Need for Office Space soar to 7 million sqft in Apr-Jun qtr

Need for Office Space soar to 7 million sqft in Apr-Jun qtr

As per the quarterly report by CBRE, a global property firm, metro cities like Mumbai, Bangalore, Delhi NCR have absorbed over 75% of the total space leased in the second quarter. 

Office Space

As per a recent survey, In spite of the recent downfall in the real estate market for large office spaces, almost 7 million sq ft space was rented during the second quarter of the year as against the 5.4 million sq ft from January to March. Also, almost 9 million sq ft space was added throughout the quarter from these metro cities, making it a nearly 96% of the space added in the whole quantum. Most of these spaces were the delayed developments especially in the city of Mumbai from previous quarters.

However, improvement is subjected to the global economic environment and government policies in India. Also, with the slowdown in large office requirements from giant global companies, the office market might witness a fall in absorption this year. The IT segment may also lose its charm as the tax linked incentives are not yet clear with the occupiers.

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Noida Extension buyers want banks to waive interest

The authority of Greater Noida is offering builders with a ‘zero period’ for paying installments. The home buyers are not too happy with it and demand from the lending banks to make all the EMIs interest free paid during the land row.

Bank

80 home buyers have formed a group and have joined hands to mount pressure on banks to waive off the interest on their EMIs. According to the buyers, banks are also to be blamed in the Noida extension real estate mess. They did not completely verify the viability of the projects which is why they charge processing fees from the buyers. They have threatened to undertake a legal action against banks if they disagree to provide financial relief to them by sharing the burden.
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Bank officials alternatively, are exploring options to deduct amount of interest from the future EMIs. They are examining legal provisions for the interest waiver.

The buyers alleged, that banks stopped disbursing further installments after the land row but continued to take EMIs from them with interest, that too, especially when they had already paid a hefty processing fee to the bank at the time of loan disbursal.


Tag: Home loan, Indian Bank, Indian Buyer, NRI investment in India, FDI,

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Commercial reality market touching skyline

Reality Market at its Peak

The commercial real estate of most of the Indian cities is booming after the prolonged abeyance. The rentals will remain under control for sometime considering the plethora in the market. The report by one of the popular property consultants ‘Knight Frank’ says that, office absorption in January-March 2012 rose up by 23 percent as in comparison with 2011.

1.04 million sq ft have been total transaction of office space, both sale and lease, in Mumbai from January to March this year as compared to corresponding year which was 0.88 million sq ft. Rentals and capital prices have dropped over the last one year even when the number of transaction are increasing. Commercial space leased at the approximate monthly rentals in Mumbai in the first three months of this year was Rs 111 per sq ft as compared to Rs 120 per sq ft in the first three months of 2011. In the same way the average property price fell between January to March of 2011 and 2012. The report pinpointed that , the growing numbers are yet to take over the present supply, causing a wider gap between demand-supply over the past year causing rent and vacancy levels to remain under burden.

The primary driver of office-space market in most of the Indian cities has been the Banking, Financial Services and Insurance (BFSI) sector, transactions in office-space in IT/ ITES sector has been abridge by half due to the interminable debt crisis. The additional report by Jones Lang LaSalle reveals that, a marginal growth is expected in the rentals of Grade A offices in Mumbai by the second quarter of this year.

An expert alleges that, with a view to boost transactions at a time when the vacancy rates are high, the developers will refrain from rising rentals. He also stated that, the cue of Indian economy is not very encouraging, office occupier continue to block the widening plans across all the major cities of India.  Significant office supply is expected in Delhi and Mumbai over next few months.

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Why do Non Resident Indians give preference to investments in Indian Real Estate?

NRI 

Approximately 30 million NRI's or Non resident Indians have been spread in 140 countries. The estimated wealth that they possess is 1.2 trillion USD.  These non resident Indians were considered to be the greatest contributors of foreign exchange in the years 2010 and 2011. There are around 7 lakh residents who have left the country searching for greener pastures. One lakh NRIs are expected to come back home each year. 

From the various investment options that are found these days, a key role has been played by the real estate due to the periodic investment returns as well as a good rate of appreciation. Moreover, there are many NRIs living in West Asia who aren’t able to stay there due to various domicile restrictions. This is the main reason why they are always seeking different options of investment including real estate for permanent settlement.

3 types of real investors are found and these include low, middle as well as high income groups. Within the given categories, there are investors as well as end-users. In the Association of Gulf Cooperation Council Countries that comprises of Qatar, Saudi Arabia, UAE, Kuwait, Bahrain and Oman, there are around fifty five to sixty lakh NRIs who work today. This includes unskilled as well as semiskilled labor.

Similarly, out of the one million NRIs in Malaysia, more preference is given to the southern cities here. In Canada, one will find a majority of NRIs who hail from Chandigarh, Delhi as well as other regions. In United States, out of the 2.5 million NRIs, the real estate requirements are dominated by various southern cities such as Chennai, Hyderabad and Bangalore. There is variation of specific needs of real estate depending on the savings potential, region as well as other factors. In India, affordable housing is found in the price range of twenty five lakhs to thirty lakhs. Here, there are various expatriates who are either very skilled or CEO’s of the companies. The salaries which they get are very high. Ten percent of the NRI population consists of technically qualified professionals as well as individuals. There are many people who look out for apartments ranging between seventy lakhs and one crore. The price range of villas is more than 2.5 crores. There are many people who have the keenness for making an investment in commercial property as many NRI’s have came back to India and have set up their offices. Most of these NRI’s are looking to setup their offices in Noida and Gurgaon and there are many good options available one of the leaders in Commercial property is ‘Cosmic Structures Limited’. They are coming up with a unique commercial property Cosmic Corporate Park where one could get all the commercial facilities under one roof. Cosmic Corporate Park is considered to be a Seven Star Luxury Corporate Space with area ranging from 150 sq.feet to 2000 sq.feet.

According to banks in India, the approximate size of home loan is thirty to seventy lakhs. There is a great demand for apartments as well as commercial property in India. Even the business of home loans in India ranges from 720 to 800 crores. The demand for real estate is driven in cities such as Jaipur, Chennai, Bangalore, Mumbai, Kochi, Pune and NCR. There is a great demand for the tier II cities as well. More and more skilled professionals and businessmen are being relocated to different Indian cities such as Noida, Gurgaon, Pune, Chandigarh and Indore and due to this; the requirement for apartments in the price range of 70 lakhs and commercial properties in different ranges is growing. This has in turn leaded to construction of many new commercial properties. Many people seek commercial property on rent and as a result the rents of commercial properties have gone up many folds.

Tag: NRI, Indian Real Estate Market, Commercial Property, Noida Real Estate Market,  

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