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As Companies Expand, Office Space is Attracting Investment in India

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Office Space

The Asian market is driving global economic growth and India is emerging as the world’s preferred outsourcing hub. According to the CBRE 2017 Asia Pacific Occupier Survey report released last week, multinational as well as Asia Pacific-based companies have aggressive expansion plans for India and China over the next three years. Interestingly, in the Asia-Pacific region, more than 80% of Indian respondents plan to hire more people in the next three years. This reflects India’s growing economy, steady progress in enacting regulatory reforms and booming outsourcing and ITES sector.

The report took responses from over 450 multinational companies and real estate consultancies and suggests India’s commercial real estate will get a big boost with these expansion plans.

The major sectors represented included banking and finance (32%), technology and telecommunications (14%), insurance (12%) and manufacturing (12%). “Multinationals’ relentless focus on driving down costs has fuelled Asia Pacific’s booming outsourcing sector,” says the survey.

More office space

Anuj Puri, chairman and country head, of JLL India says that India’s macroeconomic outlook has been resilient since 2014, leading to the entry of new foreign firms and expansion of existing firms. All of this has resulted in a demand for office space. While 30 million square feet were absorbed annually from 2012 to 2014, the figure rose to 35 million in 2015.

Puri attributes the jump to the fact that many companies are adopting an aggressive expansion strategy, particularly after the slow pace of previous years. New players in e-commerce, healthcare, and technology are driving the numbers up as well, he adds.

Vacant spaces are currently at a seven-year low of 13% – a perfect opportunity for rents to rise faster. Puri says the rise is particularly fast in lower vacancy markets such as Pune, Bengaluru and Hyderabad. “These markets are more preferred by the leasing giants within IT-ITES sector,” he explains. “Few other sub-markets such as Mumbai suburbs, Gurgaon in the National Capital Region and Chennai’s suburban business districts are also witnessing the moderately higher increase in rents.”

Of all office leases, IT-ITES continues to be at the top with a 35-40% share. Experts say this dominance is likely to continue for some years. But Puri believes that with initiatives such as Make in India, relaxed FDI norms in defense manufacturing and a gradual progress towards a uniform taxation through GST and Skill India that figure might change. “We could see the share of manufacturing rise in the medium term, from the meagre 15% it is today.”

Workplaces on the fringe

While Mumbai has traditionally been a hub for financial services, it is strongly emerging as an IT and knowledge hub, especially with huge IT parks coming up in low-cost regions like Navi Mumbai and Thane. In Navi Mumbai, as much as 76% of commercial space is already occupied by IT/ ITeS players.

“Micro-markets such as Malad, Goregaon and Powai are established commercial centres,” says Gautam Saraf, managing director, Mumbai, Cushman & Wakefield. But Navi Mumbai alone is expected to witness average absorption rate of approximately 1.2 million square feet over the next three years, he adds. Major companies like Capgemini, WNS, Hexaware, TCS and Accenture expanding their operations. “The rentals in Mumbai are in the Rs40-50 per square foot, which is less than a dollar, with good scope for appreciation in the years to come,” Saraf says.

Dharmesh Jain, CMD, Nirmal Lifestyle and president, CREDAI-MCHI, believes that Mumbai has favourable government policies, skilled IT resources, and excellent infrastructure facilities, making it one of the top destinations for outsourcing. “The outlook for commercial real estate for 2017 is likely to be vigorous with increasing demand,” says Jain. Commercial real estate in Mumbai and nearby areas is being driven by outsourcing services in a big way. “Waking up to this opportunity, Mumbai’s property developers have started to fully comprehend the workspace specifications required for IT, BPO and KPO services, which will drive the market for years to come,” says Jain.

Where offices grow, homes grow too

The strong growth in the commercial office market and expected buoyancy has spurred substantial demand for residential apartments. In Navi Mumbai, the IT boom has given a huge boost to the residential market in nodes near the offices like Airoli, Ghansoli, Vashi, Koparkhairane and Nerul. “Availability of affordable residential supply, combined with promising prospects in terms of planned infrastructure and commercial office market are expected to further attract both end-users and investors in this region,” says Saraf. “This coupled with a robust retail growth is helping fuel the revival of the residential real estate market.”

Source: Hindustan Times

Chennai Real Estate News

Home Buyers Lose The Agents And Opt For Digital Route

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property

With passing time digital media is becoming the preferable choice of the buyers as well as the developers. Developers are going to online platforms and social media to reach out to their target audience and also the buyers are increasingly going online for searching homes. This makes digital media a mainstream platform to advertise in real estate industry.

C Shekar Reddy, Immediate Past President of CREDAI explained why digital platforms are becoming more popular in the real estate. He said, “IT employees, NRIs form the majority of home buyers today who are tech savvy and use their smart phones for searching homes. Also most of the home buyers today are being influenced by social media while purchasing a home or property. As a result builders and realtors are putting utmost focus on digital platforms to reach out to potential consumers”.

The growing trend can be observed by the way the builders are spending on online platforms. It is far more than traditional marketing and publicity avenues unlike past. Builders have also become conscious of their presence and reputation on property portals and other online platforms. They are taking each step carefully so they can make the right connect with their buyers.

K Sreedhar Reddy of Telangana Real Estate Developers Association explained the growing importance of digital media, said, “Digital platforms and social media provide builders a chance to reach to the consumers in a more focused way. Also they can track the efficiency of strategy online. The cost of acquiring customers through online and social media is also lesser when compared to other advertising channels. Therefore digital platforms are becoming popular in realty sector”.

As per the inside sources, this trend is not only visible in the metros like Mumbai, Chennai or Hyderabad but also in Tier II & III cities. Customers as well as developers, both are relying more and more on digital platforms.

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Ahmedabad Real Estate News

CREDAI New India Summit

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credai new india summit

CREDAI is the apex body that represents over 12,000 private Real Estate developers spread across 23 state-level chapters and 177 cities in India. Established in 1999, CREDAI has worked hard to make the industry more organized and progressive by networking closely with Government representatives, policymakers, investors, finance companies, consumers and real estate professionals.

The New India Summit is another such effort from CREDAI to direct focus on Tier II, III and IV cities and develop them to be the forerunners of success. CREDAI New India Summit is all set to unleash the potential of an emerging India. This one small step has the power to give way to a new India.

For the longest time, our leaders and foresighted influencers have put all their time and energy in developing the Tier I cities namely Bengaluru, Mumbai, Delhi, Pune, Ahmedabad, Hyderabad, Chennai and Kolkata. No doubt, these cities have really changed the way people look at India today. These cities are the epitome of advanced technology and modern culture. But they also face challenges due to the grave pressure of urbanization. Decreasing quality of life, increasing the cost of living, overpopulation and unemployment, increase in transit time and traffic congestion, expensive housing, hospitality, education and healthcare facilities are some of the issues that all the Tier I cities face today.

According to a report, smaller cities are developing 79% faster as compared to metros with just 21%. Our of the 12,000 CREDAI members, 76.77% of them are from Tier II, III and IV cities. Looking at the scenario, it is only innate to divert the energies in developing the areas which still have potential. Thus, offering a good quality life to people in those cities itself and taking the pressure off of the Tier I cities.

The Forbes Magazine has said small cities are India’s emerging business locations. The government has also been putting dedicated efforts into schemes that directly benefit the growth of Tier II, III and IV cities. Sustainable economic development, improving infrastructure and transportation, increasing employment opportunities, and introducing technologies for rapid urbanization are some of the prime agendas that the government has been taking actions on.

The CREDAI New India Summit will take place on the 9th and 10th November 2017 in Nagpur, Maharashtra.

Also Read: FS Realty Bags The 9th Realty Plus Excellence Awards (North) 2017

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Ahmedabad Real Estate News

Tata Value Homes Launches “Offer Of The Century” With 99 Hours Flash Sale on Affordable Homes

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Mumbai, Maharashtra, India

Tata Value Homes – a 100 % subsidiary of Tata Housing – one of the leading real estate development companies in India, today announced the launch of ‘99 hours flash sale’ on Tata Value Homes across India. Through this offer, Tata Value Homes will enable customers to own their dream home with 99 percent funding by select banks. The scheme is applicable on the first 99 units across the projects and for a limited time frame of 99 hours starting from 2nd November to 6th November 2017.

Mr Rajeeb Dash, Head – Corporate Marketing, Tata Housing, said, “Tata Value Homes pioneered affordable housing in India and continues to introduce innovative offers to encourage fence-sitting buyers to take a first step towards owning a home. Customers have always been central to our business and this unique 99 hours flash sale is tailored to connect aspirers with their perfect residence from our diverse portfolio of projects.”

To avail the scheme, customers will have to log on to www.tatavaluehomes.com between 23rd October to 1st November and register using basic details. Post registration, customers can visit the site between 2nd November to 6th November 2017 to check for loan availability within 30 minutes and walk away with the allotment of the unit with a loan of 99% of the agreement value.

As the leading provider of homes under affordable housing segment, Tata Value Homes develops affordable housing that goes beyond merely providing a house, to one with a ‘neighbourhood and community’. The first 99 customers will have the convenience to buy a home from the Tata Value Homes projects such as New Haven, Bahadurgarh; New Haven Compact, Ahmedabad; Shubh Griha Ahmedabad; New Haven Boisar I & II; La Montana, Talegaon; New Haven Bengaluru, Santorini, Chennai; New Haven Ribbon Walk Chennai.

About Tata Value Homes Limited

Tata Value Homes Limited is 100% subsidiary of Tata Housing Development Company Limited, established in 2010, to exclusively focus on value and affordable housing. The vision of Tata Value Homes Limited is to be the largest home provider in India. Tata Value Homes Limited has introduced two pan-India brands – Shubh Griha (Value Homes) and New Haven (Affordable Homes). Tata Value Homes Limited is also developing a Mediterranean themed project “La Montana” near Talegaon, Pune, while Shubh Griha is currently being developed in Boisar & Vasind near Mumbai and Ahmedabad, and New Haven is currently being developed at  Bosiar,  Ahmedabad and Bengaluru. Tata Value Homes Limited today has projects in Mumbai, NCR, Ahmedabad, Bengaluru,  Chennai and Pune.

About Tata Housing

Tata Housing is a closely held public limited company and a subsidiary of Tata Sons. It is the first corporate to pioneer the concept of real estate development in India. It is widely recognized for quality construction, ethical and transparent business practices and timely delivery of properties. It has a pan-India and international presence with demonstrated capabilities in Construction, Engineering, Commercial / IT parks, Housing and Township development. It is known for international standards of design and green sustainable developments.

Also Read: Over 2 Crore Affordable Houses To Come Up Over Next Three Years

 

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