Property Management Start-ups to the Rescue of NRI Investors

Periodic inspection of properties, assured care and rental assistance make companies such as Rentprop4u a hit with those away from home

If there is one reliable thing NRIs have always vouched for and continue to invest in, it is property back home in India. Bengaluru, Kochi, Mumbai, Ahmedabad and Delhi have been investment hotspots. However, the lucrative investment comes with strings attached - how does one know their tenant is good, that their house is not damaged in their absence, or what if the tenant calls them from across the seas to get a plumbing problem fixed?

Being so far off, and rarely visiting their hometowns, NRIs now are turning to property management companies to take care of the nitty-gritty of their treasured properties.

Rentprop4u, a Bengaluru-based realty start-up, says it has seen an almost 60 per cent increase in the number of enquiries over the past one year from NRIs in Australia, US, Canada, New Zealand and the Gulf. The company helps NRIs realise the full potential of their real estate investments. 

"Usually, NRI homeowners are worried about things like finding the right tenant quickly, showing the property, tenant vacation hassles and legal implications, rent variation, lack of tenant screening and house maintenance, dependency on brokers and inability to inspect the property during tenant stay," says Nagaraju M, CEO, Rentprop4u.

Nagaraju lays out the current details, very specific to NRIs - nearly 25 per cent of apartments in Bengaluru are bought by NRIs. In Kochi, it is about 40 per cent. Investment by NRIs in other cities such as MMR, NCR, Ahmedabad, Chennai and Dehradun varies between 5 to 10 per cent of the overall market sales.

According to the 2011 census of India, out of the 90 million residential census units, 11 million units were vacant; that is about 12 per cent of the total urban housing stock. And a lot of homeowners prefer to let their investments lie idle rather than face the trouble of letting them out.

Nagaraju speaks of how companies like his have now become popular with NRIs, because they offer 100 per cent property assistance - including rent assistance, rental agreements and payments, maintenance, quarterly inspection of properties with photographs taken and sent to owners. They also offer niche on-demand services such as furnishing and payment of property taxes.

Rentprop4u takes care of one other worry for NRIs - safety - through tenant screening and background verification as well. They do a police verification of the tenant through their legal team.

Established in 2016, Rentprop4u currently has 200-plus registered properties and more than 400 users. Be it a single property or a large portfolio, the company is so confident of its tenant placement services that it guarantees to let out the property in less than 30 days or start paying the rent to the owner within a month.

"We give them 15-20 per cent higher returns compared to brokers, so NRIs find our deals attractive. We can assure uninterrupted rent payments to property owners even when some of the properties are vacant for short periods," he adds.

Bahrain-based Al Namal Group Partners with Square Plums for Co-living Apartments

Al Namal Group , a multinational conglomerate founded by Bahrain-based NRI Varghese Kurien, is entering the co-living homes sector in India through an 'operating agreement' with Square Plums, an upcoming brand of co-living homes based in Bengaluru.

Co-living homes are fully furnished, ready-to-move-in homes based in gated communities available on rent for youngsters relocating to cities for job placement.

Al Namal Group and Square Plums have been in discussions for the last few weeks and cemented the deal during Kurien's visit to Bengaluru for Pravasi Bharatiya Divas in January.

As part of the agreement, Billionaire Kurien led Al Namal Group plans to build 2 million sq ft of co-living homes in Indian metro cities. The group has earmarked investment of Rs. 300 crores for this foray.

Square Plums was founded in early 2016 by Rajesh Kotta and Hemant Attray, both alumni of BITS Pilani. It has managed to create an aspirational brand of co-living homes that is popular among the young executives working at leading MNCs and IT companies. In August last year, it had announced raising an undisclosed amount of funding from Indian Angel Network.

Kurien remarked, "We are bullish on the India story and have already invested hundreds of crores in commercial and real-estate projects in many cities of Karnataka and Kerala. Co-living homes are a new class in the sector and we have been watching this space for a while."

Mohammad Mansoor, MD of Exelon Solutions who advised Al Namal on the deal added, "After 

doing our diligence, we have found that Square Plums, with its focus on high-end, branded homes specifically designed keeping in mind the needs of co-living youngsters, is an ideal operator partner for us. The technology and marketing platform they have built is the key for us to succeed in this venture." 

Rajesh Kotta, founder & CEO of Square Plums, commented, "Finding a quality rental home is still a challenge in Indian cities, especially for singles. Over the last one year, especially following the investment from Indian Angel Network in August, we have built a branded product that ideally suits youngsters looking for a home in the city."

Hemant Attray, co-founder of Square Plums, signed off, "Homeowners who partner with us have found that on an average, rental yields from Square Plums branded homes can be up to 80% higher. In this partnership with Al Namal Group we look forward to bringing the Square Plums co-living home experience to over 7000 youngsters across 3 cities in India."

No Hope of Revival for Struggling Real Estate Sector this Diwali

Buried under high debt and inability of the developers to complete and hand over the pending projects well beyond the commitments to the hard-pressed consumers, the troubled Indian housing sector is not witnessing any festive activity this year despite the latest cut in the policy interest rate by the Reserve Bank of India (RBI), an ASSOCHAM survey has said.  

  

Based on the data and information collected from 250 builders in the Delhi-NCR, Mumbai, Bengaluru, Chennai, Kolkata, Ahmedabad, Hyderabad, Pune, Chandigarh and Dehradun, the survey found that the demand for new projects is hard to come while new launches have come to a trickle, marked by lack of consumer confidence and cash deficit of the builders.

Under such a scenario, the demand for new launches, if at all there are, has come down by over 50-60 per cent in Delhi-NCR and Mumbai while it is lesser by about 40-45 per cent in Hyderabad and Chennai. In Bengaluru, the activity has come to a total standstill, first by the demolition drive and then by Cauvery dispute agitation, adds the recent survey. 

“Whatever market is there, it is mainly for the end-users and not for investors, sale has been increased for the smaller units (2 BHK & 3 BHK)”, reveals the survey. 

“Customers are preferably looking for ready to move in property rather than going for under construction property. But not many properties fall in this category”, adds the Secretary General D S Rawat.

The resale or secondary market is also dull this festival season, marked by drop of at least 20-25 in prices this festive season. There is very little resale happening especially in the NCR and surrounding areas. Supply is in excess with private small time builders in the unorganised sector flooding the market with units.

The unsold inventory pressure in NCR region is the highest among all other cities. The NCR residential market still has an estimated 1,70,000 units of unsold inventory which is approximately 30% of the units under construction, adds the survey. As per the survey, there are nearly 8-10 million workers engaged in building and other construction activities who face uncertain future if the sector does not revive.

The ticket price 3-bedroom, 2 BHK and single room flats has seen correction by 30% in Noida, 25% in Gurgaon and 15% in some key areas of Delhi, yet the demand stays subdued

All approvals of real estate projects must be accorded in a time bound, accountable and simplifies manner, the ASSOCHAM said suggesting that the process and status of all approvals be made on line so as to bring transparency.

The property analysts have predicted that till March next year the demand for plots, houses and flats may drop by at least 15 to 20%. The housing inventory in the NCR area is huge as a large number of projects are coming up in the peripheral areas, said Rawat. 

Assetz Launches IGBC certified township 63degree(s) East in Bengaluru

BENGALURU:  Singapore-headquartered property developer, Assetz Property Group, today officially announced its entry into the mid-segment market in India with its township brand  Assetz Lifestyle'. 

The first project under Assetz Lifestyle, '63degree(s) East' is located off Sarjapur Road, Bengaluru.

63degree(s) East

Townships from Assetz Lifestyle will provide quality residential dwellings and develop the overall infrastructure of its neighbourhood. Special care will be taken to maintain the sustainability of the projects by adopting various green measures like water and energy conservation and solid waste management. In addition, community facilities like pre-schools, health centres, department stores, libraries and amenities for sports, arts, culture and recreation will be part of every project.

Mallanna Sasalu, MD, Assetz Lifestyle said, "We are elated with the launch of our first township project 63degree(s) East. A one-of-its-kind residential project in Bengaluru that will offer a wholesome living experience based on the concept of full-life, also interpreted as healthy, sustainable and luxurious living."

"We plan to develop around 10 million square feet of projects under the Assetz Lifestyle brand and build over 10,000 units in the next five years, leading to revenue realisation of over Rs 5,000 crores along the growth corridors of Bengaluru," he added.

Conveniently located off Sarjapur Road, Bengaluru, 63degree(s) East is within close proximity to social infrastructure and well connected to all the major roads. Furthermore, the demand for housing in this micro-market has increased owing to its proximity to the NICE Road which has significantly enhanced the connectivity of this area to IT hubs located in Electronic City, Whitefield and Marathahalli.

The project, comprising of 1,608 units in the combination of 1, 2 and 3BHK units are available at attractive prices. 63degree(s) East is spread across 17.7 acres of land with 60% of open spaces, and has received the 'IGBC Gold Precertification' for its meticulous design that has adopted the best of green technologies to make optimal usage of natural resources. Overall, 63degree(s) East showcases a prefect amalgamation of a healthy environment and community living.

Commenting on the development, Ben Salmon, CEO, Assetz Property Group said, "Assetz Lifestyle is a unique initiative to break away from the existing conventional residential project models. Through this brand, we intend to build infrastructure of superior quality at a great price for the benefit of our customers. A decade into our operations in India, Assetz has come to symbolize modern lifestyles through its residential real estate footprint. As such, 63degree(s) East is an extension of our product-line."

About Assetz Property Group: 

Founded in 2006, Assetz Property Group is a front-runner among multinational developers in India with over 10 million square feet under development. Assetz, headquartered in Singapore, is a multi-faceted real estate development and asset management company with four business verticals: Commercial, Residential, Warehousing and Fund Management.

Assetz has launched premium properties in prominent locations across Bengaluru including: 27 Park Avenue (HSR Layout), Clover Greens (Sarjapur-Attibele Road), East Point (Marathahalli), Stratos (Cunningham Road), Marq (Whitefield) and Lumos (Yeshwantpur).

Salarpuria Group Pre-launches ALTANA - Premium Homes in Bengaluru

BANGALORE:  Salarpuria Sattva, a leading developer in South India, has pre-launched ‘ALTANA’, the first premium gated community at Vijaynagar Extension, Off Magadi Road in Bengaluru.

Located opposite to Sumanahalli Flyover, the Group proposes to develop 1.6 million sq.ft of residential property having around 1400 homes in 12 acres of land.

Offering premium homes for people living in and around West Bangalore, the denominations would be 1, 2 and 3 BHK options. The developer has a reputation of providing high quality constructions, due diligence, on-time delivery and excellent customer relations.

Amenities at Altana include verdant landscaping, high-end outdoor and indoor amenities along with a state-of-the-art clubhouse measuring 30,000 sq.ft.

According to Bijay Agarwal, MD, Salarpuria Sattva Group, "Altana is an ideal property for people seeking to make their lives easy and comfortable. This location of Bangalore has a mix of white collar executives as well as established middle class business families, mostly living in independent spaces. 

ALTANA offers safety, comfort and more facilities that will make their life easier. The best part about this location is the fabulous connectivity, especially through the new infrastructure, Metro, nice road and outer ring road within 3-5 kms radius, which makes it ideal place for people to work or reach anywhere in Bangalore, quickly and easily."

With this project slated for launch by February 19, the Salarpuria Sattva Group has launched 4500 homes in the financial year 2015-16. Founded in 1986, the Salarpuriahas a formidable name in Bangalore, apart from its growing presence in Kolkata, Pune, Jaipur, Vizag, Hyderabad and Chennai.

The Group has plans to venture into more cities in the near future. With 16 million sq.ft spaces completed, 17 million sq.ft under construction and 30 million more in stages of development and planning, the Group has been given ‘A Stable’ rating by CRISIL, a leading global analytical company providing ratings, research and risk & policy advisory services.

The brand has been awarded with prestigious awards like NDTV Property Award, ET, and CNBC-AWAZ-CRISIL-CREDAI Real Estate Awards.

Economic crisis and impact on realty sector

The recovery of the Indian economy has once again come under cloud with key economic indicators like Current Account Deficit (CAD) and consumer inflation remaining above the comfort level of the Reserve Bank of India (RBI).

While CAD reached a high of 6.7% of GDP in the December 2012 quarter, consumer price index grew at 10.2% in April 2013. Both these indicators are set to deteriorate further as the Indian currency has depreciated sharply against the US Dollar

(USD) in the last one quarter.

The Indian Rupee has changed from Rs 54.4/USD in April 2013 to Rs 59/USD in June 2013 resulting in an 8.5% fall. Such a fall will make imports more expensive resulting in higher CAD and consumer inflation. The worsening macroeconomic condition is expected to delay the reduction of policy rates by the RBI thereby deferring the much-needed monetary stimulus for bringing back the domestic economy’s growth on the right track.

Real estate market has a very strong linkage with the economic growth of a country and any signs of a slowdown in the domestic economy can have a cascading effect on the health of the realty market. Among the various segments of the real estate market, office, retail and hospitality are relatively more prone to the vagaries of the macroeconomic situation as compared to the residential segment.

The primary reason behind this is the stark difference between rationales behind the purchase decision of a residential property as compared to other real estate segments. While there is an economic consideration for buying retail, hospitality or office property with the primary objective of using it for carrying out business activities, purchase decision for a residential property is generally driven by a totally different set of motives.

Factors such as affordability, proximity to the employment hub, presence of physical & social infrastructure, sentimental value attached to a locality and community consideration among others can have an overbearing impact on the buyer’s decision. Since many of these factors vary from one city to another, movement in the residential market is often divergent for each city. 

Analysis of the weighted average price trend in the   top six residential markets of the country namely Mumbai, the NCR, Bengaluru, Chennai, Hyderabad and Pune can help in understanding the varying characteristics of the residential market in each of these cities. Cities like Mumbai and Chennai, which are land locked from one side by the sea, have the highest weighted average price of Rs 5,900/sq.ft. and Rs 4,500/ sq.ft., respectively.

The unique topography of these two cities has ensured restricted supply of land resulting in high prices for residential properties here. While the weighted average price in Mumbai city is much higher at Rs 14,400/sq.ft., it goes down to Rs 5,900/sq.ft. for the entire Mumbai Metropolitan Region which also includes areas such as Thane, Navi Mumbai, Mira- Bhayandar and Vasai-Virar.

Demand for the domestic IT/ITeS industry over the last five years. Strong performance by the manufacturing, BFSI, IT/ITeS and other service sectors resulted in high demand for office space across the country during the last five years. A total of 168.5 mn.sq.ft. of office space was absorbed from 2008-2012 across six major cities namely Mumbai, National Capital Region (NCR), Bengaluru, Pune, Chennai and Hyderabad. IT/ITeS sector was the primary demand driver of office space in cities like Bengaluru, Chennai, Pune and Hyderabad accounting for more than 50% of the total absorption.

 

However, demand in Mumbai and the NCR was driven by a relatively diverse set of sectors as a large number of occupiers prefer to locate their corporate offices here.