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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

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

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

Commercial Office Space May Rise 20% To Over 600 M Sq.ft. This Year

Commercial Office Space May Rise 20% To Over 600 M Sq.ft. This Year

May 18, 2018 in Uncategorized

Commercial office stock in India is expected to cross 600 million square feet by the end of 2018, which is a 20 percent jump in two years, as per the India report on ‘asia pacific real estate market outlook 2018’ shared by CBRE, a real estate consulting firm.

It has also predicted that over the next two years, occupiers are expected to spend almost $48 million on leasing office space in India while new commercial assets worth approximately $6 billion would be completed.

The report, which is a part of a global research series, is released by CBRE every year, highlighting trends and dynamics across various segments in the real estate sector for the year ahead.

Commercial office stock includes the total area available for office space in India.

Market dynamics

On the housing market in 2018, the report says that demand would be driven by ready-to-move-in properties. Also, affordable housing is likely to play a crucial role in the country’s residential market this year.

Another finding predicts that leasing activity in the industrial and warehousing segment is expected to touch 20 million square feet in 2018, up 17 percent from 2017. “we expect 2018 to be the turnaround year for the real estate ecosystem in India. Significant infrastructure development across key cities, improvement in ease of doing business, the renewed focus on attracting investments in the sector and enhanced transparency is changing the market dynamics.

As the significant contributor to India’s GDP, there is an immense opportunity for the real estate sector to influence the growth prospects of the country”, said Anshuman Magazine, chairman, India and south-east Asia, CBRE.

This year, the firm expects capital inflows into real estate to witness an uptick, with office, retail, industrial and land parcels leading the activity.

Sources: www.thehindubusinessline.com

Top 8 urban areas to add 19.4 million sq.ft. retail space by 2020: Report

Top 8 urban areas to add 19.4 million sq.ft. retail space by 2020: Report

February 17, 2018 in Uncategorized

Top eight property markets across India are expected to add 19.4 million sq ft retail space supply over the next three years from 2018 to 2020. Demand for retail space is estimated to be around 15 million sq ft during the same period, showed a JLL study.

These property markets will also witness a parallel rationalization of existing mall spaces that will help the market avoid an oversupply situation. As a natural course of events, it expects a few malls to close down or temporarily suspend their operations for repairs, renovation & upgrades. This will help the market create the necessary balance to maintain the rental values.

The study revealed that 2018 will see the highest retail space supply since 2011.

The total newly completed malls in 2017 were recorded at 5.6 million sq ft that are expected to see an increment of close to 40% year-on-year and rise to 7.8 million sq ft by the end of 2018. The largest contribution to this will be coming from the two southern cities of Hyderabad with 2.2 million sq ft and Chennai with 1.5 million sq ft which will see a significant influx of mall supply.

Delhi-National Capital Region will be witnessing the highest supply of 2.3 million sq ft of new mall space in 2018, albeit recording an on-year decline of 28% since 2017.

The year 2017 saw a withdrawal of nearly 5 million sq ft retail space with a closing down of 28 malls. Most of the rationalization took place in the markets of Delhi-NCR and Mumbai owing to the fact that these markets have significant mall stocks with a considerable percentage of the same performing below par.

Encouraged by the urbanization, young population and rising proportion of nuclear families in urban locations, consumption growth along with the opening up of the FDI route for retail brands entering into India, is expected to further boost retail investments.

Mumbai that has, in the past few years, seen a slowdown in retail development activities will continue to witness remain cautious. In 2018, it will see a decline of 13% on-year in new mall completions, further maintaining the status quo in the market.

Source: Realty-The Economic Times

Gurgaon’s residential real estate market in revival mode

Gurgaon’s residential real estate market in revival mode

February 2, 2018 in Uncategorized

Over the past two years, the residential real estate markets in India have been passive. In Gurgaon, until the middle of 2016, the city witnessed subdued transaction activity and restricted new supply, with the demonetisation drive further impacting the market. Cautious buyer sentiment, coupled with high levels of unsold inventory, resulted in a slowdown in construction activity and sales. While there were a few projects in the third quarter of last year, the focus of most developers continued to be on offloading existing inventory, completing their ongoing projects and deferring new project launches. Ambiguity around the implementation of the Real Estate (Regulation & Development) Act (RERA) during the first half of the year resulted in transaction activity remaining low. On the flip side, the office market continued to see robust demand. During the April-to-June period this year, Delhi NCR witnessed close to 2 million square feet of office space absorption. A majority of this take-up was recorded in the Gurgaon micro-market. Due to sustained occupier interest, Golf Course Road, DLF Cyber City and NH8 contributed to almost 50% of leasing activity here. IT and SEZ spaces were the preferred options by occupiers. This positive traction in the office market, improving clarity around RERA, coupled with the effects of the demonetisation drive dissipating, are resulting in transaction activity in Gurgaon’s residential segment witnessing an uptick in recent months.

 

 

 

 

Union Budget 2018 Highlights

Union Budget 2018 Highlights

February 1, 2018 in Uncategorized

Prime Minister Narendra Modi has hailed his government’s last pre-poll budget as a “big step” towards achieving Ease of Business and Ease of Living. Farmers, rural India, and healthcare were the main focus of Budget 2018 — the last pre-poll budget — presented by Finance Minister Arun Jaitley earlier today, but the middle-class hopes for Income Tax relief were dashed. While the farmers were assured an MSP 1.5 times the cost of production, the poorest of the poor will be covered by universal healthcare to the tune of Rs 5 lakh per year. As a consolation prize, the middle class got Rs 40,000 standard deduction against travel and medical expenses. The Budget also gave a boost to Make in India by increasing customs duty on mobile phones, which means handsets made by foreign companies will cost more. In the Budget speech, Jaitley vowed to keep the fiscal deficit at 3.3%. Jaitley also announced a hike in President’s salary to Rs 5 lakh a month, the Vice-President’s salary will rise to Rs 4 lakh per month and the Governor’s pay will rise to Rs 3.5 lakh a month. Jaitley announced a Rs 150 crore fund to celebrate the 150th anniversary of Mahatma Gandhi. As per Budget 2018, Bengaluru Metro will get Rs 17,000 crore and Rs 11,000 crore will be allocated to Mumbai rail network. 

Real estate market shrugs off impact of demonetisation, RERA, GST

Real estate market shrugs off impact of demonetisation, RERA, GST

January 31, 2018 in Uncategorized

Residential property markets across India’s top 30 cities have shrugged off the impact of demonetization and absorbed the short-term blow of several regulatory changes aimed at formalizing the real-estate sector. In the quarter-ended September, these property markets started showing signs of returning to normalcy as sales registered the best performance in five quarters. Based on sales volumes, 22 of the top 30 markets were either hovering around their five-quarter best or bettered their previous peaks during the September quarter. All cities have bounced back from the lows witnessed around demonetization, showed data from Liases Foras Real Estate Rating & Research. The performance in this quarter assumes significance as two key reform measures were implemented around this time. In May, the government implemented the much-awaited Real Estate (Regulation & Development) Act, 2016 and the country transitioned into the new indirect tax regime with the roll out of Goods & Services Tax (GST) on 1 July. According to Magicbricks’ Propindex, the October-December 2017 quarter witnessed an average price increase of 3.1% in 46% of the 750 localities across 14 major cities. The Magicbricks’ National Price Index (NPI), after remaining stagnant for almost two years, saw the first price gain in the July-September 2017 quarter and this has continued in the October-December quarter as well with just under 1% increment. In the quarter-ended September, sales volume in tier I cities such as Mumbai, National capital Region (NCR), Pune, Bengaluru, Hyderabad, and Ahmedabad were at their five-quarter best levels. 

 

 

 

How will GST impact the various segments of Indian real estate?

How will GST impact the various segments of Indian real estate?

January 30, 2018 in Uncategorized

The Goods and Services Tax (GST) is, beyond doubt, the most revolutionary tax-related reform to be seen in India in several decades. It will eliminate the conflicting and cascading taxation structures, which have confounded several industries over the past few decades. It will most certainly have a profound effect on India’s economic prospects. A single, indirect tax, which covers all goods and services will, in the long run, increase tax collection by making it easier for retailers and several other businesses to comply and also moderate overall taxation levels. That said, it should be remembered that the favourable effects of this new taxation regime, will become evident only within 2-3 years of its implementation. Although the GST tax structure has been announced, there is still a lot of uncertainty about which tax rate will be applicable to the real estate and construction industry. The expectations are for real estate to be in the 12 per cent bracket. However, the GST rate is not the only important factor. The abatement rules, as applicable under the service tax regime and the input tax credit facility for developers, will determine if the effective tax incidence on real estate, is lower or higher under GST. Effectively, the composition scheme allowing for abatement against cost of land to the extent of 75 per cent of the house cost, for residential units priced under Rs 1 crore and less than 2,000 sq ft, makes the effective rate at 3.75 per cent. In other cases, the abatement goes down to 70 per cent, making the effective rate at 4 per cent. This will go a long way, in determining whether GST is tax neutral or tax adverse for real estate. The government has offered some clarity, on the abatement rules for under-construction houses and input tax credit benefits for developers.

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