 | RESEARCH
Source: www.bseindia.com | Mar 16, 2012
Company Change (%)BSE SENSEX -1.19Realty Index -1.26Anant Raj Inds -6.04D B Realty -2.02DLF 0.15Godrej Properties -2.82HDIL -5.21Hubtown Ltd. -4.13Indiabulls Real Estate -1.95Mahindra Lifespaces -0.72Orbit Corp. -3.37Parsvnath Developers -4.04Peninsula Land -3.18Phoenix Mills -2.65Sobha Developers 3.04Sunteck Realty -1.13Unitech -1.68
UNION BUDGET 2012 -13
A SNEAK PREVIEW
P. 1 | COLLIERS INTERNATIONAL
STREET/PRECINCTRENT
(USD)**
ANNUAL CHANGE
(%)
New York – Fifth Avenue ��,��� ��.�
Hong Kong – Queen's Road Central, Central (tie)
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Hong Kong – Canton Road (tie)
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London – Old Bond St.*** ��,��� ��.�
Paris – Avenue des*** Champs-Élysées
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Hong Kong - Causeway Bay
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New York – Madison Avenue
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Zurich – Bahnhofstrasse ���� flat
Milan – Via Monte Napoleone
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Sydney – Pitt Street Mall ���� (��.�)
HIGHLIGHTSGLOBAL
www.colliers.com
MID-YEAR 2012 | RETAIL
ANN T. NATUNEWICZ Manager | Retail Research | USA
Colliers’ 2012 Global Retail Streets survey found that of 129 locations tracked, 51 posted higher year over year average rental rates, 49 were flat, and 24 were down (5 lacked comparable data).
Retailers entering new markets—both developed and developing—continue to hedge risk by targeting the same one or two premier locations, generating heated competition and outsized rental rate growth in a handful of space-constrained corridors.
Companies with the most ambitious long-term expansion plans remain focused on emerging markets with rapidly growing middle-class populations, but recently institutional capital has pulled back somewhat to favor core markets and investments.
While economic and political turmoil did affect rental rates in headline-generating markets (such as Cairo and Athens), high streets with strong fundamentals remained remarkably resilient, suggest-ing, at least for now, some separation between macroeconomic issues and underlying real estate fundamentals.
Since we conducted our survey, however, weakening consumer sentiment among affluent shoppers has already begun to impact retailers’ revenues and could hinder landlords’ near-term ability to raise rents, suggesting flattening growth rates for the coming year.
This spring proved to be a tricky time to conduct global benchmarking, as market sentiment has deteriorated markedly since April. During the past year, virtually every entity making a forecast—including Colliers in our 2012 U.S. Retail Outlook —included a caveat related to not-yet-quantifiable global fallout from Europe’s fiscal issues. As the past few months have illustrated, the time to face Eurozone issues has finally arrived, spawning a new wave of financial uncertainty.
More than two years post-recession, though, results from our annual survey of High Street rents illustrate that the world’s priciest retail corridors continue to attract the most sought-after tenants at lofty rental rates. Eight of Colliers’ top ten Global Retail Streets in 2011 made the list again this year. The big story, however, lies with the explosive year over year rental growth achieved in a handful of markets. Six of our Top 10 grew at double-digit levels year over year in local currency units, five of them by more than 20%.
At a regional level, streets in areas that entered 2007-08 better-positioned economically—Australia, Canada, parts of Eastern Europe—had a higher percentage of this year's flat-to-higher rents than those slower to emerge from the recession. We will be watching these areas closely. Even as they represent some of the most attractive destinations for expansion-minded companies and yield-seeking investors, they too are vulnerable to softening consumer demand and, for those with reliable data, encroachment of e-commerce.
This report contains two parts. The first summarizes the results of our annual Global Retail Streets survey, conducted in April 2012. The second incorporates content from Colliers’ brokerage and research teams worldwide who contributed market operational metrics, nuanced commentary on retail conditions, and forward-looking opinions on what the next year will hold for consumers, landlords, and investors.
Record Rents for Top Retail Corridors; Global Slowdown Impacts Momentum Elsewhere
TOP 10 GLOBAL RETAIL STREETS*(USD PER SQUARE FOOT PER YEAR)
REGIONAL RETAIL RESEARCH CONTACTS
AMERICAS > Ann T. Natunewicz Ann.Natunewicz@colliers.com
EUROPE/MIDDLE EAST/AFRICA > Zuzanna Baranowska Zuzanna.Baranowska@colliers.com
ASIA > Simon Lo Simon.Lo@colliers.com
AUSTRALIA/NEW ZEALAND > Nora Farren Nora.Farren@colliers.com
Source: Colliers International* selected cities** exchange rate as of March 31, 2012*** Zone A rents
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