71,124 people visit MCHI property 2008 exhibition

MCHI property 2008 exhibition evokes overwhelming response
Housing Finance Institutions (HFIs) receive high number of loan enquiries

Mumbai, Oct 12: More than 71,124 people visited the just concluded property 2008 exhibition organized by the Maharashtra Chamber of Housing Industry (MCHI) at Bandra Kurla Complex (BKC) from October 9-12, 2008. This is a healthy rise of 14.06 percentage compared to the last exhibition when nearly 62, 356 home aspirants had visited the property show in April 2008.

The loan enquiries received by housing finance companies and banks was placed at Rs. 805.59 crore during the four day exhibition. Flat inquires worth Rs. 411.18 crores were generated during the exhibition

Housing developers had announced attractive incentives for potential buyers during the exhibition. These included stamp duty waiver, free parking, and subvention schemes see attachment

Commenting on the success of the exhibition, Mr. Pravin Doshi, President MCHI said “We are highly encouraged by the overwhelming response to the exhibition. The attendance of quality home seekers on all four days and their interest in the property show indicates the insatiate demand for housing in Mumbai and the state”.

Mr. Mayur Shah, Honorary secretary MCHI said, “Property 2008 exhibition once again proved that there has been growing demand for housing in the country’s commercial capital, Mumbai and its suburbs.

Mr. Harish Patel, Convenor Exhibition, MCHI, “We are pleased with the good response to the property 2008 exhibition irrespective of the little sluggishness in the economy”.

Mr. Deepak Goradia, co-convenor exhibition, MCHI adds, the MCHI has been organizing the mega housing exhibition in order to offer best of the opportunities to the potential buyers. MCHI’s credentials enhanced further with continuous encouraging response from the potential buyers this year.

Following are the winners of the lucky draw (the one’s who had purchased property from MCHI exhibition held in April 2008) :

Prize / Gift
Name of Winner
Property Purchased from
1 BHK FLAT at MARATHON NAGI BADLAPUR
Mr. Kanugovi Vijayavittal
Neelkanth Group

1 BHK FLAT at LOK AMBER, AMBERNATH
M/s. Indore Composite Pvt. Ltd.
Lok Housing

Rs. 60,000 GIFT VOUCHER
Ms. Monica Kapoor
Sunil Mantri Realty Ltd.

Rs. 60,000 GIFT VOUCHER
Mr. Dhruv Balsara
Mayfair Housing

Rs. 60,000 GIFT VOUCHER
Mr. Rashmikant Ganger
Lok Housing

Rs. 60,000 GIFT VOUCHER
Ms. Reena Merchant
Lok Housing

Rs. 50,000 GIFT VOUCHER
Mr. Indrajit Chatterjee
Ekta Supreme

Rs. 50,000 GIFT VOUCHER
Mr. Talamati Mastan
Sunil Mantri Realty Ltd.

Rs. 50,000 GIFT VOUCHER
Mr. Manek Dastoor
Ekta Supreme

Rs. 50,000 GIFT VOUCHER
Mr. Vishal Somani
Neelkanth Group

Rs. 50,000 GIFT VOUCHER
Mr. Mehul Smart
Mayfair Housing

Rs. 50,000 GIFT VOUCHER
Ms. Kalpana Vora
Neelkanth Group

Rs. 50,000 GIFT VOUCHER
Mr. Vijay Deole
Ekta Supreme

Following is the list of stall winners at the exhibition:

Developers Hall A

Winner : MARATHON GROUP

Runner up: 1) KOHINOOR PLANET CONSTRUCTIONS PVT LTD
2) RNA CORP.
Second Runner up: KALPATARU LTD.

B) Excellence in Design Developers - Hall B
Winner : PRUDENTIAL GROUP
Runner up: SKYLINE GROUP

C) Excellence in Design Developers - Hall C
Winner : NEEL SIDDHI ENTERPRISES
Runner up: BUILDTECH CONSRUCTION ENGINEERING & DEVELOPERS

D) Excellence in Design – Banks and HFIs
Winner : ICICI HOME FINANCE
Runner up: 1) STANDARD CHARTERED BANK
2) HDFC LTD.

Category 2: Excellence in Customer Information and Responsiveness

Winner Developers: 1) RUSTOMJEE
2) NEELKANTH MANSIONS & INFRASTRUCTURE LTD
Winner Banks & HFI’s : STATE BANK OF INDIA

Category 3 – Excellence in Innovative Marketing

Winner Developers: NAHAR GROUP
Winner Banks: LIC HOUSING FINANCE LTD.

Category 4 - Excellence in Information
Winner : MUMBAI POLICE

Property 2008, India’s only official and biggest real estate exhibition organized biannually by the MCHI for last nine years, is a one-stop destination for the potential property buyers in Mumbai. Altogether 800 properties by over 85 real estate developers and 15 housing finance companies were on display at MCHI property 2008. The exhibition was organized by MCHI and co-organized by the State Bank of India. The Gold partners of the exhibition were – HDFC, ICICI Bank, Home loans, LIC Housing Finance and AXIS bank. The silver partners of the exhibition were Reliance consumer finance, IDBI Bank and Schindler (i) Pvt ltd.

About MCHI
Maharashtra Chamber of Housing Industry (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 one common platform to address issues facing the industry. Members of MCHI account for providing more than 80 % or 90% of residential accommodation in Mumbai and its vicinity and helps both the Central and State governments in meeting their objectives or providing shelter. 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-recognised and reputed member builders, developers MCHI is affiliated with leading industry associations like FICCI, IMC and CREDAI.

GLOBAL SLOWDOWN – OPPORTUNITY KNOCKS

Anuj Puri, Chairman & Country Head, Jones Lang LaSalle Meghraj

Despite all the misgivings about a so-called ‘global recession’ and the US subprime crisis, it is a good time to be doing business in India. For quite a while now, this country’s economy has been robust enough to sail through any turbulence. India has the ability to show high single-digit growth rates for very long periods of time. Moreover, India is a saving-oriented nation that has a domestic savings rate of 33%, which means it is better equipped to absorb the fallout of variations in the economy. This is more than the extravagantly wasteful economies of most developed countries – including the US – can claim.

Nevertheless, many Indian corporates are yielding to confusion and uncertainty about the future. In many discussions with my peers, I have noted a generalized fear that the worst may yet come. The logic seems to be that the economic fluctuations we have been witnessing recently are the direct result of a global recession, compounded by the US subprime crisis. However, India is not primarily grappling with foreign-induced recession fallout, but with problems arising from its own soaring inflation rates, which had recently risen to an all-time high of 12.75%. We are grappling with the effects of high crude oil prices, rapid appreciation of the rupee and the consequent reactions of the stock market.

More specific to the property market – we are indeed witnessing a correction, but this is predominantly brought on by the sharp 200-300% rise in property rates seen over the last two years. It is perfectly natural and expected that there would be an adjustment of such irrational growth.

Do we have a challenge situation on our hands? Yes, but it is one brought about by lack of faith and information. The origin of the challenge does not lie in foreign markets, but our own. Nor is the challenge anywhere as big as its is being made out to be. India is nowhere as vulnerable to fallout of the US recession as its is being fashionably assumed. I’d like to point out here that according to international credit rating agency Standard and Poor’s, India and China are in the category of ‘not vulnerable’ countries.

Asia Pacific is only about India and China now. No other part is experiencing any exponential growth, and India is among the biggest growth drivers. Foreign players will continue to invest in India and China and cut back markets that are less of a priority, especially on the developed ones where investments take longer to pay off.
However, unlike China, India's growth story is a domestic market driven growth. India is better placed than China to withstand the worst effects of an economic downturn. China, unlike India, is more susceptible to the US financial crisis because it follows the East Asian export-led model of economic growth.
In any case, neither India’s nor China’s markets are particularly integrated with the United States, since both have market fundamentals that have separately evolved from the West over the past 60 years. China and India will not participate in a worldwide recession and will, in fact, be hedges against this. All the prophecies of doom that are floating around these days seem to rely on the erroneous assumption that the global markets are pulling out of India. The fact is that lenders and investors have merely become understandably and justifiably cautious.

China and India possess 40 percent of the world’s population. While only 20 percent of this can purchase to international standards, combined this is still larger than the U.S. disposable middle class income. Moreover, both largely supply much of the world’s consumer goods. Right now, India’s fundamentals are very strong and so is domestic demand. Only the more export-oriented businesses are likely to suffer in the short term - mainly firms in for an IPO, or financial services companies.

We all know that there has been a slowdown of sorts in the real estate sector, but we are equally aware of the fact that this slowdown was predicted anyway, and that it is specific only to some overheated markets in the North and the recent stock market fluctuations. Some domestic investors have certainly sought to sell their holdings and withdraw from the property market. However, this does not represent the international investor scenario and is not even altogether bad news. It is, in fact, positive in the sense that real estate values are correcting in overheated pockets, leading to a brake on illogical land valuations. Major players are still making serious inquiries.

How will real estate companies deal with the current scenario? It is very clear that diversification and corporate performance will be the watchwords in the future. Of course, this is a time of change, and change often gives rise to uncertainty. But corporate history has amply displayed that strong companies that emerge even stronger in turbulent times always react to change with renewed focus and energy.

They react by improving their cost efficiencies. They do it by concentrating on business, maximizing it and leveraging their intellectual capital. They do it by becoming more client-oriented, helping their clients tackle the economic situation more efficiently by change their value propositions. They do it by being even better employers, making talented employees feel valued and enlisting them to help cut costs. And they do it by raising their efficiency bars, clarifying their vision and improving their scalability.

Recession? Ladies and gentlemen, India's economic growth will be on a higher trajectory (8 to 9 per cent) in the next three years. Infrastructure spending, domestic consumption and investment will continue to drive economic growth - growth that will attract increased capital flows, be they long-term or short-term in nature – into the sector of our business operations. India is a trillion dollar economy today. At an annual growth rate of 8% over the next seven to eight years, it will double this figure –and economists agree that India’s growth story will continue over the next three decades.

For companies with a winning hand of service modules and deeply entrenched market presence, the term ‘global recession’ is little more than a call for differentiated strategies to accommodate evolving market dynamics - not doomspeak and panic. Let us take inspiration from the case of Germany. Companies there are making the right goods and delivering the right services at the right time. China, India, Russia and the countries of central Europe are rapidly expanding their economies and need the capital goods that German companies specialize in. The machine tool industry, for example, has seen orders grow at around 10 percent annually for the past three years.

Let us take a brief look at the questions that investors will be asking themselves in the current scenario:

• What are the company’s products?
• How are the company's products better placed compared to those of the competitors?
• What is the company's past financial performance?
• What are the initiatives that the company is taking – to mitigate competition, and to manage risks associated with the industry?

The only real question is whether our collective entrepreneurial spirit will be encouraged or discouraged by the recession in the US. The current scenario will certainly separate the ‘men from the boys’. In a recession, fortune favours the brave.

Honourable Kumari Selja to open Cityscape India

Minister of State (Independent Charge) for Ministry

of Housing and Urban Poverty Alleviation to outline affordable housing initiative to international investors & developers at Mumbai real estate showcase

The honourable Minister for Housing and Urban Poverty Alleviation, Kumari Selja, will be cutting the ribbon at this year’s Cityscape India, which is due to take place at the Bombay Exhibition Centre on 8-10 December 2008.

After the official opening the honourable Minister will address local, regional and international delegates during the opening of the Cityscape India Conference. Her speech entitled ‘Affordable Housing For All In India’ will outline the initiatives to develop residential property, not only for India’s burgeoning middle class, which is now estimated at 325 million people, but also for India’s lower class, which still represents approximately 70% of India’s 1.2 billion population.

“28% of India’s population now lives in conurbations and that figure is growing rapidly. The demand for affordable housing is immense and potentially the long term returns for investors and developers is colossal,“ said Graham Wood, Exhibition Director.

Cityscape India is an annual international networking exhibition and conference focusing on commercial architecture, property investment and development and attended by the most significant investors, developers, architects and consultants.

Cityscape India 2007 officially became the largest business-to-business real estate event in India attracting over 5,000 participants from 38 countries celebrating the best in real estate, architecture, urban planning and design. The event was launched in 2007 to provide the country's real estate sector, now valued at over $15 billion, a networking platform where domestic developers can source international investment contacts. It is also a platform where international developers can meet Indian investors.

This year, Cityscape India is set to welcome more than 8,000 participants from around the world. "In addition, leveraging its relationships in the global investment market place, Cityscape will reach out to over 250,000 senior decision makers seeking to invest in one of the world’s fastest growing economies," said Graham Wood, Exhibition Director.

New this year two parallel conferences entitled ‘International Real Estate Investment and Development’ and ‘Infrastructure Finance & Investment’ will take place alongside the exhibition. Recognised as India's leading networking conference, participants include, the Trump Organisation of the United States, Reliance of India and Nakheel of the United Arab Emirates.

Donald Trump Junior, Executive Vice President of Development and Acquisitions for the Trump Organisation, spoke at last year's Cityscape India, and is looking forward to returning. He added: "Cityscape India has certainly come in at the right time to provide a quality business-to-business networking platform."

There will also be an Infrastructure Conference addressing one of the most important topics in India with respected names presenting their experiences and knowledge of effectively overcoming challenges to raise equity and build public-private partnerships.

The Cityscape India 2008 Real Estate Awards will also honour leading real estate professionals and companies for their outstanding contribution to the industry. The award categories include: Most Innovative Finance; Best Real Estate Marketing Campaign Award; Best Corporate Social Responsibility Project; Best Urban Design and Master Planning; Best Developer – Retail Project; Best Developer – Commercial/Office Project; Best Developer – Hospitality Project; Best Developer – Residential Project Award; Best Developer – Mixed Use Project.

Platinum sponsors of Cityscape India 2008 are Limitless and Soundlines. Limitless, a Dubai World company, currently has nine projects – worth over $100 billion – in India, Saudi Arabia, Malaysia, Vietnam, Jordan, Russia and the United Arab Emirates. Soundlines has diversified into real estate, construction, HR consultancy, hospitality, travel and tourism and healthcare with offices in UAE, Saudi Arabia, Qatar, India, Nepal and Bangladesh.

Gold sponsors are Tanmiyat Group, one of the Middle East’s leading real estate and investment companies, with joint ventures and projects across the region, including Saudi Arabia, the UAE, and Jordan, with investment plans for India, China and Tunisia.

Suggested policy changes in the upcoming Budget for the retail sector

- Anuj Puri, Chairman & Country Head, Jones Lang LaSalle Meghraj:

1. Retail - specifically shopping malls and centers - should be granted industry status. The lack of industrial status does not allow developers to effectively address major issues such as traffic regulation and staff satisfaction/retention. Nor can retail avail of industry-appropriate subsidies, benefit from more favourable import/export laws or introduce the level of transparency required to attract more foreign players

2. Service tax as pertains to rentals should be clarified and freed from existing ambiguity. Service tax rentals paid for property that retailers occupy is an unrealistic financial burden. Thanks to increased competition, retailers are already operating on thin margins, and the added encumbrance of service tax only serves to make goods costlier for consumers.

3. Electric supply to shopping centers and malls should be incentivized/subsidized, in line with similar benefits given to other public spaces.

4. The budget should incentivize the creation of cold storage chains to help reduce wastage (approximately 30% of products are currently wasted for lack of these)

5. The budget should facilitate the creation of retail-related community centers in Tier IV/IV cities and towns that are undergoing rural consolidation, to help retail spread to these locations in a uniform and systematized manner

Contributed By : Arun Chitnis

REAL VALUE IN A CHANGING WORLD

Anuj Puri (Chairman & Country Head, Jones Lang LaSalle Meghraj)

We are at a defining point in the history of Indian real estate. Rarely has a business sector seen so much churn, conjecture, simultaneous pessimism, optimism and prophetic predictions in the space of just a few months.

To say the very least, these are interesting times. There has been a slowdown in Indian real estate because an amalgam of reasons - overheating of prices in certain 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 – property and interest rates were inflated to begin with. Nevertheless, we are still given to focusing more on reasons beyond our borders than those within them. There is a currently fashionable saying making its rounds – when the US sneezes, the whole world catches cold. In the case of India, however, I beg differ.

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. The fall in demand will prevail for approximately ten to twelve months, but it will not be of a magnitude comparable to that of other countries. India continues to be very attractive, but foreign investors are now justifiably awaiting greater transparency and stability.

Still, prices are doubtlessly stagnating and there may be a more generalized correction over the next one year. However, many locations and properties will continue to be in great demand. The retail and commercial space sectors have seen a major sea change on the demand side, completely redefining what is expected from the coming supply. No longer can we adhere to traditional standards of format, efficiency and location – everything is changing, ladies and gentlemen, and we must change with the times.

Our thinking must change, because the sector is changing. I cannot emphasise this enough. We are on the threshold of an awakening into the Era of Transparency. From this point in Indian real estate history onward, we will forever need to look beyond short-term profitability and concentrate on making our projects institutional quality assets through more tie-ups with international expertise.

In commercial projects, the onus is now clearly on large floor plates, workplace ambience and conformity to international sustainability standards. In fact, our thinking must now permanently reorient to global best practices and eco-friendly projects with LEEDS certification.

In the retail sector, the sad truth is that there is an oversupply situation brewing, mainly because the current supply is opportunistic and not based on actual demand. Developers are building malls in catchments where land is available, without studying existing and potential demand.

In residential real estate, most large development houses have now woken up to the fact that affordable housing projects have the fastest absorption rates and are focusing on this hitherto neglected sector. It makes both social and business sense. Business sense in terms of the volumes the market is offering that developers can cater to, and social sense because it provides buyers of economical housing more options to choose from. The demand in terms of units is phenomenal and developers getting into this segment can build for years to come.

Yes – interesting times. We are in the eye of the storm and therefore do not adequately sense the full extent of the turbulence all around us. However, the current market dynamics are already serving the required purpose – bringing about a Indian real estate Renaissance. Quality retail and commercial spaces in tune with the international blueprint are arriving, and developers are now launching housing projects for the common man as never before.
May the future begin.

Contributed By : Arun Chitnis

Micro Markets – The new growth engine for 2008

Micro Markets – The new growth engine for 2008
According to latest 2Q 2008 Asia Pacific Property Digest research from Jones Lang LaSalle

India, 20 August 2008 - The office property markets have continued to post growth over the past few years. However, the last few quarters, have witnessed a polarization of office markets in terms of growth in demand across the country, reports Jones Lang LaSalle Meghraj in its second quarter 2008 Asia Pacific Property Digest (APPD), a comprehensive quarterly report providing market update, significant trends in office markets in India.

The office markets, across six Indian cities including Mumbai, Delhi NCR, Bangalore, Chennai, Hyderabad and Kolkata, can categorized into three broad segments

(1) first segment includes markets which are likely to be “susceptible” in terms of retarded demand growth for the remaining half year of 2008.
(2) second segment includes micro markets which are “strong” in terms of maintaining demand growth for the next two quarters, and
(3) third set includes micro markets which have “high potential” in terms of improving demand growth for the rest of the year.

Anuj Puri, Chairman and Country Head, Jones Lang LaSalle Meghraj says, “It is interesting to note that the “high potential” office micro markets, anticipated to clock increased growth in demand, would do so essentially on the back of affordable product values, improving infrastructure and enhanced product being delivered. It is expected that over the next 8-10 quarters, such markets could witness strong pre-leasing commitments by occupiers despite robust supply pipelines, which are in place.”

Source: Jones Lang LaSalle Meghraj 2Q 2008 APPD; CBD-Central Business District; SBD-Secondary Business District

In case of the susceptible markets, demand from occupiers in the IT/ITES segment, could be rationalized on the back of economic slowdown in the US. This coupled with the strong supply pipeline in many of these markets could lead to a potential consolidation in the respective markets, leading to relatively higher vacancies, although, this may not immediately manifest itself in any marked rental consolidation in such markets.

If the global economic slowdown sustains, we foresee the vacancies to rise in these micro-markets due to strong supply volumes. This might put some pressure on the rental values next year. Rental values are consolidating across all vulnerable markets, however, no major rental fall is expected in these markets this year.

Moreover, it is increasingly becoming evident over the last two quarters that micro markets which are dependent on demand from IT/ ITES occupiers, are likely to be more sensitive to the occupation cost variations as compared to those micro markets which derive demand from non IT/ITES occupiers.

This is evident from the fact that many of the CBD areas in cities such as Delhi, Mumbai, Chennai, Hyderabad, Bangalore and Kolkata continue to enjoy captive demand from corporate occupiers mainly from BFSI, Consulting, and other service industries. The consistency in most of these office markets is also attributable in part to the relatively limited growth in the supply pipeline over the last few years.

Supply Trends
In terms of new office supply completions in the first half year 2008 as compared to same period in the previous year (2007), it is interesting to note that the cities (including all micro markets) that have clocked the highest positive growth rate in terms of delivered supply on a year-on-year are Kolkata, Chennai, Mumbai and Delhi. In fact, Bangalore and Hyderabad are two cities which have actually posted negative growth in terms of stock completion in first half of 2008 vis-a-vis same period 2007.

Source: Jones Lang LaSalle Meghraj 2Q08 APPD

Outlook
A remarkable insight to note is that Hyderabad, Delhi, Mumbai, Chennai and Bangalore have more than half of the total expected office stock completions planned to be delivered in the remaining half of 2008. Whereas, in Kolkata the situation is just reverse, where about a third of the total stock completions are due to be delivered in the remaining half of 2008.

On the demand front, the second half of 2008 is expected to witness high pre-leasing activity in most IT SEZs and, IT parks developed by blue chip developers. While the slowdown in the IT/ITES sector is a known story, the slowdown has been only in terms of a deceleration in the estimated growth rate to 21-24% for 2008-09 vis-a-vis the recorded 28.2% growth in FY 2008. Further demand from emerging industries like pharma, biotech, semiconductor, R&D operations and logistics will top this IT/ITES demand. Thus, taking cognizance of the supply-demand scenario, the next two years will witness strengthening of the real estate office market fundamentals in terms of market behaviour, rationalisation of demand-supply, and increased consolidation.

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 USD2.7 billion, Jones Lang LaSalle has approximately 180 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 portfolio of approximately 1.2 billion square feet worldwide. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with more than USD54 billion of assets under management. For further information, please visit our website, http://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 corporate 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

Current Market Scenario by Anuj Puri

Anuj Puri, Chairman & Country Head, Jones Lang Lasalle Meghraj:

There has been a moderate-to-mid slowdown overall. Retail investments have shown a sharper decline than institutional investments.

Financial institutions are finding it attractive to enter projects at reasonable valuations in the current market situation. Retail investors in residential property probably need to wait and watch till after Diwali to get good value.

Mumbai, Delhi NCR and Pune would have been the best investment options three years ago. The returns were about 30% p.a. Despite the current slowdown, returns are likely to be between 20–30% if an investor holds on for the long term. In the short-to-medium term, they will be considerably lower.

Provided that one does not pay excessively for a property, and further provided that one holds it for a sufficiently long period, thereafter exiting at the right time, returns will be the same. Only the time-frame for these returns has changed – not the potential. It is now a matter of holding power and investor maturity.

Short-term investment would yield much lower returns. To illustrate:

Delhi / NCR- Residential: 7-8%, Commercial: 11-13%
Mumbai - Residential: 7-9%, Commercial: 11-13%
Bangalore - Residential: 6-8%, Commercial: 11.5-13.5%
Kolkata - Residential: 6-8%, Commercial: 11-12%
Chennai - Residential: 6-8%, Commercial: 11.5-13.5%
Chandigarh (incl. Mohali, Panchkula, Zirakpur) - Residential: 6-8%, Commercial: 12-14%
Indore - Residential: 7-8%, Commercial: 12-14%
Cochin - Residential: 5-7%, Commercial: 12-13%

These figures are a reflection of rising property prices and increased risk. Expected returns are higher in riskier markets.

Contributed By : Arun Chitnis

iProperty Group Enters India By Acquiring RealAcres.com; To Invest Almost $500,000 In Working Capital

The IPGA Group (iProperty), a company listed on the Australian Stock Exchange (ASX), has made its debut in the Indian market by acquiring Horizon Infoventures, which owns the Indian property portal RealAcres. The acquisition has been made through its wholly owned subsidiary iProperty Group Asia Pte Ltd. iProperty will introduce print, exhibition and online luxury products to the Indian market.

Further details include that iProperty will invest A$ 0.53 Million (around $470,000) in 4 tranches for 43 percent shares, and swap shares for 17 percent. They will have the option to acquire the remaining 40 percent based on future earnings. The management of RealAcres have a lock-in for a minimum of 3 years.

The deal appears on the same lines as to iProperty's July 2008 acquisition of VRHouse.com.tw in Taiwan. RealAcres claims that it has around 211,000 property listings. The company is based in Mumbai, and focuses primarily on the Western India market. Considered that many times real estate agents are offered free listings to get them to sign up for property sites, so the number of listings may not be an indication of paid listings, hence revenue figures might vary.

In the online property space, if one looks at the transaction or listings based models, then the most prominent players are MagicBricks (Times Business), 99Acres (Info Edge), Indiaproperty (Consim) and Makaan.com while in the business networking space, its only propertymixer.com. HT Media and Manorama Online are also planning real estate portals.

Contributed By : Dushiyant

UK-India Cross Border Investment Set to Grow to £10-15 Billion by 2018: Jones Lang LaSalle

UK-India Cross Border Investment Set to Grow to £10-15 Billion by 2018: Jones Lang LaSalle
Leading UK Developer, The Berkeley Group, Launches London Developments in Delhi and Mumbai

Mumbai, India, 7 August 2008 – Spurred by India’s rapid economic acceleration and continued growth in the medium term, India has seen an unprecedented rise in individual wealth and in the emergence of High Net Worth Individuals (HNWIs). As a consequence, an increasing outward trend in cross border residential investment by Indians in international markets like the UK is increasingly gaining prominence. According to the report, ‘UK-India Cross-border Residential Investment’ released by Jones Lang LaSalle today; Indians could potentially own 20,000 - 30,000 UK residential properties over a 10 year horizon.

A favourable investment environment makes the UK a preferred residential investment market for India’s rising HNWIs and burgeoning middle class population. With no restrictions on Indians investing in UK residential property and strong house price growth, the market will continue to see the current investment size of £0.6 – £1.2 million grow exponentially over the next 10 years, according to the report.

UK residential property headlines have been grabbed by the purchases of Ultra HNWIs like Lakshmi Mittal who have bought a number of homes in the past couple of years. However, there has also been a growing tide of lower-profile purchases by Indians. The number of such Indians with the propensity to invest in the UK residential market is likely to increase to 583 million by 2025 coupled with another 400,000 HNWIs (four times the current base today) by 2017.
In response to this growing appetite for UK property, The Berkeley Group, one of the most respected names in the UK property market, will be launching two of its most exciting developments at exhibitions in Mumbai and Delhi. Two of the principal divisions of The Berkeley Group, St George and St Edward Homes, will be showcasing Aquarius House in Vauxhall, South London, and Stanmore Place in Stanmore, North London in India in August.

Of its international clients, Berkeley has found particularly success among Asian investors. Paul Vallone, Managing Director, Berkeley Homes (Urban Living) Ltd. said “As the Asian middle class grows, more of them are looking abroad for sound investment opportunities. Parents choose an apartment that they can pass on to their children when they go to university, while business travellers will often buy a ‘lock up and leave’ flat that they can use during regular trips to London. Indian investors are some of the most discerning buyers in the world and we believe that, because all of our projects are built in convenient and sought-after locations with the highest level of specification and security, they are ideally suited to such purchasers.”

The Berkeley Group has recently announced that two of its principal divisions, St George and St Edward Homes, will be travelling to India to launch two of its most exciting developments to date: Aquarius House in Vauxhall, South London, and Stanmore Place in Stanmore, North London. Using the specialised local knowledge of Homebay Residential – the residential arm of Jones Lang LaSalle Meghraj, these developments will be exhibited in both Mumbai and Delhi.

‘UK-India Cross-border Residential Investment’ continues to add that the combined growth in the Indian economy and the level of wealth creation to date, it is clear that the potential spend on UK residential property investment can be huge over the next ten years. It further says, “Specific predictions are difficult but broad assumptions give one some idea of the potential scale of investment. Currently, the proportion of any individual’s wealth invested in property is typically 20% of all assets. We can also make the assumption that the approximate proportion of wealth invested in the UK rather than elsewhere is 10%. By combining these numbers the following seem quite plausible over the next 10 years.”

Raminder Grover, Managing Director, Homebay Residential (a subsidiary of Jones Lang LaSalle Meghraj), said “UK-based developers are increasingly interested in attracting investors from India. They are targeting not only the high net individuals but also the upper middle segment. The UK represents a very amenable market for Indian investors - the British Pound is far more stable than the rupee, there is far greater transparency in the UK real estate market, UK tenants sign long leases of up to 25 years and their long-term income generation capacities are extremely stable, not to forget the London Olympics in 2012. These factors are of great importance to investors in such projects.”

Contributed By : Arun Chitnis

JONES LANG LASALLE ACQUIRES CHURSTON HEARD, THE UK’S LEADING INDEPENDENT RETAIL CONSULTANT

Boosting its retail business in the UK

London, 10 July 2008 – Jones Lang LaSalle has announced that it is to acquire Churston Heard, the UK’s leading independent retail consultancy. Churston Heard employs 80 people and offers a full range of retail services including agency, town centre and out-of-town retail; rent reviews; management; investment, development and shopping centre management.

Alastair Hughes, CEO EMEA at Jones Lang LaSalle said: “This acquisition will further strengthen our business and improve our ability to advise clients on retail property in the UK. UK clients are looking for excellent local market knowledge within a first class international business – this acquisition will provide exactly that.”

“This is part of our strategy to strengthen our retail business across Europe. We will now be a market leader in the UK as well as Germany, Central & Eastern Europe, Russia and many other European markets.”

Churston Heard was established in 1969 and has an excellent reputation, providing a full range of consultancy services to an impressive client list of retailers, developers, institutions and funds. The combined strength of the two firms will see Jones Lang LaSalle’s shopping centre instructions increase to 110 and dedicated retail specialists rise to 150.

The new management structure will comprise Chris Powell as Chairman of Retail, EMEA; Guy Grainger will take on the role of Head of Retail Agency in the UK, working alongside Stuart La Frenais, Damian Sumner and Paul Marshall. Robin Coady will chair and jointly run the expanded UK Retail Capital Markets team with Adrian Peachey. Tim Vallance will lead the Out of Town team and Stephen Mahon will become the Head of Asset and Professional Advisory.
Chris Powell, from Churston Heard said: “We see Jones Lang LaSalle as a complementary fit to our culture, which is built on client service, market intelligence and expertise. It increases our reach and market share in the UK and drives our business forward across the continent. It will also provide new and exciting opportunities for our people.”

The deal, which will be concluded next week, will see Jones Lang LaSalle finance the acquisition through phased cash payments based on time and performance. The 80 Churston Heard employees will move into the Jones Lang LaSalle offices in Hanover Square in September.

Stuart La Frenais, Head of Retail Agency at Jones Lang La Salle commented: “It is well known that we have been looking to strengthen our retail business and Churston Heard has been top of our priority list for sometime. The structure of their business fits ideally with ours with their areas of strength complementing ours. Having worked at Churston Heard for several years I know a number of individuals well and know that the fit between our teams will be fantastic. I personally look forward to working with Guy again, together with the rest of the retail team at Churston Heard”.

“The combined business will focus on the UK and will also have a dedicated European retail team based in the UK which will co-ordinate with our strong European network of offices, covering 25 countries, to provide a seamless service for both our landlord and retailer clients.”

Guy Grainger, Head of Retail at Churston Heard added: “This provides our team with the ideal platform to apply our experience and skills to a wider network of clients, without huge disruption – we are a very good fit. Our retail intelligence will enable Jones Lang LaSalle and Churston Heard to create one of the largest and most experienced retail advisory services in Europe.”

Contact: Charlotte Freeman
Phone: 020 7399 5616

Email: Charlotte.freeman@eu.jll.com
Reference: NR3624

Contributed By : Arun Chitnis

From the CEO's desk

We have decided to include this particular address from Minal on our blog because it's special and close to our heart. This time's "From the CEO's desk' newsletter from Minal to the members was to thank them for the overwelhming response to our unique initiative of a Virtual Exhibition for CREDAI Karnataka. As many of you will be aware, CREDAI Karnataka and PropertyMixer joined hands for the first time to launch a unique Virtual Exhibition (or VExpo) initiative for the Realty Expo held by the former in Singapore during 28-29th June 2008.

The idea being to present a complete replica virtual counterpart of a physical exhibition held for promoting Bangalore & Chennai properties in Singapore. The straightforward benefits

1. Sit anywhere and visit a Real Estate Exhibition by premium developers from Bangalore
2. Search for all properties on offer during the exhibition
3. All properties mapped according to price range on interactive maps for quicker selections
4. Shortlist and compare properties based on information provided in the Virtual Stalls by each developer
5. Maintain touch directly with developers
6. Be where you cannot travel to and get access to all promotional offers by developers duing the period of the exhibition

This exhibition was a sample, to include only 2 properties per developer but looking at the immense sucess and the great feedback received for the initiative, it is poised to become a regular with many leading Real Estate Exhibitions.

For those of you who have missed the opportunity, we have still retained a bit of the exhibition at http://VExpo.PropertyMixer.com as a part our research to make it better and you are more than welcome to use your PropertyMixer credentials to logon and explore the same.

In case you find it interesting, don’t forget to use the "invite friends" feature on there and get others looking for property investments in Bangalore, Chennai, Hyderabad & Cochin to see it. In case of any further clarifications or details required, use the enquiry forms provided to directly get in touch with the developer.

For those of you who would like to know more about participation in our virtual exhibitions and all other queries, please address them to admin@propertymixer.com

83 per cent of Multi-Nationals in Asia Pacific Increasing or Maintaining Growth Plans in 2008

Jones Lang LaSalle Survey: 83 per cent of Multi-Nationals in Asia Pacific Increasing or Maintaining Growth Plans in 2008 India, China and Vietnam Remain the Top Three Destinations

India, 24 June 2008 – According to a Jones Lang LaSalle survey released today, 83 per cent of multi-national companies polled said that they will increase or maintain current growth plans in Asia Pacific. In fact, 28 per cent are responding to the gloomy global economic situation by looking to accelerate the growth of their operations in the region.

Jones Lang LaSalle’s survey also shows that India, China and Vietnam remained the top destinations for company growth plans in the region in 2008.

The report highlights that there are some key evolutionary changes occurring in the region’s economies, as individual nations continue to mature and attract higher value operations. These changes have a long-term impact on demand in the local property markets. For instance, in India, China and Vietnam, rising middle class incomes are driving growth for more banking retail outlets. Furthermore, China and India, once known for their low cost workforces, are, in some cases, losing factory jobs to other countries, but still enjoying significant net growth, as their increasing per capita incomes and advancing skills are attracting increasingly sophisticated activities.

Jones Lang LaSalle’s CEO of Regional Business Lines and Corporate Solutions, John Forrest, says that the survey shows how business in Asia remains less affected by the sub-prime crisis. “As the leading supplier of real estate services to corporations in Asia Pacific, we are still seeing strong demand for space. However, an uncertain economic environment is forcing corporations to find smarter ways to manage their growth. For example, many are outsourcing the management of their real estate or re-designing current office space to be more efficient.”

Jones Lang LaSalle, a professional services firm specializing in real estate, conducted a survey of 30 senior corporate real estate executives from leading multinational companies active in Asia Pacific in the second quarter of 2008. Findings from the survey are presented in the firm’s research paper, Gauging Demand, which focuses on how occupier demand for office and industrial space in Asia Pacific is being affected by global economic turmoil.

Strategies Differ by Industry Sector
Three sectors were surveyed, Financial Services, Technology and Manufacturing/Consumer Goods. Of the three, Financial Services predicts the most aggressive growth in 2008, with 44 per cent having added more growth to their original plans in the first quarter of the year, and 33 per cent predicting further growth by the end of the year. Even though this sector is showing the most aggressive growth of the three sectors some companies remain cautious with 44 per cent expecting to scale back in 2008. This is, in part, a reflection of the differing degree of exposure to sub-prime suffered by the banks – some emerged unscathed while others faced huge write-downs.

Where 44 per cent of Financial Services companies are expecting to scale back during the year, it is Manufacturing/Consumer Goods companies that are showing the most mixed response. The companies polled were split evenly, with a third looking to further expand their growth plans, a third to scale back and a third expects no change to current plans. Companies in this sector are also more likely to shift operations into or within the region, as they look for fresh markets and lower-cost destinations.

The most consistent of the three sectors is Technology. On average the majority, 83 per cent, are ramping up or maintaining current growth plans in the region in 2008 in response to the current economic climate. The reason cited by those surveyed lies in the search for greater revenues driven by the migration of their client base to Asia Pacific. Even though there are growth plans, cost containment remains a key driver for their real estate strategy.

Jones Lang LaSalle Meghraj India CEO, Vincent Lottefier, says "Different industry sectors are responding to the economic environment in markedly different ways, with traits that have significant implications for the markets in which they are major players. India still remains overwhelmingly the focal points of most new growth, easily outpacing the rest of the field."
Forrest comments that, “Even the financial sector, which has been the hardest hit in other regions, is not contracting on an overall basis. Emerging markets in Asia really are the world’s bright spot for growth at the moment.”

Contributed By : Arun Chitnis

MAHARASHTRA – REAL ESTATE SNAPSHOT

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

In India, as in other parts of the world, the vigour of the economy is mirrored in the demand for and prices of real estate. Reserve bank of India has estimated that the real estate sector represents approximately 5% of GDP, being the second largest employer in the nation. Real estate can thus provide a glimpse into the marketability of a state.

To my reckoning, Maharashtra represents in this regard a unique market model – it is an amalgam of high business and, as a result, intense residential and commercial real estate activity. In fact, its operative trends are so firmly entrenched that we have not witnessed any significant slackening in overall activity despite the economic pressures affecting many other Indian states. However, there is no denying that there has been an impact. The cities of Mumbai, Pune and Nasik would serve as suitable illustrators for the current scenario.

In Mumbai, affordable housing has become an elusive dream. Skyrocketing rate appreciation brought on by the continuing demand-supply mismatch has boosted residential home prices almost completely out of the reach of the common man. It is definitely not an investor's market right now, owing to the generalized slowdown. Prices are stagnating and there may be a correction in certain locations over the next twelve months. Of course, factors like specific location sector and property typology will play a role. End users are advised to study property trends before buying a home for genuine self-use. It is possible that the area they have chosen to buy into may see a drop in rates over the next six months to a year. Meanwhile, Navi Mumbai – the new growth sector – offers options both for those seeking affordable homes and those who seek investment opportunities.

Pune benefited for a considerable period from Mumbai’s unrealistic. The recession in the American markets has weakened the commercial and residential markets. The slump in the stock market has caused investors to start moving out. Second home buyers are keeping away and end users are cautious in their buying, awaiting price corrections. Despite the generalized slowdown, developers continue to have holding capacity and there continues to be demand for mid-segment homes, 80% of which is Pune is driven by software professionals and recently relocated manufacturing sector executives. The highest demand is in and around Hinjewadi, Kharadi, Magarpatta, in and around SP Infocity and in and around Phursungi and Hadapsar.

Nasik, whose residential market grew at a rather leisurely pace until about 2006, suddenly began showing significant annual appreciation rates from the beginning of last year. Nasik had begun emerging as a realistic alternative destination for buyers who were discouraged by Mumbai and Pune’s high rates. It offered low entry costs and, at the same time, reasonably attractive appreciation rates. Another reason was the increasing presence of the IT/ITES sector there. In recent times, Nasik has been witnessing rather healthy appreciation rates; because of its relatively late entry into the real estate stakes, it was insulated from the regressive dynamics currently prevalent in the rest of Maharashtra.

Despite the slowdown, Maharashtra remains one of the foremost contenders in the real estate sweepstakes. All sectors – residential, commercial, retail, industrial and hospitality –continue to show an upward curve in the long term.

Contributed By : Arun Chitnis

Initial Public Offering (Offer closes at 5 PM today 6 June 2008)

Initial Public Offering (Offer closes at 5 PM today 6 June 2008) - Indiabulls Properties Investment Trust - only the second Singapore property trust to offer exposure to India

Indiabulls Real Estate, part of diversified Indiabulls group with interests in financial services, power, retail and realty businesses, last week filed a prospectus with Monetary Authority of Singapore for an initial public offer of IPIT, estimated to raise about $300 million.
IPIT is a business trust registered under the laws of Singapore and is making an offer of its units to public and institutional investors and the IPO is expected to be priced towards the end of the month.

An investment arm of NRI billionaire Lakshmi Mittal family has already agreed to purchase 91 million shares in the trust at the IPO price, amounting to a 3.9 per cent stake

Key features:
· 262.5 million common units (subject to over allotment option)
· Sing$1.00 to Sing$1.10
· Offering is for 353.5 million shares
· Lead Managers Deutsche Bank and Merrill Lynch
· DPU of 5.12 cents per unit in forecast year 2009 and 9.82 cents per unit in the projection year 2010. This will signify increase of 92% in the dividend yield.
· Applicants may use cash only
· Applications can be made through DBS Bank (including POSB), OCBC or UOB Group

ATMs, internet banking websites of DBS Bank and UOB Bank or on printed application forms which form part of the Prospectus.

A copy of the prospectus is available on the SGX-ST website: http://www.sgx.com

IBREL is offering to sell about 353.5 million shares of IPIT in a price band of 1.0-1.1 Singapore dollar each, and in the projected price range, the IPO could mop up SGD 353-389 million (USD 259-286 million) for the company.

As per the time table for the IPO filed with the Singapore Stock Exchange that the price would be fixed today end after the offer closes at 5 PM and shares would commence trading on June 11

Key Investment Highlights
1. Premier office space trust offering exposure to the booming Indian economy and to the rapidly growing services sectors
2. Unique opportunity to invest in strategic Mumbai market, India’s premier commercial centre
3. Exposure to prime initial portfolio built and managed to international standards which will attract a quality tenant base
4. Strong growth model combining high organic growth potential and the Trustee-Manager’s three pronged acquisition strategy
5. Strong sponsorship and commitment from Indiabulls
6. Sponsor’s alignment of interest with that of Unitholders
7. Stable and growing distributions

Conclusion: This is the second Singapore property trust to offer exposure to India. The return on the investment ie Dividend yield of 9.82 % in 2010 and increasing thereafter is excellent. There is strong sponsorship and commitment from Indiabulls group which is the fourth largest real estate group in India by market capitalization.

The ROFR on the other properties of Indiabulls will provide an excellent return to the investors. So don’t miss this opportunity as today is the last day and the offer closes at 5 PM. Incase you need any further details, you can contact us at media@propertymixer.com

Jones Lang LaSalle Named to 2008’s “World’s Most Ethical Companies” List by the Ethisphere Institute at The Forbes, Ethisphere Joint-Conference

CHICAGO, 5 June 2008 – Jones Lang LaSalle Incorporated (NYSE: JLL) today reported that it has been named to The Ethisphere Institute’s second-annual World’s Most Ethical Companies list. Ethisphere, a think-tank dedicated to the research and promotion of profitable best practices in global governance, business ethics, compliance and corporate responsibility, announced the award at the Ethisphere and Forbes joint-conference, “Driving Profit through Ethical Leadership,” held on June 3rd. The list of World’s Most Ethical companies will also be featured in the Q2 issue of Ethisphere Magazine.

“We are very proud of this award,” says Colin Dyer, Chief Executive Officer of Jones Lang LaSalle. “It reflects the significant effort we make through our Ethics Everywhere(sm) Program to act with integrity in everything we do. Our clients, employees and shareholders expect and deserve nothing less.”

Researchers and analysts from The Ethisphere Institute reviewed several thousand companies in order to determine the finalists, which included a rigorous, multi-step evaluation process. The 2008 World’s Most Ethical Companies methodology committee is comprised of leading attorneys and government officials, professors and leaders who care about ethical and honest business practices.

“We applaud Jones Lang LaSalle, which is among the companies honored this year because they have developed impressive and meaningful ethical business practices, making them true standouts within their industries.” says Alexander Brigham, executive director of Ethisphere Institute. “They go well beyond legal minimums, opting instead to bring about innovative ideas that contribute to the public well being. By their actions, they are forcing their competitors to follow suit, or fall behind and truly embodying the notion that ethical business practices are more profitable.”

The extensive research process included reviewing over 10,000 of the world’s leading companies on six continents. Ethisphere analysts reviewed codes of ethics, litigation and regulatory infraction histories; evaluated investment in innovation and sustainable business practices; looked at companies’ activities to improve corporate citizenship; studied nominations from senior executives, industry peers, suppliers and customers; and worked with consumer action groups for feedback and rating.

The day-long conference, which featured Forbes editors and executives from world-renowned corporations, universities and ethics organizations, focused on ethical culture and leadership and highlighted companies’ experiences and ethical challenges, provided advice on preparing for ethical dilemmas and gave viewpoints from an investor’s perspective. The conference culminated with recognizing Ethisphere Magazine’s 2008 World’s Most Ethical Companies at an evening awards dinner.

About Ethisphere Institute

The research-based Ethisphere Institute and associated membership group, the Ethisphere Council, are supported by more than 100 institutions and corporations, including Thomson West, the Practising Law Institute, the National Association of Corporate Directors, the Global Reporting Initiative, Corpedia and dozens of others. The Institute is dedicated to the research, creation, and sharing of best practices in ethics, compliance, and corporate governance among its membership companies. It also focuses on the development and advancement of individuals on its membership council through increased efficiency, innovation, tools, mentoring, advice, and unique career opportunities. Ethisphere Magazine is the quarterly publication of the Institute. More information on membership can be found at http://www.ethisphere.com/.

The Ethisphere Institute publishes the globally-recognized annual World Most Ethical Companies Ranking™ as well as the Government Contractor Ethics Program Ranking™ and the upcoming Global Anti-Corruption Quotient.

Contributed By : Arun Chitnis

Investors who missed investing in Dubai during its early days...will they try out Abu Dhabi?

With the recent success of Cityscape Abu Dhabi, it is said that the emirate plans to invest Dhs1 trillion, or $270 billion, in new construction projects.

Abu Dhabi, which is just a 2 hrs drive from Dubai, which is the capital of the United Arab Emirates and the richest city in the world. The emirate's 420,000 citizens, who sit on one-tenth of the planet's oil and have almost $1 trillion invested abroad, are worth about $17 million apiece. (A million foreign workers don't share in the wealth) .

Abu Dhabi has been relatively slow in joining the global real estate boom, but now, with great investor interest and good public appetite for owning properties in the region, it is seen as one of the most upcoming investment destinations in the middle east.

The development pattern in Abu Dhabi is noticably similar to the inch to Dubai it is seen to follow the pattern of growth similar to that of Dubai by many. Attractive financing schemes are being offered to investors but yet, one thing that could decide the fate of investments in Abu Dhabi is that in the initial days, Dubai properties were priced on the lower side. Slowly when Dubai became a global hub for investments, coupled with a great government and infrastructural support, now Dubai properties are reasonably on the higher side. In contrast, for example, launched with prices from $2.2 million upwards which might be considered on the high side, although in a new real estate market this could be cheap for a luxury, Maldives-style location.

Currently, where Dubai properies are not really selling on a premium anymore, the growth of a similar opportunity Real Estate market right in the beighbourhood is more seeming like unwelcome competition for Dubai. Since both the emirates belong to UAE and with the growth of tremendous real estate in both these areas, which in Dubai's case have not only been successful in getting investors from Europe and accross the world but people have moved there to make it their home, it probably will do some good to Dubai too in the long run.

Now, it is yet to be seen if Abu Dhabi is able to attract similar interest from investors accross the globe and if investors who put their money comparing it to Dubai actually can makeup for the money they could create at some point by investing in Dubai. Only time will tell!

Contributed By : Pankaj Thukral

Al Qudra sells entire tower in 30 minutes at Cityscape Abu Dhabi

ABU DHABI – Al Qudra Real Estate (AQRE) sold out its Amber Tower within 30 minutes at the official sales launch at Cityscape Abu Dhabi. Amber Tower is the first high-rise building within the Shades development at Shams Abu Dhabi.

“Amber Tower is Al Qudra Real Estate’s first development targeting both UAE and expatriate endusers and investors,” said Claus Peter Rees, AQRE acting CEO. “Cityscape Abu Dhabi represents the perfect platform for a sales launch,” he added.

The Shades Project, which is strategically situated next to Shams Abu Dhabi’s central park and water canals, encompasses five residential towers. Amber Tower consists of 34 floors with studio, one, and twobedroom apartments.

The development will include many modern-day facilities, including fitness and entertainment areas, a day-care centre, a beauty salon and landscaped terraces, as well as a rooftop swimming pool and underground parking area.

The project was designed by one of Canada’s largest design and construction firms, the NORRGroup, and by the architects behind Dubai’s renowned Jumeirah Emirates Towers.
“Our focus lies in delivering premium services while ensuring that our investors receive a maximum return on their investments,” concluded Rees.

Jones Lang LaSalle acquisition of Kemper’s Group is finalised

Creating the leading retail real estate advisor in Germany

London, 19th May 2008 – Jones Lang LaSalle today announced the closure of its acquisition of Kemper’s Group in Germany, following the completion of all regulatory approvals. The acquisition of Germany’s leading retail property advisor makes Kemper’s Jones Lang LaSalle Retail Group (a wholly owned division of Jones Lang LaSalle Germany) the retail property market leader in Germany. The projected sales of the Kemper’s Jones Lang LaSalle Retail organisation for the full calendar year 2008 will amount to approximately 56 million Euros.
The Kemper’s Jones Lang LaSalle Retail Group has 220 employees in nine German locations operating across four business sectors: Retail Leasing, Retail Investment, Retail Management and Retail Advisory. The executive board of the Kemper’s Jones Lang LaSalle Retail Group will comprise Gerhard Kemper, Rüdiger Thräne and Jörg Ritter. Gerhard Kemper will also become the fourth member of the Management Board of Jones Lang LaSalle Germany.

Christian Ulbrich, CEO Jones Lang LaSalle Germany, commented: “Our acquisition of Kemper’s reflects the increasing globalisation of the real estate markets. Consolidation in the marketplace reflects the changing demands of the client base of occupiers, developers and investors, all of whom have an increasingly international outlook. Clients frequently require integrated ‘one-stop shop’ services from real estate consultancies and the Kemper’s Jones Lang LaSalle Retail Group is very well placed to provide these integrated services.”

Gerhard Kemper, of Kemper’s Jones Lang LaSalle Retail Group, added: “The merger has created even more competence, expertise and professional know-how than the two companies were able to provide individually. The combined forces of both companies mean we are now able to execute transactions of any scale in the retail sector in Germany.”

Following this acquisition, Jones Lang LaSalle Germany has a total headcount of over 750 employees. Europe-wide Jones Lang LaSalle has a total of 3,900 employees, 500 of them within the retail sector.

Contributed By : Arun Chitnis

Indiabulls Property Trust (IPIT) all set to list in Singapore

Real Estate trusts listed in Singapore have seen unfavorable markets during the past few months, following significant falls in share prices and hence companies opting for Initial Public Offers have rightly stayed away from the declining market. Surprisingly enough, Indiabulls Properties Investment Trust (IPIT) looks like it is set to launch an offering of about S$260 million ($190 million) within the next couple of weeks, following the start of pre-marketing at the end of last week, which means a saving grace for IPOs looking at the Singapore market in the near future.The listing vehicle for this IPO is sponsored Indiabulls Real Estate (IBRE), which is by India’s third largest property developer in terms of market capitalization, will be structured largely as a real estate investment trust (REIT) but will be listed as a business trust to give it greater flexibility with regard to how much of its portfolio can be made up of properties still under development. The initial portfolio will consist of two commercial property developments in the up-and-coming business & commercial district of Lower Parel in Mumbai, which was a former industrial region that used to house numerous textile mills like Pheonix Mills & Jupiter Mills, but is now a micro-market with high-end commercial and residential developments. All Residential as well as Commercial developments in the Lower Parel area, are premium because of lack of availability of good commercial space in Mumbai, high rental values and quality tenants, including banks, financial institutions and large corporations.


Indiabulls Properties Investment Trust (IPIT)’s developments – One Indiabulls Centre (which was formerly known as Jupiter Mills) and Elphinstone Mills are located within two IT parks in the area. When finished, the two combined will have 2.97 million square foot of lettable office space, 438,000 sq ft of retail space and 119,000 sq ft of residential housing. If successfully listed, IPIT will become only the second property trust in Singapore to be backed by Indian assets after Ascendas India Trust (a-iTrust) that listed in July last year, beating DLF and Unitech to the punch. DLF, Unitech and Indiabulls were all considering spinning off part of their property assets through the REIT route or business trust in Singapore around Feb this year, but the plans were postponed as the selling pressure on global equities intensified. At the time, DLF and Unitech were both aiming for significantly larger IPOs at up to $1.5 billion and $700 million, respectively.

It is a logical decision for IndiaBulls Real Estate to vouch for the early mover advantage in being the first to take on the still challenging market. Considering that a-iTrust is still down 30% from its highs from November, this move could prove to be both risky & smart, since the Singapore market is showing signs of recovering.

It is also said that Billionaire Lakshmi Mittal, the world's richest Indian, has committed to buy units equivalent to a 3.9 per cent stake in IPIT, which is in process of listing in Singapore.



Contributed By : Shivang Prabhakar

Mumbai to get Cybertecture office building says James Law

James Law Cybertecture revealed the plan to yet again innovate with his design and architectural skills, but this time, the venue is Mumbai. Yes, Mumbaikars, you are about to get an office building in the shape of an egg, right in the heart of Mumbai's central business district.

The project is a cybertecture office building that is aiming to bring together iconic architecture, environmental design, intelligent systems and new engineering, to create “the most innovative building for the city of Mumbai and for India in the 21st century,” according to the company’s founder James Law.
Law’s inspiration for the project comes from looking at the earth itself, and translating that into a sustainable ecosystem derived from an integrated and seamless application of cybertecture that evolves to give a building’s inhabitants the very best space to work in.

The symbolic ‘planet’ form is further stretched to cater for 15 levels of accommodation, housed in the egg-shaped building which is orientated and skewed at an angle to create both a strong visual language as well as to alleviate the solar gain of the building.

By using the egg shape, as opposed to a conventional building, there is up to 20 percent less surface area, with the unique design allowing for up to 30 metre spans of column-less floors.

Source: Cityscape Abu Dhabi Newsletter
For more information, please log on to http://www.cityscapeabudhabi.com.

Cityscape Extends To Friday By Royal Appointment

Release Date: Wednesday, May 14, 2008

In an unprecedented decision in the history of Cityscape exhibitions, the Government of Abu Dhabi has requested that the premier real estate development and investment event be extended by one day. Cityscape Abu Dhabi will remain open for an extra day, now concluding on the evening of Friday May 16th.

The exhibition was opened today at the Abu Dhabi National Exhibition Centre by HH Sheikh Mohammed bin Zayed Al Nayhan Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces.

Mark Goodchild, Project Manager, Cityscape Abu Dhabi said: “We received a formal request from the Abu Dhabi government that they would like us to extend the event by one more day. This is unprecedented for Cityscape, but considering the massive interest on the first day, it is hardly surprising. We’re delighted that the government should grant us such exceptional support and also that they recognise the importance of Cityscape for the development of Abu Dhabi and for many of the region’s exciting projects.”

To underscore the importance of the event as a showcase for the capital’s intricate planning, sustainable projects and investment transparency, His Highness General Sheikh Mohammed bin Zayed Al Nahyan Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces agreed to be patron of Cityscape Abu Dhabi for a second successive year.

In terms of ‘home-grown’ support, the Abu Dhabi government and locally-based real estate heavyweights have shown full support for the industry showcase. Major local developers such as Mubadala, Sorouh Real Estate, ALDAR Properties and Al Qudra Real Estate all have a significant presence.

Organisers IIR Middle East said that the show was sold out some months ago, with over 300 confirmed exhibitors covering more than 30,000 square metres of exhibition space.

Platinum sponsors of Cityscape Abu Dhabi include Mubadala, Aldar, Sorouh, Al Qudra, The Land Holding Company and Escan. Gold sponsors include Dubai World Central, Tameer and Saudi Oger, with Future Brand and East & West Properties taking silver status. The Department of Municipal Affairs of Abu Dhabi is associate sponsor, Urban Planning Council of Abu Dhabi is Strategic Planning Partner while HSBC is investment sponsor.

For more information, please log on to http://www.cityscapeabudhabi.com.

For more information, please contact:

Nathalie Visele
Director
Shamal Marketing Communications
Dubai, United Arab Emirates
Tel.: +9715 0457 6525
E-mail: nathalie@theshamalgroup.com

Destination of the Future for Mumbai Realty

With Booming commercial property development on LBS Marg and Neighboring locations like Ghatkopar, Vidyavihar, Powai / Connectivity to all suburbs, BKC, Eastern Express Highway, LBS MARG is becoming an hot destination for commercial property development. Since LBS Marg is centrally located and connected to all suburbs, it is becoming a more preferable destination for most of the corporates. It has got connectivity to major destinations like Bandra Kurla Complex, CST Road, Kalina, Eastern Express Highway, Jogeshwari Vikroli Link Road which helps people to drive down from Eastern Suburbs to Western suburbs, Powai - Sakivihar road which connects to Andheri and from Eastern Express Highway people can easily drive down to Airoli, Vashi, Ghatkopar, Chembur, Sion and towards town. Also, the first proposed METRO RAIL coming up from Versova-Ghatkopar Belt is one of the reasons for the major development. All the railway stations like Ghatkopar, Vikroli, Kanjurmarg, Bhandup, Mulund are at a walking distance near to LBS MARG.

• Demands from corporate sector mainly from IT, ITES, BPO’s / demand - supply position in the commercial property :-- Considering all the above factors, sectors like IT/ITES/BPO’s / FINANCE and BANKING/RESEARCH firms and even premium hotel players are eyeing the LBS Marg belt from Ghatkopar To Thane. Already players like WNS, Accenure, CapGemini, Wipro Spectramind, Prudential, Colgate Palmolive, HCC, CIPLA, Johnson and Johnson are located in this area and demand is still coming up for office space requirements from corporates. However, one of the major factor which attracts the demand at LBS Marg are the rates that are quite lower compared to Bandra Kurla Complex, where the lease rates are approximately Rs.300-400 per sq. ft. Those who are not able to match their requirement considering the availability of supply and rate factor at BKC, they switch over to LBS MARG where the rates are in the range of Rs. 60 to Rs.180 per sq. ft, which is still at the lower side compared to Bandra Kurla Complex. Currently there is a demand of more than 20 lakh sq. ft for office premises ranging from 5000 sq. ft till 2,00, 000 sq. ft each. However, there is a scarcity of commercial office premises for ready possession. Most of the constructions coming up are under construction phase. Total construction of around 60 lakh sq. ft is coming up at LBS MARG and connected to areas like Powai, Ghatkopar (East), Ghatkopar (West), Vidyavihar, Chembur.
  
• Projects coming up from well known developers:-- Considering the demands coming from all above players, most of the developers are coming up with development of commercial office space with state of the art amenities and malls on LBS MARG belt. Developers Like Runwal, K Raheja Construction, Hiranandani, Kohinoor Group, Nirmal and other private developers from Ghatkopar are coming up with large floor plates of commercial office premises / IT PARK / Malls to meet demand for these corporates.

Following are few of the projects coming up :

• Rates / Appreciation of property values in last 2 years and future prospect:- Rates in these location are ranging from Rs. 7500 per sq. ft to Rs. 18000 per sq. ft (Capital Value) and for lease it ranges from Rs.60 per sq. ft till Rs. 180 per sq. ft. There has been an appreciation in the capital value of property in last 2 years by more than 100%. Rates in same areas were around Rs. 4000 per sq. ft two years back. Analyzing the current growth scenario and demands coming up, prices are expected to rise further; we can see more and more companies having their corporate offices in LBS MARG and connected areas like Powai, Ghatkopar, Vidyavihar, Chembur.

Contributed By : Mehul Ved

JLLM - Anuj Puri's take on the Real Estate Sector

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

What is the current situation in real estate markets?

There is 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. The credit crunch and the US recession are not the only factors involved here. Interest rates have shot unrealistically high begin with. However, the current market dynamics notwithstanding, the property market in India will continue to thrive – albeit at a more realistic rate. Prices are stagnating, and we can reasonably expect a correction in certain areas over the next twelve months - depending on specific location sector and property typology. Meanwhile, demand for property in certain locations will continue undiminished due to the existing and upcoming market drivers there.

What are the opportunities and challenges for the Indian real estate sector now?

We do have a challenge situation on our hands, but it is one brought about by lack of faith and information. The origin of the challenge does not lie in foreign markets, but our own. Nor is the challenge anywhere as big as its is being made out to be. India is nowhere as vulnerable to fallout of the US recession as its is being fashionably assumed. The international credit rating agency Standard and Poor’s has clearly stated that India and China are in the category of ‘not vulnerable’ countries.

India is still among the biggest growth drivers. Foreign players will continue to invest in India and go slower on low-priority markets, especially the developed ones where investments take longer to pay off. There are, for instance, immense opportunities in Indian retail. The segment of India’s more affluent shoppers is 6 million strong – a segment that spends approximately $28.36 billion annually. India still maintains its ranking as the 5th most attractive of all emerging retail markets in the world.

Has the slowdown in market affected the real estate industry in terms of property sales?

There has been a slowdown in domestic transactions and we are indeed witnessing a correction, but this is brought on by the sharp 200-300% rise in property rates seen over the last two years. It is perfectly natural and expected that there would be an adjustment of such irrational growth. The sales volumes previously predicted for 2008 now need to be second-guessed. However, lack of growth does not equal a setback – only a period of stagnancy. Indian real estate continues to be a good risk diversifier that generates excellent risk-adjusted returns.

What are the issues the sector is currently facing in India?

Lack of infrastructure, lack of transparency and unrealistic rate inflations brought on by speculation in many geographies across all sectors come readily to mind. Thankfully, the Government has taken various proactive steps to curb inflation and to drive out speculative investment. Regulators and progressive incentivization schemes for townships and SEZs will help steer the boom in more constructive directions. We are also on the verge of seeing the introduction of REIT-style investment routes to funnel in additional and sustained foreign funds into the sector.

How could one express the current scenario in figures, and what do they mean?

There is an existing shortage of 25 million residential units. The residential sector will continue to be the driving force. Almost 91% of all real estate investments are in the residential sector. Approximtaley two million residential units admeasuring an average of 1,200 square feet will be constructed annually.

In the commercial sector, each year sees the development of approximately 60 million sq ft of office space. There has been a slowdown in absorption but no sign of increasing vacancies. In the retail context, over 300 shopping malls are under construction and will be operational by the end of 2008. Each year sees the development of approximately 25 million sq ft of retail space.

How can the sector be strengthened?

There is a clear need for schemes specifically designed to put in much-required infrastructure, and further incentivization of affordable housing projects to encourage developers to address the monumental demand for residential space from the middle class. The sector also needs the benefit of single-window clearance provisions for progress-oriented projects.


Contributed By : Arun Chitnis