Retail FDI Will Help Mall Owners Fill Vacant Space

December 10, 2012 – 6:12 pm

Retail FDI is expected to help the mall owners to find takers. With the government’s decision to have more Foreign Direct Investment, India has opened the gates to the foreigners. As a result foreigners are now free to run shops in India. This created hopes in the minds of mall owners. Read More »

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

Sahara Groups Fail Again to Refund; SC Condemns

December 6, 2012 – 7:13 pm

The Apex Court of India harshly condemned Sahara Groups for their failure. Sahara Groups failed to refund its investors Rs.27000-Crore. Sahara Groups was further ordered to refund the amount within a week by SC.

Sahara India Real Estate Corporation Ltd and Sahara Housing Investment Corporation Ltd (SIRECL and SHICL respectively) had been fined Rs.27000-Crore. These groups were given deadline to recompense 3-Crore investors. SC found out that the SC order is so far not accomplished. Read More »

By skgupta | Posted in Property News | Tagged , , , , | Comments (0)

Real Estate Builders Exploit Migrant Laborers in Noida

December 5, 2012 – 7:23 pm

Real estate builders raise higher demand for laborers. The shortage of real estate laborers forced Real estate builders to appoint migrant laborers for accomplishing their projects.

Real estate developers point to the shortage of real estate laborers as the main reason for their delayed projects. Real estate sector is the second best employment -provider in India. It stands very close to Information Technology, the top employer sector. Read More »

By skgupta | Posted in Property Articles, Property News | Tagged , , , , | Comments (0)

Online Media to Cover Reputation of Real Estate Firms

December 4, 2012 – 4:03 pm

Real estate builders now use social media to preserve their reputation. Their reputation is tainted by hostile home buyers who express their negative comments.

Real estate builders expect to shield their reputation by appointing online reputation managers. Many real estate companies have hurriedly appointed online reputation managers. Read More »

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

PMO Brands Robert Vadra DLF- Real Estate Scam Clean

December 3, 2012 – 6:44 pm

On another controversial move, Prime Minister’s Office gave clean certificate to Robert Vadra against the Real Estate Scam between Him and DLF.

PMO in its affidavit submitted to the Allahabad High Court stated that the real estate dealings between the real estate developer firm DLF and Robert Vadra are entirely a personal matter. Read More »

By skgupta | Posted in Property News | Tagged , , , , | Comments (0)

Air India Stumbles at Cold Real Estate Market

November 28, 2012 – 9:15 am

Sluggish Real Estate Market prevented the AI’s Plan to monetize the vacant floors in its building at Nariman Point. The bid was postponed as there was no taker for the building.

Civil Aviation Minister Mr. Ajit Singh blamed the sluggishness existing in real estate sector as a factor which blocked AI’s Plan. Tough market conditions chased the takers away and there was no one willing to take up the floors at the declared rates.

The rentals at Nariman Point are said to be higher than that of Lower Parel or at Bandra Kurla Complex (BKC). These areas are recently more preferred as these areas charge lower rentals.

Air India barely uses 6 floors in its 23-story building. Three floors are already leased and the rest remains vacant. Based on the 2011- report of Jones Lang Salle, the Air India plans to raise an amount of Rs.5, 000-Crore approximately. However real estate experts and property consultants are of the opinion that the National Carrier will have to lower the amount for gaining any takers.

According to them Nariman Point has lost its prominence with the arrival of Bandra Kurla Complex and Lower Parel. The lower rate of these areas has attracted many while the higher rate of Nariman Point distracts many.

Despite the cold wind of sluggish real estate market Civil Aviation Minister Mr. Ajit Singh remained confident of achieving the desired amount through monetizing its real estate assets. The National Carrier expects to raise a fund of Rs.5, 000-Crore approximately.

Air India plans to monetize its real estate assets in Delhi and Mumbai. So far the National Carrier has received tepid response from the takers. As a first plan, the national carrier was about to bid 11 floors (total 1.6 lakh sq. ft.) at Nariman Point.

The National Carrier further had plans to shift its Headquarters to New Delhi. Air India also planned to lease out the entire building after their shift to the capital.

Mr. Singh said that the National Carrier will be able to carry out the monetization plan. He further added that a real estate consultant is already employed to carry out its plan.

Earlier Hindustan Unilever also faced a similar situation. The Hindustan Unilever was forced to lease its building at a lower rate than they demanded. The real estate experts say this would be the same which will befall on Air India as well. As the figures say the National carrier may have to lower the rate anyway.

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

Indiabulls Real Estate Ltd. is to Set Office in the UAE

November 26, 2012 – 6:59 pm

Indian real estate firm Indiabulls Real Estate Ltd. targets UAE NRIs. The firm expects to have more Non- Resident Indians (NRIs) as their clients.

Indian real estate firm Indiabulls Real Estate Ltd. targeting UAE NRIs, have launched an overseas office in the UAE. The real estate firm is about to launch its first overseas office in the United Arab Emirates region. Read More »

By skgupta | Posted in Property Investment, Property News | Tagged , , , , | Comments (0)

Global Stars to Endorse Indian Real Estate

November 22, 2012 – 6:56 pm

Real estate developer group Homestead’s recent endorsements with Maria Sharapova and Michael Schumacher are noted as a new beginning of real estate in India.

Real estate builders have now become capable of bagging global stars to endorse their projects. However they are mainly concentrating on residential projects. Tennis star Maria Sharapova and F1 legend Michael Schumacher visited India to endorse some real estate projects. Read More »

By skgupta | Posted in Property News | Tagged , , , , , , , , | Comments (0)

Property Dispute Takes the Life of Real Estate Developer

November 20, 2012 – 6:01 pm

Real Estate Developer Pony Chadha lost his life while trying to sort out his dispute over property. His brother Hardeep also was killed by the security persons of Mr. Chadha.

Police Sources exposed the existed- property- dispute as the main reason which led to the murders of real estate developers. Nearly 15 people have been arrested by the police. Most of the arrested are from the security personnel. The detained are questioned at Mehrauli police station where they are kept under custody. Read More »

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

MHUPA Regulatory Body: New Protection for Homebuyers

November 19, 2012 – 6:55 pm

Ministry for Housing and Urban Poverty Alleviation (MHUPA) head union minister Mr. Ajay Maken revealed that the government is all set to introduce a new regulatory body to protect the troubled home buyers.

The MHUPA minister pointed to the fact that the LIG (Lower Income Group) homes are decreasing now. By making it mandatory for all the real estate builders that they should separate 35 % of affordable homes for the middle class families. Read More »

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

CREDAI Praises AP Govt.’s Online Approval of Building

November 17, 2012 – 6:53 pm

Andhra Government has recently launched online approval system for real estate buildings. The Apex body of the developers- CREDAI penned it down as highly appreciable real- estate-reformation.

Single window system for approving real estate projects will speed up the delivery.  Confederation of Real Estate Developers’ Association of India had earlier blamed the red-tapism and corrupted officials as reasons of delayed deliveries. Read More »

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

Bandra Kurla Complex and its Past, Present & Future

May 19, 2012 – 5:03 pm

Bandra Kurla Complex was created by MMRDA as an alternate CBD to Mumbai, with the express purpose of halting the further growth of offices and commercial activities in South Mumbai. Currently, BKC has a total stock of 8 million square feet of office space. An additional supply of 2.5 million square feet is expected in 2012 with the completion of The Capital, FIFC and TCG Finance Centres. Over the last few years, BKC’s G Block has gained prominence as the key location within this unique micro-market. The current vacancy level at Bandra Kurla Complex stands at 16%.
Leasing and buying activity at Bandra Kurla Complex continued to accelerate during the last two quarters. The rent correction appears to be complete, with most existing buildings and new projects recording flat rates or slight increases over the prior quarter. The overall stability of the market is a sign that it has bottomed out.

With the Diamond bourse soon to be operational in 2 million square feet of premises, the people churn at BKC will increase dramatically. How the MMRDA will address the management of this sudden onslaught of traffic remains to be seen. Other areas of concerns at BKC include the continued lack of F&B outlets and sufficient public transportation. The Metro project announced in 2008 would be a game changer; however, this project has been drastically delayed. The monorail project, now scrapped, could have been a significant infrastructure boost for Bandra Kurla Complex.

Various infrastructure initiatives like the Santacruz–Chembur Link Road will help adjacent areas around BKC such as LBS Road, Sion, Kurla, Kalina and Mahim to develop, posing competition for BKC. Many senior executives who work in BKC are expected to shift their residence to Bandra, driving up residential prices in Bandra.

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

India’s Lodha Group in Talks to Buy DLF’s Mumbai Land-Sources

May 18, 2012 – 4:14 pm

India’s Lodha Group is in advanced talks to buy a plot of land in Mumbai from DLF, the country’s largest listed real estate developer, for about $500 million, two sources with direct knowledge of the situation said.

Sale of the 17-acre plot is seen as part of DLF’s plan to sell some of its assets to pare its debt of about $4 billion. DLF bought the land for about 7 billion rupees ($129 million) in 2005.

Mumbai-based developer Lodha has emerged as the front-runner for the land parcel in central Mumbai said the sources, declining to be named as the matter is not public yet.

DLF declined to comment, while a spokesman for Lodha said the company was not in talks with DLF.

 

By skgupta | Posted in Property News | Tagged , , , | Comments (0)

Century Real Estate and IIM-B sign MoU

May 17, 2012 – 6:50 pm

Bangalore-based, Century Real Estate and the Indian Institute of Management Bangalore has signed an MoU for setting up the IIMB-Century real estate research initiative.

The IIMB-Century Real Estate Research Initiative will focus on collecting data and conducting scientific, cross-disciplinary research on the Indian real estate sector that will be published in leading academic and practitioner journals, the realty company said in a statement.

“There is a tearing need for such an initiative in the real estate space that will focus on research, act as an interface between the industry and the policy makers and eventually churn out quality human resource for this sector,” says P Dayananda Pai, Founder-Century Real Estate.

Additionally the research initiative will seek to provide guidance and policy recommendation to government and industry stakeholders on major issues relating to the Real Estate sector.

“The initial charter for the Research Initiative will be to create taxonomy of relevant data that will be required to do meaningful research, initiate research projects that fill key knowledge gaps and engage with key stakeholders within the industry” says professor Venky Panchapagesan, who has been leading the effort to set up this initiative at IIMB.

 

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

Will CREDAI, Fire Department MoU work?

May 17, 2012 – 6:50 pm

Announcement of a memorandum of understanding (MoU) between the Confederation of Real Estate Developers Association of India (CREDAI) and the Karnataka State Fire and Emergency Services (KSFES) Department on fire safety certification has raised quite a few eyebrows in the real estate industry.

While an industry expert questioned how “credible” would the entire process be, if the issuance of a no-objection certificate (NOC) and a clearance certificate (CC), which earlier took months or even years, would now have to be completed within 30 days. “Currently, the KSFES has been manually going through each drawing and then mulling over all the errors and suggestions. This consumes a lot of time. According to our MoU, we will be providing software prepared by a company which would identify the errors in the drawing. It would indicate whether a particular project proposal is in acceptance of the norms by highlighting the faults in red colour. Then at the click of a button, the department can either condone or reject the proposal. The company has provided similar software to civic bodies of other places like Mumbai, Pune, Ahmedabad, Nagpur and other places. Hence, their credibility is established,” asserted Sushil Mantri, under whose President ship CREDAI signed the MoU. He argued that it is important to make this move as almost 90 percent developers are suffering because a handful of builders did not follow norms.

“CREDAI members are responsible for almost 60-70 percent output of the city. Further, to become a member of the confederation, they have to sign a code of conduct which covers all the approvals and rules. By delaying progress of approvals, not only do builders incur losses as production suffers, but also the revenue to the city and BBMP is further delayed,” he said.

 

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

Indian Springs Country Club to be Auctioned by Williams & amp; Williams

May 16, 2012 – 6:04 pm

Williams & Williams, the premier brand in real estate auctions, today announced it will auction Indian Springs Country Club in Broken Arrow, Oklahoma. This private club offers a first class experience with an array of amenities and recreational sports, making it an appealing and unique income-producing investment. The live auction will take place on Tuesday, June 5 at 5 p.m. CDT with a nominal opening bid of $250,000. Interested buyers can bid on-site or in real time from anywhere at auctionnetwork.com.

Developed in the 1960s, Indian Springs Country Club was designed to be the focal point of several residential communities. The 38,000+/- square foot clubhouse, which includes an outdoor patio area, is perfect for hosting weddings, birthdays and holiday celebrations for both casual and fine dining occasions year-round.

Indian Springs Country Club features two sprawling 18 hole regulation golf courses including the championship style River Course and the Windmill Course. The River Course features views of the Arkansas River with gently rolling hills, beautiful ponds and streams and challenging elevation fluctuations. The Windmill Course, developed in 1972, tests golfers’ accuracy and iron play with tight fairways surrounded by a variety of lush trees.

The tennis facilities are just as impressive, boasting 10 lighted post tension hard courts and four covered courts. Three swimming areas offer a cool escape in the summer months — two Olympic-size pools with diving boards and slides and a third pool for younger children.

“Indian Springs is more than a county club. For 45 years, it has been a gathering place for family, friends and the community to celebrate important family events, make memories and actively engage in golf, tennis and other social activities,” said DC Roberts, Senior Director of Sales at Williams & Williams. “The sellers have many years of fond memories and look forward to passing the property on to new owners to care for the club for generations to come.”

Broken Arrow and the neighbouring metropolitan area of Tulsa have grown up around this popular country club, although the immediate area still boasts a quiet suburban lifestyle and luxury homes. It is one of the fastest growing communities in the state and has been listed by Family Circle magazine as a top 10 best town for families and included on Money Magazine’s top 100 best places to live.

All club-owned equipment and furnishings will be conveyed with the real estate. For more details about Williams & Williams’ auction of Indian Springs Country Club visit http://williamsauction.com/ISCC. Open public inspections will take place at 16006 East 131st Street South, Broken Arrow, Oklahoma on Friday, May 18, May 25 and June 1 from 11 a.m. to 2 p.m. and two hours before auction.

By skgupta | Posted in Property News | Tagged , , , , | Comments (0)

Unitech’s Net Profit Plunges 98% On Weak Property Demand

May 16, 2012 – 1:57 pm

Unitech Ltd. (507878.BY), one of India’s top realty companies by sales, Wednesday posted a 98% drop in consolidated net profit for the January-March quarter as expensive loans and property prices crimped demand for apartments and shopping malls. Profit in the fiscal fourth quarter plunged to INR22.6 million from INR1.03 billion a year earlier. The figure lagged the INR790 million averages of estimates in a Dow Jones Newswires poll of five analysts. Sales declined 32% to INR7.16 billion from INR10.54 billion.

Unitech and other realty companies in India have been hit by weak demand in a slowing economy. The central bank raised interest rates 13 times between March 2010 and October 2011, before finally easing rates this April. Also, rising living costs and reluctance of most realty companies to make major cuts in prices have made potential buyers put off purchases.  Unitech’s net profit for the financial year ended March 31 fell 56% to INR2.48 billion. Sales declined 23% to INR24.46 billion.  “Financial year 2011-12 was a very challenging year, particularly in terms of availability as well as cost of funding for real estate projects,” said Ajay Chandra, Unitech’s managing director. “This has resulted not only in an increase in financing costs for the company, but also adversely affected construction activity.”

Chandra said, however, that he expects the current financial year to be “significantly better” as there has been a gradual improvement in availability of funding in recent months. Also, interest rates are expected to come down. He said Unitech plans to deliver nearly nine million square feet of space in this financial year which began on April 1, up from last year’s 3.4 million square feet. The guidance will be helped by Unitech receiving bookings for 7.19 million square feet in the past financial year — including 6.34 million square feet of residential bookings — totalling INR38.08 billion. The company launched projects of 7.81 million square feet last year.

By skgupta | Posted in Property News | Tagged , , , , , , | Comments (0)

Unhappy with the Allahabad High Court Orders, Farmers Go On Rampage

May 15, 2012 – 7:07 pm

After the Allahabad high court rejected the review petition of villagers in Noida Extension, a small section of farmers unhappy with the order went on a rampage targeting projects of several builders. Other farmers were, however, happy that the Allahabad high court had turned down the plea made by the Greater Noida Authority in its review petition to not dole out hiked compensation and developed plots to non-ancestral lands of villagers.

Soon after news of the order reached Noida Extension, some agitated farmers took to the streets and targeted under-construction properties of developers. They blocked traffic at the Gol Chakkar in Noida Extension for a few hours. The angry crowd was dispersed following police intervention. “After getting news about farmers agitating in the region, we reached the spot and our officials managed to quell the agitation,” said SP (Rural), Ashok
Kumar.

The police informed that no case has been filed into the incident of violence. “We are likely to register a case into the matter,” Kumar added.

Farmers’ counsel, Pankaj Dubey, informed that after facing rejection from the high court, where they had sought land to be given back to farmers, they would now challenge the October 21 verdict in the Supreme Court.

Other sections of farmers have expressed happiness over the fact that the plea made by Greater Noida Authority, vide its review petition, in which it had expressed its inability to pay hiked compensation and developed plots to all farmers has been turned down. The Authority had asked for relief from the high court in granting it order to pay compensation and plots only to those farmers who had ‘ancestral lands’ in the region as against ‘non-ancestral lands’ belonging to those who are not originally from the region but own land in different villages.

“The Authority had been trying to make a difference between ancestral and non-ancestral land in the region in giving compensation to farmers,” said Ranveer Pradhan, president of a farmers’ organization, Grameen Panchayat Morcha. “Not only was the Authority shy of giving any developed plots in lieu of acquiring ‘non-ancestral’ lands, they had also been paying 10% less compensation to owners of such lands. It is a matter of great satisfaction that farmers across the board are eligible to get 64% hiked compensation and 10% developed plots now that the high court has upheld its original order delivered on October 21,” said Pradhan.

The Grameen Panchayat Morcha said that there is a vast amount of land in the Noida Extension region which the Authority had classified as ‘non-ancestral’.

 

By skgupta | Posted in Property News | Tagged , , , , , , , , | Comments (0)

Allahabad High Court Says No Review of Noida Land Order

May 15, 2012 – 4:19 pm

Home-buyers in Noida and Greater Noida will have to wait longer for their flats. The Allahabad high court on Monday dismissed the plea of the Noida and Greater Noida authorities seeking review of its earlier order requiring all projects in the area to get the NCR Planning Board’s approval. So, till these clearances are in place, buyers will not get possession.

However, there was some relief for the buyers as well, with the court striking down a review petition by a group of villagers who wanted the land acquisition quashed in a village where construction work had started. The ruling led to some farmers in Noida Extension taking to the streets and attacking housing projects. They blocked traffic for a few hours.

The court also stuck to its earlier ruling granting increased compensation as well as 10% of the developed land to farmers. Both the Noida and Greater Noida authorities had filed applications seeking review of the order dated October 21, 2011 which requires the NCR Board’s clearances for projects. The authorities argued before the three-judge bench of Justices Ashok Bhushan, S U Khan and V K Shukla that there was no need for such approvals but the bench was not impressed.

The court also dismissed applications to review the order on providing 10% developed plots to farmers. The authorities said development work in the area was almost complete and there were no leftover plots which could be given to farmers. Appearing for the farmers, Kamal Singh Yadav, opposed the review applications saying developed plots were available but were not being provided to farmers. On October 21, 2011, after hearing 491 petitions against land acquisition filed by farmers of 63 villages falling under Noida and Greater Noida, the Allahabad High Court had cancelled land acquisition in three villages where construction had not started.

The acquisition was undertaken by the authorities using the urgency clause in the name of industrial development. But later the land use was changed to residential and plots sold to builders. However, in 60 villages where substantial construction work was already done, the court did not quash the acquisition. Instead, it asked the authorities to increase compensation and provide 10% to the affected farmers.

Thus, while ensuring enhanced compensation to farmers, the court also took into account the interest of more than 50,000 people who had booked flats and houses in projects on the acquired land. Now, the two authorities have no other option but to take approval of NCR planning boardwhose meeting is scheduled later this month and pay enhanced compensation to farmers.

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

Affordable Housing Policy for All is Coming Soon

May 14, 2012 – 7:33 pm

In two months, India could have a brand new affordable housing policy, an effort to give some boost to a weakening real estate sector. The Union Ministry of Housing and Urban Poverty Alleviation is in the process of finalising such a policy in two months.

The government had already allowed external commercial borrowing for low cost houses in India in the annual Budget. But the real estate companies are not too keen on this segment because of the low margins. Hence the government is now trying to make affordable housing attractive for the developers as well.

The policy will raise the floor space index to compensate developers for high cost of land and also ease density norms, the Business Standard article says. It would give capital and interest subsidy to developers. Even government land would be auctioned on the basis of who could build maximum number of low cost houses.

The Mhupa has also built an internal committee to fast track the process of granting approvals of housing projects in a bid to reduce costs by 25-40 percent. Approvals would be given in six-eight weeks as against almost 70 approvals they require at present which typically take   between two to three years.

A recent example of such a case is the allegation by the Maharashtra Chamber of Housing Industry and the Confederation of Real Estate Developers’ Associations of India that plan to construct 500,000 affordable homes in Mumbai, Thane and Raigad districts of Maharashtra is gathering dust due to “inaction and policy paralysis” on the part of the state government. Such projects could be better executed with some sort of a single window clearance system.

On the other hand, the government is also making strict riders for the ECB borrowing so that money cannot be borrowed for low cost housing and transferred to other segments. So the government could mention specific projects and developers that could access the ECB funds and also mention specific channels like National Housing Bank to borrow the funds.

 

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

With Stringent RBI Policy Do You Benefit From Buying a House Now?

May 14, 2012 – 7:16 pm

Interest rates and escalating property prices had forced many prospective buyers to postpone their plans of buying a house. However, the recent easing of monetary policy by the Reserve Bank of India (RBI) has brought them relief in at least one aspect-lowering of interest rates.

Many public and private sector banks have announced a cut in their interest rates by 25 basis points. This means a reduction in the EMI that a borrower would have to pay. Suppose you had taken a home loan of Rs 30 lakh for 20 years at an interest rate of 11%. If the bank cuts its rates by 1%, resulting in a rate of 10%, your instalment will be slashed by Rs 2,000.

While this is undoubtedly a piece of good news, the recent regulation that has been introduced in the real estate sector has the potential to dampen your soaring spirits since it could impact your eligibility as a borrower and, consequently, your home buying decision.

If the interest rates drop, your eligibility as a borrower increases marginally, depending on the percentage of reduction. Says Adhil Shetty, chief operating officer of Bankbazaar.com: “While calculating the borrowing capacity of an individual, it’s typically considered that the EMI will be 40-50% of the net take-home salary.

So, if there is a substantial drop in the interest rate, his eligibility goes up.” This is because the borrower will be able to afford a higher EMI or be more comfortably placed to pay the same amount of EMI. However, Shetty says that most banks pass on the benefit only to new loan borrowers.

“If there is a drop of 50 basis points, the average borrowing capacity of an individual goes up by Rs 60,000-70,000, which is not much. Of course, this differs from case to case, but banks consider various other factors before offering a low rate even to new borrowers,” says Pankaj Maalde, head, financial planning, Apnapaisa.com.

He also advises that the fall in rates shouldn’t tempt you to prepay a loan. You will have to weigh whether the advantage of a lower EMI is higher than the prepayment penalty you may have to pay.

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

Demand in Residential Market will Remain Stagnant

May 11, 2012 – 6:14 pm

A recent report by Global Property Consultants CBRE South Asia, India Residential Market View – 2011 states that while the residential markets across NCR and Mumbai witnessed steady escalation in prices during the revival period from 2009 to first half of 2011 (as high as 40-50% in certain micro-markets), the latter half of the year brought in stagnation in overall prices.

Numerous repo-rate revisions by RBI, which led to upward revision of mortgage rates, tighter control on teaser rates earlier being offered by financial institutions to reduce EMI burden in the initial years of loan tenure, and inflationary pressures impacted end user as well as investor sentiment by the end of 2011. This coupled with supply pile-up lead to downward pressures on capital values across various micro-markets in these leading hubs. While the year 2012 started on a positive note with the central bank reducing repo rates by 50 basis points for the first time in several months (after increasing it 13 times in the last 2 years), the impact on demand rejuvenation might be limited.

“During 2011, we witnessed initial buoyancy in the real estate market as investor and developer sentiment improved, riding on the high residential demand wave. However with repeated interest rate hikes, rising prices and prevailing economic conditions, the market saw a dip in sales towards the middle of the year,” said Anshuman Magazine, Chairman & Managing Director, CBRE South Asia Pvt Ltd. This led to a supply pile-up in the key markets of NCR (National Capital Region), Mumbai and Bangalore, leading to capital values remaining flat across various micro-markets in these three leading hubs.

“While the recent rate cut by the RBI has helped generate positive sentiments in the market, stagnancy in demand will continue in the short to medium term unless there is an overall improvement in the economic scenario,” Mr Magazine added The NCR market witnessed considerable appreciation in capital values in the first half of the year, with premium markets witnessing steady demand from expatriates, high net worth individuals (HNIs) and executives from multinationals and Indian companies.

By skgupta | Posted in Property News | Tagged , , , , , , | Comments (0)

IL And FS PE Plans Fresh Fund under Euronext-Listed Yatra Capital

May 11, 2012 – 4:47 pm

IL&FS Investment Managers Ltd (IIML), the country’s largest home-grown private equity firm by assets under management (AUM), is planning to launch a fresh fund under the banner of Amsterdam’s Euronext-listed Yatra Capital.

Yatra Capital is an India-focused real estate investment firm, promoted by Saffron Capital Advisors.

Archana Hingorani, chief executive officer and executive director of IIML, told “We are in the process of getting shareholder approval at its upcoming annual general meeting. After the approval comes and depending upon the capital markets, we will be able to raise fresh money for the same.”

IIML would be hoping to be second time lucky.

This involved renaming the existing shares of Yatra Capital as ‘real estate shares’ whereas the new share class was to be christened as ‘infrastructure shares’. This would have developed Yatra Capital as a multi-class fund house with a strategy to invest in Indian infrastructure through debt and equity components, as against its present strategy of primarily equity investments in the Indian realty sector.

Yatra Capital has invested across asset class but its maximum exposure is in the retail segment where it has invested in market city projects of the Mumbai-based realtor Phoenix Mills Ltd. It also has enterprise level stake in Saket Engineers Pvt Ltd and the Phoenix Mills.

After the proposal was submitted, a number of amendments were suggested by the concerned shareholders and the board had later determined that until a final position was reached on the potential amendments to the proposal, it would not be implemented. This happened in spite of the board getting what it called a ‘broad’ investor support.

By skgupta | Posted in Property News | Tagged , , , , , , , , | Comments (0)

Oberoi Realty: Mumbai Land Prices Set to Extend 15% Decline

May 11, 2012 – 1:48 pm

Mumbai land prices, India’s most expensive, may extend their 15 percent decline this year as high borrowing costs force indebted developers to sell real estate, Oberoi Realty Ltd. (OBER) Chairman Vikas Oberoi said. Land transactions have dried up as buyers aren’t willing to pay higher prices or “ferociously” compete to purchase land, while sellers have been holding out, he said.

“We are waiting for the right opportunity to buy,” Oberoi, who runs India’s second-largest developer by market value, said in an interview in Mumbai. “I don’t want to waste my bullets. Oberoi, with no debt and about 13 billion rupees ($244 million) in cash, will take advantage of falling prices to buy land, he said. Oberoi Realty reported a 5 percent increase in earnings to 1.43 billion rupees in the three months ended March 31 as the company increased home prices, beating analyst estimates.

Analysts have expressed concern that Oberoi isn’t deploying cash to buy land and putting the money to better use. The “missing clarity” on new land acquisitions may be a drag on valuations with “idle cash” offering lower returns, Mumbai-based analyst Tejas Sheth at Emkay Global Financial Services Ltd. said in a note to clients on April 26. Oberoi said he is in the market to buy land. “I am not watching the audience; I am watching my game, not playing for the gallery.” Oberoi said. “I am very interested and very aggressive to acquire land, but aggression can’t be jumping off the cliff, it has to be backed with caution and preparation. After I jump I want to land on my feet not on my head.”

Mumbai’s amended building rules for home construction will spur new projects and increase supply in India’s most expensive property market, where permissions to build had come to a virtual halt, Oberoi said. “The rules have crystallized what one can get, the basic land potential is clear,” Oberoi said. “Discrimination between two developers has now gone as everyone gets the same area. It’s levelled the playing field in a big way, which is fantastic.”

 

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)

Due to Allotment Cancellation the Competition Commission of India Pulls Up DLF

May 10, 2012 – 6:22 pm

The Competition Commission of India (CCI) has pulled up real estate major DLF Ltd in a recent order for cancelling the allotment of an apartment of a member of DLF’s Park Place RWA, stating that it was in “direct contravention” of its stay order of September 2010.

The order was passed by the commission to prevent the opposite party from abusing its dominant position to the detriment of allottees during pendency of the proceedings. The CCI also severely admonished the builder for discriminatory behaviour towards members of the owners’ association and other allottees/owners.

The cancellation letter for one Vipin Mahajan was issued on January 28 last year when the interim order was in force. According to Mahajan, despite the directions being in force to date, the opposite party issued a letter in January last year, cancelling the booking of his apartment and forfeited a sum of Rs 23,06,778 out of the total amount of Rs 44,89,503.

While the CCI accepted this restoration of status quo and therefore felt that no further direction needs to be passed as far as restitution of Mahajan’s apartment was concerned which had been a great relief for the allottee concerned, the CCI as prescribed by the Competition Act 2002 “is obliged to impose penalty because of the deliberate non-compliance”? This, the order stated, was a violation of Section 42 of the Act.

Also, Section 48 of the Act makes it a liability of every person for penalty, who at the time of contravention was in charge of or was responsible to the company for conducting its business. DLF will now have to disclose the name of the errant persons who were responsible for the misconduct and also give a show cause notice as to why the penalty should not be imposed. The case on the same is up for hearing on May 17.

Meanwhile, a spokesperson of DLF Ltd clarified that the company had “restored the ownership of the apartment which was %cancelled due to non-payment of dues by the %allottee”.

By skgupta | Posted in Property News | Tagged , , , , , | Comments (0)