Galfar wins road deal in Uttarakhand and Uttar Pradesh

Muscat: Galfar Engineering and Contracting Company, the biggest contracting firm in the Middle East, has won the tender for four laning of Kashipur-Sitarganj section of NH-74 in the Uttarakhand and Uttar Pradesh by National Highways Authority of India, Ministry of Transport and Highways, on design, build, finance, operate and transfer (DBFOT) basis.

The company will get a grant of Rs 2.23 billion. The construction period is for 910 days, and the concession period is 21 years and the project is envisaged to cost RO42.61 million, the company's Vice-Chairman and Managing Director Dr P. Mohammed Ali stated in a statement.

The company's Indian affiliate has completed the Indore-Ujjain road project on BOT basis, and started toll collection for 25 years. The execution of other two projects, including Ghaziabad-Aligarh road, are in full swing and will be ready within a year. 

Also, the company has submitted serious bids for road projects and is expecting some more projects in India in the near future. These projects are in the region of Rs 10 billion, Dr Mohammed Ali earlier said.

The company's order book position was around RO700 million by end-September, 2012. As Oman government has a lot of plans for infrastructure development, the company expects to get a fair share in the contracts.

FDI in Multi-Brand Retail: Key to Speed up Retail Transformation

In an important policy move, the Indian government gave permission for up to 51% FDI in multi-brand retail in September 2012. The objective of this policy is to boost the retail business through adoption of international standards and practices.

The entry of international products, practices and technology is expected to enhance the efficiency of domestic retailers. The government has made it mandatory for foreign multi-brand retailers to place at least 50% of their total investment in back-end infrastructure, thus giving a boost to facilities such as logistics and warehousing.

With multi-brand retailers exploring opportunities in India, demand for retail space is likely to rise significantly. This will induce developers to launch new malls and, as store size requirements are significantly higher for multinational retailers, will encourage them to build larger malls along with sufficient mall infrastructure.

Quality will also receive a significant boost as the malls will be constructed to meet international standards and norms. The competitive environment is likely to enhance the productivity and efficiency of domestic  retailers; with better and more transparent pricing, sales will improve significantly. Domestic retailers will also leverage their portfolios by adopting many of the new retail strategies followed by large international retailers.

The average size of shopping malls in India has already begun to increase as developers focus on larger spaces. The success of a mall does depend on its size as superior grade malls are nearly double the size of average grade malls. It is estimated that the average size of a superior grade mall is 400,000 sq ft, whereas the normal size of average grade and poor grade malls are 190,000 sq ft and 150,000 sq ft, respectively.

The larger malls allow for a complete tenant mix in various formats and categories, and can adopt modern mall management practices easily. With the introduction of FDI in multi-brand retail, the average size of a mall is likely to increase as foreign retailers tend to occupy large spaces. As a consequence, both total mall supply and size are expected to increase over the medium to long term.

CREDAI urges Bengal to repeal urban land ceiling act

Kolkata: Contrary to the West Bengal government's claim that land was not an "issue" for industrial development in the state, CREDAI, the apex body for the country's private real estate developers, Thursday said the state should repeal its urban land ceiling act.

Real estate firms have been demanding that the Mamata Banerjee government should do away with the Urban Land (Ceiling and Regulation) Act (ULCA) as West Bengal is one of the few states to have such a legislation, which is hindering launch of major real estate projects in the state, an IANS report said.

"It is surprising that Bengal has an urban ceiling act. The entire country has abolished that act and got benefited by it as the prices of the land stabilised and it ensured more supply," Confederation of Real Estate Developers' Associations of India (CREDAI) president Lalit Jain said.

"Land being the state subject, the reforms has to take place here," Jain told reporters on the sidelines of 'Bengal Builds', a three-day conclave on urban infrastructure development here.

Jain's comment came just after state Industry Minister Partha Chatterjee, during his speech at the same event, claimed that there was "no issue" related to land acquisition in the state.

"Where is the problem of land? The problem is the perception for the 34 years (of Left Front rule) that nothing has happened," Chatterjee said.

Talking to the mediapersons, Jain also said the state should raise the floor area ratio (FAR) to five from 1.5-3 at present for the construction of tall buildings in order to address the problem non-availability of space.
He suggested that the local taxes and stamp duty should be brought down in the state.
"The state has to rationalize its taxation policies," he observed.

Chief Minister Mamata Banerjee, however, said the government would constitute a task force to identify the problems regarding development of urban infrastructure.

The task force would report to the cabinet committee on infrastructure.

Sahara India Pariwar buys NY's Plaza Hotel for $575M

Sahara India Pariwar, an India-based conglomerate, has completed the purchase of a 75 per cent interest in the iconic Plaza Hotel New York from real estate company El Ad US Holdings’ position in the hotel with a total valuation of $575 million, according to a report. 
 

The acquisition includes 230 hotel rooms and retail space. Kingdom Holding Co., controlled by Saudi billionaire Prince Alwaleed bin Talal, will retain its 25 percent stake in the property. 

 

The iconic Plaza Hotel is located in Manhattan, adjacent to Central Park. Notable guests of the Plaza over the years have included Eleanor Roosevelt, the Beatles, Mark Twain and Groucho Marx.

“This was a great opportunity for the buyer to expand into a key U.S. market with the purchase of an irreplaceable asset, the Plaza Hotel,” said Solid Rock’s President Greg Rice. “The corner of 59th Street and Fifth Avenue is arguably one of the world’s most valuable pieces of real estate.”

“The New York City hotel real estate market remains one of the world’s most attractive investments. It is the world’s most liquid market and is excellent for capital preservation as it consistently outperforms inflation. There also is upside in the hotel market as it has not yet reached pre-recession levels,” Rice added. “While luxury hotels in New York City have been one of the harder hit segments of the hospitality industry, they will benefit from strong growth as room rates return to their peak levels.”

Sahara India Pariwar is a major business conglomerate in India with operations in multiple sectors, including financial services, life insurance, mutual funds, housing finance, infrastructure and housing, print and television news media, entertainment channels, cinema production, consumer merchandise retail, health care, hospitality, manufacturing, sports and information technology. 

The group is run by Subrata Roy who owns a five-star Mumbai hotel, a top-rated cricket team and TV channels in India, and who acquired London's Grosvenor's House in 2010 for $726 million.

Orbit Residency gets GRIHA per-certification through Surmount

Surmount, a leader in Green Building Consultancy Services, after achieving the GRIHA per-certification for two of the projects, Orbit Terrace and Orbit Grand is now successful in getting the GRIHA per-certification for yet another project, Orbit Residency in Mumbai.

Surmount Energy has achieved GRIHA pre-certification from the Association for Development and Research for Sustainable Habitats (ADaRSH) for one of most prominent projects in Mumbai, the Orbit Residency.

Orbit is one of the most recognized and respected brands in the Indian Real Estate Industry. Surmount Energy has announced that Surmount was able to serve them through our Green Consultancy Services to achieve these GRIHA pre-certification requirements.

Balbir Khera, CEO of Surmount Energy, says, “Surmount is glad to be a part of Orbit Group’s Green initiatives, and delighted to have worked jointly with them to achieve their objectives of the GRIHA pre-certifications successfully. Orbit Residency is a premium property located at most coveted areas of Mumbai and it is a matter of pride for Surmount that Orbit has chosen the company as its partner in this work”.

GRIHA is a green building evaluation system that has been conceived by TERI and developed jointly with the Ministry of New and Renewable Energy, Government of India. In accordance with the Office Memorandum by Ministry of Environment and Forest (MoEF), government of India, Association for Development and Research for Sustainable Habitats (ADaRSH) has proposed a procedure that will enable fast track environmental clearance through GRIHA pre-certification. ADaRSH promotes GRIHA (Green Rating for Integrated Habitat Assessment) as a design & evaluation tool for Green Buildings and Habitats.

Surmount launches Home & Community automation products

Navi Mumbai:  Surmount at an recently held Green Building Congress 2012 at Hyderabad International Convention Centre (HICC) has showcased its  community automation solutions for green home and communities.  Surmount has participated in every Green Congress exhibition since 2008 as one of the leaders in the green building and automation industry, a company release said.

Balbir Khera, CEO of Surmount Energy commented, “We have been a part of Green Building Congress since long and we are overwhelmed by the large turnout at our booth during the exhibition this year. We thank all our visitors who showed interest in our home and community automation products and our green building consulting services.”

Surmount’s BuildTrack suite of automation solutions focuses on improving safety, security, convenience and energy savings for residential & commercial buildings and townships. These solutions offered by Surmount communicate emergencies instantaneously via online, e-mail and SMS options to the owner or other authorized parties, thereby providing the ability to react quickly to them. 

The BuildTrack solution also offers conveniences such as video door phones and remote controlled switches for lighting and other purposes. Surmount introduced its unique product, EzRemote that can be used in any home to turn on/off switches using a remote. The design is such that there is literally no change to any of the visible wiring or any changes to existing switches.   

Surmount Energy is a leader in Green Building Consultancy Services; Automation Solutions for Home, Township & Offices; and CCTV & Surveillance Systems. Its services and solutions currently serve 2.2 million sq. meters of space in India across 100’s of new and existing buildings. The automation solutions offered under the BuildTrack™ brand are designed to meet the safety, security, comfort or convenience needs in a broad range of residential, commercial or retail facilities and buildings.

Real Estate Regulatory Bill should make everyone accountable: Habib

Regulatory authority for real estate is a welcome move. But in the present form it would only tax the developers. Just because a few developers took the customers for a ride, it is not fair on the part of government to rate all developers in one scale. The Bill should bring realty brokers, financial institutions, agents, government authorities, consultants and even architects under the purview, says WS Habib, Managing Director, Ramky Wavoo Developers and Treasurer of CREDAI Chennai. Excerpts from an interview with KR Iyer.

WS Habib, Managing Director, Ramky Wavoo Developers

Can you brief us about RWD?

Ramky Wavoo Developers (RWD) is a joint venture between Hyderabad-based Ramky Group and Wavoo group of Chennai. While Ramky group has been into infrastructure, waste management and property development and have presence throughout India and 8 countries, Wavoo is Chennai-based and I am from Wavoo family. We were landlords basically and I got into property development in 1996 in the name of Wavoo Realty and Investments. As we grew, we realised the need of a partner to launch bigger projects. That is how we launched RWD in 2005, a fifty-fifty collaboration between the Ramky Group and Wavoo Realty and Investments .Together we have completed three projects and currently doing four in and around Chennai. 

    Real estate market in India suffers due to various macro-economic conditions. What is the impact on RWD?

Land prices are going up and also the construction cost – these are the major factors affecting the real estate market. Labour shortage too adds to our woes.  As for as Chennai, there is no visible sluggishness in the real estate market, as we are seeing a lot project launches which shows the demand. We are also affected by other external factors like Euro crisis, economic downturn and rupee depreciation.  But overall, one can say that real estate sector is growing, albeit slowly.  In Chennai, not much projects are coming up inside the CBT due to high price and low growth factors and most of the projects are now concentrated in the outskirts. RWD has a good match of projects in both - within the city and outskirts. As it caters to both young and older generations, we don’t foresee any erosion in our growth level.

Can you give us a brief account on your on-going and future projects?

Present projects

We have a project under construction at Nelson Manickam road called Atlantis. A premium commercial and residential complex, Atlantis is epitome of modern design, luxury and has eco-friendly values. Spacious and splendidly appointed, this 14-floor complex boasts of three floors for parking, three floors for commercial enterprises and 42 luxurious island apartments in one, two and three bedroom configurations.  Both residential and office complexes have separate entrance.

We have another project at Kelambakkam, OMR, called Elysium. This is entirely three-bed room apartments, and will be handed over by December. Both the projects are CRESIL five-star rated.

Our motto is to give more value of money to the customer. For example in Atlantis, we do not want to add amenities like gym, swimming pool etc, which will add up the buyers’ cost. If it is for outskirts, we would have added these facilities as prices are low there. The OMR project has all such facilities inside.

Future projects

We are planning to launch a multi-storey residential project in Vanagaram of west Chennai in next couple of months. It will have six towers to occupy 500 apartments of all denominations. We have also signed a high-end residential project in Egmore’s Pantheon Road. This will be launched sometime in May-June 2013.

Apart from this, we have one interesting project coming up near Chennai. Called Ecopolis, this is a farmland project situated 2-3 km from Vedanthangal, the birds sanctuary.  We are offering land sizes from quarter to half acre at a very reasonable price and also providing all facilities to the buyers to make it green. We have clubhouse where people can come and stay and do farming while enjoying the serene beauty of the place. It is part of our green initiatives. As farming is dying, we want the city people to come and do farming. Though we don’t expect any profit out of this project, we see it as part of our CSR initiatives. 

       What will be the effect of the proposed Real Estate Regulatory Bill on the real estate sector?     Do you think the Bill is developer- friendly?

Regulatory authority for real estate is a welcome step. But in the present form it would tax the developers. Just because a few developers took the customers for a ride, it is not fair on the part of government to rate all developers in one scale. We actually are doing the government’s job by providing housing at larger scale to people. We are already facing a lot of problems in terms of approvals and this (Bill) will only add to our problems. Obviously, corruption will seep into the system.  The Bill also warranted deposition of part of the project money to the regulator. This will cause liquidity crisis and developers will find it difficult to complete the projects in time, which will ultimately increase the cost.

Though the government’s intention is to put some check on builders, CREDAI has already following those regulations proposed in the Bill. In fact, all our members have signed a code of conduct and abide by the rules and regulations formulated by CREDAI. The objective is to have transparent dealings. More so, agencies like CRESIL rate the builders and projects. So, if a project is CRESIL rated, most of the checking about the project and builder’s credit worthiness etc would have been done by the agency itself. They check our track record, balance sheet, legal documents, agreement papers, project report etc. They also check the architecture details and even visit the site for first-hand information from contractors. In the competitive market, it is not prudent to spoil the name as you can’t come back again to do business.  People can choose CREDAI developers if they want trouble-free and transparent transaction with clear title.

Larger developers get affected

Most of the large developers are CREDAI members. The Bill will affect them the most compared to smaller ones.  There are some 2000-3000 small developers doing projects size of 10 or 15 apartments in Chennai. For them this bill will not have much impact. In fact, they have to be regulated as most of the violations are happening there. We can only accept the Bill if the government takes everyone including realty brokers, financial institutions, agents, government authorities, consultants and architects under the purview of the Bill. If this happens, it will be a win-win situation for everybody – buyers, developers and housing finance companies. In short, for somebody’s mistake, we should not be penalised. 

Despite low sale and receding demand, housing prices are going up across India.  Do you foresee price correction in the New Year?

As for as Chennai, I don’t see any price correction in the New Year. In Chennai, we are seeing good demand, both in city and outskirts. Though developers are not launching more projects in city due to price factor, more projects are being launched in the outskirts of the city. We are not responsible for price jack up in the real estate sector. In fact, we act as the facilitator. Though construction cost is going up, we have kept our margin tight. We buy the land, get all people in place, get the necessary approvals and sell while keeping our margin. It is not we who are responsible for realty price rise, but macro-economic factors and other factors such as unsteady prices of cement, steel and construction material, labour crisis, approval delays and finally, soaring land cost. 

 

What are the problems faced by the construction industry?

Labour is the major impediment apart from the approval delays and increase in construction cost. I think we have to adopt pre-caste construction technique to beat the labour issue. Two to three years down the line, this could be the situation in India as awareness about the pre-caste construction is growing rapidly.  But the mind-set of the home buyers should change. People still prefer brick to beam type of construction. They still have problem with hollow blocks and solid blocks. Few projects are coming up in Chennai using pre-caste technique and I am sure that the mind-set will change in the coming days and we can see more such projects. 

Pre-cast is the future

Apart from being durable, pre-caste construction has many advantages.  All over the world developers are using this technique to build large buildings and even bridges.  If metro- rail projects and bridges can be built using pre-caste method, why not homes?  Not only it will reduce the man power, it will also reduce the project completion days and cost of construction. 

About awards and certifications received by RWD

RWD has been awarded with the excellence in villa projects as Construction Industry Award 2012 by Kattumana Thozil in September this year. The company also certified by Bureau Veritas Certification (India) Pvt Ltd for the integrated Management system of organisation in accordance with standard ISO 14001:2004 & BS OHSAS 18001:2007. All our projects are CRESIL rated, that speaks volumes about our products. We are focused to get all our future projects green certified by the Indian Green Building Council.