JLL India Appoints Manish Aggarwal as MD for North and East

Leading international property consultancy firm JLL India has appointed industry veteran Manish Aggarwal as Managing Director - North and East India operations. Previously, Aggarwal was MD - North and East India at Cushman & Wakefield, and prior to that held key positions at Knight Frank and Colliers. He will be based in Gurgaon.

Manish Aggarwal

Manish Aggarwal will primarily focus on strengthening JLL's Delhi NCR transactions businesses, while simultaneously overseeing the firm's Eastern India operations. As a part of his new role, Aggarwal will also assume a senior leadership seat within JLL's India Leadership Council (ILC), a press note from JLL India said.

Santhosh Kumar, CEO - Operations & International Director, JLL India said: "Drawing on his extensive experience as a real estate expert across asset classes, Manish Aggarwal will drive our growth in North and East India. He has managed a variety of complex, high-value assignments with major Indian and international corporate clients, developers and funds. His indubitable abilities and deep connections with key stakeholders in these two critical markets made him the natural choice for JLL."

"As a real estate services professional, the move to JLL India is a logical transition for me," said Manish Aggarwal. "During my long career in the realty space, I have witnessed the transformational growth of this firm globally as well as in India. It is the pre-eminent and leading name among international property consultancies in India, with a vast operational platform that presents me the kind of challenging professional opportunities I prefer. I am highly enthused about applying my core competence in the North and East Indian markets to advance JLL's business there and to spearhead the next phase of growth in these critical markets," he added.

Manish Aggarwal's multi-faceted expertise, which includes identifying new business avenues, cross-selling opportunities, strengthening client relationships and ensuring service delivery have come into play from Day 1 of his appointment at JLL India. He is one of the rare real estate professionals specialized virtually in all key aspects of the realty business. Apart from office real estate transactions, he is an expert in real estate-focused Capital Markets, Land and Industrial services and Investment Services, including Valuations.

With the Delhi NCR office being one of JLL's most dynamic business centres, Aggarwal's leadership will contribute significantly to reaffirming the firm's stature as the region's leading International Property Consultancy.

JLL India Makes Strategic Investment in Cloud1 Enterprises

International property consultancy JLL India‘s proprietary Real Estate Technology Investment vertical has announced an investment in NCR-based Cloud1 Enterprises, an end-to-end cloud-based platform that enables corporates to deploy telematics technologies to bring efficiency to employee transportation.

JLL India’s recently established structured vertical makes proprietary investments into early-stage technology companies with the potential to disrupt the real estate business.

Anuj Nangpal, Head – India Real Estate Technology Ventures, JLL India says, “Estimated at US$ 2 bn in India alone, the employee transportation sector is currently highly fragmented, inefficient and opaque. The potential for further optimization of company transportation costs via data analytics and telematics is phenomenal. Functionalities like mapping and routing have become basic features throughout the globe in this industry. Cloud1 will focus on data integration with traditional fleet management systems to convert telematics insights into fleet productivity.”

Cloud1’s business model is not predicated on a high customer acquisition cost and corresponding burn rates as a result of deep discounting. Proprietary algorithms allow intelligent utilization of vehicles and real-time trip monitoring, which enables Cloud1 to squeeze ultimate efficiency out of the value chain and offer employers a dedicated trip based model.

Sumir Anand, Co-founder – Cloud1 says, “Adhering to global standards of compliance and transparency, Cloud1 – unlike other technology providers – has made up-front investments to tech-enable vehicles which are supported by a 24 x 7 Command Center. Our platform and solution completely de-risks our clients from having to invest in technology. The grey area of employee transportation is one of the Indian industry’s biggest pain points; with Cloud1, we envisage a paradigm shift in this daily necessity – and the substantial operating expense it usually involves. We have invested over 18 months in developing and perfecting the platform.”

The current daily transportation cost per employee ranges between INR. 6000 to 13000 per month, and Cloud1 is confident that this figure can be reduced by at least 15%. In addition, up to 60% reduction can be realized in direct manpower deployed to service the organization’s transportation needs.

Cloud1’s services can imply an overall saving of up to 20% towards this expense – while adding substantial safety and security for employees. At current estimates, this could reflect an overall reduction in operational costs for the industry to the tune of INR 1200 –1500 crores per year.

“Cloud1 offers a managed services model to its clients via a telematics-enabled employee transport platform seamlessly integrated into the vehicle,” says Anuj Nangpal.

“With an entrepreneurial team of seasoned ITeS professionals with combined domain experience of over 70 years, Cloud1 has developed an accountable service delivery solution with practical and real-time tools to solve the transportation problem for BPM and InfoTech companies who currently rely on an unstructured vendor base for the daily commute of several lakh employees. Cloud1 seeks to offer the safest, most reliable and cheapest technology-enabled solution to corporate transportation teams. Thus, this investment is perfectly aligned with JLL’s commitment to offer technology-based services to the industry,” he says.

As opposed to current pure software platforms, Cloud1’s solution directly integrates vehicles with Cloud 1’s 24 x 7 Command Center, which actively monitors exception alerts on each trip and captures all critical data points – including driver authentication, vehicle compliance, safety and security alerts and route deviation.

Thus, the solution creates a completely secure, transparent and efficient employee transportation service offering and eliminates the need for clients to have ‘dedicated in-house’ call centers. Cloud1 will partner with its clients to offer analytics about data generated on its telematics platform to drive further efficiencies. 

Anuj Puri Leaves JLL, Ramesh Nair to Lead India Business

Anuj Puri

Mumbai  / Singapore – Anuj Puri, Chairman & Country Head of JLL India, today announced his decision to leave the Firm, simultaneously confirming that Ramesh Nair will take over as CEO and Country Head. 

Ramesh Nair will assume his new role on 1st March 2017. He will report to JLL’s Asia Pacific CEO Anthony Couse.

Anuj Puri joined JLL in 2007 when his company Trammell Crow Meghraj (TCM) merged with the Indian arm of global real estate firm JLL. This formidable partnership gave rise to the largest real estate services company on the Indian subcontinent.

“It’s been an incredible 10 years at JLL, but now is the time to step back and reflect before moving in a new direction,” says Anuj Puri. “The company has great leaders who are now at their prime, and it is to such a leader that I pass on the baton. Ramesh Nair has, over the years, taken everything he undertook from strength to strength and has earned his laurels many times over. I’ve worked closely with him for many years, and am confident that he is perfectly placed to spearhead JLL and take it to several new levels.”

Ramesh Nair

Ramesh Nair’s leadership potential and track-record for business success is well-documented at JLL India. He has a strong reputation for leading teams across the Firm’s various business lines, and for his focus on business growth and the advancement the team members that drive it. A long-term thinker, he has amply demonstrated his capabilities for talent development, strategy and amplification of the Firm’s core values. He has managed some of the largest P/Ls within JLL India, and has extensive experience in leading teams, change management and servicing domestic and multinational owners, occupiers and investors across multiple asset classes and geographies.  

“It’s an absolute honour to be taking over as head of JLL’s India business,” says Ramesh Nair. “I’ve had a fascinating journey with the Firm over the past 17 years, and would like to thank Anuj as well as the regional and India leadership teams for their support and confidence in me to lead JLL, in this exciting phase in India’s economic growth and development. Anuj is a legendary figure within Indian and global real estate, and filling his shoes will certainly be a big task. However, I look forward to working more closely with our clients and teams to produce outstanding outcomes and drive growth to the next level.”

As CEO and Country Head, Ramesh will be responsible for overall direction, strategy and growth of JLL’s India business. He joined JLL in 1999, has risen swiftly through the leadership ranks and has been a member of the India Leadership Council since its inception in 2008. In 2013, he was promoted to the role of Chief Operating Officer, India and became an International Director in 2014.

“Anuj Puri has been a great asset to JLL over the past 10 years, and has imparted a distinct identity to the Firm due to his large industry stature and contributions. On behalf of the regional and India team, I thank him sincerely for his immense contribution,” says Anthony Couse. 

“We are fortunate to have a great depth of talent among our India leadership – and an eminently qualified successor in Ramesh Nair, who has been hand-picked and endorsed by Anuj and the regional leadership. Ramesh is known for his persistence, drive, resilience, and energy which he brings to the Firm. I look forward to working with Ramesh closely – and to seeing him put into action exciting new growth plans for our India business, which is almost INR 3000 crore in size," he further adds.

JLL India bags top honours at Asian Real Estate Leadership Awards

The Residential arm of the Property Consultancy JLL India has been adjudged as Property Consultant of the Year in the Residential category at the prestigious Asian Real Estate Leadership Awards 2016, hosted by Asian Confederation of Business and endorsed by CMO Asia.

JLL India bagged the top awards in the leading categories of Property Consultant of the Year – Residential and Innovative Real Estate Marketing Campaign of the Year for the Firm's Online Home Fest organized in April earlier this year.

Held at Dubai on 6th October, 2016, the award ceremony was graced by a stellar line-up of pre-eminent developers, bankers, architects, property consultancies and ancillaries from across 35 countries in Asia. Hosted since 2011, the Asian Real Estate Leadership Awards define and celebrate outstanding business vision and performance across all sectors of the real estate industry. They are among the most credible and coveted of recognitions for excellence in real estate business leadership in Asia.

Commenting on the adulations,  Santhosh Kumar, CEO – Operations, JLL India said, “We are gratified at being recipients of these distinguished awards. JLL India's Residential Services division is backed by the thoroughbred DNA of the Firm's robust international platform as well as local market expertise and experience. At its heart, the residential segment of Indian real estate is and will remain a people's business where the human element lies at the core. Success and recognition in this segment relies on forging, maintaining and building on excellent relationships between buyers, investors and developers. At all times, JLL India's Residential Services division has leveraged its well-deserved reputation for best-in-class services to consistently deliver the highest value to its clients."

Always at the forefront of innovations that consistently redefine the way real estate business is done, JLL India has employed the latest technology-enabled initiatives to maintain its edge on the Indian property market. In the most recent manifestation of this disruptive tech-led culture, JLL Residential Services’ recent and enormously successful Online Home Fest was backed by fully-automated and integrated systems which proved to be a critical differentiator in the residential brokerage business. The success of this venture has been amply vouchsafed by bringing in the coveted Innovative Real Estate Marketing Campaign of the Year award.

Continuing its disruptive, client-focussed approach to doing real estate business, JLL is currently hosting the Online Home Carnival in partnership with Housebolo (an NDTV venture). As in the case of the preceding Online Home Fest, this Carnival has been garnering a massive response for participating developers from India and Dubai. The Carnival, which will remain live till the culmination of the current Indian festive season, is targeting over 180 mn Indians and NRIs spread across 72 countries.

What Drives Demand for Ready-Possession Homes?

It is no secret that ready-possession projects or projects nearing completion are costlier than under-construction projects. Nevertheless, many buyers are eager to acquire property on an immediate basis rather than waiting. There are sound reasons behind such a decision:

Cost Differences:

The real estate sector has gone through a serious down phase over the past couple of years, resulting in lower new launches, price reductions and higher unsold inventories. This has encouraged developers to offer attractive deals, discounts and various freebies to attract buyers of ready-to-move properties. Therefore, it makes sense for buyers to invest in a ready-possession project rather than wait for a new project to come up over a period of time. Also, prices are beginning to rise again, and the market is looking up steadily - this is the best time to invest in property, and a property that’s ready to be moved in obviously has great appeal.

Cost of Rentals:

Most people buy their homes with bank loans, and it becomes costly for them to keep paying EMIs as well as the rentals till the builders complete their project and hand over the house keys. Paying a little bit extra to acquire a house right away is cheaper than paying rentals over a period of time, which is an additional cost for the buyer.

Rental Income Potential:

A lot of investors buy houses with the objective of earning rental income or re-selling them to earn profits. Purchasing a property in a completed project helps them to start earning immediately out of it through rentals rather than waiting a few years and locking their money away in a non-income generating project.

Security:

The real estate sector is still fragmented, and there are a lot of fly-by-night operators who dupe unwary buyers and investors by collecting the initial sums and then vanishing. In these uncertain times, people want security and assured returns, and finished projects offer them this stability and guaranteed safety of a project.

Uncertain Delivery Timelines:

Unfortunately, the cases of delayed delivery of projects have been on a consistent rise owing to various factors plaguing the real estate sector. This directly impacts the financial burden on a buyer, for whom the uncertainty costs a lot of money. Also, the extended periods of EMIs and other expenses take a toll. Therefore, it makes more sense for buyers to invest in a completed projects rather than ones that is mid-way or about to begin.

Uncertain Support Infrastructure:

A lot of new projects are coming up in the vicinity of major cities where the supporting infrastructure like roads, electricity, water connections etc. are not developed. These are promised only when the projects are completed, but under-construction projects have to wait for long periods of time. This puts off the buyers who want to move in their new homes and also derive the benefit of ready infrastructure instead of waiting for basic amenities to be provided to them.

These are valid concerns for buyers; and the demand for ready-to-move-in homes works equally well for developers, who can offload their unsold inventory and get much-required liquidity.

By Ashwinder Raj Singh, CEO – Residential Services, JLL India

JLL India Launches 10-day Online Home Fest

Leading international property consultancy JLL India has launched Online Home Fest (OHF) – India’s first deal-centric, web-based event for residential properties on  JLLR.CO.IN. 

The 10-day Home Fest, which began today (April 6, 2016)  offers exclusive discounted rates, convenient payment plans, value-added offers and zero brokerage around the festive season of Gudi Padva and Navratri.

The Online Home Fest features select residential properties from reputed developers across Mumbai, Delhi NCR, Bangalore, Chennai, Kolkata, Pune, Hyderabad and more. With over 64 developers participating from across the country and with Indiabulls exclusively offering home loans starting 9.50% interest with zero processing fees, Online Home Fest is a complete offering for serious home buyers.

Commenting on this initiative, Ashwinder Raj Singh, CEO - Residential Services, JLL India said, “Buying a home invariably involves research, be it on-ground or online followed by site visits. While online property searches are helpful, sifting through a morass of online listings in an attempt to identify the best deals is a daunting and often impossible task for lay end-users. JLL India’s launch of the Online Home Fest takes the sting out of the property search by featuring select properties which have been carefully examined by our expert team, and deals curated to suit the specific needs of today’s home buyer.”

HIGHLIGHTS:

• Residential properties across 96 projects by 64 developers in 15 cities
• Easy access to exclusive deals: Discounted prices, special payment plans and value-added offers backed by expert guidance on request
• Zero brokerage to the end buyer on purchase of new properties
• Facility to compare deals and offers across cities and projects

Participating developers include major trusted brands like Embassy, Prestige, Purvankara, K Raheja Corp, Ekta World, Plaza, M3M, AIPL, Signature Developers, Jayabheri Properties, Ruchi Realty, Mantra, Well Wisher, Goyal & Co, Arun Shelters and Prime Lifespaces,

The Fest enables users to check, compare and shortlist properties online, and is supported by a dedicated team of on-ground experts to facilitate the buying process. From access to the best deals to scheduling guided site visits and further assisting with documentation - everything is taken care of on a single call, eliminating the need of multiple points of contacts for the end buyer.

With technology as a key enabler, the online fest is backed by robust online marketing, dedicated in-house call centre, customised CRM and a mobile application helping create a seamless customer experience.

JLL India And Khaitan & Co Release Definitive Report On Real Estate Regulatory Bill

Mumbai: Leading international real estate consultancy JLL India, in partnership with eminent law firm Khaitan & Co. has released ‘Deciphering The Legal And Commercial Aspects of RERA’ - a definitive report on the game-changing Real Estate (Regulation and Development) Act 2016 (RERA) at a press conference here today.

RERA was recently passed in the Parliament and it received the assent of the President of India on 25 March 2016. It has paved the way to setting up of a real estate regulator, which is proposed to be set up within one year from the date of coming into force of the Act, to deal with commercial and residential realty.

Anuj Puri, Chairman & Country Head, JLL India said, "This Bill, which was waiting in the wings for far too long, will significantly reduce the various irregularities and contrasts currently plaguing the Indian real estate sector once it is implemented. Among many other things, RERA will provide a positive impetus towards achieving the Government’s 'Housing For All' vision, while ensuring a level-playing field for developers and buyers. This report examines the various nuances and implications that this very important Bill holds for all real estate industry stakeholders.”

RERA will help make the Indian real estate sector more mature, and more attractive for foreign investments as well as for Indian consumers. It will, for instance, disallow the common practice among many developers of pre-launching projects without getting requisite approvals from the local authorities, and it will make mandatory project registration with the regulator. Developers will also have to disclose approval status, project layout and timeframe for completion to the regulator as well as customers. However, there are a number of other ways in which this BILL will influence the real estate sector.

Haigreve Khaitan, Partner - Khaitan & Co said, "RERA is poised to revolutionize the way in which real estate is built, sold and consumed in India. It is an important milestone in the country's quest towards increasing transparency and ease of doing business. It is important to understand the legal implications that it holds for all related industries and stakeholders. This report is therefore very pertinent and timely."

All in all, the incumbent government has succeeded against various odds and given Indian real estate its most valuable card. RERA is a verdict to end the age of information asymmetry, lack of accountability and unwarranted project delays, and marks the beginning of rising transparency, liquidation of assets – and, importantly, positive sentiment.

JLL India Partners With Snapdeal to Market Residential Properties

Property Consultancy firm JLL India's Residential Services division has partnered with leading online market place Snapdeal in an effort to expand its reach in the Indian real estate market. The partnership will combine Snapdeal's deep penetration into the Indian online consumer market and JLL India's expertise in residential real estate marketing.

With the added capabilities of the Firm's recently launched dedicated residential marketing portal JLLR.CO.IN, this move will cement JLL India's leadership stance in the country's online and offline real estate markets. Effectively, customers looking to purchase residential properties on Snapdeal can now avail on-ground advisory and transaction services from JLL. 

While Snapdeal will provide a seamless online real estate platform to enable home searches, JLL will organise guided site visits, help clients negotiate with developers and assist with documentation and mortgages.

Anuj Puri, Chairman & Country Head, JLL India says, “Ecommerce is evolving rapidly and proving to be a major disruptor of traditional marketplaces. In November 2015, India’s internet user base was around 402 million - today, it stands at just over 462 million. There is no ignoring the power of the Internet and the online marketplace, and we will leave no stone unturned to leverage this power. This partnership underscores our mission to remain future-ready and ahead of the curve."

The JLL-Snapdeal partnership will provide customers get an end-to-end service spanning the entire home search and purchase process. Buyers will not be charged brokerage on deals in the primary sales space, viz. purchases from developers. Starting last week of March, JLL is hosting a unique online fest in partnership with leading developers with best possible deals across India and this partnership is timed to make the most of this strategic initiative.

Speaking about this partnership, Tony Navin, Senior Vice President, Partnerships and Strategic Initiatives, Snapdeal said, "The real estate category on Snapdeal has grown rapidly since its launch in August 2014. We have forged alliances with some of the most trusted names in the real estate industry to offer a range of housing options for our ever-expanding customer base in a hassle-free and transparent manner. Our partnership with JLL India's Residential Services agency will further enhance purchase experience for our real estate customers."

JLL India Launches Residential Property Portal JLLR.CO.IN

Leading international property consultancy JLL India today announced the launch of its dedicated portal for its residential business. The website provides quick and intuitive access to select projects across the country, as well as various JLL-owned knowledge resources for customers.

Unlike the current crop of online aggregators and brokers active in the residential property space, JLLR.CO.IN offers technologically enhanced ease of navigation without distracting advertisements, and a new search capability which allows visitors to quickly and easily find appropriate projects or relevant information. The search function additionally helps customers to narrow down, compare and shortlist options. Since this is a firm-specific service, an expression of interest or inquiry will not result in a multitude of broker calls, but connect the buyer with a single dedicated representative to provide a 360-degree consultation service.

Additionally, to cater to customers interested in investing in residential property abroad, the platform acts as a gateway to real estate investment opportunities in countries such as Singapore, Malaysia, Hong Kong, Thailand and the United Kingdom. The customer will be connected to the corresponding JLL personnel in the identified country, who will assist in identifying and closing such a transaction.

 

To provide the ultimate user experience, the website has been designed to be compatible with all commonly-used browsers and mobile devices. The rich, clutter-free content is easy to navigate and share with others to provide a time-efficient and focused home search process. JLLR.CO.IN also provides instant access to JLL India's latest real estate research.

Commenting on this initiative, Ashwinder Raj Singh, CEO, Residential Services, JLL India said, "The portal has been devised on the back of extensive customer feedback, and focuses squarely on providing convenient, transparent and no-nonsense access to select projects suiting every budget. The design and content allow customers to make informed decisions, aided by the offline consultation process to fill any information gaps.

Simultaneously, the site provides an innovative platform for developers to boost the discoverability of their projects. JLLR.CO.IN is the shortest distance between developers and buyers, simultaneously eliminating the intrusiveness of aggregator sites and providing an end-to-end solution with best-in-class industry expertise in the offline follow-up and transaction process."

Key features:

• Clutter free site with select properties enabling easy access to verified information
• Look-ahead Navigation to reduce the number of clicks to navigate the site
• Engaging user experience with enhanced search and navigation
• Filters which allow users to easily narrow down search by selecting key attributes
• Rapid Response Functionality and optimization for different browsers and mobile devices
• Dedicated user accounts to shortlist and compare projects to revisit as per their convenience
• Convenient forms to request call back for more details and personalized site visits

Union Budget 2016: Realtors Expect More But Happy To See Few Positives

When the Finance Minister presented his third budget speech in the Parliament, the housing sector was waiting with bated breath expecting the much-needed impetus to the sagging Indian real estate sector which has been in doldrums for the last few years.

Although there are no big-ticket announcements to cheer up developers and home buyers, realtors feel that Arun Jaitley has given some room for the sector to find its growth momentum when he made his point to promote agriculture, infrastructure and rural sectors while giving a push to affordable housing.  

Realtors and their associations though welcomed the budget proposals vis-à-vis real estate sector, they are cautious and refused to be overwhelmed.  Excerpts…

Budget Promotes Affordable Housing - Praveen Jain, President, NAREDCO

While referring the Budget as ‘growth-oriented,’ the National Real Estate Development Council (NAREDCO) has highlighted the impetus given to agriculture, rural sector development and infrastructure besides offering incentive to affordable housing by allowing 100 per cent deduction for profits from housing projects (upto 30 sq. mtr in metros and 60 sq. mtr in other cities). Praveen Jain, President, NAREDCO said, Rs 50,000 additional deduction of interest on home loan for first time home buyers, exemption of Service Tax on Construction of affordable houses and disallowing DDT for Real Estate Investment Trusts (REITs) are expected to stimulate the housing activity.

Rural Focus will Generate Domestic Demand: Dr. Mahesh Gupta, President PHDCCI

While applauding the Union Budget 2016-17 announcements, President, PHD Chamber, Dr. Mahesh Gupta said that the focus on rural India would go a long way to generate demand in the economy and give a push to overall growth and development of the country. 

He expressed happiness over the government’s proposal to increase the tax exemption limit on Home Loans interest for the first time home buyers for housing loans up to Rs. 35 lakh will give a boost to the real estate sector.

Dr. Gupta said, stimulus to real estate sector would provide a significant fillip to the economy and enhance India’s GDP.

Budget is Well-balanced to Face Adverse Global Pressure: Kapil Wadhawan, CMD, DHFL

This year’s union budget has been encouraging for the housing sector and the overall economy. The proposal to introduce 100% deduction to undertakings for construction of affordable housing will help us in realizing honorable PM’s “Housing for all by 2022” scheme.
                         
The proposal to introduce guidelines for renegotiation of PPP contracts and reform dispute redressal mechanism will encourage private participation in the development of affordable housing projects and road infrastructure.

Decision to exempt REITS from DDT is also a welcome move. This will ensure positive movement on real estate projects and will help in bringing the sector on a sustained growth path.

DHFL had recommended empowering the customer for greater affordability. In this context, the decision to give additional exemption of Rs 50,000 for housing loan upto Rs 35 lakh sanctioned in 2016-17 for 1^st time home buyer provided the cost of a house is not above Rs 50 lakh is praiseworthy and will definitely ensure that more Indians will fulfill their dream of owning a home.

DHFL welcomes government’s commitment to boost road infrastructure and address rural distress by skill development of rural population, allocating funds for MGNREGA scheme and providing support to agriculture. We are of the view that this year’s budget will enable the Indian economy to withstand adverse global pressure and move on the road to a more balanced, sustainable and inclusive growth. We will remain an attractive destination for investment over the medium and long term.
 

Below Expectations But With Some Positives, Anuj Puri, Chairman & Country Head, JLL India

To give him due credit, the Finance Minister has definitely made a concerted attempt to manage expectations with a balanced budget. While three of the real estate sector’s major expectations – increased HRA deduction, removal of DDT from REITs and boost to affordable housing by allowing 100% deduction on profits made by entities constructing them – have been addressed, the Budget offered no financial protection from project delays to home buyers.

Most first-time home buyers in the major metros will be left out of the additional Rs. 50,000 tax exemption announced today, as it is applicable only on houses worth up to Rs. 50 lakh with loans of up to Rs. 35 lakh for houses. This announcement will mostly benefit first-time home buyers in tier-III and tier-II cities. The infrastructure sector was a major beneficiary today.

The biggest announcement with implications for the real estate sector in India was removal of DDT from real estate investment trusts (REITs).

Budget Could have Done a Lot More for Real Estate Sector: Kishor Pate, CMD - Amit Enterprises Housing Ltd.

This Budget could have done a lot more for the real estate sector. However, there were some positives. The fact that the annual housing rent reduction limit has been increased from Rs. 24000 to Rs. 60000 could lead to an almost immediate uplift for rental housing across the major cities. This can also potentially encourage the sentiment for home ownership in the long run.

Also, first-time home buyers have been given the benefit of an additional deduction of Rs. 50000 on home loan interest for loans not exceeding Rs. 35 lakh, where the value of the house is no more than Rs. 50 lakh. This will result in improved home buying sentiment in smaller cities with lower housing costs, such as Pune. An improvement in sentiment will also be seen in the cheaper far suburbs of the metros.

However, this deduction is not sufficient to increase the sentiment much for first-time home buyers in the central parts of the metros like Mumbai, where housing prices are exceedingly high and such an exemption makes little to no difference in the burden on home buyers. 

The fact that the market indices took a nosedive immediately after the budget announcement more or less reflects the way sentiment in the housing sector has gone. However, if the RBI announces a cut in interest rates on the heels of the reduced fiscal deficit announced by the Finance Minister, it could be a day saver.

Not Enough to Infuse vibrancy in Realty Sector: Arvind Jain, Managing Director - Pride Group

Budget 2016-17 was far below expectations. Some leeway has been given to first-time home loan borrowers, but the relief will not boost demand in the metros. That said, service tax has been exempted for developers who are focused on constructing affordable housing with unit sizes not exceeding 30 square meters in the larger cities and 60 square meters in the smaller cities. This is a significant plus, and in line with the incumbent Government's intention to boost affordable housing.

Allocation to MNREGA and irrigation activities have been stepped up, so it is logical to expect rural income to rise from this year onward. This can positively affect rural consumption story and boost the growth of smaller towns. Encouragingly, Rs. 1500 crore has been allocated for the moderation of land records in the Digital India campaign, which will definitely have a positive impact on transparency in the real estate sector.

On the retail front, permitting seven days of operation for small and medium-sized shops in the unorganized retail segment will allow them to compete more effectively with malls. This will boost the demand for retail stores on high streets significantly.

The plans to revive inoperational civil airports in partnership with their States with a rather small allocation of Rs. 100-150 crore per airport can have positive implications for the real estate development in these cities. It will boost infrastructure, and airports are also know influencers of demand for all categories for real estate.

Budget Gives Grand focus on rural economy, infrastructure development: ASSOCHAM

Huge focus on rural economy with a commitment to double the farmers’ income by 2022, betting quite high on rail and road infrastructure and yet sticking to the financial discipline by retaining the fiscal deficit targets for 2016-17 are the most important takeaways from the Union Budget 2016-17, ASSOCHAM President Sunil Kanoria commented.

“A huge commitment of Rs 2.18 lakh crore on the rail and road infrastructure will not only kick start the economic growth but would also result in having a multiplier effect on India’s economy,” said Kanoria.

Maha's New Retail Trade Policy: A Boon To Retailers

Ashutosh Limaye

Considering retail to be an essential amenity, the Maharashtra state government recently shared the draft of a new retail trade policy. To help retailers achieve optimal potential, the state government has suggested making some exceptions and relaxations in the current regulatory framework. Among the key suggestions is the introduction of retail entertainment zones (REZs).

Why REZs Are Needed

The development control regulations (DCR) shall reserve spaces for retail and entertainment on the same lines as reservations for essential services and restaurants, in order to make retail more affordable. Currently, the urban policy does not clearly reserve spaces for shopping and recreational needs of citizens, so shops tend to be set up in a haphazard manner. More importantly, shops compete for spaces in commercial locations, which are extremely expensive and untenable for the retail industry.

Creating a zone for retail and recreation will help increase consumption and simultaneously raise the standard of well-being of citizens. With this new policy, the state government will aim to recognise the need for shopping and recreational areas to create a much-needed balance between residential, commercial, industrial, shopping and recreational areas in urban places.

Accordingly, efforts will be made to:

• Provide retail areas with direct access to mass public transport systems,
• Secure a traffic plan designed for the long term,
• Ensure year-round electricity, water, gas, sewage and IT connections.

REZs will be large retail developments where many big-box and other retailers will come together and give families an opportunity to spend an entire day out. The state government will consider such a ‘retail park’ concept under its master plans to give the advantage of choice to consumers, increase competition (which will help reduce prices for consumers) and also reduce vehicular usage by eliminating the need to travel to different parts of the city merely to compare retailers.

These retail parks would preferably be adjacent to highways and have an integrated public transport system. This will support connectivity, ease traffic in and around the city, provide customer convenience and result in cleaner cities.

Retail Zones To Figure In Regional / Town Planning

City master plans shall reserve land for retail development on the lines of Delhi, where they have been able to create specific centres in South and West Delhi for retail.

Benefits

1. Large malls of international standards require larger land parcels. Earmarked spaces in master plans will help them maintain high standards of development
2. The earmarked spaces for retail / entertainment development would also rationalise land prices
3. Infrastructure like roads, public transportation and power will be planned in advance.

Development Control Regulations

Requirements for retail and other businesses are different, and there is a need to incorporate such specific business needs. The following modifications will be done to enhance viability and quality of development for retail centres:

• Higher ground coverage: Malls house various retail components across floors but customer movement reduces on the higher levels, making them less productive. Retail development shall be allowed higher ground coverage up to 70% (subject to setback and fire safety regulations as also FSI norms being followed).

• Recreation ground: In a retail environment, organised players offer various types of recreational facilities and activities on a commercial basis. Such activities, within the applicable norms, should be allowed to set up in a ‘recreation ground’.

• Floor to floor heights: Retail developments, being public spaces, get crowded. The availability of higher floor-to-floor height allows the common areas and shops to look spacious and provide a relaxed and comfortable shopping environment to customers. The floor-to-floor height limit shall be raised to 5.5 meters, as is allowed in several other states.

• Parking norms: Malls, depending on their sizes and locations, receive a large number of vehicles. Limited parking space not only reduces the number of people visiting malls but also creates traffic hassles in and around them, leading to public inconvenience. The parking rules, which currently consider parking in excess of regulation as FSI, will be changed to allow larger numbers of car parks – without FSI implications.

• Services: Unlike office spaces, retail spaces need more services due to movement of goods and customers throughout the day. Retailers need to replenish their stocks in the store to service customers’ needs, and thus require higher storage space in a mall. Moreover, to cater to large numbers of customers and to provide ease and comfort of movement, high capacity air-conditioning, escalators and lifts are required. 15% of development will be allowed as services including storage areas in the basements, etc.

• Changes: Space requirements of retailers and demographic profiles of customers both keep changing. Changes in use of spaces – for example, from fashion retailing to restaurants to entertainment or vice versa, are frequently seen. To address these needs, spaces for retail and other uses will be allowed to amalgamate, divide or interchange with simplified approval processes.

• Building height: Currently, there is a height restriction of 30 meters for buildings that house a multiplex or auditorium. Retail developments generally do not work at higher levels. Therefore, to use the entire eligible FSI of the land, alternate commercial use like hotels, service apartments, offices, etc. are required to be developed on upper floors. Restrictions on building heights will be relaxed as done in neighbouring states.

• Additional FSI for retail zones: To enhance the viability and quality of development for retail centres, up to 50% additional floor space index (FSI) will be admissible over and above the base FSI subject to payment of full applicable premium, as per the prevailing ready reckoner rates.

By Ashutosh Limaye, National Director – Research, JLL India

JLL India Gets Ashwinder Raj Singh as New CEO of Residential Services

Gurgaon: JLL India, the leading international property consultancy, has appointed Ashwinder Raj Singh as the new head of its Residential Services business. 

As CEO - Residential Services, Ashwinder Singh will take charge of JLL India’s residential sales and leasing business across the country and simultaneously take up a position within the Firm's India Leadership Council, a JLL India release said.

A seasoned market veteran with 18 years of hands-on experience in the real estate and financial services domain, Ashwinder Singh's forte lies in leading large sales, marketing and product teams, and particularly in meeting targets amid challenging market conditions.

 

Importantly, as erstwhile EVP & Country Head - Sales & Distribution at IndiaHomes.com, Ashwinder brings to the table a deep expertise in in the areas of online technology and digital marketing. These are vital focus areas for JLL India's residential services division, and of critical importance to the Firm's forward-looking vision for this predominantly B2C business.

 

Prior to entering real estate, Ashwinder held senior positions in leading global institutions like Citibank, Deutsche Bank, ICICI Bank and Fullerton Securities.

 

Anuj Puri, Chairman & Country Head, JLL India said, "Over the past few years, JLL's residential business has been a remarkable success story, and we firmly believe in the unfettered potential that this segment offers. Given his expertise within the real estate industry and particularly in the digital marketing domain, Ashwinder will play a key role in boosting our success in this business to the next level."

 

The residential market in India is almost 85% of the total real estate market. With the green shoots of revival after a prolonged slowdown now very visible, the residential space will touch the $8 BN mark by 2020. This will be backed by easy loan affordability, the fact that 65% of the Indian population are looking to buy their first homes, and a neo urban rich segment of 30 million in the income bracket of above Rs. 10 lakh p.a. within this period.

 

Ashwinder Singh on his new role, said: "I am honoured and excited to take charge of the residential services business of India's largest and leading international property consulting firm. JLL India has a clear and detailed road map for expansion of this business. My immediate focus area will include providing customers an open architecture platform where they can chose the best homes on the basis of their requirements and our exhaustive due diligence standards. We are also expanding the operational base, and will now cater to residential consumers across all the major cities across length and breadth of India as well as abroad."

Building 'green' India for sustainable development

The real estate sector in India is one of the largest drivers of the country’s economic growth. the sector also provides large-scale employment and contributes massively to the country’s GDP.  While realty is vigorously driving growth, it is also true that it is adversely affecting the environment.

The question arises, how do we curtail this impact on the environment?  The answer is, by a more determined adoption of the concept of sustainable development, says Anuj Puri, Chairman & Country Head, JLL India. He further adds, “Sustainable development is all about limiting the destruction of natural resources and consumption of its gifts, and ensuring that we keep the planet green and alive.”

India is by no means lagging behind on the sustainable development front. The fact that the number of certified green buildings in India has surged over the last four to five years is a direct indication to the growing popularity of the ‘sustainability’ concept. However, we have a lot of catching up with more developed countries to do.

CII Sohrabji Godrej Green Business Centre

While there is a more than decent saturation of space committed for ‘green’ certification in India today, it is nowhere close to being enough if we consider the space under development and the number of existing buildings. The growing population and its rising aspirations for better living and working conditions have increased the demand for sustainable projects in India., Puri says.

How does this scenario look for developers?  There is no denying that this is a very challenging environment for developers with committed funds for development of projects. They need to be able to find occupiers or buyers in order to recover the cost of capital and the investment. This means that the growth story of sustainable real estate in India depends on consumers proffering demand for as much as on developers generating supply of green buildings.

In India, IGBC has licensed the LEED Green Building Standard from the U.S. Green Building Council, which is responsible for certifying LEED buildings in India. There are other rating systems that are more localized; the most significant among them is the TERI GRIHA. So, there is no lack of routes for ‘green’ certifications for developers in India. However, there is still a serious lack of State-level incentives for developers and occupiers of certified buildings.

There is a huge market potential for green buildings in India. A large number of corporate firms are now establishing and stating sustainability commitments. Commercial development in the top tier I cities has shown a significant increase in projects committed to Green certification. However, there is still a visible lack of ‘green’ penetration in tier II cities, and the residential sector has by no means risen resoundingly to the occasion as yet. This is significant, because the biggest share of real estate development and absorption in India is vested in the residential sector.

“The way I see I, there has to be a much clearer benefit statement for consumers of green real estate in the country for this scenario to change for the better. Buildings account for up to 40% of the total energy consumption in India, and commercial and residential real estate combined will account for more than 2000 TWH of energy consumption by 2030 (more than double of the figure in 2012). Of this, more than 60% will be consumed by residential. Therefore, stakeholders of the residential real estate sector in India definitely need greater encouragement to go green,” Anuj Puri says.

Sadly, the reality is that most home buyers in India are still quite averse to paying an extra premium for a green residential project. Obviously, developers will not fall over themselves to cater to a segment wherein demand is lacking. There is therefore a distinct need for a combination of incentives and stipulates to boost the development and consumption of sustainable real estate development in India.

Greater awareness is a key factor in increasing demand for green real estate, and the impetus for this awareness has to hinge on two aspects and drivers – the first of course being cost. Home buyers need to be convinced that their total ownership cost, including maintenance, over the life cycle of the property will actually imply significant savings. The second aspect is equally important – developers and consumers of green real estate must become more sensitized to their contribution to sustainable living over the long term; of creating a better world for future generations.

States should become more serious about subsidizing development of green spaces so that developers can keep their development cost at par with non-green spaces. This will ensure that these developers will not have to levy an extra premium on the buyers. When sales of a project are positively impacted by Green certification, developers will have a clear rationale to adopt the sustainable development route.

Also, bodies like the IGBC and the TERI should take a cue from the consumer product market and bring out a more ‘palatable’ version of the benefits of green homes. For example, if we consider energy star-rated products in the consumer segment, a 5 star rating for an air conditioner becomes an attractive proposition for buyers because they know exactly how they benefit from it. Sustainable homes with a ‘star’ rating by bodies such as IGBC or TERI should attract buyers for similar reasons.

Already, the Bureau of Energy Efficiency has a star rating system for the energy efficiency of buildings. The purview of this system should be extended through state sponsorship to cover a more ‘holistic’ sustainability index.

The Road Ahead…

As a country, India has an energy deficit of around 12%, and this is only set to increase once electrification of the country’s geography is enhanced over the subsequent two five year plans. As per statistics published by the IGBC, the total square foot area committed to Green certification in India stands at over 1.5 billion sq. ft. This encompasses projects at all stages of certification; registered, pre-certified and certified.

This is a highly encouraging statistic, but there is a lot more that needs to be done. The key to making ownership of green spaces more attractive to home owners is to increase awareness. The residential real estate sector is the biggest focus area in this regard, and this is the segment wherein the concept of ‘going green’ must be transformed from a campaign covering a limited few into a determined mass movement.

Anuj Puri, Chairman & Country Head of JLL India, which is a leading real estate research firm.