JLLM - Impact of RBI's credit policy / Slowdown? / The Sector's Future

- by Anuj Puri, Chairman & Country Head, Jones Lang Lasalle Meghraj

IMPACT OF RBI'S CREDIT POLICY ON THE SECTOR

• Sentiments in the sector will continue to be muted, especially in the residential sector, which has seen the highest price appreciations and is the most sensitive to non-amenable lending norms.
• Major developers who are flush with private equity and IPO-based money, further bulwarked by pre-sale monies and land banks, will not be as seriously affected as smaller players. They will not offer substantially reduced rates as they have prolonged holding capacities.
• Some smaller development concerns who have projects under construction will have difficulties in bringing these to completion.
• Some developers in certain areas may sell their products at lower rates, or choose to sell to speculative investors in bulk, at marginally discounted rates.
• Many buyers who were in wait-and-watch mode may continue to postpone their intended property purchases.
• Residential developers will begin to look more seriously at incentivized formats such as townships, while office space developers will consider the SEZ option. The extension of the STPI scheme by one year is not significant enough to make much of an impact.

SLOWDOWN ON THE REAL ESTATE MARKET

• There has been a slowdown in domestic transactions because an amalgam of reasons - overheating of prices in certain Northern regions, reduced liquidity among developers because of the credit crunch and a watch-and-wait stance among property buyers as they anticipate a blanket correction in the sector. This cannot be attributed solely to the credit crunch and the US recession. Interest rates were inflated to begin with.
• Certainly, the previously hoped-for sales volumes for 2008 will not materialize. However, lack of growth does not equal a setback – only a period of stagnancy.

US SUBPRIME CRISIS / REDUCTION IN FOREIGN INVESTORS

• As of now, foreign investors affected by the economic adjustments in the West see India's strong economic fundamentals and the continued strength of the real estate market as a desirable investment alternative.
• Nevertheless, many of them are taking a more calculated approach now, opting to wait until the present market fluctuations have been resolved and the scheduled infrastructure enhancement projects are launched.
• India - and for that matter China - represent an economic scenario that has evolved separately and on very different parameters from the economies in most developed countries. It is an emerging economy, with an emerging and maturing real estate market. There will be a fall, but it will not be of a magnitude comparable to that of other countries.
• Foreign investors are now justifiably awaiting greater transparency and stability.

FUTURE PROSPECTS FOR THE SECTOR

• India continues to be a boom country, but the boom is now assuming the properties of a controlled and focused explosion rather than the free-for-all market mayhem it previously stood for.
• Prices are stagnating and there may be a correction in many areas over the next one year. This, again, is not a blanket evaluation, and factors like specific location sector and property typology will play a significant role.
• Certain locations and properties and properties will continue to be in great demand.

Contributed By : Arun Chitnis

Jones Lang LaSalle and Colonial First State Property Management Launch ‘Sandalwood’ in India

India Retail Witnesses Advent of Highly Specialized Mall and Asset Management Services

Jones Lang LaSalle and Colonial First State Property Management Launch ‘Sandalwood’ in India

Mumbai, 22 April 2008 - Riding on Asia’s robust retail growth and India’s unprecedented retail boom, Jones Lang LaSalle Incorporated (NYSE: JLL), and Colonial First State Property Management today announced a joint venture partnership to form Asia’s first integrated retail development and management service provider – Sandalwood. The 50:50 joint venture company will help Asian and Indian developers and retailers to capitalize on premium retail opportunities as well as creating long term value for retail assets.

Colonial First State Property Management is one of Australia’s largest full service property development, management and leasing specialists. Since its inception in 1983, the firm has undertaken more than 25 major shopping centre developments and now manages 36 centres on behalf of third party clients in every state of Australia, including iconic Chadstone Shopping Centre in Victoria, Chatswood Chase in Sydney and Queens Plaza in Brisbane.

India's retail sector is evolving at a swift pace and is set to grow by 35% by 2010. This growth has been fuelled by a strong economy, favourable demographics, rising wealth levels as well as rapidly changing lifestyles and consumer aspirations of an ever burgeoning middle class. The real estate sector has responded well to this retail growth. The total retail mall stock has been doubling every year, from a meagre one million sq ft in 2002 to a staggering 40 million sq ft in 2007 and an estimated 60 million sq ft by the end of 2008.

There are over 100 malls operating in India and more than 300 being developed and of this total, more than 90% have yet to achieve global benchmarks. In order to be globally successful, mall owners and developers in India need to focus on vision, scalability and processes and create a distinct proposition for themselves in this emerging market. Sandalwood, with its specialist property management skills and development expertise will ensure that retail owners and developers are strategically positioned for long term growth and success

Anuj Puri, Chairman and Country Head, Jones Lang LaSalle Meghraj says, “As retail in India grows at a rapid pace, this is indeed an opportune moment for us to introduce specialized retail and intensive asset management services. Sandalwood will seek to create long term value for India’s mall owners through its globally benchmarked practices, proven expertise in property development and intensive asset management.”

Darren Steinberg, Head of Colonial First State Property Management says, “Asian economies are amongst the fastest growing in the world with real GDP compound average growth of approximately 9% per annum over the last five years, and their retail management and property development markets have grown at a compound average growth rate of more than 20% in the same period. Colonial First State Property Management’s specialist retail property management skills enable property owners to receive the benefit of master planning and development expertise which is critical to ensuring assets are enhanced and strategically positioned for long-term growth and success."

Stewart Hutcheon has been appointed as the new Chief Executive Officer of Sandalwood Asia. Mr Hutcheon is well known and highly regarded by the retail management and property development community in Australia. His impressive career includes over 18 years experience in the retail property sector. His most recent appointment was as Director of Leasing and Deputy Managing Director of AMP Capital Shopping Centres Pty Ltd, with shopping centre assets under management of approximately A$9 billion. Prior to that, he spent over seven years at Westfield, Australia.

In India, Sandalwood’s operations will be spearheaded by Ms Gagan Singh, who has over 28 years of experience across the apparel, exports and hospitality sectors. In addition to performing her new role, she holds the position of Deputy CEO of Jones Lang LaSalle Meghraj.

Ms Singh says, “I am delighted to be heading up this new and exciting company. Sandalwood will draw upon global expertise and local knowledge to bring our clients’ visions to highly profitable retail environment that is based on strong differentiation for their retail assets. Sandalwood seeks to help create space not just to shop in, but to ‘live’ in.”

Mr Puri concludes, “We are excited by the opportunities that lie ahead for Sandalwood India. The retail business in India is growing and the pace is expected to accelerate. The market and business outlook is extremely positive and Sandalwood is well-positioned to be an industry leader in the active retail sector in India.”

About Jones Lang LaSalle

Jones Lang LaSalle (NYSE:JLL) is a professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2007 global revenue of USD 2.7 billion, Jones Lang LaSalle has approximately 170 offices worldwide and operates in more than 700 cities in 60 countries. The firm is an industry leader in property and corporate facility management services, with a global portfolio of approximately 1.2 billion square feet. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with approximately USD 49.7 billion of assets under management. For further information, please visit our website, www.joneslanglasalle.com.

Jones Lang LaSalle has over 50 years of experience in Asia Pacific, with over 16,000 employees operating in more than 70 offices in 13 countries across the region.


About Jones Lang LaSalle Meghraj

Jones Lang LaSalle Meghraj, the Indian operations of Jones Lang LaSalle, is the premiere and largest real estate professional services firm in India. With an extensive geographic footprint across ten cities (Delhi, Mumbai, Bangalore, Pune, Chennai, Hyderabad, Kolkata, Kochi, Chandigarh and Coimbatore) and a staff strength of over 3300, the firm provides investors, developers, local corporates and multinational companies with a comprehensive range of services including research, consultancy, transactions, project and development services, integrated facility management, property management, capital markets, residential, hotels and retail advisory. For further information, please visit www.jllm.co.in

About Colonial First State Property Management

Established in 1983, Colonial First State Property Management (CFSPM), is today one of Australia’s largest full service property development, management and leasing specialists.
CFSPM has acquired more than two decades of intelligence on Australia’s retail property markets, with the iconic Chadstone Shopping Centre in Victoria remaining as one of its outstanding achievements. Since inception, CFSPM has undertaken more than 25 major shopping centre developments and now manages 36 centres on behalf of third party clients in every state of Australia.

As a member of Colonial First State Global Asset Management, the largest manager of Australian-sourced funds, CFSPM provides critical services to a range of assets held within Colonial First State Global Asset Management’s suite of listed and unlisted property funds and mandates. These services, covering the gamut of retail and office property requirements, are also provided to other third party clients outside the Colonial family of companies. Ultimately, CFSPM’s key point of difference in the market place is the fact it has 700 professionals on the ground at any given time. This means CFSPM is close to the issues at hand and able to react quickly and strategically in every situation.

CFSPM has expanded its capabilities beyond the retail sector and is steadily growing its operations in the office sector. The business is committed to growing both parts of the business. With a core focus on maximising investors’ returns on an asset by asset basis, CFSPM is a critical component of our property investment management offering.

Contributed By : Arun Chitnis

PROPERTY 2008 : The Largest Property Super Market

2nd April 2008

Property 2008 an exhibitive extravaganza is all set to become a one-stop destination for potential property buyers in Mumbai

Maharashtra Chamber of Housing Industry – MCHI’s Property 2008 – 12th Real Estate & Housing Finance exhibition will be held at the Bandra Kurla Complex, MMRDA Grounds, Opp. Citibank from 17th to 20th April 2008, from 11.00 am to 8.00 pm. The exhibition is organized by MCHI and co-organized by LIC Housing Finance & SBI. The Gold Partners are HDFC & ICICI & Silver Partners, DHFL & AXIS BANK.

Spread over an area of 25,000 sq. metres consisting 3 A/c halls, Property 2008 will have leading property developers and Housing Finance Institutions (HFI) participating from Mumbai, Navi Mumbai, Thane and rest of India along with International property developers.

Mr. Mayur Shah, Convenor, Exhibitions MCHI said, “This being home buying season, buyers want to settle in their new homes before school starts in June, this Property Exhibition will ideal opportunity to select property of choice & budget. As summer vacations commences many home buyers find this a perfect time to buy a new home and shift during the vacations as well.”
As many as a 100 + Real Estate Developers including Global Corporations and pan-India project-developers will be here to share the platform and negotiate interpersonally with around 1,00,000 buyers. In the Residential Property category, on display will be 1-5 BHK Flats, Duplex, Apartments, Penthouses, Bungalows, Row Houses and more. The Commercial Properties will display Retail outlets in Malls ,Multiplexes, Commercial Shops, Industrial Galas, Office Premises, Corporate Parks, IT Parks, SEZ. The Financial Products section, around 15 HFI’s & Banks, will offer spot home loans at competitive rates as well as home loan insurance.

The participants at this Mega Exhibition will display their properties from Mumbai, Thane, Navi Mumbai, Pune, Goa, Bangalore, Chennai, Delhi, Hyderabad, Kolkatta, Jaipur, Kochi, Lucknow, Nagpur, Nasik, Panchgani, Karjat, Neral, Sangli, Lonavala, Murbad etc. To add International color there would be participation from locations such as Dubai, Australia etc.

A JOB Fair again with a differenceThis time, Property 2008 will also play host to a unique 3rd Job Fair specially designed for the Real Estate Industry: The rapid growth in Retail and Infrastructure has created such an opportunity for specialization in quality manpower in the real estate industry that it will seek to provide professionals a well honed platform for growth and advancement in their respective careers. The Realty Industry will be looking at Professionals such as Designers Engineers Technical Experts Accounts Finance Customer Service Administration Purchase Management Marketing.

MCHI has constantly endeavored to bringing innovative ideas and concepts to the markets. Even globally, it is relied upon by the entire housing industry, in bringing together participants from India as well as abroad, giving it a clear edge in the minds and hearts of Mumbai’s home buying public.

Maharashtra Chamber of Housing Industry (MCHI)MCHI, formed in 1982 has now become the most prominent body of real estate builders and developers bringing together members dealing in real estate and construction industry on a common platform to address issues facing the industry. Members of MCHI account for providing more than 80% to 90% of residential accommodation in Mumbai and its vicinity, and helps both the Central and State governments in meeting their constitutional obligations – providing shelter to the shelter less. MCHI works towards raising awareness among the general public, real estate and construction industry while providing them with exhaustive information on projects and new developments in and around Mumbai. With over 400 well-recognized and reputed member builders, MCHI is affiliated with leading industry associations like FICCI, IMC and CREDAI.

Highlights of Property 2008

1. The only official and largest real estate exhibition of India being organised by the Official Real Estate Body MCHI.
2. 100 plus developers showcasing more than 1500 projects
3. 15 housing finance companies & banks participating
4. MCHI Job Fair being organised concurrently.
5. Exhibition covers an area of approx. 2,50,000 sq ft.
6. Over one lac footprints expected at the exhibition.
7. Air conditioned aisles, registration areas, coffee lounge, food courts & comfortable A/C business lounges for one to one discussion in the exhibition.
8. Free drinking water facility for visitors will be available.
9. Free shuttle buses running to and fro from venue and main railway stations, Bandra (E) & Kurla (W).
10. Ample Car Parking facilities with Valet Service.
11. Entry is free for the exhibition.
12. Legal advice on Real Estate & Home Loan counseling will also be given at no cost to the visitors.

For Further Information please contact Prakash Mondkar Sobhagya PR – Sobhagya Advertising ServiceHand Held – 9820669034Land – Line 22661286/22662979 Email- sobhagyapr@rediffmail.com


Contributed By : Minal Arora

Is buying home abroad a fashion or it really makes sense for an Indian?

Well, two years before when I moved from London to India, I always thought buying home in India was cheaper and made more sense and those who invest abroad mostly do it for flaunting…but two years living here and seeing the entire lifecycle of real estate development and growth, I am not so sure if its for the snob value alone that people are investing abroad.

During the last quarter of 2007, I did visit a few exhibitions in Delhi and Mumbai, where the most exotic real estate was showcased from across India with very fashionable tags attached to them. When I saw developers like DAMAC, Al Fara, Dubai Properties, Kuala Lumpur Metro Group and many other foreign developers wooing buyers in the Indian market to invest in Dubai and Malaysia, my first reaction was….nah…it isn’t going to work.

I thought Indians are traditionally not the people who would buy houses abroad, but I was most certainly wrong.

I actually have discussed this with executives from leading developers from these countries and found out that its pretty interesting but not only do their investments give better returns but it also comes coupled with lucrative bonuses like holidays, lucky draws to win cars, luxury apartments, sometimes maybe even jets.

Typically, Dubai, Malaysia and Singapore are the few attractive destinations where Indian residents are looking at investing or have been investing for a while now. Due to the slowdown in US and the falling property prices, a lot of US developers are seen moving to India…expecting to attract them to invest in various parts of US.

With Indian residents having the flexibility to invest $100,000 per head every year in foreign property, it makes a lot of sense for foreign developers to get to India since their investments now only offer better rental incomes but in Dubai and Malaysia they come with tax holiday on any money you make out of the property appreciation, which sure is a big bonus. Dubai goes one step further and offers a citizenship also on investing in a property there, which has proved to be a major plus when it comes to the Dubai based groups winning over the investment game.

Contributed By : Rahul Gandhi

Will a ‘firang’ broker be the one to sell u a home

At the last Cityscape Real Estate exhibition held in Mumbai, a stall of an IT SEJ in Hyderabad was 'manned' by a 'consultant' from the UK. He was sharp, knew what was happening not just in the project he was selling, but also trends in the city/state/India/SE Asia; was very clear about the legal issues involved, had finance details on his finger tips, was incredibly polite and courteous, and was 'aggressively helpful' in potential leasers' decision making. A visiting card meant three calls across the next month plus e-mails that were friendly, packed with information with polite requests to get back in case any other details were required. Vinod Thakkar, CEO of real estate firm Square Feet is at his Mulund office, recounting the experience. "Unless Indian real estate brokers wake up to the reality that they need to adapt to the changing times, such guys will take over the" broking function altogether," he muses. "Let us face the reality - these global consultants as of now are only at the tip of the pyramid - branded, high-end real estate. But they are moving to other segments of the pyramid and this is a wake-up call for all in Indian real estate marketing and sales," he points out. Thakkar has just completed a re-branding exercise of the various 'estate agency' offices his company controls. A training session currently aims at standardising the experience for a customer coming to any of his offices while an IT back up will make data sharing a reality – with prices updated being reflected in real time.

Thakkar says he's got miles to go - 'the scenario is changing, we have to be ready for today's customer with tomorrow's service levels'.

With global real estate agents operating in the Indian scenario, local builders will be able to easily market their products at better prices as these realty firms would be organised, 'presentable marketing agencies' on lines of HDFC Realty, which is already operational, says Venkatesh lyer of the Chembur-based Siddhivinayak Estates. "This may enhance the cost of property due to the involvement of global firms, but ultimately, these firms have to will rope in local small-time brokers to run the show," he feels.

Andheri-resident estate agent Rajesh Bijiani feels it is pertinent that the government of India should mandate a license for such 'global consultants' who intend to deal in real estate. This, he feels, will stop the proliferation of 'misleading businesses' in real estate sector. "Half a decade back, finding a real estate agent in the interior areas was nearly impossible. Now, there are dozens of local and foreign real estate consultants in all sorts of locations all over the country. Most operate without a license and many of those that have them do not operate in the manner as we would have thought a real estate agent would in the so-called 'first world countries'. With no proper control, it is every man for himself; wheeling and dealing for his own best interest, and not that of the seller or the buyer."

Branding is the future of Indian real estate, says Bakshi. "As we have seen in other industries in India, the market will move to the branded players. For examples, the coffee business transitioned from the Rs. 5 coffee seller on the road side, to the Café Coffee Days and Baristas. The grocery business moved from the neighbourhood 'bania' to Reliance Fresh and Big Bazaars. Why should it be any different in the realty management sector? Lakhs of independent players will morph into (say) a dozen branded players in the future. As in any other industry, branded players will cater to the mass consumers, while the more traditional brokers will cater to niche markets."'

Sangeet H Kumar is CEO, ACBD Global Asset Corp., a new set-up which covers more than just real estate deals - it looks at real estate as an asset class, for one. He's back from a 'hard-sell' visit to the UK and UAE, and he is hard at work getting responses across to potential buyers he’s met while in two countries. “Buyers expectation are similar, whether they are resident Indians buying real estate at home, NRIs or PIOs buying Indian real estate from an Indian realtor, or an Indian in a foreign country dealing with a global real estate firm in that country. Transparency in terms of details and information, safety and security of their investment and a professional way of working," he says.

"When one says a 'professional way of working', it basically means quick response to the customers' queries, and the replies should be correct and complete," says Gurpal Singh Sethi, real estate personality who's recently returned from brokering a hotel deal in Seychelles. It has been his work in a previous hotel deal in the UAE which got him the enquiry from Seychelles, but he is quite clear that clinching the assignment required him being conversant with 'global best practices'. He is brokering a deal which seeks to convert a slew of 'ready possession residential towers' into serviced apartments at Vikhroli, and says times are changing. "In India, almost all real estate business happens because of word-of-mouth publicity and referrals. It is mostly verbal communication that drives deals at home. When you deal with an international clientele, this does not work. You have to quote from research reports, give price trends over a time frame and generally be a research / analyst- cum-finance expert-cum-legal eagle at the very least, apart from being a real estate agent who follows 'global best practices'. Otherwise, you don't stand a ghost of a chance," he adds.

Realtor Ramprasad Padhi has been handling realty requirements of expatriates in Mumbai since the last few years and says that their initial mind-set is that Indian real estate is full of cheats. "You have to be a true 'realtor', show them that your work is as good as the realtor they deal with in, say, the USA or UK. Once the barriers are down, you have a customer who doesn't do any further deals without you," he adds. An MBA with online selling portals galore, Padhi, like Thakkar, Sangeet and Gurpal represents the new face of Indian real estate selling. "The phase when you had a 'paan walla' or a 'kirana' shop seller doubling up as a 'broker' is over," muses Padhi. "These days, buyers are savvy, have done their homework, know their fiscal options and expect professionalism from their 'consultants' and unless the Indian real estate selling set-up measures up to these expectations, it will lose customers to developers' direct sales set-ups and also to the new development of organised, global firms that are setting up shop in India," he smiles. "Global players coming in will only ensure all players in the Indian real estate's sales and marketing will shape up. Else, they will have to ship out," he concludes.

Published in: TIMES OF INDIA (PROPERTY PLUS ) Friday, March 28, 2008



Contributed By : Ramprasad Padhi
Pinnacle Realty (http://www.mumbaiproperties.com/) Suite # 24, Royal Tower, I.C.Colony, Borivli West, Mumbai 400 103 Board Nos: 2893 3333, 2892 5252, Cell : 9820 1515 00 Email : ram@pinnaclerealty.in

The first women only hotel opens in Riyadh

In the most conservative country in the world, where women are always kept in lock and key, safe from the eyes of other men, the kingdom's first hotel exclusively for females opened yesterday, offering plush lodgings with a full-range of health and beauty facilities for ladies to pamper themselves, away from the accusing eyes of a male-dominated society.

A hotel catering just for women has opened in Riyadh. The Luthan Hotel & Spa has 25 rooms and aims mainly at businesswomen in the region. he hotel is owned by a group of 20 Saudi princesses and businesswomen, where the facilities include conference rooms and health and beauty treatments. Once inside the hotel, women do not need to be covered head to toe, as all employees are female.

Ironically, it is a hotel for women but it was left to seven princes headed by Sultan bin Salman, a son of Riyadh's governor, to officially inaugurate it.

Contributed By : Shivang Prabhakar

IT & Tourism both pushing Kochi to top of prospective investment destinations

Kochi or Cochin, considered as god’s own country, was the scene of boats languidly gliding through the waters, Chinese fishing nets silhouetted against the sunset and merchants haggling over the price of spices. While, the beauty of Kochi remains unhampered, Kochi’s skyline has changed, considerably.

IT & Tourism both pushing Kochi to top of prospective investment destinations

As a port city, Kochi has always been the proclaimed economic capital of Kerala with trade and retail being its revenue generators for decades. In the recent times, since NASSCOM ranked it as the second potential city for investments in the IT sector and ever since Kochi has emerged as a favored destination for the IT & ITES industry.

Kochi shows vast potential for economic growth and industrialization based on norms such as real estate growth, available work force, overall infrastructure, policy initiatives and commercial history. However, the accessibility of cheap bandwidth through undersea cables and lesser operational costs in comparison to other key cities in India has proved to be of major advantage, specially for huge IT companies / BPOs who spend considerable amount of money in the daily data transfer to their overseas clients.

The important thing to remember is that Kochi is the one city which is well connected to the rest of the world through sea. This is also one of the reasons for Kochi being identified as an attractive destination for investments. Moreover, this inflow of investments has created realty prospects in the city, both residential and commercial as the IT firms are bringing in more and more people into the city. And with the coming up of Cochin Special Economic Zone (CSEZ) the economical capital of Kerala is now even more attractive to the investor counting on economic and realty prospects.

The SEZ, apart from catering to the business growth and industrialization with the investments in IT and Business parks has also been responsible for growth of Kochi real estate.
With this year’s budget not renewing the STPI screme for IT companies, the only resort for IT companies to still enjoy a tax holiday will be to move into SEZs and Kochi well qualifies all criterions of an ideal investment where the real estate owned by these companies will also give them considerable returns.

Besides the Technopolis developed at the CSEZ, the setting up of a software productivity center by Wipro in Kochi is considered as one of the variable factors in the evolution of Kochi as an upcoming city. Major IT firms such as US Software, IBS, Sun Tec, Gemini, NeST, Ernst and Young, Tata Consultancy Services, Infosys, ACS Inc. and Allianz Cornhill are only some of the IT firms gradually making their presence felt in the business prospect of Kochi.

The thrust from NRI remittances and the tourism sector are also greatly responsible for the changing postcard picture of Kochi. Restricted by the sea on its western coast, Kochi is spilling over to the neighbouring towns and villages, where land prices have made impressive gains. Once considered distant, neighbourhoods like Edappally and Tripunithura have appreciated from Rs.25, 000 to Rs.2 lakh for a cent.

The growing demand for housing units and the constraints on space have induced city builders to focus on building apartments in Kochi. Local builders are offering top-of-the line fittings and lifestyle add-ons like clubs and swimming pools to apartment complexes to woo home makers who prefer these homes for the security and convenience they offer.

DLF recently launched it’s Riverside Kochi project which was one of the few it has in the south, right in the backdoor of the backwaters and many other real estate developers are putting in money to develop world class living for the people who will be migrating to the place to live and work in the MNCs moving over to grab up spaces in the SEZs.

With everything from nice sceneries to good infrastructure and connectivity Kochi sounds like the place to invest and many of the “Returning NRIs” to India have sought after this opportunity and already invested their monies in this amazing and very cosmopolitan city.



Contributed By : Shivang Prabhakar

Future Group's 'Pantaloon Retail' to sell "walk-in apartments" in India

Well, if you are one of those couples who wish to live in a modern apartment, have the money to buy one, but no time to pick and choose interiors, you don’t have to worry anymore.

The Kishore Biyani-led Future Group, whose flagship company Pantaloon Retail operates over 1,000 stores nationwide, is entering into a joint venture with Mr Sumit Dabriwala, a Kolkata-based developer - is looking to market its 2 & 3 bed-room "walk-in" apartments through Future Group stores such as Big Bazaar.

This initiative is a part of the Future Group’s diversification strategy where they are foraying into selling real estate and health care, so as to leverage their physical presence across the country. The apartments is an ‘all-fitted ready-to-live-in apartments’ and a new brand is also being worked upon by the company to mark its foray into this industry.

Home Solutions Retail will provide the brown and white goods required to furnish these apartments. FH Residences is also looking to advertise its apartments in Future Group malls.

Contributed By : Manish Bhasin

Feng Shui & the BA GUA octagon

The BA GUA octagon is one of the tools used in Feng Shui to help determine preferred locations for certain functions in the home or office. The BA GUA is placed with the front door of the floor plan of your home or office placed at the bottom of the BA GUA octagon.



The bagua divides any space into nine areas. Each area corresponds to a different aspect of your life. Whatever is going on energetically (good or bad) in that part of your space will affect the related aspect of your life (see diagram).

Align the bottom edge of the bagua with the wall the door is in. Stretch the bagua sideways or lengthwise to cover the entire space. The door or entryway will always be in ken, kan, or chien gua, although it may overlap more than one gua. As you stand in the doorway facing into the space, hsun gua is always at the far left; kun gua is always to the far right, and li gua is always at the center of the wall opposite you.

If there is more than one way to enter a space, orient the bagua to the main door or entryway. Even if you usually enter your home through the garage, align the bagua of your home to the front door.

Every space has a bagua. There is a bagua for your plot of land, a bagua for your house, and a bagua for each room within your home. You can even apply the bagua to your desk, bed, or stove.

The bagua is rich with meanings and associations. The most important meanings of each gua are shown below....

Everything that happens in life can be boiled down and placed within 9 categories that are also known as life situations. Each category is spatially represented by an area within your living quarters. Individually these areas are called a gua, while placed in a specific order it is called the bagua (ba meaning "8") and it is shaped like an octagon. The 8 sides, and the middle, form the 9 zones which relate to the various life situations. However, it does not end there! Each gua is also associated with a specific color, shape, symbol, body part, etc. Here are the specific life situations which are associated with the 9 zones that compose the bagua.

(1.) Prosperity and Abundance: This is the area that relates to wealth or having money for the good things in life. It does not have to do with life's necessities such as food, rent, and utility bills. Many Feng Shui consultants consider this area to be a power source since money is often viewed as power. If you are seeking big money then this is the corner that you must work upon. Prosperity and Abundance's colors are purple, green, gold, and red. Its body part is the hip and its associated number is 8.

(2.) Fame and Reputation: This is the area of the home that supports you as a person out in the real world. It deals with how others perceive you which in turn makes a great difference in the area of money and relationships. It also has a lot to do with your own integrity and honest which in turn will make a difference in your dating life as well as in your other relationships. For this reason, even if you are a jerk, or if people just think that you are a jerk, then you still do not have to despair since the fame and reputation area can help you out. This area's element is fire and its color is red. Its shape is triangular; its creative cycle items are wood, green, and columnar; its destructive cycle items are water, black, and undulating; its body part is the eye; and it's associated with the number 1.

(3.) Relationships and Love: If you are seeking a relationship, or simply looking to have a really good time then look no further than this area of the bagua! It is very important that this area of your home be balanced in order that you can have harmony in your relationships. So, before deciding to become a monk or a nun, you should make sure that this area of your hope is balanced. Relationships and Love's colors are pink, red, and white. It is associated with all major body organs and the number 2.

(4.) Creativity and Children: This area of your home relates to creative thinking. You may wish to begin in this area since it will help you form creative cures for the rest of your home. This area also relates to children since they are well known for their creative thinking abilities. Anything to do with working with children (whether they are yours or not, your siblings, or even the children that you may have in the future) should be done in this area of your home. Creativity and Children's element is metal; its color is white; and its shape is round or mounded. Its creative cycle items include Earth, yellow, flat or square shapes; its destructive elements include fire, red, and pointed shapes. It is associated with the mouth and the number 3.

(5.) Helpful People and Travel: This area of your home is set aside for calling upon someone who can make your life easier, whether it is a teacher, inspirational writer, maid, or other person who is helpful. Helpful People and Travel's color is grey, black, and white. It is associated with the head and the number 5.

(6.) Career and Life Path: This area of your home is linked to whatever it is that you are supposed to be doing in life, whether it is business or traversing a more spiritual path. This area of your home is dedicated to getting you onto the right path for your life. Career and Life Path's element is water; its color is black; its shape is undulating and free forms. Its creative cycle elements include metal, white and round objects while its destructive cycle elements include earth, yellow, and flat or square objects. It is associated with the ear and the number 6.

(7.) Skills and Knowledge: This area of your home effects how you learn, store and use knowledge. While each gua's energy affects the areas around it, this one is especially worthy of your attention. For instance, if you do not have the ability to manage the money you earn then it may erroneously appear that your Prosperity section is not working for you. This area is especially worthy of attention if you are in school but simply cannot bring yourself to study. Skills and Knowledge's colors are blue, black, and green. It is associated with the hand and the number 7.

(8.) Family: This area is associated with family issues. It also holds the energy for every day monetary issues such as rent, food, and the other necessities of life. Thus, if you do not have this area in order then your Prosperity area may never really reach its true potential. Family's element is wood; its color is green; and its shapes are rectangular, columnar, and vertical. Its creative cycle items include water, black, and undulating shapes while its destructive cycle elements include metal, white, and round objects. It is associated with the foot and the number 4.

(9.) Health and Other: The center of the bagua contains all of the other life situations which are not mentioned above. Since this area is located in the middle of your home it geographically touches all other areas and thus, due to its location it affects all other areas, both literally and figuratively. As the old saying goes, "If you don't have your health, you don't have anything." Health's element is Earth; its colors are yellow and earth tones; its shape is square, horizontal, and flat. The creative cycle elements include fire, red, and pointed objects while the destructive cycle items include wood, green, and columnar objects. It is associated with any of the body parts that are not associated above and the number 9.

The Ba Gua points are contributed by Brenda-Marie Hoffman - © 2002 Pagewise

Contributed By : Abhi Chopra

Commercial Space - is india priced out ?

Indian office space has witnessed one of the fastest appreciations in rentals, in the world, the latest survey by global consultancy firm Cushman & Wakefield reveals. Consultants and experts feel that this is a matter of concern as it clearly suggests that supply of office space is not keeping pace with the demand.

Office space in Nariman Point, the central business district of Mumbai, and Connaught Place in Delhi, rank fifth and 10th among the costliest commercial sites of the world. Both of them have moved up by two ranks, since last year. The occupancy cost, including all the maintenance expenditure, for Nariman Point, is Rs 546 per sq ft per month, and for Connaught Place it is Rs 423 per sq ft per month. These rates have nudged Nariman Point and Connaught Place past the costliest areas in New York, Washington, Shanghai and Zurich.

MD of CB Richard Ellis (South Asia), Anshuman Magazine, says if the trend continues for some more time, India will loose the advantage of being a cheap destination for companies to shift base from other countries. The fact that cities like Delhi and Mumbai are costlier than New York, Washington, Rome, Shanghai, Amsterdam and Zurich is not a matter of pride, rather an issue to be taken up by the government and civic/development authorities/agencies seriously.

If India has to remain competitive in the international market, its real estate cost must be lower than that in the developed world. A senior consultant said the productivity of Indian workers is normally lower than those in developed countries. And hence, the real estate and other overhead costs should also be lower than those in the developed countries. Therefore, if India has to grow at around 9%, it must remain competitive in the global market, the consultant argues. As real estate has become an important ingredient in service sectors like information technologies, call centers, education and hospitals, keeping costs under check will help the country remain competitive in the global market and also in achieving high economic growth.

In 2007, Indian cities witnessed some of the highest growths in rentals, as shown in the chart. But, as rentals have gone through the roofs, many companies are shifting their bases to other cities, and in some cases, particularly, in the call center segments, to other countries. So, at the present price points, it seems there will be a situation of over supply. This, some consultants feel, would lead to price correction over the next 12 months.

As against India, its competitor China as a whole delivered a steady performance. Rents in mainland China registered an average growth of 5% over the year. Beijing is currently facing oversupply of high-grade space, and in consequence, rental growth was marginal.

Shanghai also experienced an increase of 10% in rentals. Rentals at the best locations in Beijing and Shanghai are $48.43 per sq ft per year and $61.62 per sq ft per year, respectively. As against these, the highest rentals in Mumbai and New Delhi are $166.04 per sq ft per year and $124.53 per sq ft per year, respectively. Though the economic returns from the space in India and China are almost the same, the high rentals in Indian cities make them uncompetitive in the global market.

Executive managing director of Cushman & Wakefield (South Asia), Sanjay Verma, says most micro markets in Mumbai saw an upward trend in rental values, largely due to lack of new supply because of project delays. Similarly, in Gurgaon in the National Capital Region of Delhi, prime supply has essentially met the pre-committed demand. Therefore, the fresh demand only pushed the rentals.

However, the good news is that the high rental values witnessed across the country would not be sustainable beyond 12 months because of large supply that is going to come during the period.

Among the Indian cities, Bangalore has witnessed one of the lowest growths in rentals, in the country. While rentals have increased by 20-26%, here, they are still among the lowest in the country, with prices ranging between Rs 44 per sq ft per month to Rs 73 per sq ft per month. This is mainly because of large supply of quality space in the city. Interestingly, Bangalore is witnessing one of the highest demands for space in the country. As against this, other cities like Kolkata witnessed one of the highest rises in rentals, at Rs 65 to Rs 70 per sq ft per month. Such rise in rentals is mainly due to the entry of better grade supply in a constrained office market.



Contributed By : Ramprasad Padhi
Pinnacle Realty (http://www.mumbaiproperties.com/) Suite # 24, Royal Tower, I.C.Colony, Borivli West, Mumbai 400 103 Board Nos: 2893 3333, 2892 5252, Cell : 9820 1515 00 Email : ram@pinnaclerealty.in

Indians, Chinese & Russians are biggest buyers of luxury homes in London

According to a Knight Frank Report issued recently, International buyers account for more than 60% of all house and apartment purchases in the UK capital for properties costing more than £4 million (about Rs32.5 crore). The value of London’s costliest residences has tripled in the past decade as the number of homes for sale priced over £2.5 million has fallen by a quarter in the past two years.

Properties priced at more than £4 million rose 43% from June 2006, while homes selling for less than £1 million gained just 1.6% in the 12 months. The average price of a luxury house in Knight Frank’s monthly index, which draws from seven of London’s most expensive districts, is now about £5 million, with apartments costing £2.5 million.

A typical house has gained in value by at least £1,00,000, about four times the average annual UK wage, each month since September. A house which cost £1,00,000 at the time the survey began in 1976 would be worth £4.32 million today. Monthly gains in the luxury house price index will probably slow to 1% for the remainder of the year. Prime properties in London sell at £2,300 a square foot, or 5% more than in Monaco. In New York, comparable homes sell for about £1,600 a square foot and in Tokyo for about £1,100, according to Knight Frank figures. Indians account for a major share of above Million Pound Homes in LondonLondon’s open economy, a stable political environment and an advantageous tax system make it attractive to international buyers, said Knight Frank.

Indians, Chinese and Russians play an important role in the luxury housing segment.
Russians favor Knightsbridge, home to Harrods department store, Belgravia, Chelsea, favoured by bankers, and St John’s Wood, which includes London Zoo and Lord’s cricket ground. They are willing to pay more than £10 million for the right property, said Knight Frank. More Russians own London homes costing more than £5 million than any other nationality apart from Britons, said Bailey.

“The sheer volume of Russians in London will make it difficult to match them,” said Bailey.
Many Indian buyers are “keen to uncover bargains,” looking for properties or neighbourhoods where there is “improvement potential,” said the Knight Frank report. It said many Indians are seeking properties priced between £750,000 and £1 million, with St John’s Wood a preferred part of the city.

Chinese buyers from Hong Kong with up to £2 million to spend like to look in Belgravia and Knightsbridge, the report said.

“The incidence of wealthy Chinese buyers purchasing property in central London is only just beginning,” said Knight Frank. “Over the next two to three years we expect the number of Chinese applicants to speed up noticeably.”

Emerging markets are growing faster than developed economies and the UK is the favored country for inward investment into Europe, boosting residential property purchases. India ranks second behind the US for inward investment projects in Britain.

“The UK, and in particular London, by virtue of its status as one of only two truly global financial centres, is a major beneficiary of this trend and should continue to do so for some time,” said Knight Frank.

Source: Livemint, ET & Knight Frank

Contributed By : Tia Singh

Magicbricks.com’s premium property fair records transactions worth70 cr

Leaf of Luxury – the premium property fair organized by Magicbricks.com in Delhi – clocked in transactions of about Rupees 70 crore. About 20 deals, amounting to Rupees 70 crore, were closed at the fair itself. The fair recorded a footfall of more than 1,000 High Net-worth Individuals (HNIs).

This is the first time that Magicbricks.com organised such a fair in the Delhi NCR region. Leaf of Luxury showcased premium residential properties by eight exhibitors. It was an initiative to connect to the premium segment of the society and has seemingly paid off well.

The fair was held on March 1 and March 2 at Hotel Shangri La, New Delhi. The success of this show hints that Delhi is ready for more such shows and the HNIs will lap up all such events in future as well.

I welcome all readers to share their views on luxury living in Delhi.

Contributed By : Yojana Sharma

Highlights of India's Union Budget for 2008/09 - What it means for Real Estate?

THE ECONOMY

• Total plan spending in 2008/09 seen at 2.4 trillion rupees ($60.3 billion). Non-plan spending seen at 5.07 trillion rupees.
• Government to waive debts of small farmers. The total cost of the farm debt waiver scheme will be 600 billion rupees.
• Fiscal deficit in 2008/09 seen at 2.5 percent of GDP compared to 3.1 percent of GDP in the previous year.
• Revenue deficit seen at 1 percent of GDP in 2008/09 compared to 1.4 percent of GDP the previous year.
  

• Government confident of GDP growth of 8.8 percent in 2007/08.
  
  

INVESTMENT, INFRASTRUCTURE, INDUSTRY AND TRADE

• Saving rate and investment rate estimated to be 35.6 per cent and 36.3 per cent,
  respectively, by the end of 2007-08; between April- December 2007-2008. FDI
  amounted to US$ 12.7 billion and FII to US$ 18 billion
  

RURAL INFRASTRUCTURE DEVELOPMENT FUND

• Corpus of RIDF-XIV to be raised in 2008-09 to Rs.14,000 crore, with a separate
  window for rural roads.
  
  

ROADS

• National Highway Development Programme (NHDP): Allocation for NHDP enhanced to Rs.12,966 crore in 2008-09 from Rs.10,867 crore in 2007-08; Completion rate in the Golden Quadrilateral is 96.48 per cent and in the North South, East West Corridor project is 23.36 per cent; Special attention being paid to SARDP-NE; programme devised for the North Eastern region; 180 kms of roads completed in 2007-08 and 300 kms. of road targetted for completion in 2008-09.
  
  

HOUSING FOR THE POOR

• Subsidy per unit in respect of new houses sanctioned after April 1, 2008 to be enhanced from Rs.25,000 to Rs.35,000 in plain areas and from Rs.27,500 to Rs.38,500 in hill/difficult areas to reflect the higher cost of construction;
  

• Subsidy for upgradation of houses to be increased from Rs.12,500 per unit to Rs.15,000;
  

• Public sector banks to be advised to include IAY(Indira Vikas Yojna) houses under the differential rate of interest (DRI) scheme and lend up to Rs.20,000 per unit at an interest rate of 4 per cent.
  

BUDGET ESTIMATES

• Plan Expenditure estimated at Rs.243,386 crore.
  

• Non-Plan Expenditure estimated at Rs.507,499 crore.
  

• Urban infrastructure spending to rise to 68.7 billion rupees.
  

• Rural infrastructure spending will be 140 billion rupees.
  

• Government spending on national highways will be 130 billion rupees.
  
  

TAX PERSPECTIVE

• Income tax threshold raised to 150,000 rupees.

• Tax to GDP ratio in 2007/08 seen at 12.5
  

• Government proposes increasing short-term capital gains tax to 15 percent and a commodity transaction tax for futures.

• Government proposes to withdraw banking transaction tax from April 2009.

• No change to corporate tax rates.
  

• Service Tax - Four services brought under service tax net namely, asset management service provided under ULIP, services provided by stock/commodity exchanges and clearing houses; right to use goods, in cases where VAT is not payable; and customised
  software, to bring it on par with packaged software and other IT services.
  

• Five year holiday from income tax being granted to two, three or four star hotels
  established in specified districts having UNESCO-declared 'World Heritage Sites';
  the hotel should be constructed and start functioning during the period
  April 1, 2008 to March 31, 2013.
  

• Five-year tax holiday for hospitals.
  

• Excise duty rates on bulk cement and packaged cement brought on par.
  
  

SOURCE : http://indiabudget.nic.in

For further insights, discussions, reactions and opinions on the budget 2008/09, please logon to http://www.propertymixer.com/

Contributed By : Minal Arora

Bangalore & Delhi have seen highest price rise in property from 2000-2005 – Economic Survey 2007-08 Suggests

With the growth of economy and rapid urbanization, property prices in almost all Tier 1 & many Tier II cities have seen an upward trend. The National Housing Bank (NHB) had earlier set up a Technical Advisory Group (TAG) to explore the possibility of constructing a real estate price index.

Source: Economic Survey 2007-08

According to TAG’s pilot report submitted for select cities in India, some cities like Bangalore have seen a price rise of 28.8 % year on year and Delhi according to the report has seen a price rise of 19.1 % year on year. These numbers are significant and although an index which would be able to give the overall picture for the country is being planned and will take sometime to come, this index atleast gives some indicators as to what is the Real Estate trend.

One important thing is that these figures are only till 2005. NHB, however, is setting up an institutional mechanism for releasing an economy-wide housing price index on a regular basis.

Contributed By : Rahul Gandhi

UNDERSTANDING VASTU & FENGSHUI AND THEIR RELAVANCE IN THE REAL ESTATE MARKET

VASTU SHASTRA:

Vastu is a Sanskrit word which means Vaas: Live Tu: you, a place where you live or dwell. Shastra means a text which contains knowledge or instructions. Simply put Vastu Shastra means instructions laid down for building a structure.

HISTORY:

Historically Vastu dates back to the Vedic times. Although there is reference of Vastu in several ancient books, Mayamata and Manasara are the most important ones. Being a technical subject it was confined to the Sthapathis or architects. They laid down several principles for constructing a building taking into account the five elements of nature.

BASIC FUNDAMENTALS:

Vastu Shastra is based on the importance of the 5 elements of nature (wind, water, earth, fire, space) and the 4 directions (East, West, North, South). Any structure which is not built in accordance with these elements or aligned with the 4 directions will sooner or later pose problems for its inmates. The interplay of nature acting through these elements and directions therefore forms the basis of Vastu.

VASTU AND REAL ESTATE

Vastu touches every aspect of our lives. Vastu homes provide us with a healthy and secure life. Offices built on Vastu principles enhance sales and productivity. Vastu compliant factories can promote the efficiency of the workers and minimize breakdown of machines or other equipments. Malls and retail outlets can see the boost in sales. In short modern societies can benefit from Vastu in a lot of ways. Today we have so much moved away from nature. Either we are confined to the four walls of our home or office. A walk on the city roads is far from relaxing. In such a scenario the principles of Vastu need to be correctly applied to our buildings and we shall ourselves experience excellent results.

FENG SHUI

Feng shui means the Law of Heaven and Earth. Feng means wind and Shui means Water. It believes in the balance of yin and yang (the two opposites) and a balance between Heaven and Earth.Chinese saw wind and water as the intermediaries between heaven and earth.

HISTORY

The earliest records of Feng shui can be established during the Han Dynasty (200B.C – 200 A.D). There is evidence that the Chinese wrote on bones about the logical assumptions of natural cause and effect. The observation of Nature’s cycle and it’s relationship with the well being of humans. However, it is also believed that the Buddhist monks travelled to Tibet to teach and preach Lord Buddha’s teachings.Along with the Buddhist philosophies they also carried with them other systems which were practised and perfected in India. Vastu was one amongst them. The beliefs slowly altered to suit the local customs and culture.

BASIC FUNDAMENTALS

Feng shui too takes into account the importance of the 5 elements and the 4 directions. But it also lays a lot of emphasis on flow of “chi” or the cosmic energy. It is the invisible life energy force which operates within a human body as well as the buildings we live in. A building without proper flow of chi is nothing but an ailing or dead concrete structure. The philosophy behind Fengshui is to create environments where the chi flows smoothly to achieve physical and mental health.

FENGSHUI AND REAL ESTATE:

Not only South East Asia but the Western world too in-corporate Fengshui principles and considers it as an effective tool. In Taiwan whenever a new skyscraper goes up the owners hire a Fengshui consultant to plan and build their buildings. Fengshui is thousands of years old philosophy but its principles are as much relevant today. Example: The Form School of Fengshui proposes that the best site for a home is on a south-facing slope - preferably between two hills of unequal size (the Green Dragon and the White Tiger). Ideally, a river will be running along one side of the structure. The river should then turn in front of the building and then disappear.
Looked at another way, such a home on the south slope gets the maximum hours of sunlight, is shielded from the chilly, health-sapping north wind and has a good supply of water for drinking and cleaning. By then conveniently disappearing under the ground and gravel, the river carries away effluents and other "dirty" water.
Therefore with a little foresight and a good knowledge of Fengshui we can select the best place for ourselves.

In the coming weeks we shall investigate about the different aspects of both Vastu and Fengshui and how both can be a very powerful tool for increased effectiveness. The meaning purpose and role attached to every direction. How an alignment of the house, with the four directions can bring a healthy and positive change and lots more.

Contributed By : Sabina Vanjani

Luxury living catching on in India

Rising income levels in India is creating more billionaires every year and this has a direct impact on consumption patterns as well. A survey suggests that there are 1.6 million luxury households in India and each of these luxury household earns about Rs 45 lakh per year and they spend about Rs 4 lakh per year on luxury and 'very premium' goods and services. This development has created a spur in the housing demand as well.

Many developers are targeting High Net-worth Individuals (HNIs) to sell their premium properties. Magicbricks.com is organizing one such fair to bring developers of luxury properties together. Big developers like Emaar MGF, Unitech, Ambience, Parsvnath, Supertech and Assotech will display their property worth rupees one crore and upwards. The fair is being held in Hotel Shangri-la, New Delhi on Match 1 and March 2, 2008.

The response to this fair will determine how many of these luxe-living projects find spot takers among HNIs.

Contributed By : Yojana Sharma

Singapore-based Cinnovation Group acquires Nova Island in "The World"

Singapore-based Cinnovation Group on Monday said it has acquired the Nova Island in Nakheel's The World islands project.

The company also revealed plans to build a luxury hospitality haven on this 400,000 square foot island - a project valued at $200 million (Dh730 million). Cinnovation's acquisition of the island and its development is in partnership with Dubai-based Global Realty Partners (GRP) Group.
The hospitality arm of Cinnovation Group owns resorts in Maldives, Sri Lanka and Malaysia. Other projects include management and development of boutique resorts in the Middle East, South East Asia, India and China, business hotels in the Middle East and India, and eco-tourism resorts in Africa.

On Nova Island, Cinnovation plans to create an island paradise reflecting the best aspects of its flagship property Taj Exotica Resort & Spa (Maldives), a Leading Hotel of the World.

Contributed By : Shivang Prabhakar

Mumbai’s Aspiration to be the New Global Financial Centre

Authored by Sangeet H Kumar
CEO, ACBD Global Asset Corp

Mumbai city, known as the “Financial Capital” of India, has a new aspiration…..
to become a “Global Financial Centre” (GFC).

It’s not that we the Mumbai-ites want this to happen. It’s the combined initiative of the India government, the Indian Industry & Trade Organizations and the world market forces that are driving this dream into reality. Even recently on his visit to Mumbai, Ken Livingstone, the Mayor of London, believes that Mumbai has the potential of becoming a big financial centre, just like London. Let’s analyze as to what are the driving factors for making Mumbai a GFC -

(1) Rapid growth of Indian Economy and the continuous flow of foreign Direct Investment and Foreign Initiative Investment (FII) have created a need of an International Financial Centre.

(2) Mumbai has one of the most talented & educated and English literate human resources, in form of IT, finance & banking professionals.

(3) Mumbai also has a geographical & location advantage, as it serves Europe, Middle East and Asia market, through a single business day.

(4) India is increasingly becoming a favorite destination for global investments in Indian stock market & Real Estate Industry.


To realize the dream of becoming a GFC, there are a number of Private and Government Initiated Projects that are being undertaken or being planned.

Modernisation and development of Chhatrapati Shivaji International
Airport (CSIA) at Mumbai.Project cost is pegged at Rs 5700 crore.
Phase-I will completed by 2010.

Development of an International Airport at Navi Mumbai, part of Mumbai Metropolitan Region.

The Airport will be developed as a Greenfield Airport through Public Private Partnership (PPP)..Project cost will be Rs 9970 core with a targeted completion by year 2013.

Development of Mill land paving way for real estate development in the form of Shopping Malls, Multiplexes, Residential and Commercial spaces.

Bandra-Worli Sea Link Project expected to be ready by Mid 2008 will reduce
con­gestion at Mahim causeway and the western corridor.
Project is currently esti­mated to cost Rs 1,104 crore and will lead to fuel saving.

Nhava Sheva - Sewri Sea Link project envisages a six lane expressway connecting Sewri in South Mumbai to Nhava in Navi Mumbai. Project is expected to be com­pleted by year 2018.

Mumbai Metro Rail Project envisages rail link between Versova-Andheri­Ghatkopar in Phase-I at a cost of Rs 2356 core. Phase-I will be operational by 2011.

Dharavi Slum Redevelopment Project envisages development of integrated township with world class amenities and infrastructure.Project will be executed at a cost of $2.3 billion.

Brihanmumbai Storm Water Drain proj­ect envisaging the complete overhaul of the 100-year old drainage system in the city initiated by BMC.

Middle Vaitarna Dam Water Supply Project under JNNURM ensuring sufficient and smooth water supply to Mumbai res­idents. Govt. of India has approved 35% funding of the project.

Mumbai Sewerage Disposal Project Phase II

Mumbai Urban Transport Project Phase­II implementation.
Project has so far received an in principal approval from the Ministry of Railways.

So as the world enters into the New Year of 2008, Mumbai is getting ready to join New York, Chicago, London, Frankfurt, Geneva, Zurich, Hong Kong, Singapore, Tokyo and Sydney as the New Champion City of the financial world.

Contributed By : Sangeet H Kumar

Are the rising property prices causing a social divide?

Authored by Sangeet H Kumar
CEO, ACBD Global Asset Corp

There is no denying to the fact that India has quite a high economic disparity (which is prevalent in most of the developing countries in the world) .The rich are getting richer and the poor are getting poorer is cliché’, and very much a reality in the New India. With luxury limited to a privileged few who drive a 7 Series BMW, own a villa in Mauritius, sport a one crore watch, wear a Solitaire and take a holiday to Europe as often as some holiday at a nearby hill station.

With the high property prices seen all across India, sometimes I wonder that added to the above, real-estate is soon becoming responsible for the growing social divide in our country. Coupled with the high property prices, we are witnessing luxurious projects being launched by developers that are obviously expensive. Penthouses and villas, with the best of designs, layouts and features like a private swimming pool have become order of the day.

Especially the middle class are getting crunched and as the property prices keep rising, definitely higher than the incremental income, they are left high and dry. I know a few of my clients who believe that they can never move to a new (read bigger) house. They repent that they could not take the right decision at the right time.

I would like to give a perfect example of 3 brothers who last year sold their family bungalow in a posh suburb of Mumbai. One of them bought a row house in a distant location for a 10% higher price that was prevalent in the market at that time. The client was grumbling that I had sold him an expensive deal. The second brother being a pessimist kept telling me that the market would see a correction and he would rather wait. He moved into a rental house and believed that he had taken a right decision. The third brother who lives in the US invested part of the money in business and now is in the process of picking up a new house.

In just a period of 12 to 14 months the row house today is worth 30 to 40% more than the purchase price. The brother, who believed that the property prices would fall, is still living in a rented house. (I just hope that his wife does not divorce him) The brother in the US is quite a happy man because I believe that the property in the US have taken a beating in the last one year or so.

Though my wife's single demand is that we should soon move to a new apartment, that too a terrace one (perhaps because her brother just bought a 4000 sq.ft. penthouse) I still consider myself privileged as I have a roof above my head.

Contributed By : Sangeet H Kumar

The Property Boom In India to Continue in 2008

Authored by Sangeet H Kumar
CEO, ACBD Global Asset Corp

With property boom spreading in all directions, real estate in India is touching new heights and will continue to do so in 2008. The Indian real estate has huge demand potential in almost every sector, especially commercial, residential and retail.

Policy changes introduced by the Government allows for 100 per cent foreign investments in construction projects with fast-track approvals. But the real attraction for foreign investors is potential investment returns of 25 to 30 per cent and more in Indian projects that might be hard to come by in the US and in Western Europe today. With a growth rate of about 30 per cent and projected figures of 90 billion US dollars, by 2015, it can be safely said that the real estate sector in India is truly booming.

Robust economic growth, congenial environment/opportunity for buying property in India, 2010 hosting of the Common Wealth Games in Delhi along with the positive outlook of Indian government have been the key factors behind the sudden rise of the Indian Real Estate sector - the second largest employer after agriculture in India.

This budding sector is today witnessing development in all area such as - residential, retail and commercial in metros of India such as Mumbai, Delhi & NCR, Kolkata and Chennai. Easier access to bank loans and higher earnings are some of the pivotal
reasons behind the sudden jump in Indian real estate.

Growth in commercial office space requirement is led by the burgeoning outsourcing, retail and information technology (IT) industry.

One of the main propellers of this growth is also the rapid urbanisation of Indian cities. The Indian government has estimated a shortfall of 20 million accommodation units. This quantum of demand, coupled with a short supply, ensures that there's a great requirement for residential realty. This in turn translates into great opportunities for real estate companies providing quality township projects. Industry observers feel that this growth is facilitated by favourable demographics, increasing purchasing power, existence of customer-friendly banks and housing finance companies, professionalism in real estate and reforms initiated by the Government to attract global investors.

It is also estimated that India will need 475 billion dollars in the next five years to upgrade its infrastructure. This level of investment opportunity hasn't gone unnoticed by global investors and has drawn the heavy weight investors to India. But the real story lies in the deeper changes within Indian society that are expected to have an even greater impact on real estate. India has a young profile today. Half of its population is under 25 years and the country's median age is 24 years compared to 33 years in China and 43 years in Japan. The country is urbanising at a rapid rate of 2.5 per cent per year.

The number of cities over one million is expected to double from 35 in 2001 to 70 cities by 2025. Mumbai and Delhi is projected to be the world's second and third largest cities by 2015. Tier 2 cities like Pune, Hyderabad and Chennai are becoming increasingly important in this scenario. India's large population is now being viewed as one of its key strengths, especially a young and urbanising population.

The trend towards urbanisation is part of a long-term structural change in the Indian economy. Where now, less than 30 per cent of the population live in cities, that figure is expected to double by 2030.

More importantly, this young customer base has an ever-growing demand for products and services and is providing massive labour market opportunities as well.

This new brand of consumer's rising disposable incomes is also being generated towards lifestyle products, real estate included.

Contributed By : Sangeet H Kumar