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Bharti Realty On Expansion Spree In NCR, In Talks To Form JVS For Projects Over Rs 1000 Crore

Bharti Realty On Expansion Spree In NCR, In Talks To Form JVS For Projects Over Rs 1000 Crore

November 15, 2018 in Uncategorized

Bharti Realty, the real estate arm of Bharti Enterprises, is looking to expand its presence in Delhi and Gurugram markets and is in talks with landowners as well as other developers for joint ventures to build new projects worth over Rs 1,000 crore each, a top company official said. Bharti Realty currently has around 15 completed projects, having nearly 5 million sq ft of fully leased Grade-A commercial space, in Delhi-NCR and some other cities. It has almost completed a 7 lakh sq ft office building at Gurugram and will soon start the leasing process. "We are looking to add new projects in Delhi and Gurugram. We are being approached by landowners and other real estate developers for partnerships. We are actively considering it," Bharti Realty MD and CEO S K Sayal told PTI. The company would continue to focus on the national capital region market, he said. Sayal said the size of the projects would be over Rs 1,000 crore each and the deal could be finalised in the next few months. To foray into the housing segment, Bharti Realty had in 2015 formed a JV with Eros group to develop a residential project at Surajkund in Haryana. Asked about the status of this 52 acre-project, Sayal said the construction work has not yet started because of a pending legal case in the National Green Tribunal (NGT). The company has got all regulatory approvals from the centre as well as the state government to start this project, comprising 2,300 units and around Rs 2,000 crore of investment, he said. Sayal expects that the company would soon get approvals from the NGT and the National Capital Region Planning Board (NCRPB) to develop this project. The housing project at Surajkund will be a vertical smart city where apartment price will be in the range of Rs 1.25 crore to Rs 4 crore. On the commercial project that it bagged from the Delhi International Airport Ltd (DIAL), Sayal said the construction work would start in 6-8 months' time as the project is being conceptualised and the overall master plan of the commercial hub 'Aerocity' near the airport is being approved. The development of this 23-acre commercial project, having about 2.5 million sq ft of leasable area, mostly retail, would require an investment of about Rs 1,500 crore. In January 2017, DIAL -- which operates the aerodrome in the national capital -- had given the contract to Bharti Realty to develop an area of nearly 2 lakh sq metres of retail space near the airport here. This contract decided through the bidding process, involved an upfront payment of Rs 315 crore as well as licence fee equivalent to 20 per cent of revenue with minimum guaranteed payments, GMR had said last year. DIAL is a subsidiary of GMR Infrastructure. Bharti Realty already has 2-3 properties in 'Aerocity', named 'Worldmark Aerocity', comprising fully-leased 1.5 million sq ft area. On the overall real estate market, Sayal said the sentiments are low and housing demand is subdued. "The dynamics in the real estate market have changed post demonetisation, new real estate law RERA and the GST. Forward trading has stopped. There is a lot of sanity in the market and the consumers will be beneficiary of these reforms," he noted. The Bharti Group has a presence in telecom, agri-business, financial services, retail and real estate among others. Sources: economictimes.indiatimes.com

Difference between Carpet Area, Built-Up Area & Super Built-Up Area?

Difference between Carpet Area, Built-Up Area & Super Built-Up Area?

November 13, 2018 in Defination, Real Estate News

Not knowing what each actually means is what could give Developers a chance to take you for a ride. However, it is not rocket science. Just a little reading and you will be pretty thorough with the terms. Here are some of the basics of Real Estate you should know. Carpet Area Carpet area is the area that can actually be covered by a carpet or the area of the apartment excluding the thickness of inner walls. Carpet area does not include the space covered by common areas such as a lobby, lift, stairs, play area, etc. Carpet area is the actual area you get for use in a housing unit. So when you are in search of a house, look at the carpet area and then make your decision, because that is the number that will give you an idea of the actual space at your disposal. Focusing on the carpet area will help you understand the usable area in the kitchen, bedroom, living room, etc. Nowadays, many builders don’t even mention the carpet area at first, and usually, charge on the basis of built-up area or super built-up area. Carpet area is usually around 70% of the built-up area. Built-Up Area Built-up area is the area that comes after adding carpet area and wall area. Now, the wall area does not mean the surface area, but the thickness of the inner walls of a unit. The area constituting the walls is around 20% of the built-up area and totally changes the perspective. The built-up area also consists of other areas mandated by the authorities, such as a dry balcony, flower beds, etc., that add up to 10% of the built-up area. So when you think about it, the usable area is only 70% of the built-up area. So, if the built-up area says 1200 square feet, it means around 30% (360 square feet) is not really usable, and the actual area you will get to use is only the remaining 840 square feet. Super Built-Up Area Super Built-up area is a builder’s BFF! It is the area calculated by adding the built-up area and common area that includes the corridor, lift lobby, lift, etc. In some cases, builders even include amenities such as a pool, garden and clubhouse in the common area. A Developer/Builder charges you on the basis of the super built-up area which is why it is also known as ‘saleable’ area. Now let us consider this case – the rate is Rs. 2,000 per square foot and the super built-up area is 1,200 square feet, then the base cost will come up to 24 Lakhs. When there is more than one apartment on a floor, the super built-up area is calculated in a different manner. Let us assume this is the case. — The area of Apartment 1 is 1000 square feet — The area of Apartment 2 is 2000 square feet — The total common area is 1500 square feet, out of which the share of Apartment 1’s common area is 500 sq. ft. while the share of Apartment 2’s common area is 1,000 sq. ft. Then the super built-up area of Apartment 1 is 1,500 square feet and of Apartment 2 is 3,000 Square feet. The super built-up area, as seen in this example, is divided in the ratio of the apartments’ built-up areas (in this case 1:2). Considering the fact that Builders and Developers usually price their apartments based on super built-up or ‘saleable’ area, being unaware of the fundamental difference between carpet area and built-up area and other terms leaves one running blind. Often the actual usable area is much lower than the super built-up area. Some Builders take into account the carpet area while charging you, but this is only in the rarest of the rare cases. 90% of the developers calculate the base cost on the basis of the super built-up area; the more the amenities the higher the super built-up area. Real Estate can be complicated, and you cannot change the rules and practices, but you definitely can make an informed decision when you’re aware of the various types of calculations for square footage, a seemingly major but actually simple job! We hope this clears up the confusion that always seems to permeate floor areas and how prices are calculated, making it easier for you to make decisions. Got more questions? Ask us below! Here’s Part 2 of Real Estate Basics, where we talk about OSR, FSI, Loading and Construction Stages. Sources: housing.com

Housing Sales In Delhi-NCR Up 7%; New Supply Dips 6% During Jan-Sep

November 10, 2018 in Uncategorized

Housing sales in the Delhi-NCR market increased by 7 per cent while new supply declined by 6 per cent in the January-September period of this calendar year as developers focus on clearing unsold inventories, according to property consultant Anarock. The Delhi-NCR, a major property market in the country, saw sales of 31,550 units during January-September 2018 as against 29,400 units in the corresponding period of the previous year. However, new launches fell by 6 per cent to 17,225 units from 18,400 units during the period under review, showed data compiled by Anarock. Anuj Puri, founder and chairman of Anarock, said the launches might increase during the current quarter to meet higher demand during the ongoing festival season. In seven big cities, the consultant said that housing sales rose by 8 per cent to 1,78,400 units during January-September 2018. The new supply also rose by 18 per cent to 1,39,700 units till September 2018 as property markets of three key cities in South India -- Bengaluru, Hyderabad and Chennai -- saw a healthy launch. The consultant tracks NCR, Mumbai Metropolitan Region (MMR), Chennai, Kolkata, Bengaluru, Hyderabad and Pune markets. Puri attributed the rise in housing sales to an overall favourable macroeconomic environment over the last one year. "Additionally, the teething issues of new policies including Rera and GST have finally subsided in 2018, leading to positive consumer sentiments," he added. Housing sales got affected last year on the adverse impact of notes ban as well as implementation issues with the new reality law Rera that came into effect from May 2017 and the GST. Puri expects commercial real estate to remain buoyant in 2019 that in turn would have a positive impact on a residential real estate as well. On sales outlook for the current quarter, Puri said developers expect sales to rise in the ongoing festive season while prospective home buyers are pinning hopes on builders for getting better deals and offers. Anarock said its recent consumer survey underscored that in the backdrop of stalled or delayed projects, only 5 per cent prospective buyers were interested in buying homes in new projects, while 49 per cent preferred to buy ready-to-move-in properties, and 46 per cent wanted those that would complete within a year.

Advantages of Buying A Property in Joint Names

Advantages of Buying A Property in Joint Names

November 3, 2018 in Uncategorized

Property owners are often ignorant about the implications of buying a property in a single name, instead of joint names. One of my colleagues had bought a flat in his name before marriage. After marriage, the EMI was serviced by the couple, in equal parts. However, he was shocked to learn that his wife could not claim the income tax benefits on the home loan. Who can be a joint owner? There is no law that governs who you can add as a joint owner. It can be a close relative (spouse, parents, children, brother or sister), your partner in a business, or even friends. Even if you are financing the property alone, it makes sense to add a close relative, like spouse or children if you are married, or parents in case you are a bachelor. A person, who is added as a joint owner in the agreement, need not contribute towards the purchase of the property. Taking a home loan jointly While giving a home loan, lenders insist that the joint owner is included as a co-borrower. Lenders tend to favourably consider home loan applications, where the co-borrower is a close relative, like spouse, parents or children. A majority of the lenders do not entertain loan applications, where the co-borrower is not one of these close relatives. As the joint owner has to join the applicant as a co-borrower, you may not get a home loan if the joint owner is a friend, partner, or a brother or sister. Smooth succession of the property As most of the residential properties purchased nowadays are apartments in housing societies, it is better to buy in joint names. In case anything happens to one holder, the society will generally transfer the flat in the name of the remaining joint holders, without insisting on a probate or a no-objection certificate from the other legal heirs. Income tax benefits of joint home loans The income tax benefits, whether for principal repayment of a home loan under Section 80C or for interest on a home loan under Section 24b, can only be claimed by the owner or the joint owner of the house. Consequently, the benefits of a home loan cannot be claimed by you, unless you are an owner of the property, even if the loan is being serviced by you. Buying a house today may require a minimum home loan of Rs 50 lakhs. The interest on this loan would be around Rs 4.75 lakhs per annum @ 9.50%. In case the house property is used for self-residence and is owned and being serviced by you only, you will only be able to claim Rs 2 lakhs and the tax benefit for the balance Rs 2.75 lakhs will be lost. However, in case the same property is purchased in joint names and the loan is serviced by both the holders, both of you can claim the tax benefit of Rs 2 lakhs each, on the interest payment. Similarly, for repayment of the principal home loan amount under Section 80C, if the property is jointly owned and the home loan is equally serviced, then, both of you will be able to claim this benefit of up to Rs 1.5 lakhs each, presuming you do not have any other investment or expenditure qualifying for Section 80c. Sources: housing.com

Can improving connectivity attract buyers back to the real estate market? : Greater Noida

Can improving connectivity attract buyers back to the real estate market? : Greater Noida

November 1, 2018 in Uncategorized

Noida Extension, which is popularly also referred to as Greater Noida, has gained a lot of interest from buyers, due to infrastructure development in recent times. According to Venket Rao, managing director of Integrated Business Advisory, “Easy accessibility to the central parts of Delhi through the Noida-Greater Noida Expressway and the proposed international airport at Jewar, are two key infrastructure developments that will have a positive impact on the residential real estate market of Noida Extension.” With the extension of the metro connecting Delhi to the interiors of Greater Noida sectors, including sectors 50, 51, 78, 101 and 81 on the Dadri Road and sectors 83, 85, 137, 142, 143, 144, 147, 153 and 149 in Noida, interest in residential and commercial property investments, is only expected to increase in this satellite town. Connectivity drives Greater Noida’s Real Estate Market Sunit Sachar, senior vice-president (marketing, CRM and advertising), Parsvnath Developers, maintains that Greater Noida has all the necessary ingredients for comfortable living, with facilities like speciality hospitals, reputed educational institutions, international outdoor and indoor sports facilities like a car racing track, stadium and cycle velodrome, apart from well-laid parks and residential sectors. There are special industrial sectors close to residential sectors, thereby, encouraging the concept of residences close to the workplace. “This growing, well-laid out industrial township in the NCR, is well-connected through highways with Delhi and Noida. This connectivity is set to improve, with the starting of metro rail services, which will push property prices upwards and increase occupancy. The upcoming international airport at Jewar, will also increase the importance of Greater Noida and Noida. Needless to add, the proposed industrial parks in Greater Noida, along with the Eastern Peripheral Expressway connecting Kundli-Sonepat to Palwal, is expected to further enhance the importance of the place. The IT sector in Greater Noida is expected to grow, once the functioning of the metro begins,” Sachar elaborates. Project delays in Greater Noida dampen buyer sentiments However, Greater Noida has also been in the news for delays in the delivery of units, by some of the most reputed developers in the Indian real estate community. Rao bluntly points out that “This market had taken a lot of beating, especially in the context of a huge number of stuck projects. This, coupled with excessive inventory, resulted in a slowdown in this market. Nevertheless, over time, with very few new launches, as well as the development of infrastructure, there are no signs of revival evident.” While Greater Noida has better-planned development than Chandigarh, the law and order issues and delays in metro rail connectivity affected the enthusiasm of people to shift from Delhi to this locality, approximately 60 km out of its municipal limits, adds Sachar. “Delays in the implementation of projects, always take a toll on other corresponding developments. This is because whenever a big development takes place, it brings along with it other smaller constructive developments. Uncertainty is a disturbing factor for investors, which gets compounded by delays in major projects,” he explains. In the current scenario, there is ample supply available in Greater Noida, while demand remains well below the corresponding real estate developments. However, property buyers’ interest towards Greater Noida is driven by its easy accessibility to the central parts of Delhi. It is well-connected with Delhi through the Noida-Greater Noida Expressway and once the metro becomes operational, this interest only seems set to increase. Sources: housing.com

Dos And Don’ts For NRIs Investing In Indian Realty

Dos And Don’ts For NRIs Investing In Indian Realty

October 24, 2018 in Investment News, NRI News

Besides exercising necessary due diligence, NRIs also need to adhere to certain specific laws and regulations, while buying, selling, or renting out real estate in India The realty market in India has always seen considerable interest from the Indian diaspora, as an investment avenue. With developers constantly striving to woo non-resident Indians (NRIs), they can choose from a variety of options, in the residential and commercial segments.

“The realty market is in the midst of a slowdown and this is the right time to invest,” says Kalpesh Patel, head – international sales, Rustomjee Group. “Developers are offering good deals and benefits such as flexible payment plans, subvention schemes, etc. Although demand still exists at the local level, buyers are playing a wait-and-watch game. NRIs must take optimum advantage of this situation,” suggests Patel.
Buying and Selling An NRI can either come to the country and buy or sell a property or give a Power of Attorney (POA) to a relative and get the transaction done, without coming to India. NRIs can also avail of home loans in India. The documents for the loan may vary, according to the country in which the NRI is settled. Generally, the term of the loan will be 10 to 15 years, while the amount that the NRI is eligible for, will vary based on age, income, education, etc. To finance the property’s purchase, it is advisable to use a non-resident external (NRE) account, as this will help the NRI to take back the capital invested in the property when they resell the property. Investing for the Future
“For NRIs who are on the verge of retiring and planning to settle in India, this is the right time to invest,” advises Ashwinder Raj Singh, CEO – residential services, JLL India. “Social infrastructure in most of the large Indian cities has improved a lot while civic infrastructure is also being ramped up. As more hospitals, schools and shopping malls come up and connectivity improves, it will give rise to better standards of living. This will directly enrich the quality of life after retirement,” Singh adds.
Once the primary residence is secured, NRIs can also use surplus funds, to invest in a second apartment and use it to generate rental income. However, they must be aware of all the bye-laws and regulations that apply to NRI investors, especially with respect to taxes, as rental income is taxable in India. It is also taxable in other nations, except in cases where a treaty exists between the two involved countries, with regards to double taxation, he points out.
“NRI investors should avoid projects by unknown developers. Numerous buyers have fallen into difficulty, by putting their funds in projects that lacked mandatory clearances and fell short of even the minimum standards of quality. Unless an NRI plans to visit India and evaluate projects, s/he should opt only for reputed developers. In all cases, NRIs should strictly verify points, such as the track record and brand visibility of the developer, the social and civic infrastructure available in the location, the amenities in the project and the timelines for possession, in the case of under-construction projects,” cautions Singh.
A project that is targeted towards NRIs, is no different from other offerings in the market. A property should be evaluated, purely on the basis of its location and amenities on offer, the legal validity of its title and the developer’s brand image. Sources: housing.com

Registration with HRERA is Must For Real Estate Projects

Registration with HRERA is Must For Real Estate Projects

October 22, 2018 in Gurgaon Investment, RERA Update

In a landmark decision, the Haryana Real Estate Regulatory Authority (HRERA) said that all real estate projects will have to mandatorily register with it. The authority asserted that all ongoing real estate projects and those which have been completed come under its purview as per the RERA Act. It said that the only exception would be those which got obtained completion certificate prior to the enactment of the Act. The order means that over 800 residential and commercial projects in Gurugram, which had sought the exemption for technical reasons, will now come under the ambit of the authority. Currently, 250 real estate projects are registered with HRERA, Gurugram. The judgment was delivered after a real estate company raised objections to the applicability of the rules and jurisdiction of HRERAon its project after a buyer filed a complaint against the delay in delivery of the shop she had booked. The authority also made it clear that merely filing an application for part completion, or occupation certificate by a department of town and country planning does not make a real estate projects exempt. “In several cases the applications are incomplete and the certificates have been obtained or are under process. This will not be allowed and neither condoned. All projects, which have not obtained completion certificate must get registered,” said Dr KK Khandelwal, chairman, HRERA, Gurugram. Simmi Sikka, a buyer in Emmar’s commercial real estate project Emerald Plaza in Sector 65, had complained to the authority seeking compensation for the delay in the delivery of a shop. “The question was raised whether a project which is not ongoing and has received deemed occupation certificate should come under HRERA or not. We have settled the issue once for all and made it clear that projects, including the Emmar Plaza, came under our purview,” said Khandelwal. The order also made it clear that the developers were under the wrong impression that only ongoing projects came under the purview of the act. “Somehow the developers also managed to get exemptions under HRERA rule and using these to their advantage tried to get an exemption from the Act. This cannot be allowed and everyone is accountable,” the order said. The authority also said that this order will also mean that any loophole in the Haryana rules, which led to the alleged dilution of the Central Act, will be plugged.

“This judgment has not only settled confusion regarding the applicability of act and registration of projects but also nullified the effect of dilution of rules. It will enable the authority to exercise power and functions in the true spirit of the RERA Act which otherwise had been marginalized on account of Haryana rules. This decision also settled the controversy regarding ongoing projects, which will now be treated as simply real estate projects,” said Khandelwal.
The authority also maintained that as far as ongoing projects were concerned, the authority would look into timely delivery, layout, planning, design and sanctions, and to ensure that there is no diversion of funds. For completed projects, which have been delivered in the last five years, the obligation of the promoter would entail workmanship and structural defect liability. All real estate projects are covered for land title defect liability. it said. Sanjay Sharma, a Gurugram based real estate consultant, welcomed the ruling.
“This is the step in the right direction. It will bring all the ongoing projects under the purview of HRERA,” he said.
Sharma also called for proper legislative backing to the authority so that it could act independently.
“It is most likely that this decision could be challenged in a higher court. The government should give legislative backing to this order to ensure HRERA Act is not diluted and its judgments are implemented,” said.
Sanjay Sharma, a Gurugram based real estate consultant, welcomed the ruling.
“This is the step in the right direction. It will bring all the ongoing projects under the purview of HRERA. It is most likely that this decision could be challenged in a higher court. Therefore, the government should give legislative backing to this order to ensure HRERA Act is not diluted and its judgments are implemented,” Sharma said.
Sources: hindustantimes.com

What Are Ready Reckoner Rates? Real Estate Basics:

What Are Ready Reckoner Rates? Real Estate Basics:

October 17, 2018 in Defination, Real Estate News

To avoid evasion of stamp duty through the undervaluation for agreements and to minimize the disputes on the quantum of stamp duty, all state governments publish area-wise rates of properties, on a yearly basis, known as Ready Reckoner rates. What Is The Significance Of Ready Reckoner/Circle Rates? The Ready Reckoner (RR) rate, as it is referred to in Mumbai, is also known as the Circle Rate in Delhi. This rate is the government’s estimate of minimum property values in various locations. The rate differs in every state, city and in different localities in those cities. Authorities determine the price of real estate in a particular locality, based on several factors. Based on these factors, a benchmark is set, below which no property transaction can take place in that particular locality. This benchmark is known as the Ready Reckoner/Circle rate. It is the minimum price on which the government will charge stamp duty and registration fees. The RR rates are typically lower than the current market rates of properties in a particular area. The rate is reviewed periodically and revised, to bring it closer to market rates. As real estate transactions take place in the private realm and the price is often not disclosed, state governments need a benchmark, to ensure that they do not lose out on an important source of revenue. How Does The Ready Reckoner Rate Affect Real Estate Transactions? While RR rates specify the minimum amount at which properties can be sold in an area, there is no maximum limit above which a property cannot be sold. This leads to a significant difference between the RR and market rates. Most property transactions in India take place on the basis of the market rate in a particular locality. The stamp duty and registration fees, to be paid by the home buyer, are calculated on the basis of this market rate. Therefore, a big difference between the RR rate and market rate leads to a loss of revenue for the government. In rare cases where the RR rate is higher, the stamp duty and registration fees will be calculated on the RR rate. On the other hand, higher RR rates discourage home buyers from registering their properties. By periodically revising RR rates and bringing them closer to market rates in every locality, the state government can increase transparency in real estate transactions and also ensure that they do not lose out on revenue. The Importance Of Ready Reckoner Rates For Home Buyers The RR rate of properties in a particular area is a good indication of the amount of money a potential home buyer will have to shell out. Market rates of properties are almost always higher and property prices in an area tend to increase when the RR rate is expected to be increased. It is also beneficial for buyers to purchase property in an area, where the gap between the RR and market rates is relatively smaller, especially if the purchase is being financed by a home loan. Sources: housing.com

Key Legal Checklist For Buying A Commercial Property

Key Legal Checklist For Buying A Commercial Property

October 15, 2018 in Defination, Real Estate News

Buying a commercial property, then keep the following points in minds: 1. Verification Of Title And Ownership Of The Seller It is a settled legal principle that a person cannot convey a better title, than what he himself has. As a first step, the buyer should undertake due diligence, to ascertain the existence of the title with the seller, the nature of the title and its marketability and the ability of the seller to convey clear and marketable title, free from encumbrance. Documents, for a period of 30 years, if not more (and where documents are not available, for a minimum period of 12 years) must be examined and the seller may be called upon to provide the following documents/information:

  1. Title documents of the property – government order for grant, succession certificate, sale deed, gift deed, will, partition deed, etc., evidencing the transfer of title over the years, culminating in the vesting of property with the seller.
  2. Nature of title – leasehold, freehold, or development right.
  3. In the case of the seller claiming development rights to the property, the development agreement and power of attorney, executed by the owners in favour of the seller.
  4. All title documents being duly stamped and registered at the office of the jurisdictional sub-registrar of assurances.
  5. Khata registered in the name of the seller.
  6. Information on pending or past litigation.
  7. Availability of original title documents with the seller.
2. Verify Identity Of The Seller Similar to verifying the title to the property, the buyer should also ascertain the identity of the seller and any specific conditions, governing the ability of the seller to convey the property. The following instances may be noted for illustration:
  1. Residence status and nationality of the seller, in case of an individual and whether consents from government authorities are required for the sale.
  2. Identification of all owners, in the case of properties held jointly.
  3. Where the seller is a company, trust, partnership firm, society, etc., the constitutional documents of the entity are necessary, to confirm its ability to own and transfer the property, besides ascertaining that the person executing and registering the sale deed is duly authorised.
  4. Orders from the competent court, permitting a sale of the property and appointing a guardian, where the property is held by a minor or person of unsound mind.
3. Conversion And Land Use Permissions With increasing urbanisation and merging of revenue lands with urban conglomerates, conversion of property for non-agricultural use assumes crucial significance, since several state laws restrict the purchase of agricultural property by non-agriculturists. Secondly, the buyer must examine the Master Plan and satisfy that the property is developed in accordance with the zoning plan – such as residential, commercial, industrial, public/semi-public, parks and open spaces, etc. Where actual use is different from the notified zoning, obtaining orders from the Town Planning Authority permitting change of land use, is mandatory. 4. Construction Approvals For purchase of apartment or land with constructed building, the buyer should also scrutinise the building plan/layout plan sanctioned by the local municipal authorities, along with approvals issued by government, statutory and regulatory authorities, for providing infrastructure facilities, water, sewage, electricity, environmental clearance, fire safety approval, etc. 5. Occupancy Certificate It is mandatory for the seller to obtain the occupancy certificate from the competent authority, prior to conveying the property. Use of the property, without obtaining occupancy, exposes the buyer to penalty under the applicable building bye-laws, besides the risk of a demolition of the property. 6. Check Status Of Tax Payment Non-payment of property taxes constitute a charge on the property, affecting its marketability. Hence, the buyer must verify with the municipal authorities that the seller has not defaulted on payment of property taxes. 7. Encumbrance Searches at the jurisdictional sub-registrar of assurances, where property documents are registered and information available on the official web portal of the Ministry of Corporate Affairs, in case of the seller being a corporate entity, will reveal information of any registered encumbrance on the property. By way of caution, the purchaser may also issue a public notice in newspapers, prior to completing the transaction, calling for claims from interested third parties, if any. 8. Physical Survey And Access To The Property The buyer may undertake a physical survey and confirm the extent and measurement of the property. In the case of land, it is advisable to identify and demarcate the boundaries and access to the property and further, ascertain any other physical attributes that may impede enjoyment of the property. 9. Compliance Under The Real Estate (Regulation And Development) Act, 2016 (RERA) RERA mandates that developers should register their projects with the authority constituted under the Act. A buyer, intending to buy a property in a project coming under the ambit of RERA, is advised to verify whether the property has been registered with the authority under RERA. Information available on the official web portal of RERA for each state, also provides details of any cases/complaints filed against the developer of the project and default by the developer, if any and thus, provides useful insight into the credibility of the developer and the project and helps the buyer make an informed choice. Conclusion While buying a property, it is better to err on the side of caution. With proper legal advice, scrutiny of documents and verification of relevant information pertaining to the property, the buyer can ensure that the investment brings peace of mind and a sense of security. (The writer is associate partner, Khaitan & Co LLP) Sources: housing.com

India Office Leasing Tops 32 Million sq.ft. in First Three Quarters Of 2018

India Office Leasing Tops 32 Million sq.ft. in First Three Quarters Of 2018

October 13, 2018 in Investment News, Real Estate News

With sustained interest from occupiers led by the technology sector, commercial leasing activity across India has crossed 32 million sq ft, up 7% from a year ago, across India’s top 8 property markets in the first three quarters of 2018. Office space absorption during the September quarter rose 3% from a year ago and 12% sequentially to 10.9 million sq.ft.with Mumbai, Bengaluru, Hyderabad and NCR accounting for almost 80% of the leasing activity, said showed data from property consultant CBRE South Asia. Occupiers from the technology sector, with a share of 48% of total leasing, drove office space take-up in the country during the third quarter. Occupiers from the engineering and manufacturing sector with 14% share were followed by co-working and business centre operators that absorbed 11% of the total leased space.

“India’s economic growth continued on its upward trajectory and real estate services along with financial and professional services sector contributed to this economic surge as it grew from 5% in the previous quarter to 6.5% during the review period. Sectors such as BFSI, engineering & manufacturing, and agile/ co-working/business centres are likely to account for a larger share in leasing activity going forward,” said Anshuman Magazine, Chairman, India and South East Asia, CBRE.
Interestingly, India had witnessed 42 million sq.ft.office space absorption in 2017, while the first nine months of 2017 had seen absorption of 30.1 million sq ft. Even as several mid-to-large-sized deals were reported in Bangalore, Hyderabad, Pune and Gurgaon, more than 30% of the transaction activity was reported in SEZ space. Similar to the previous quarters, office space take-up was dominated by small- and medium-sized transactions. Mid-sized transactions ranging between 10,000 sq.ft.and 50,000 sq.ft.accounted for around 45% of the transaction activity, while small-sized transactions less than 10,000 sq.ft.had a 42% share. The share of large-sized deals with over 1 lakh sq.ft. size increased to 7% during the quarter. The agile workspace sector continued to witness a strong growth momentum, with global and Indian majors expanding their footprint in tier 1 and tier 2 cities. Co-working and business operators leased about 3.3 million sq.ft.space in the first three quarters of the year, almost doubling their take-up reported in the first three quarters of 2017. Other sectors such as Banking, Financial Services and Insurance (BFSI) with 7% share also contributed to the increase in leasing activity.
“The trend of agile spaces is rising during a booming start-up era, even as corporate are drawing up fluid expansion and occupation plans. Occupiers are also expected to keep strong checks on space utilization ratios and innovation in workplace strategies while expanding their footprint and implementing their expansion plans. Also, SEZs are expected to account for a larger share of the upcoming supply over the next few quarters. Given the approaching sunset date, we anticipate an increase in demand for SEZ s space,” said Ram Chandnani, Managing Director, Advisory & Transaction Services, India, CBRE South Asia.
Pre-leasing activity rose in during the quarter, largely in Bangalore and Hyderabad, driven primarily by tech and BFSI corporates. Overall, the country witnessed more than 12 million sq.ft.of pre-commitment transactions in mostly under construction assets in the first three quarters of the year, the report said. On the other hand, supply addition during the quarter dipped marginally by 1% from a year ago to 7.1 million sq ft. Bangalore and Kochi accounted for 60% of the quarterly supply addition, followed by Mumbai and Hyderabad. Except for Pune, Kolkata and Kochi, all cities reported a dip in development completions on a quarterly basis. Slippages were reported in cities such as NCR, Mumbai and Hyderabad. Sources: economictimes.indiatimes.com

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