Why is the global market turning to Indian real estate?

Over the last couple of months, there have been a slew of big deals in the Indian real estate sector. One might have read about them in passing, but let's put them into perspective. There are two broad areas of the industry that are seeing action the commercial real estate market and the affordable housing market. Wall Street has poured millions of dollars into our market. Goldman Sachs, Warburg Pincus and Blackstone have invested over $900 million in Indian real estate.

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Goldman Sachs invested $150 million dollars in Piramal Realty and $250 million in Bangalore-based Nitesh Estates. A month before that Piramal raised 1800cr from Warburg Pincus. Blackstone acquired the 247 Park Office project in Mumbai for $160 million.

According to a report by KPMG released at a recent conference, Private Equity investments committed into Indian real estate have crossed $3 billion in this year alone. We also know that pharma company Abbot India will pay Godrej Properties 1480cr for a 19-storey office building in BKC in Mumbai. TCS entered into an agreement to lease over two million sq ft at Hiranandani Estate in Thane for what is billed as the largest single office space transaction in India in terms of area, according to the Economic Times.

Why is the global market turning to Indian real estate when the customer has turned away? Our interactions with the industry show that investors believe that the sector is turning around in some pockets.

The uptake or absorption of commercial space has improved tremendously in the last year and this information is heartening for us as investors. When the demand for commercial space increases it means simply that more jobs are being created. More jobs will mean a better economy and more demand for housing. Within the residential sector, investors are focused on affordable housing where they foresee the highest demand in the future.

What can we gather from news of these investments? If global investors believe the Indian market will offer them substantial returns in the future, it means they also believe there will be a turnaround in our market. The time to cut the deal on property would be now, before the prices begin to rise. My advice to all those waiting to buy a home would be to start moving on the deal right now.

The second and more important learning from this information is to be very selective about the builder or developer one invests with. Global companies have picked builders with strong reputations after conducting tremendous due diligence. It is a practice we must follow as well. The onus of conducting research on builder lies solely on the buyer. But having said that, don't let this opportunity pass by. If one is in the market to buy a home, this is the market to be in.

Source - TOI

30 Gujarat cities covered under 'Housing For All'

Ahmedabad - Thirty Gujarat cities have been selected by the central government under its ambitious scheme 'Housing for All'. The central government has identified 305 cities and towns across nine states for implementation of the scheme. As many as 305 cities and towns have been identified in nine states for beginning of construction of houses for the urban poor under the scheme, said a senior housing and urban poverty alleviation (HUPA) ministry official. The HUPA ministry will provide assistance of over Rs 2 lakh crore over the next six years for enabling two crore urban poor own their own houses.

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Apart from Gujarat, the selected cities and towns are in Chhattisgarh (36 cities/towns), Jammu and Kashmir (19), Jharkhand (15), Kerala (15), Madhya Pradesh (74), Odisha (42), Rajasthan (40) and Telangana (34). Under the 'Housing for All' initiative of the central government, named as Pradhan Mantri Awas Yojana launched by Prime Minister Narendra Modi on 25 June this year, two crore houses are targeted to be built for the poor in urban areas by year 2022, coinciding with 75 years of Independence.

Besides these nines states, the official said, six more states have signed memorandum of agreements (MoA) with the ministry committing themselves to implement six mandatory reforms essential for making the housing mission in urban areas a success. The states that have so far agreed to implement the mandatory reform measures are Gujarat, Andhra Pradesh, Bihar, Chhattisgarh, Jammu and Kashmir, Jharkhand, Kerala, Madhya Pradesh, Manipur, Mizoram, Nagaland, Odisha, Rajasthan, Telangana and Uttarakhand.

By signing the MoA, the states agreed to make necessary changes including doing away with the requirement of separate non-agricultural permission in case land falls in residential zone earmarked in master plan of city or town and preparing or amending master plans earmarking land for affordable housing, among others.

Source - The Times of India, Ahmedabad

Reghupathi commission recommends payment of compensation to apartment buyers

CHENNAI: Justice R Reghupathi commission of inquiry that probed collapse of an 11-storey building at Moulivakkam last year said the other surviving building at the site resembled the ill-fated block "in terms of all short-falls and deviations that contributed to the mishap". The soil is loose, sandy and watery and pile foundations were not laid for a depth of 18 metres. On the reason for the collapse of the building, the report said it was built primarily with a raft foundation and pillars were knocked off to accommodate driveways. Experts who inspected the building detected insufficient concrete settings, cracks and punctures in columns.

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The report said the "present tragedy is a self-speaking parable" and said it was not known how many projects, both completed and under-construction, suffered from similar deficiencies. "The present instance is the best example about the dark-side behind the real estate and construction business where money is considered to be the only ambition and aim, and lives of human beings and customers are put at stake to test the duration of the feeble constructions raised by them.

Noting that regulatory agencies lacked technical experts the commission recommended sweeping changes in CMDA's functioning including setting up of a committee comprising technical experts from CMDA, legal officers and experts in soil investigation, foundation design and structural engineering to carry out field inspections at every stage of construction of mega projects. The committee should inspect buildings at various stages including earth work stage, laying of foundation, basement and concreting of each floor, the report said.

Even though Tamil Nadu government has a directorate of vigilance and anti-corruption, Raghupathi has suggested setting up of a vigilance wing to keep a check on hidden and underhand transactions between officials in the regulatory agency and developers.

As regards the loss suffered by customers who had invested in the ill-fated building and neighbours, whose houses were damaged in the disaster, the commission has urged the government to set up a committee to assess the loss and pay compensation by drawing money from the state disaster relief fund. Buyers were still repaying loans though their apartments were completely razed, the commission pointed out and said it felt the need to go beyond its brief and suggest ways of assuaging their sufferings.

Reacting to media reports that the government and the regulatory agency flouted norms by giving permission for high-rise buildings on a narrow road, the report said, "Prima facie it appears there is no violation on the part of CMDA and the government in recommending relaxation (of norms)."

While developers welcomed most of the recommendations of the commission, they have reservations against retaining money from contractors for 10 years. "CMDA already retains a deposit from developers. Blocking more money as surety will add to project cost," said a city developer.

Source - TOI 

Pune's realty market offers an ideal investment

Pune's realty market is an ideal and safe residential investment market as compared to other Indian cities. Pune has maintained its status as a safe residential realty investment destination unlike Delhi NCR, where residential real estate prices saw depreciation during the last two years and Mumbai, which saw a marginal appreciation over the same period.

It is one market where the real estate is well priced with a wide assortment for different buyer needs. The city being an IT and manufacturing hub, there is a continuous demand for homes. “With assured returns on houses at a constant rate of year-on-year appreciation, Pune has been a favourite location with investors who are averse to high risks,“ says Sanjay Bajaj, managing director Pune , JLL India.

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Pune also has a great opportunity for geographical expansion. The city is well connected to Mumbai and several holiday destinations like Goa, Mahableshwar and Khandala making it a perfect city to invest in real estate. “We see real estate prices in the city starting from Rs 4,000 per sq ft and ranging up to Rs 15,000 per sq ft, says Kishore Bhatija , MD Real Estate Development, K Raheja Corp.

In the eastern corridor of Pune, Wagholi and Kharadi have close proximity to major IT development and manufacturing hub and developing quickly. “In the southeast of Pune, NIBM, Undri and Hadapsar are emerging residential locations with quick access to camp, Pune station, Swargate, major highways and in close proximity to Magarpatta IT Park, major schools, clubs and hospitals,“ says Bhatija. He adds that Hinjewadi and adjoining areas like Wakad, Baner, Balewadi, Pirangut belonging to the western corridor of Pune are developing excellently. Additionally, connectivity to Mumbai and infrastructure development by PCMC have played a key role in accelerating development in these city parts.

The city is largely a mid-segment market when it comes to residential properties. 'Sweet spot' for buyers in this segment lies between Rs 4,500 and Rs 5,200 per sq ft. “In other words, a 1,000 sq ft flat costing about Rs 50 lakh forms the median ticket size in the city. Most buyers prefer to book houses in the pre-launch stage, especially at rates around Rs 4,600 per sq ft,“ says Bajaj.

Despite their proximity to each other, Mumbai and Pune are two very different markets. Mumbai's legendary space crunch has made residential property there exorbitantly costly, driving more and more aspiring middle-income home buyers to the fringes. Meanwhile, Mumbai continues to grapple with its infrastructure deadlock. Prices in most areas of Mumbai have stagnated and there is a considerable pressure from the market to bring them down. On the other hand, Pune's residential property market has maintained its momentum even in a challenging economic environment. Various research agencies have confirmed that Pune has prevailed as one of the best-performing residential real estate markets over the past two years. Residential sales have remained healthy enough to sustain the viability of the city's real estate market, encouraging Pune's developers continue to launch fresh residential projects in all budget categories affordable housing, mid-income housing and even in the super-luxury category.

“Today, the annual demand for homes in Pune is close to 46,000 units, where it was less than 20,000 units per annum just 15 to 20 years ago. While Mumbai is staggering under the weight of unsold units all across the city, supply and absorption of homes in Pune continues to make both property development and property investment eminently viable , “ says Kishor Pate, CMD Amit Enterprises Housing Ltd.

Bajaj concludes that the current inventory level stands at 16 months, which is slightly higher than the last six year's quarterly average of 15 months. This is a healthy figure, and reflects demand-supply equilibrium. For buyers, this means that once the right price point and overall ticket size as well as the location matches their requirements, it is advisable to go ahead with the purchase.

Source - Magicbricks News

GST and its impact on real estate buyers

Goods and Services Tax (GST), a Value Added Tax (VAT) yet to be implemented, has been creating a lot of buzz. Here is an insight about what the tax, if implemented, can mean for the real estate buyers.

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In India, at present, taxes are collected at multiple points, such as manufacturing, sale, entry, providing service, consumption etc. It also differs from state to state. Some taxes are levied by the central government and some are levied by the state governments.


This has a cascading effect and ultimately goods and services become costly for the consumers. Multiple registrations, filing returns, assessments and keeping records for different purposes has added complexities to the businesses. This also has resulted in high rate of litigation in the tax matters.

Advocate, Govind Patwardhan, chairman of State Taxation Committee of Mahratta Chamber of Commerce, Pune, explains, GST is intended to integrate and include many indirect taxes such as excise, service tax, custom, central sales tax, VAT, luxury, entertainment etc.

“This will lead to unified tax rates and rules at the pan India level. Taxes paid in one state will be allowed to be adjusted against taxes payable in another state. It is also likely to bring down cost, improve tax compliance and collections. This is also expected to boost India's economic development by breaking tax barriers between the states. It will integrate the country as one huge market like the European Union.

Patwardhan further explains that at present taxes paid under one act cannot be set off as input tax against tax under other act. For instance, service tax is not allowed to be set off against VAT and vice versa. Therefore, the cost of goods and services goes up.

On the contrary, GST will be one tax and hence the tax element in the price of goods and services payable by consumers will come down considerably. This will improve funds inflow from foreign countries. Higher inflow will create demand for various goods and services. Housing, being one of the preferred asset classes, will see a surge in demand.

Source - Magic bricks news 

How Monsoon can help you in renting, buying

There is something alluring about the monsoon season which appeases almost everyone. However, when it comes to Mumbai’s real estate, monsoons have a reverse effect to the existing houses, as here torrential rains put a stop to the daily activities of the city residents. Still, interestingly, this season may prove to be beneficial for the buyers, in certain ways. Know how -

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Bargain for lower rates

For many developers, it is a lean season in terms of sales. Incessant rains stop buyers from making a purchase. “People wait till festivals to initiate any property transaction, which leads to piling up of residential inventory. Thus, developers facing liquidity crunch, come up with monsoons discounts as a part of their marketing campaign to attract buyers,” says Gaurav Arora, a local real estate consultant.

Expert also say that, majority of developers are ready to offer property at lower rates to serious buyers. It is the same for tenants looking for rented accommodations. “In Mumbai, one can easily negotiate by 10-25 per cent on the sale or rental values during the monsoon season,” says Arora.

You can settle for a big house

Since many developers are ready to negotiate on the property price, this can be an opportunity to buy a larger space. Arora says, “The property prices in Mumbai are very high, and buying a property is a big deal for a middle-class man.”

Opportunity to check the property

For those, who are willing to invest in a partially or fully developed property, monsoons are an opportunity to check the construction quality of the project. You can check for water leakage, dampness, water clogging, etc.

Check the locality

A city like Mumbai, where water logging and traffic jams are normal, and a visit to the locality can prove to be beneficial. If it is a plot, you should check whether it is a low-lying one whether you would need to add more soil to level the area.

Isha Gupta, a resident in Mumbai says that, “Water logging is a major issue in most of the localities in Mumbai, even in the affluent areas. A visit to a locality can give you a fair idea how your neighbourhood is during this time and one can have an idea.  This is an important point to keep in mind, because when you plan to sell the property these can prove to be a deterrent”.

Source - Magicbrick news

Documents for transfer of immoveable property should be clearly defined

Parties execute lease deeds and license deeds to undertake any action pertaining to transfer of immoveable property. The general belief is that the nature of the document is determined by what the document is called.  In a number of situations, a landlord transferring his property on rent under a lease titles the document (executed for the purpose) as ‘license deed’.

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He is obviously under the  misconception that (because  the document is titled license deed) he can forcibly evict the tenant any time. It is, therefore, essential to understand the difference between license and lease. The concept of license has been defined under the Indian Easements Act, 1882. A license is a personal right granted by one person to another to do something upon immoveable property of the grantor and does not create any interest in the property itself. A lease is defined under the Transfer of Property Act, 1882. Though there is a marked distinction between a lease and a license, identifying whether a transaction is a lease or license of a specific property may not always be clear.

One of the main differences between license and lease is that in case of a license, the possession of the property remains with the owner but the licensee is permitted to use the premises for a particular purpose. No interest is created in favour of the licensee and he or she can use the property only in the manner as permitted by the grantor.
In the lease of an immoveable property, the lessee is entitled to be entrusted the possession of property and is entitled to the enjoyment of the property to the exclusion of the lessor. Thus, a lease is a transfer of an interest in the immoveable property. If in a transaction, the person has only a restricted or limited right to use the property, while the property remains in possession and control of the owner, such a transaction is considered to be a license.

A lease is a transfer of right to enjoy such property, in consideration of a price, ie the rent, whereas in a license, the grantor gets a license fee as consideration. When the  grantor sells his property in which he has a license, the purchaser may not be bound by such license unless explitly agreed. However, when the lessor transfers the leased property, the buyer of the property will be responsible to undertake all the liabilities of the lessor.

 The courts in certain cases have decided whether the transaction was a lease or a license based on different factors --- largely subject to the facts and circumstances of each individual case. For instance, where the lessee had been granted the right to exclusive possession of the property, the instrument in question was held to be a lease deed by the courts. On the other hand, where the defendant was given exclusive possession of the disputed premises for a particular purpose but was not given the permission to sub-lease the property, the transaction was held to be a license. In some cases, where the keys of the premises were taken by the grantor in the morning and returned in the evening, the court has held the transaction to be a license.

Thus, the title of the document is not conclusive enough to determine whether a transaction is a lease or a license. In order to avoid disputes, it is for the parties to clearly set out their intention whether it’s a lease or a license in their documentation. For avoiding any dispute, the factors that should be kept in mind while drafting the lease deed or the license deed include, the terms with respect to rent/license fee, which party is entitled to possession of the property, the terms of usage of the property, etc.

Courts have, time and again,  held that for ascertaining the nature of the document it is necessary to look into the real intention of the parties, ie whether they intended to create a lease or a licence. Courts take into account the language of the document and the facts and circumstances, irrespective of the name of the document executed by the parties. 

Source - Hindu 

‘Achhe din’ for builders of luxury towers in Mumbai

MUMBAI: Chief minister Devendra Fadnavis has ushered in 'achhe din' for several developers building luxury residential towers, mainly in areas where property prices are the highest in the country.

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The state urban development department headed by him, issued a notification on May 21, exempting them from paying a hefty premium to the BMC for building extra areas.

 

Upcoming skyscrapers in Lower Parel, Worli and Nepean Sea Road, where apartments have reportedly sold for between Rs 40 crore to Rs 100 crore, will benefit from this new rule.

 

Influential developers were lobbying with BJP leaders to exempt them from this premium. They contended that they received their preliminary building permissions much before the premium payment rule for building extra areas was introduced on January 6, 2012.

 

Municipal commissioner Ajoy Mehta said the civic administration will now have to compile a list of all such projects that are exempted.

 

TOI in its edition dated May 5 had reported about the government's move to exempt such developers from paying what is called Fungible FSI premium to the BMC.

 

By far, the biggest beneficiary of this largesse is One Avighna Park, a luxury residential project near Currey Road station in central Mumbai. Its developer Kailash Agarwal had opposed paying the premium on the ground that his project had procured permissions prior to January 6, 2012. "It was our contention that buildings which were constructed more than 70% should not have been affected by the new development control rules introduced in January 2012," he said.

 

Agarwal's project comprises two towers of 64 floors each with "sky villas and sky mansions". The project has been stuck for the past couple of years because of this issue. The building was earlier approved by the BMC with unusually large fire refuge areas and decks on each floor.

 

Industry sources said Palais Royale, touted as India's tallest residential building at Worli, may also benefit from this notification. Construction stopped a few years ago after the project was caught in litigation following allegations of large-scale building violations.

 

Fifty-six floors were built though the initial municipal permission was for 43 floors. The developer contended that BMC had passed plans up to the 56th floor. The BMC had ordered that areas exempted from the building's floor space index (FSI) be now counted as part of it. FSI is a ratio that determines how much can be built on a plot. Refuge areas, passages, swimming pools and structural columns were not included in the FSI when Palais Royale's plans were approved by BMC seven years ago. The new notification may come as a huge relief for this project.

 

Another major beneficiary is an under-construction, high-end luxury skyscraper at Nepean Sea Road called Sesen, a project owned by Satellite Group, but now believed to be taken over by Pune-based builder Avinash Bhosale. The initial permissions were procured prior to the January 6, 2012 cut-off date, hence the developer will not have to pay premium when it seeks sanction for further construction.

 

A 37-storeyed Breach Candy tower built on a one-acre plot by the Singhanias of Raymond could also get a reprieve under the new rule.

 

The project has been stuck for some time now. A report prepared by then municipal commissioner Sitaram Kunte observed that excessive concessions granted to the developer caused a "mammoth" construction of 27,400 sq m against an FSI of 2,570 sq m. "The total construction area is more than ten times the FSI computation," it said.

 

Several ongoing projects of D B Realty in the Worli-Prabhadevi belt could escape paying the premium. The developer of Orbit Grand, a luxury tower at Lower Parel, also found its project stuck after it had to reduce its total area from 85,000 sq ft to 70,000 sq ft. The notification will allow the builder to now utilise the entire area without payment of premium.

 

"Many builders who had paid the fungible FSI premium to BMC will now try and seek a refund," said a top developer.

Source : The Economic Times(ETRealty.com)

Fullerton seeks licence to start housing finance business in India

MUMBAI: Fullerton, the nonbanking finance company backed by Singapore-based Temasek Holdings, plans to enter the affordable housing market in India and has applied for a licence from the National Housing Board. "We will start the housing finance business with an initial capital of Rs100 crore," said Shantanu Mitra, MD and CEO at Fullerton India. "We will be focusing on affordable housing and MSME."

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Non-banking finance companies (NBFCs) in the housing finance business face competition from banks, which are able to lend at lower rates. Mitra said the company does not plan to apply for a banking licence as the rules are domestic. "The rules on foreign shareholding are not appropriate for us to apply for a banking licence," he said.

 

The Reserve Bank of India has round, it gave out licences to IDFC and Bandhan Financial Services. IDFC had to gradually bring down its FII limit to 50% to comply with the RBI's norms. On Thursday, Fullerton reported a 60% year-on-year jump in net profit to Rs301 crore in the year to March 2015 on higher interest income. The company is mainly into lending against property, giving loans to small companies, personal loans and rural loans. It had a total loan portfolio of around Rs 9,000 crore.

 

The asset quality of the company improved as it has moved from unsecured lending to a balance portfolio with 45% into secured lending. Net nonperforming assets increased slightly to 1.41% from 1.34%.

 

The company has 437 branches and plans to open 40 more across the country this financial year as it increases focus on rural markets. Fullerton India has capital adequacy norms of 19%. The company is well capitalised and does need to raise any capital, said Mitra.

Source : The Economic Times

PM Narendra Modi's 'Housing for all by 2022' scheme to be launched by mid June

NEW DELHI: The government is getting ready to launch PM Narendra Modi's most ambitious scheme: Housing for all by 2022. Modi is likely to launch the scheme as an umbrella mission, dovetailing all affordable housing schemes and slum redevelopment projects.

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The urban development and rural development ministries have finalised their respective components for providing 6 lakh houses - 2 lakh in urban areas and 4 lakh in rural areas. According to sources, the Prime Minister has to give time for the launch of the scheme, which is likely around mid-June. A source told ET, "The ministers have been busy with the 1st year anniversary programmes.

 

After this we are only waiting for PM to give time for the final launch. It's a very big initiative so it would have a proper launch." The endeavour, which was earlier planned as Sardar Patel Mission, would now be named to commemorate 75 years of Independence. The new mission would include all the already existing schemes of Ministry of Housing and Urban Poverty Alleviation and rural development ministry. A senior official said, "Schemes like Rajiv Awas Yojana, Rajiv Rinn Yojana would all be included under this mission."

 

One of the main components of the mission would be slum redevelopment. Under this, land will be pooled and then given to a private real estate developer. Slum dwellers would be given flats free of cost in multi-storey towers by the developer. The government would allow the developer to generate revenue by developing a portion of land of commercial purposes.

 

A senior urban development ministry official said, "In case some projects are unviable, viability gap funding would be allowed." The government is also planning to increase the interest subsidy of 5% on loans granted to economically weaker sections (EWS) and lower income group (LIG) categories to construct their houses.

 

Sources said that the subsidy would be increased and the amount of loan is likely to be increased from Rs 5 lakh to Rs 10 lakh under the new mission. Another major component is the upfront assistance given to individual beneficiaries for constructing or upgrading their tenements.

 

his amount is also likely to be doubled under the new scheme. "The biggest challenge before the Modi government right now is that the funds would be provided by the Centre and the states would reap political benefits out of such a welfareoriented scheme," said a source.

Source : The Economic Times (ETRealty.com)

Raman tells builders to give buyers flats in Greater Noida

NOIDA: Scores of homebuyers in Greater Noida (west) conveyed their grievances to Rama Raman, the chairperson and CEO of Greater Noida Authority, on Wednesday.

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Following the meeting, Raman asked the developers in question to resolve all buyers' grievances at the earliest and start giving them possession of the flats.

 

Nearly 1.5 lakh buyers in Greater Noida (west) have been waiting for their flats for more than four years. Their dreams were put on hold after the row over land acquisition broke out in 2011. Nearly two weeks ago, the SC upheld land acquisition by the Greater Noida and Noida Authorities between 2006 and 2009, bringing relief to thousands of homebuyers who had invested in the area.

 

"We have asked the developers, who are members of CREDAI (Confederation of Real Estate Developers Association of India), to speed up their projects and resolve issues related to late delivery, unjustified penalties, changes in layout plans, high interest on late payments, stalled possession, withdrawal of buyer from project, among others," Raman said.

 

Raman assured the homebuyers of his support and "We will do our best to help resolve the issues and in making sure all developers follow ethical practices," he said.

 

"We met the buyers and have heard their issues. We hope to mitigate some of their complaints," Manoj Gaur, president of CREDAI NCR, said.

Source : The Economic Times (ETRealty.com)

 

Securing Smart Cities aims to make smart cities safer

New Delhi: Soon a new not-for-profit global initiative, Securing Smart Cities, is going to be launched with the aim to solve the cyber security challenges that smart cities face through collaboration and information sharing.

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Backed by leading IT security researchers, companies and organisations including IOActive, Kaspersky Lab, Bastille and the Cloud Security Alliance, the group plans to serve as a communications node for companies, governments, media outlets, not-for-profit initiatives and individuals across the world involved in the creation, improvement, and promotion of smart and safe technologies for modern cities.

The concept of a smart city is very topical and many organisations are working on intelligent solutions to make urban areas energy efficient, comfortable, environmentally friendly and physically safe.

Unfortunately, there are concerns about the cyber security of these smart cities. The more IT organisations involved in creating a smart city, the greater is the potential risk.

The initiative seeks to prevent this outcome using a range of activities, such as:

Educating smart city planners and providers on the importance and cost benefits of security best practices

Collaborating with partners to share ideas and methodologies Endorsing the significance and benefits of introducing security early into the development lifecycle of a project or plan

Fostering partnerships between cities, providers, and the security community

Creating standards, guidelines, and resources to help improve cyber security across all areas related to smart cities

Participants in the initiative believe that it will help efficiently and responsibly share knowledge about the cyber security of modern cities. It will also connect vendors of infrastructure automation equipment with security researchers.

Source : The Financial Express

Apollo sets up Asia real estate pvt equity platform

Mumbai: Nipun Sahni, former managing director and head, India, real estate investment group at Bank of America-Merrill Lynch and founder and chief executive officer at Rezone Investment Advisors, has joined US-based Apollo Global Management as partner and head of real estate, India.

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Apollo is setting up real estate private equity platforms in Asia with offices in Shanghai, Hong Kong and Delhi, among other cities. Other team members of Sahni at Rezone have also joined Apollo in India.

 

Sahni has joined Apollo along with Philip Mintz, founder of Venator real estate private equity, and his China team. Mintz will be heading Apollo's Asia real estate private equity platform.

 

Apollo has absorbed $500-million assets under management of Venator, which was a China dedicated fund. It has not yet firmed up its new fund raising plans, said Sahni.

 

"Asia is a growing market for real estate capital. We would like to get our investors to participate in the right strategies in Asia," said Sahni. The funds' primary focus would be investments in China and India.

 

Besides real estate private equity, Apollo has three other platforms in India for private equity, special situation investing and credit with independent teams.

 

Sahni had set up Rezone after global investor Blackstone bought Asia real estate portfolio of Bank of America-Merrill Lynch (BofA-ML), where he was heading India real estate investment group.

 

As of March 2015, NYSE-listed Apollo managed over $163 billion of investor commitments across its private equity, credit and real estate funds and other investment vehicles making it one of the largest alternative investment management firms globally.

 

Apollo's focus on Asia real estate comes at a time when global real estate investors such as US-based Blackstone and Singapore's GIC are aggressively buying commercial assets in countries such as India.

 

"It is a great time to invest in India and own income yielding assets in office and retail space as valuations are attractive. In 12-18 months, markets will pick up due to government initiatives such as Make in India," said Shishir Baijal, chairman at property consultant Knight Frank India.

Source : Business Standard

Consultant to design Karkardoma smart city to be finalised in a few weeks: DDA

 NEW DELHI: Delhi Development Authority (DDA) is set to finalise the name of the consultancy company in the next few weeks to design a 100-storey smart sub-city complex at Karkardoma, a top official said on Wednesday.

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"The DDA has received proposals from global consultants from places such as Dubai, Singapore, Paris to design the smart sub-cities complexes to begin with at places like Karkardoma and Sanjay Lake area. The organizations is short listing their proposals which would be finalized in next few weeks," said Balvinder Kumar, vice chairman of DDA. 

 

With an approximate investment of Rs 4,500 crore, the Karkardoma complex will be built by the National Building Construction Corporation (NBCC) under sole administrative control of the Delhi Development Authority (DDA). Construction will begin by mid 2016. 

 

"Approximate investment volumes are yet to be worked out for a similar complex at Sanjay Lake area of Delhi also being developed by NBCC," Kumar added. 

 

The union urban development ministry on Tuesday notified operational guidelines for implementing the land pooling policy, which will help DDA obtain land for housing, bypassing the lengthy land acquisition process. 

 

However, the actual implementation now depends on Delhi government's decision on declaring 95 villages in the city as development area and 89 of them as urban villages. 

 

Kumar also infomed that, "the notifications for the Transit Oriented Development Policy would be declared towards the end of this week." 

 

The DDA's Master Plan Delhi (MPD) 2021 proposes construction of 25 lakh housing units by 2021 for which 10,000 hectare of land will be required. As per DDA estimates, 2.5 lakh houses, including 50,000 EWS units, will require 1000 hectare of land. 

Source : The Economic Times (ETRealty.com)

Developers, analysts look forward to implementation of Land Pooling Policy in Delhi

NEW DELHI: Affordable housing in the capital city of Delhi could get a major boost with the centre notifying norms for the land pooling policy, a decision welcomed by the industry. 

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The decision can bring down the land prices in Delhi and solve housing problems for the economically weaker sections. 

 

The Centre, on Tuesday, notified the operational guidelines for putting to use the Land Pooling Policy of the Delhi Development Authority (DDA). The policy itself was notified a year and a half back. 

 

"Delhi may be able to unlock its potential for real estate development across 20,000 hectares of land concentrated across peripheral zones," Anshuman Magazine, chairman and managing director, CBRE South Asia said. 

 

However, since most of the land falling under this policy is in remote and peripheral areas of Delhi, infrastructure development in these areas will take time and immediate housing solution may not be possible. 

 

"This policy will make available more land for housing, bringing down land price prevailing in Delhi," said RK Arora, chairman of Supertech. 

 

"This likely to result in a healthy availability of residential dwelling units which will not only enable availability but also help in keeping a control on residential prices," said Rohan Sharma, associate director-research and real estate intelligence service, JLL India. 

 

Developers like Prateek Group are looking forward to the implementation of the policy. "As developers we would be eagerly waiting for the policy to turn out the way it is planned. The effects on Delhi's realty will be very clearly visible once this activity starts," said Prashant Tiwari, chairman, Prateek Group. 

 

Now the Delhi government has to notify 95 villages, mostly in southwest, west and north Delhi, as development areas. The government has to declare 89 of these villages as urbanised. 

 

The DDA had proposed the policy to have private sector participation in land consolidation and development while DDA itself assumed a larger role of a facilitator. 

 

According to the policy, those who provide DDA with larger land parcels will benefit more. On contributing 2-20 hectares, the land owners will be compensated with land parcels measuring 48% of the original. Those contributing 20 hectares or more, the compensatory plots will be 60% of the original plot. The owners will be allowed to build residential, commercial, public and semi-public facilities on these alternative plots.

Source : The Economic Times (ETRealty.com)

Nod to four new urban townships on Noida e way

GREATER NOIDA: The second phase of the Yamuna Expressway Industrial Development Authority's Master Plan-2031 was approved by a joint board of the three development Authorities Noida, Greater Noida and YEIDA on Monday, paving the way for four new urban townships adjacent to the cities of Aligarh, Agra, Hathras and Mathura.

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While two townships will be developed at Tappal and Raya, locations for the other two are yet to be earmarked.

 

YEIDA tabled its budget for this financial year, allocating Rs 6,229 crore for projects, with a large chunk being reserved for land acquisition and farmers' compensation, besides promising to deliver 4,500 out of 7,000 affordable housing units by December 2015. YEIDA's CEO PC Gupta said that the four new urban centres, spread over 20,000 hectares, will be developed as smart cities. The total area under the Master Plan-2031 (Phase-II) measures over two lakh hectares, which is more than double the area of the Phase-I in the master plan, and is expected to have a population of 21 lakh by 2031.

 

"The Tappal urban center will be developed across 11,101.40 hectares, whereas the Raya centre will be developed across 9,366.20 hectares. They are proposed to have a population of 12.75 lakh and 9.76 lakh respectively," he said. "A dedicated tourist zone will also be developed in Raya while Tappal will boast of a recreational zone," Gupta said.

 

"Work on the four townships will start immediately after the state government gives its green signal. These will be smart cities that exploit technology to offer more structured and hospitable living conditions for residents," he said.

Source : The Economic Times (ETRealty.com)