Realty sector will continue to bleed in 2014: ASSOCHAM

Outstanding investments attracted by India’s real estate sector have plummeted from over Rs 15.39 lakh crore as of September 2012 to about Rs 14.51 lakh crore as of September 2013 thereby registering significant drop of about six per cent, apex industry body ASSOCHAM has said.

“The real estate sector suffered grave turbulence in 2013 due to plethora of reasons like rampant economic slowdown both globally and domestically, liquidity crunch, unstable currency, high input costs, labour shortage, high interest rates and growing inflation,” according to a comprehensive analysis titled ‘Real Estate Sector: Outlook for 2014’ conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

Interestingly, investments in real estate sector had increased marginally by about two per cent from about Rs 15.1 lakh crore as of September 2011 to Rs 15.3 lakh crore as of September 2012, highlighted the ASSOCHAM analysis.

About 68 per cent of the total investments in realty sector as of September 2013 were under implementation while about 69 per cent of real estate investments were under implementation in the previous year.

Maharashtra accounts for about 20 per cent share of these investments followed by Gujarat (13 per cent), Haryana (11.2 per cent), Karnataka (11.1 per cent), Uttar Pradesh (9.8 per cent) and Andhra Pradesh (9.6 per cent).

The states of Jharkhand, Haryana, Gujarat, Madhya Pradesh and Andhra Pradesh are top five states that have seen significant decline in investment inflows in realty sector during the yearlong period between September 2012 and September 2013. While Bihar, Jammu and Kashmir, Assam, Orissa and Uttar Pradesh have recorded a surge in investments attracted by realty sector.

With a view to ascertain as to what 2014 holds for the sector, the ASSOCHAM had interacted with about 1,000 developers, real estate brokers and agents, property consultants and senior officials of various companies in the real estate domain during the course of past one month in 10 prominent cities of Ahmedabad, Bangalore, Bhopal, Chennai, Delhi, Hyderabad, Jaipur, Kolkata, Lucknow and Mumbai.

There seems to be no respite in the offing for India’s real estate sector at least during the first half of the calendar year 2014, believe majority of players in the realty sector, highlighted the ASSOCHAM survey.

“The situation on real estate front is not likely to improve much owing to an uncertain political scenario at least during the first six months due to forthcoming general elections and poor investor, end-user confidence due to sluggish economic growth coupled with continued high property prices,” asserted about 60 per cent of respondents.

“The overall performance of India’s real estate sector in the year 2014 is likely to remain subdued as people refrain from buying property and developers continue to grapple with high debt, rising construction costs, unsold inventory even as property prices go through the roof thereby slowing the demand for real estate leading to an oversupply situation,” many of these said.

In its survey, ASSOCHAM representatives sought various suggestion from key players in the real estate sector for revival of the sector – need for a single window clearance system to clear all projects instead of seeking approvals of myriad regulators and authorities thereby saving both time and costs; need to evolve a rational structure vis-à-vis payment of stamp duties on sale and purchase of land and housing properties; revise the limit of interest deduction on housing loan of Rs 1.5 lakh introduced by Finance Act 2001 to Rs five lakh; allow more foreign direct investment (FDI) in real estate firms to strengthen the industry in townships, housing, built-up infrastructure and construction development projects to spur economic activity, create new employment opportunities  and simultaneously add to available housing stock and built-up infrastructure.

On its part, ASSOCHAM has also given certain recommendations to the government  to bring the realty sector back on growth trajectory which include - repeal highly restrictive and archaic laws of Rent Control Act and Urban Land Ceiling and Regulation Act; the government should act as a facilitator and not as a regulator for real estate projects more so where demand is more than supply; state governments should complete land records process and make them computerized; infrastructure including transportation, logistics, water, power, housing, healthcare, sanitation and others must be taken in tandem to spur real estate development; government should grant industry status to real estate sector to facilitate bank loan and long-term finance for real estate projects and real estate must be classified as infrastructure and priority lending sector should be made available to keep pace with demand-supply scenario.

Real Estate Development: Staying Ahead In Challenging Times

In a slow economic environment, the only way in which to grow one’s business is by taking it on a war-footing. Conducting business on a war footing can be defined as being ready and prepared to take on or sustain war.

A related concept is ‘war economy’, which is a term used to describe the steps undertaken by an entity to mobilise its economy and resources for war production. 

However, in the context of real estate development, going on a war-footing quite simply means assuming a mind-set that focuses on producing, mobilising and allocating resources to not only sustain but exponentially grow business, says Kishor Pate, CMD – Amit Enterprises Housing Ltd..

Get Out Of Denial Mode

There is a problem and it is not going to go away by assuming an ostrich-like attitude to it. The best way to deal with an economic crisis is to admit and accept that the crisis prevails. The real estate company – from leadership to employees – should not be in denial of the situation.

Get Into Innovation Mode

In times of economic uncertainty, real estate companies rely on innovations in marketing, sales and customer service to maintain and to expand market share. One of the prerequisites for running a successful real estate development company in such times is offering clients that decisive bit of extra that clearly defines the products as superior, and going the extra mile on pre-sale as well as after-sale service.

Know Your Opponents

To win a war, one must know one’s own strengths but also those of one’s competitors. Real estate is a highly competitive business, and it is necessary to evaluate the competition on a regular basis. This will help in defining success strategies.

Change The Game Plan

In order to retain and increase market share in challenging times, real estate developers need to adapt by changing business models which are no longer working. A 360-degree approach change to capitalize on the prevailing market condition has helped many real estate companies to not only survive but also retain their market leadership.

Ramp Up On Employee Management

In a slow market environment, real estate developers must take advantage of the fact that this is, in fact, the ideal time to recruit the most talented people. Management needs to open their ears to ideas on how business can be improved which emanate from within the ranks. Creating ‘think tank’ groups is an ideal way to harness the collective power of mind merge.

Study The Market Like Never Before

In a challenging business environment, it is extremely necessary to develop greater insights about one’s customers, the manner in which the business is changing and what kinds of new technologies can be adopted.

One can then develop frameworks that clearly indicate where clients need better services, and address those needs in a proactive manner. The mantra needs to be ‘service improvements’ rather than ‘business improvement’, because improved business is a direct outcome of improved services.

In today’s times, every real estate development company needs to follow the strategies that have historically worked for businesses that set out to grow in a competitive market:

• Identify and focus on your ideal target market – then strategically broaden your horizons
• Cultivate a and grow a comprehensive database of prospects, vendors, past customers and future prospects
• Distinguish yourself from the competition – extend exceptional customer service. Under-promise and over-deliver
• Communicate with your target market on a consistent basis. Do not ignore the strengths of the competition, but articulate how you are different.

Mall stock in India to reach 76 mft in 2015

Pan India mall stock for the top seven Indian cities - Bangalore, Chennai, Delhi, Kolkata, Hyderabad, Mumbai and Pune - is expected to increase from 76 million square feet in 2013 to 95.7 million square feet in 2015, according to Pankaj Renjhen, Managing Director – Retail Services, Jones Lang LaSalle India.

Among the seven cities, Delhi NCR and Mumbai have been leading in terms having the highest concentration of shopping malls, he says.

 

As of now, Delhi and Mumbai together account for 62% of the Pan India mall stock. They are followed by Bangalore and Chennai, which together constitute around 20% of the pan India mall stock respectively.

The net addition of shopping malls from 2013 to 2015 is expected to be around 24.9 million square feet. In 2010, the stock of shopping mall in India stood at around 53.3 million square feet; by the end of 2017, it is expected to reach 107.8 million square feet, he opines.

In 2013, an estimated supply of around 5.2 million square feet was registered - a 22% increase over last year’s supply of shopping mall space. Chennai led with 1.95 million square feet of supply in 2013, followed by Mumbai and Pune. In 2014, Delhi NCR is expected to hold the dominant position in terms of expected net addition of shopping malls.

Emerging Trends

In the coming years, the average size of malls is likely to increase as developers are focusing on project sizes that allow for a critical mass in terms of offering various formats and categories under one roof. In 2014, the average size of malls is estimated to be around 380,000 square feet, which is expected to increase to 470,000 square feet in 2015 and further increase to 660,000 square feet in 2017.

There is also an increasing trend among upcoming malls to adopt a structured approach in planning, execution and launch. The importance of formulating an optimal tenant mix to ensure the maximum utilisation of retail space is now recognised and accepted by almost all major mall developers. Retailers are showing the highest interest in upcoming retail projects that offer not only a good location, but have been optimized in terms of design and trade and tenant mix.

Chennai Real Estate – From Steady To Fast-Track Growth

Chennai’s commercial real estate sector has seen consistent growth over the last 10 years. The city’s grade A office stock grew phenomenally from just 3.6 million sq ft in 2003 to 51.2 million sq ft in 2013.

The city’s office stock development is primarily driven by IT/ITeS sector – a sector whose phenomenal growth has attracted pan-India developers such as DLF, Shapoorji (SP), Tata realty, Divyasree, Prestige and International players such as Ascendas to launch projects in Chennai.

 Alastair Hughes, CEO – Asia Pacific, Jones Lang LaSalle says, “On an average, Chennai records a gross absorption of around 4 million sq ft of office real estate every year. In 2013, we expect around 3.6 million sq ft of gross absorption, given the below-average absorption of around 1 million during the first half of the year. However, with quite a few big transactions in the pipeline, we still expect the second half of 2013 to compensate for the first half’s slowdown.”

Apart from the IT/ITeS sector, Chennai’s broad base of economic activity allows office developers to cater their vacant spaces to other industries such as automotive, semi-conductors, etc. Some of the prominent non-IT players who recently took office space in the city include Renault Nissan, Saint Gobain, Michelin, Flextronics and FLSmidth.

Badal Yagnik, Managing Director – Chennai & Coimbatore, Jones Lang LaSalle India says, “The city’s office space vacancy is currently around 25%, yet the preferred locations such as Guindy, pre-toll OMR and Mount-Poonamallee Road have very thin vacancy levels. Rents in these preferred locations rose by 5-10% during the last year. Some of these locations are also seeing increased supply of office spaces. The new of blocks of Ramanujan IT city (approx. 2 million sq ft) and SP Infocity (approx. 1 million sq ft) that will become operational this year have been seeing healthy pre-leasing from large multi-national corporates.”

The retail real estate segment in the city has remained upbeat with the opening of two major malls - Phoenix Market City (approx. 1 million sq ft) and Prestige Forum Vijaya mall (approx. 0.7 million sq ft) in the southern and western parts of the city respectively. Addressing the shortage of mall space in Chennai, both these malls cater to the retail needs of their upmarket neighborhoods which were deprived of malls for long time.

Chennai's economic development has been closely tied to its port and transport infrastructure, which is considered the best in India. Two major ports, namely Chennai Port (one of the largest artificial ports) and Ennore Port support the city’s industrial growth. Chennai, known as the Detroit of Asia, generates around 60% of India’s automotive exports and the city continues to attract several auto majors and auto ancillary companies, each investing around INR 2,000–2,500 crore. 

Renault Nissan, Hyundai, TVS and Yamaha are among the automotive giants who are planning to enter or expand in Chennai, with Saint-Gobain, Murugappa Group, Hitachi and Nokia also having big plans for the city. 

Apart from the above private players, the Tamil Nadu Government plans to set up an industrial township near Mahabalipuram and has also announced an initiative to establish a multi-storeyed industrial estate at Thirumazhisai near Chennai. All these proposals are expected to increase the need of industrial land in the suburbs of Chennai. 

Along with the existing industrial locations such as Sriperumbadur, Oragadam and Maraimalai Nagar, these upcoming industrial establishments will attract employees to settle closer to their work, thus catalyzing residential sales in these far-off locations.

Chennai’s residential market has seen steady capital appreciation over the past decade. However, the steady increase in prices has kept residential sales in check of late. Indeed, some of the prominent residential locations in Chennai witnessed around 15–20% increase in capital values over the last six months, which in turn has caused prospective home buyers to delay their purchase decisions. Moreover, the anticipation of interest rate cuts further into the year and home buyers’ expectation on price stability has reduced sales velocity.

With major infrastructure projects such as the metro rail, Phase III of the MRTS from Velachery to St Thomas Mount and the Outer Ring Road appearing closer to reality, rapid capital value appreciation is estimated across the city. Furthermore, the proposed monorail, Peripheral Ring Road project, Greenfield Chennai-Bangalore expressway and the new Greenfield airport is also triggering capital appreciation in these locations.

Along with the above projects that are in various stages of implementation, the State Government and Chennai Corporation recently announced new infrastructure projects - including the proposed 45-km elevated road from Taramani to Mahabalipuram to decongest OMR, a multilevel parking facility at Siruseri, skywalks at T. Nagar and George Town and several grade separators across the city. With this increased infrastructure spend, the city’s real estate values have been on the rise.

Global construction equipment market to reach USD 192 bn by 2017

 The global construction equipment market is expected to reach USD 192.3 billion by 2017 from USD 143.6 billion in 2012, growing at a CAGR of 6 % from 2012 to 2017, with India and China holding the lion's share, according to a report.

The new market report published by Transparency Market Research "Construction Equipment Market - Global and China Forecast, Market Share, Size, Growth and Industry Analysis, 2011 - 2017," found that earth-moving equipment segment alone has contributed about 43% to the total construction equipment market revenue in 2012.

Asia is the most promising market for construction equipment worldwide due to relatively good performance of construction and mining industries, in countries like India and China. Europe holds the second largest share of the construction equipment market, the report pointed out.

The construction equipment market is driven by factors such as growth in construction activities, emergence of lease-based equipment, and increasing government investment in infrastructure development especially in developing nations. In addition, demand by companies in infrastructure and real estate is also supporting the growth of the construction equipment market.

Despite the encouragement by governments across the globe, there are certain factors inhibiting the growth of the construction equipment market such as uncertain economic conditions, and strict emission regulations. The increasing price of raw materials such as steel is also a major challenge for the construction equipment market.

 

The earth-moving equipment segment holds majority market share of the total construction equipment market and is estimated to be worth USD 61.7 billion in 2012. Material handling equipment is the fastest growing segment and is expected to grow at a CAGR of 6.6 % from 2012 to 2017.

The construction vehicles segment is expected to exhibit healthy growth during the forecast period (2012 - 2017) and will attain a market size of USD 22.9 billion in2017, the report said.

China is the major contributor to the global construction equipment market and accounts for about 41.2% of the overall global sales of construction equipment. The construction equipment market in China in 2012 is estimated at USD 59.2 billion and is expected to reach USD 95.6 billion in 2017 at CAGR of 10.1% from 2012 to 2017. In addition, China also holds about 17% market share of the global agriculture equipment industry.

Some of the key players dominating the construction equipment market are Caterpillar (U.S.), Komatsu (Japan), Volvo (Sweden), Hitachi (Japan), Liebherr (Switzerland), Sany (China), Zoomlion (China), Terex (U.S.), Doosan (South Korea) and John Deere (U.S.). Caterpillar is the leading player in the global construction equipment industry. Some of the Chinese construction equipment market players dominating the global market are: Sany, Zoomlion, XCMG, Guangxi Liugong, Lonking and others.

Tata Housing to build luxury homes in Alstom T&D’s Bangalore plot

Tata group’s realty arm Tata Housing Development is acquiring land in Bangalore from power transmission company Alstom T&D India for Rs 120 crore to develop its second luxury project in the southern city.

"Tata Housing entered into an agreement with Alstom T&D India to buy its manufacturing unit spread across 20 acres in Bangalore for Rs 120 crore," Tata Housing said in a statement, adding, the acquisition is expected to be completed in three months.

Tata Housing had launched its first luxury project in Bangalore, ‘The Promont’, in 2011. US-based Portman Holdings has reportedly invested around Rs 65 crore in this project for a minority stake in November last year.

Currently, Tata Housing has its footprint in Mumbai, Lonavala, Talegaon, Pune, Ahmedabad, Goa, Gurgaon, Chandigarh, Bangalore, Chennai, Kolkata and Bhubaneswar. Besides, it is also looking to augment its presence in tier I and II cities.

 

Last week, Alstom T&D India, an arm of French conglomerate Alstom, had said it is selling its property in Bangalore to an unnamed large Indian business group for Rs 120 crore. This unit was previously used for manufacturing instrument transformers

Infrastructure devt drives Indian NDT equipment market:Frost & Sullivan

Mumbai: The nondestructive test (NDT) equipment market in India is poised for a steady growth. Demand from end-user industries, such as automotive, transportation, aerospace, military and defense, will be the biggest driver of market revenues as rapid industrialization in the country makes NDT equipments indispensable, according to an analysis from Frost & Sullivan.

Further, improvements in road and air infrastructure and the building of oil reservoirs, pipelines, refineries and nuclear power plants, offers immense opportunities for NDT equipment vendors, it says.

Indian Nondestructive Test Equipment Market has earned revenues of Rs 359.2 crore in 2012 and estimates this to reach Rs 501.9 crore 2016.

The introduction of safety norms, precautionary measures, quality assurance, and regulations by the government boosts the NDT market segment as it is critical for establishments to provide safety assurance and procure trouble-free license approvals. NDT equipment for inspection in the nuclear industry, in particular, is expected to gain a strong foothold during the forecast period.

Further, periodical assessment strategies enforced to preserve ageing infrastructure and improve cost-effectiveness by optimizing its useful life supports the use of NDT equipment. For instance, NDT is used to help reduce investment in new resource procurements by testing old, high-pressure vessels, navy ships, aircraft and railway coaches for refurbished use.

“India has become a hub for third-party inspection services over the last decade. More than 500 companies are offering inspection services across product segments spurring demand for new equipment as the inspection services market grows”, says a Frost & Sullivan analyst.

However, price remains a concern. The volatility of the Indian currency and its drastic devaluation has lead to significant price differences between currency value at the time of placing raw material import purchase orders and final delivery, thereby shrinking manufacturers’ margins. New procurements are being postponed till the situation stabilizes, and this is adding to NDT equipment suppliers’ woes. In addition to price consciousness, customer reluctance to use new technologies too curtails sales volumes.

Raising awareness on the benefits of NDT equipment among end-user industries, government organizations, and training institutes can bridge the gap between vendors and customers in the Indian market. Mitigating redundant technological features in NDT equipment through customized value addition, as well as improving automation and ease of use will widen market potential. Concerted efforts are also required to deliver comprehensive turnkey testing solutions with benefits spread across the value chain.

“Reduction in size, with the possession of maximum features and working ability, is the order of the day for many instruments, and NDT equipment follow suit,” says the analyst, adding, “Achieving maximum reliability and accuracy, and deriving ideal levels of flaw detection with such instruments at affordable prices, have become key areas of focus in NDT equipment instrumentation and measurement research.”

Mantri Developers bags CII-ITC sustainability award

Bangalore: Mantri Developers, a leading real estate developer in south India, has been bestowed with CII-ITC Sustainability Award for the year 2013. The developer has won a Commendation Certificate for achievement on the journey towards sustainable development, a release said.

Commendation certificate for significant achievement was presented by Corporate Affairs Minister, Sachin Pilot to Snehal Mantri, Director Marketing and HR, Mantri Developers.  Suresh Prabhu, Chairman, Jury, CII-ITC Sustainability Awards and Chairman, Council for Energy, Environment & Water, Y C Deveshwar, Chairman ITC and Seema Arora, Executive Director, CII-ITC Centre of Excellence for Sustainable Development are also in picture.

Sachin Pilot, Minister for Corporate affairs presented the award to Snehal Mantri, Director Marketing & HR of the company at an award ceremony organised by CII at India Habitat Center in New Delhi recently.

Speaking after receiving the award, Sushil Mantri, Chairman and Managing Director of Mantri Developers said, “Mantri Developers is committed to achieve the highest performance standards in the areas of sustainability, service and quality. The roots of being sustainable and contributing to social needs are embedded in our value system. We always believed in giving back to society and our sustainable efforts are also a part of the same. This recognition will energise us further in our continuous journey of sustainable development.”

Mantri Developers has introduced sustainability in all their business processes. The triple bottom line approach is imbibed in their corporate strategy and is actively practiced in business operations of the companies, which directly transformed the life of many.

The CII-ITC sustainability awards are an industry benchmark to recognise the contribution of notable thought leaders, promoters and institutions which helped to translate the vision of creating a sustainable world into reality and have successfully instituted sustainability in some element of their business. The label aims at communicating to consumers, investors and business partners that the company is sustainable, responsible and well governed.

This award was given to Mantri Developers after a rigorous evaluation process carried out by expert CII assessor and distinguished jury panel.

About CII-ITC Sustainability Awards:

The CII-ITC Sustainability Awards are conferred to Indian companies that demonstrate excellent performance in the area of Sustainable Development. The Sustainability Awards - instituted by the CII-ITC Centre of Excellence for Sustainable Development in 2006 - are a unique initiative to identify and recognise Indian business for their exemplary performance in economic, environmental and social dimensions of all their imperatives.

About Mantri Developers:

Mantri Developers Pvt. Ltd. is a leading developer of world class Homes, IT Parks, Retail Spaces and Educational Institutions. Sushil Mantri founded Mantri Developers in Bangalore in the year 1999. In just 14 years, the company has built over 24 projects. Today, as part of its diversified portfolio Mantri Developers cumulatively has to its credit over 20 million square feet of constructed area, over 30,000 satisfied residents and 11 million square feet under various stages of construction. 

Mantri Developers has a track record of delivering 1.4 homes per day since inception. The company plans to focus on the residential sector, retail, hospitality, IT Parks and educational institutions in Bangalore, Chennai, Hyderabad and Pune.

Branded luxury homes for India's super-rich

In India, the concept of branded luxury homes is only two or three years old. Growth of this segment could be pegged at roughly 5-6% per annum, owing to the fact that it is a very exclusive niche category with a restricted number of buyers, says Anuj Puri, Chairman & Country Head, Jones Lang LaSalle India. 

The basic premise behind branded residences is that the developers of such projects tie up with international luxury hospitality or lifestyle brands to create unique and highly differentiated offerings. As in all new business segments, there was no specific pre-existing demand for such homes - the mind-set of the target audience first needs to be primed to create demand, as supply will only follow demand. This process is happening with a fair degree of success in cities like Mumbai, Pune and Delhi NCR. 

Branded luxury homes bring various advantages beyond a designer label and location with them. They boast of professionally designed interiors and exteriors, highly evolved, centralized facilities management and various additional features like concierge services, high-grade electronic surveillance and security and valet parking. These factors have high appeal value, especially to buyers who have seen such homes abroad and aspire to live at such levels.

Branded luxury homes are targeted at that segment of India’s super-rich that prefer the conveniences and status value of luxury homes designed, marketed and often managed by international hospitality or signature designer brands. 

Developers of branded luxury homes are generally happy to provide personal customization to their buyers as long as these customizations do not detract from the overall project specifications, aesthetics and integrity.

The overall share of luxury homes in the Indian real estate domain would not exceed 6-7%, depending on how 'luxury' is defined in various markets. In industry terms, we define 'luxury' housing as homes costing Rs. 4-5 crore, while homes with ticket-sizes of around Rs. 1-1.5 crore fall in the premium or high-end segment.

The branded residences segment is not without challenges. These would include a limited buyer segment, finding the needed land parcels within high-prestige locations, providing the required infrastructure to adequately supplement the overall luxury experience - and, of course, getting the right brands to come on board in the first place. The latter factor is by no means without challenges, since international designer labels – by their very nature - have very high brand standards which a proposed project must demonstrably be able to live up to. 

The fate of branded residences as a property investment segment still hangs in the balance. From the churn point of view, selling mid-income housing is easier than high-end or luxury homes since a larger base of the population falls in the mid-income category. The sale velocity is higher and the sales cycle is also shorter, with mid-income housing projects usually being sold with 3-4 months of their launch. 

In comparison, high-end apartments and luxury homes often take more than six months to sell. As already mentioned, the bulk of demand for residential properties in India lies in the budget / mid-income category and comes from buyers who can avail of ready bank funding. 

Though buyers of ultra-luxury housing such as branded residences are not dependent on such considerations by virtue of their existing networth, it also means that the pace at which the branded luxury housing segment will grow depends on the pace at which India's macro-economic environment is able to produce such individuals. 

Eldeco launches 'Inspire Neo' At Sector 119 Noida

Eldeco Group has come up with ‘Eldeco Inspire Neo’, a new high-rise residential tower at Sector 119, Noida.

Strategically located, this 2/3 BHK apartments (1121- 1761 sq. ft.) comes with a gamut of fully-loaded amenities like a modern lifestyle club with gym, billiards, table tennis, swimming pool, party hall and guest rooms; sports facilities - badminton, lawn tennis court, half court basketball and more, 24/7 power back-up, computerised electricity billing and drinking water through individual RO in each apartment.

Apart from the state-of-the-art- facilities and its two tier security system, these apartments in Inspire Neo are perfect for the choice of comfortable stay in Noida with starting price of Rs 53 lakh. Its proximity to the FNG Expressway and Noida City Centre Metro Station offer easy connectivity for its residents, which are another factor that makes the flats in Inspire Neo worth an attention, according to a release.

Eldeco Inspire Neo comes with other conveniences such as its serene surroundings and access of a full-fledged Golf course within driving distance of 10-15 minutes; access to the commercial hub of Noida, Sector-18 and Fortis Hospital at Sector 62, just minutes away from Inspire Neo’s location. This project also has excellent potential for high rental returns, as a number of software giants such as HCL and TCS have corporate offices close by.

Eldeco Group has been at the forefront of Real Estate development in North India since 1975. The group is synonymous with timely and quality delivery in a number of cities across India. Carrying more than 39 years of expertise in construction and real estate development, Eldeco has delivered more than 200 projects spanning townships, high-rise condominiums, industrial estates, malls and office complexes. The group’s business activities rest on the principle of high quality, superior construction technology and high consumer satisfaction.

Eldeco Inspire Neo would be an excellent choice for the home buyers for buying their dream home or for investment purpose, added the press note.

'Walk Score' Gaining Importance In Pune Real Estate

'Walk Score' factor accounts for a much higher preference rating among Pune's home buyers than the 'walk-to-work' option, which is unrealistic in most cases, says Arvind Jain, Managing Director of Pride Group.

Arvind Jain

Abroad, a new trend of evaluating neighbourhoods by their 'walk score' is being seen among home buyers. The idea behind this is simple, and in fact the very basis of that favourite real estate mantra 'location, location, location.' And it has great pertinence for the Pune real estate market, as well.

The investment value of a location is traditionally judged by how many office complexes are coming up in the area. This makes sense - investors can expect demand from people who work in these offices, since living close to work is always a great convenience. It reduces the daily travel time, which means one can spend more time at home with one's family than on the road.

However, property buyers look for more than proximity to work when they choose a home. In a city like Pune, where traffic congestion is a huge problem, people also aspire to have various conveniences within walkable distance from their homes.

A housing project's 'walk score' is determined by how many shops, clinics/hospitals, parks, playgrounds, restaurants and coffee shops are within walkable distance. In fact, this factor accounts for a much higher preference rating among Pune's home buyers than the 'walk-to-work' option, which is unrealistic in most cases anyway.

The logic is simple, yet profound. A family's happiness quotient in a housing project does not hinge just on how soon the breadwinner (or, in the case of Pune's every-increasing dual income families, breadwinners) can get to and from work. In the course of any normal working day, there are still family members back at home who need to keep the household running.

Pune is also a city where a significant number of families still include elders, who have their own social and leisure needs. And even for the younger generation, commuting home from work just to face the traffic again to pick up groceries or enjoy a cup of coffee with friends is annoying and draining.

The convenience of having essential goods, services and places of recreation within walkable distance from home therefore ranks high on most Puneri families' wish-list. For families are fortunate enough to live in the central locations, in homes purchased at a time when they were still affordable, this is not a problem. But for the majority of today's generation of home buyers, Pune's newer locations are the only options.

One of the ways out of this fix is the increasing availability of township properties. Most of the large townships are coming up on the city's peripheral locations; this means that property prices in them are more affordable. At the same time, they have high 'walk scores' because they include retail, leisure, healthcare and even schools.

This explains why township properties in Pune are becoming so popular. However, not all townships are created equal. A good township is planned in a manner which allows all residents to access such outlets and facilities on foot with equal ease.  While evaluating a township as the venue for one's new home, it is therefore essential to study the master plan and establish its actual 'walk score'.

Stay invested in Pune Luxury Property

Kishor Pate

During 2013, the investment potential for residential properties in the financial capital of Mumbai remained largely flat and unexciting. Most serious property investors in Mumbai who chose residential property are now content to exit with moderate profits.

Pune, on the other hand, showed an almost uniform appreciation of 14-16% in property prices. Vacancy levels in Pune stand between 20-22%, while in Mumbai they are close to 35%. As a result, investors are staying invested in Pune, says Kishor Pate, CMD - Amit Enterprises Housing Ltd.

One question being asked by the real estate investors in Pune is whether they should prefer mid-income or luxury housing? To be sure, Pune has a number of options in both segments. Mid-income apartments are definitely the faster-moving product on the market. However, luxury housing in Pune has been getting a lot of exposure of late, mainly because it is a much more vibrant segment in this city than in Mumbai.

 

It has been argued that Pune has seen far too many luxury projects being launched in the last two to three years. However, the fact is that these projects are not aimed primarily at property investors but at NRI and HNI buyers who are purchasing such homes for personal use. Property investors focused on Pune have always been more interested in acquiring mid-range flats which they can dispose of faster. This is a limited perspective, usually brought on my budget constraints.  

There is, in fact, a very high demand for luxury property in Pune from self-use buyers, which is why developers continue to see sense in launching premium housing. It must be remembered that as long as there is demand, supply will follow. And as long as the demand is from buyers who wish to own such properties for personal use, there is no glut on the market - these units will not be put up for sale again for a very long time.

For this reason, investment in luxury property in Pune does make sense for long-term investors. These are premium offerings in locations which will eventually not be able to accommodate further development. However, it is a play which requires high investment power and the ability to hold on to the property for at least five to seven years. After such a period, the real estate development potential of a location which is popular today will be almost exhausted and demand will begin peaking.

There is no doubt that demand for luxury housing in Pune is very sustainable. An increasing number of multinational companies are recognizing Pune's unique advantages in terms of trained manpower, cheaper real estate costs and reduced logistical hassles. The result is that more and more high-paying jobs are being created every year, which leads to a steady demand for high-end homes. At the same time, more and more NRIs from Pune who have completed their high-paying tenures abroad are returning every year.

Obviously, luxury homes in key areas such as Aundh, Baner, Sahakarnagar, Kalyaninagar and Viman Nagar will become increasingly valuable over time. But within a span of five to seven years, even newer areas will have been made valuable because of increased infrastructure and accelerated saturation. Investing in a luxury property in such an area today can pay off handsomely over the long term.

Issues affect real estate construction projects

As companies across the world prepare to expand their presence in Asia’s emerging markets, a new report by Jones Lang LaSalle, ‘Who’s Protecting Your Blindside?’ has highlighted seven hidden risks associated with real estate construction projects.

“While professional project management is well understood and accepted as critical to the success of real estate projects, the importance of construction management is often overlooked and frequently performed by a part-time supervisor rather than a professional construction manager,” said Dave Colverson, Regional Director, Construction Management for JLL in Asia Pacific.

According to the report, many businesses expose themselves to the following seven pitfalls during real estate construction projects, despite good project management at the onset:

Confrontational relationships: When competing on price, it is in the interest of contractors to protect and maximise their position, which can lead to cutting corners to save time and cost and avoid penalties

Lack of flexibility: Failing to accommodate flexibility in the project scope means that potential changes made along the way result in avoidable additional fees and delays

Miscommunication: Without clear communication and responsibility, crucial tasks can be missed and decisions made based on poor/uninformed assumptions easily lead to delivery issues

Breakdown between project phases: Ineffective stakeholder management leaves gaps in knowledge transfer where technical errors an oversights can occur

Unfamiliar local market dynamics: Insufficient market knowledge limits the ability to deal with unanticipated local requirements, legislation and restrictions

Lack of accountability on site: Absence of a qualified on-site representative leads to mistakes or delays, and the inability to prevent accidents and address the consequences in a timely manner

Transparency and governance issues: Lack of identification, understanding and compliance in supply and management of materials and labour resources exposes your business to regulatory, legal and financial risk

“Managing projects in diverse Asian markets can be particularly challenging for companies that are unfamiliar with local market dynamics. Local nuances include skills and availability of trade contractors, legislation such as health, safety and environment, availability of logistics and infrastructure, cost of trade contractors and materials, taxes, authority approvals and regulations,” said Colverson.

For example, a company in China was unable to move into its new office space on time because the main contractor had not obtained the required authority approvals. Later, sick leave and staff complaints were high because the main contractor had not allowed enough time to purge the air of construction-related smells. In India, an on-site flood during an office fit-out left a company with financial loss, delayed occupancy and a damaged reputation because no one had overall responsibility for work at the construction site. Insurances were limited to individual trades and no one was assigned to effectively plan and manage the necessary rectification.

“Unfamiliar local market dynamics and real estate transparency issues are among many hidden risks throughout a construction project,” said Colverson, adding, “Companies can reduce their risk by engaging a professional construction manager who is familiar with the local market as early as possible. They will benefit from advice on potential construction issues during the design stage, smooth transition between all phases of the project and a single point of accountability for all on-site works. This in turns insulates companies from the subsequent business impacts.”

While the success of real estate construction projects is typically measured by time, cost, quality and safety, when things go wrong bottom-line impact can be significant. This includes risk to a company’s reputation, brand, compliance, talent attraction, customer satisfaction, business continuity and profitability.

Schemes that help poor to own a shelter

 Though India can boast of having one of the highest number of High Net Worth Individuals (HNWIs), the Economically Weaker Section (EWS) still occupies the major portion of the population, and providing them with shelter is nothing but a daunting task for any government agencies. 

But still, how many of these people know that there are several Central and state-sponsored schemes through which they can realise their dream of having home? Riding on illiteracy, government apathy and corruption at high levels, these EWS always remain shelter-less.

Though there are several articles, write-ups and news regarding the presence or launching of such schemes, there have been no efforts, either from government agencies or financial institutions to take it directly to the doorsteps of these people.

An earnest effort was made by the Government to set up a Credit Risk Guarantee Fund (CRGF) Trust for Low Income Housing on 1st May, 2012 to facilitate economically weaker sections and low income households in getting credit from banks and housing finance companies. But how many poor people came forward to ustilise this scheme?

Recently, while answering to a question in the lower house of Parliament, Dr. Girija Vyas, Union Minister of Housing and Urban Poverty Alleviation (HUPA), stated that this Scheme provides guarantees for the loans given to EWS/LIG persons up to Rs 5 lakh by lending agencies without any third party guarantee or collateral Security. National Housing bank is the Nodal agency for operationalizing CRGF. 

She said, as on date, 39 Member Lending Institutions have executed the Memorandum of Undertakings (MoUs) to participate in the scheme. The total corpus fund of the Trust is Rs 1000 crore. Government of India has so far released Rs. 150 crore as corpus of the fund. But one thing, which is not clear that where a poor person could find a home with Rs 5 lakh? He could build a home if he has a piece of land. But nowhere in the country, a flat of 40 sq mt could be found for this amount, even in the remotest of remote places, says Diwan Singh, a property dealer and financial adviser from South Delhi.

The Credit Risk Guarantee Fund Scheme for Low Income Housing (CRGFSLIH) is already operational. Rs. 5 lakhs ceiling in guarantee has been prescribed keeping in view the average loan size for a 40 sq mt house and the repaying capacity of the people in Economically Weaker Sections and Low Income Group segments, the Minister added.

For those ill informed here are the list of pro-poor housing schemes floated by the government of India in the recent past.

Rajiv Awas Yojana (RAY): Government had launched RAY in June 2011 in two phases-  the preparatory phase for a period of two years which ended in June 2013.  The government has approved the implementation phase of RAY in September 2013 for the period of 2013-2022. The Central support under the scheme is admissible to States/UTs and Central Government Agencies for providing housing including new houses, incremental houses, rental houses, transit housing and development/improvement of basic civic & social infrastructure under the scheme.

Jawaharlal Nehru National Urban Renewal Mission (JNNURM): For rehabilitation of slum dwellers the Government had launched the JNNURM on 3rd December, 2005 for assisting State Governments in providing housing and basic civic services like water, sanitation etc to urban poor/ slum dwellers in 65 select cities under the Sub Mission Basic Services to the Urban Poor (BSUP) and in other cities and towns, under the Integrated Housing and Slum Development Programme (IHSDP).  JNNURM has been extended up to March, 2015 for completion of projects sanctioned up to March, 2012. 

One of the three pro-poor reforms under JNNURM is provision of basic services to urban poor including security of tenure improved housing, water supply, sanitation education health and social security. The reform is envisaged to be an outcome of JNNURM and is to be implemented in a staggered manner over the Mission Period (extended up to 31.3.2015) in convergence with the programme of other Ministries.

Affordable Housing in Partnership (AHP): As an integral part of RAY, the competent authority has also approved continuation of implementation of Affordable Housing in Partnership (AHP) Scheme. The scheme has been amended to provide Rs 75,000 per EWS/LIG dwelling unit of 40 sq m size for housing and internal development components with an objective to encourage private sector participation in affordable housing.

Rajiv Rinn Yojana (RRY): The Centre has implemented RRY with effect from 1st October 2013. Under this Scheme, an interest subsidy of 5 % per annum for loans up to Rs 5 lakh and for tenure of 15-20 years, will be provided to EWS/LIG housing loan borrowers in Urban Areas availing loans from Financial Institutions i.e Scheduled Commercial Banks & HFCs etc.

L&T bags Rs 2,935 crore order from Qatar

New Delhi: Infrastructure major Larsen & Toubro's power transmission vertical has bagged a
Rs 2,935 crore order for setting up transmission and distribution network in Qatar.
 

"Power transmission and distribution business of L&T has secured an EPC (engineering, procurement and construction) order valued at Rs 2,935 crore from Qatar General Electricity and Water Corporation for supply and commissioning of transmission lines and substations," a PTI report quoting company statement, said.
 

The order is part of expansion of the Qatar Power Transmission System. "This order aligns well with L&T's expansion plans in the international arena," S N Subrahmanyan, Senior Executive Vice President (Infrastructure & Construction) L&T, said in the statement.
 

The scope of work for the company includes supply, erection, testing and commissioning of switch gears, power transformers and auxiliaries, the statement said. The project, which is spread across prominent locations in Qatar, is scheduled to be completed in 22 months. 

These substations are being built to augment the existing power system network to cater to growing infrastructure facilities.
 

L&T, shares were trading at Rs 1089.95, up 2.50 per cent on the BSE.

Dalmia Bharat Cement Gets National Energy Conservation Award

Chennai: Dalmia Cement (Bharat) Limited’s Ariyalur plant in Tamil Nadu has bagged the National Energy Conservation Award for the year 2012-13 by the Ministry of Power. 

The leading cement manufacturer received the award for the second year in succession, and has become the only firm in the sector to get the coveted recognition, according to a release.

The award recognises efforts made by companies to optimize energy consumption.

Vipin Agarwal, CEO South, Dalmia Bharat Cement received the award from the President Pranab Mukherjee at New Delhi recently.

Speaking on the occasion, Vipin said, "We are committed to utilising alternative sources of energy with a strong focus on safety, environment and energy conservation. In line with this, we develop, implement and emphasise on continually improving our processes and systems to enhance energy performance."

"This award is a testimony to our concerted efforts towards ensuring energy efficiency," he added.

Dalmia Cement (Bharat) Ltd.

Dalmia Cement (Bharat) Limited (DCBL), a part of the Dalmia Bharat Group, is a pioneer in cement manufacturing for over seven decades since 1939. With an expanding India footprint, the company is a category leader in super-specialty cements used for oil well, railway sleepers and air strips. 

DCBL has strong foothold in the south, east and northeast India. It has equity in OCL India Ltd. and has acquired Calcom Cement in Assam and Adhunik Cement in Meghalaya. With a growing capacity, currently pegged at 21.8 MTPA, Dalmia Cement is a top quartile player in India.

Ashiana Homes and Landcraft Projects launch mega residential project in Gurgaon

New Delhi: Ashiana Homes Pvt. Ltd. and Landcraft Projects Pvt. Ltd. have entered into a Joint Venture agreement with equal equity to launch state-of-the-art residential project - The Center Court -- at Sector 88A , Gurgaon on Dwarka Expressway. The new joint venture company is named Ashiana Landcraft Realty Pvt. Ltd.

While IndiaREIT Domestic Fund, sponsored by the Piramal Group, has invested Rs 100 crores in the project, IIFL has invested Rs. 80 crores in the Center Court. Ashiana Landcraft will be investing Rs. 600 crores in the project to ensure planned development and on-time delivery.

Rohit Raj Modi, Director, Ashiana Landcraft Realty Pvt. Ltd. (ALRPL) said, "Owing to locational advantage and infrastructural development that is underway, Dwarka Expressway is poised for stupendous growth. We are therefore delighted to join hands with another leading name in the industry, Landcraft Developers Pvt. Ltd. to develop state-of-the-art residential project on the Expressway."

"Young and upwardly mobile customers today are not just looking for homes they are looking for a complete lifestyle. With strong focus on health and fitness young customers today are opting for residential spaces that offer them a complete package in active lifestyle. The Centre Court we are confident will set new precedent in active lifestyle in the Indian real estate industry," said Manu Garg, Director, ALRPL.

He further, said, "With the launch of the Center Court we aim to bring forth our age-old legacy of commitment, quality and trust to our customers by offering them a never before experience in active living. We have brought together best names in architecture and landscape design to make this possible."

Designed by a very dedicated and experienced team of professionals in unique "S" shape, The Center Court offers 85% of land as open landscaped area. This extensive outdoor area has been designed by internationally acclaimed landscape architect Belt Collins International, Singapore. Light Design Partners (LDP), Singapore and HBO+EMTB (Mumbai / Sydney) are part of the project team to provide high quality of outdoor & indoor lightings and interiors that will add to the up-market experience that The Center Court strives to achieve.

 On offer

The proposed projects will come in four basic unit sizes: 2BHK + Study, 3BHK, 3BHK +SQ and 4 BHK apart from exclusive villas & penthouses.

The Center Court offers a 25000 sq ft centrally air-conditioned club house comprising lounge, kids play zone, banquet facility, library, gold class movie lounge, gymnasium, spa and massage suits, along with billiard room, table tennis and various other board games. Outdoor sports facilities like tennis courts, basket ball courts, volley ball court, squash court, multiple swimming pools, jogging track, cycling track, cricket pitch, golf putting green, rock climbing wall will offer ample avenues for active lifestyle to the residents.

Double height air conditioned building lobbies exquisitely designed by HBO+EMTB to create a warm and welcome ambiance for residents and their visitors, world class concierge service, high speed lifts with classy interior, round the clock three tire security, access control lobbies and dedicated ambulance service for those unforeseen medical emergencies will be other unique features of the Centre Court.

Ashiana Homes

Ashiana Homes has been in the housing development sector for over last 25 years and has set the benchmark for quality and commitment in real estate. Since 1997 the Group has been involved with development and construction of residential projects at Greater Noida, Indirapuram, Ghaziabad, Gurgaon in Delhi NCR and, with new Projects coming up in Bhubaneshwar and Jaipur. Ashiana has completed over 33 lacs sq.ft. Construction, in residential sector and has lived up to its claim of providing quality housing at affordable cost to more than 3000 happy families.

Landcraft Projects

Landcraft is real estate vertical of the Garg Group , a multifaceted business group with diverse business interests in sectors like Education, Steel & Publication and commands impeccable reputation and track record for more than five decades. It is known for reliability and trust amongst all its stakeholders. Landcraft has delivered more than 2.2 million sq. ft. area to more than 2200 customers by developing the first phase in three projects - River Heights, Golf Links and Dinesh Nagar. The company is now implementing the second phase of all the three projects where another 3 million sq. ft. will be ready in next 3 to 4 years.