Struggling with a slowdown across segments, the Indian property market is moving towards the next phase of consolidation. Liquidity crunch in the real estate market is beginning to drive many mid-sized and small developers to beg for cover.
Many want to liquidate their land and incomplete projects by selling them to bigger developers or private equity players even at lower valuations. This is due to the stagnant market conditions. Around fifteen deals in real estate sector have fallen through in the past two months with investors developing cold feet.
A mid-sized builder at Chembur in Mumbai has put its fourteen floor commercial property in central Mumbai on the block. The developer wants to raise around one hundred fifty crore rupees which would help him complete his upcoming project.
A Hyderabad-based real estate group has started advertising to attract high networth investors to generate fifty crore rupees against bulk purchase of its housing project in the city. A small developer in Mumbai, pushed to a corner on account of mounting payables for construction material, is now offering its project at Juhu-Versova in Mumbai at about 35% discount to the current market price. In Delhi, some developers have approached property consultant to sell their income generating commercial properties to finance some of the unfinished projects.
Real estate funds and established developers admit that they are working on various proposals. Hiraandani Developers chairman Niranjan Hiranandani said, “Even in the normal circumstances we used to get offers from mid-sized developers to buy out their projects. But now, the numbers have increased considerably”.
ICICI fell 2.4% to 686 rupees, its lowest in almost two years. DLF declined 3.8% to the lowest since it began trading in July. The Bombay Stock Exchange’s Bankex Index lost 3.3%, and the real estate index shed 4%.
The Reserve Bank of India unexpectedly lifted interest rates the second time in two weeks and told lenders to keep more cash in reserve after the surge in crude-oil prices pushed inflation to a 13-year high. The central bank also signaled it will keep raising borrowing costs. Read More »
Indian marketers’ search for the next big emerging markets ends here. There are 51 districts in the country, like Tiruchirapalli (Tamil Nadu), Amravati (Maharashtra), Bhavnagar (Gujarat), Kamrup (Assam) and Jabalpur (Madhya Pradesh), with at least one major town with a population above 5 lakh, that offer huge market potential for anything from mass products like soaps and toothpastes to high-end durables like LCD Television and cars. Read More »
As new government policies drive progress towards addressing climate change and other key environmental issues, the real estate markets around Asia and the world will change its look quickly and adopt green building concept, both in developing new buildings and improving existing ones, .
This transformation will be driven by various combinations of regulation, government incentives and changing market dynamics. Read More »
By Rajani
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Posted in Property News
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Also tagged Aspiration, Bangalore, Chennai, Conventional Buildings, Cost, Employees, Energy, Government, Government Policies, Green Certificate, House Renter, Mumbai, New Buildings, Requirement
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The Real estate industry in India has been growing by leaps and bounds in the past few years. However, the country still lacks a credible way to cross-check the price swings (real or reported) in the sector. For example, recent reports of residential prices cooling off in major cities of the country could not be verified. Read More »
By Rajani
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Posted in Property News
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Also tagged Ahmedabad, Equity Investors, Financial Institutions, Government Body, Hyderabad, Index, Jaipur, kanpur, Launch, Major Cities, Market Trend, Price, Price Appreciation, Residential Prices, Sensex
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Indiabulls Real Estate Ltd plans to invest 10 billion rupees to expand its retail business in the next 2-½ years. Mr. Gagan Banga, Group spokeman said that the real estate firm, which also houses the group’s retail and power businesses, expects lease rentals of 10 billion rupees from two of its properties under development in Mumbai by the end of the next financial year.
Mr. Banga, also the Chief Executive Officer of Indiabulls Financials Services Ltd, said that the finance firm plans to launch its first mutual fund scheme by October. Mr. Banga further said that the Indiabulls group plans to focus on agri-based spot trading for its proposed commodity exchange, which is awaiting approval from the commodities market regulator.
Fearing a supply glut in the housing and commercial property markets, real estate companies are pinning hopes on the booming hospitality sector.
It’s not that the trend has just set in. It has certainly gained momentum of late, with practically every developer announcing hospitality projects. Read More »
By Rajani
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Posted in Property News
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Also tagged Amp, Commercial property, DLF, Hospitality Project, Hospitality Sector, Hotel Industry, Parsvnath Developers Ltd, Purvankara Projects, Real Estate Companies, Real Estate Sector, Realtors
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Real estate developer Nirmal Lifestyle is planning to develop 20 townships across India.
The company has marked an investment of $5 billion for the first phase, which includes five townships under the brand name of Lifestyle City, a company release said. Spread over 300-1,000 acre, the phase I townships will come up one each in Pune, Indore and Panvel, and two in Mumbai.
The company is looking at generating $10 billion from these five projects in the next 10 years.
Nirmal Lifestyle chairman and managing director Dharmesh Jain told that the houses in these projects would be priced between Rs 20 lakh and Rs 1 crore. He declared, “Houses in Mumbai cost much more than the price we have put to our projects. So we hope to successfully tap this market”. Nirmal Lifestyle, which has built over 50 lakh square feet of residential and commercial space, is one of the top real estate players in the Mumbai market. Read More »
By Rajani
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Posted in Property News
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Also tagged Capital Partner, Commercial Space, Global Property, Indore, Investment, Investment Officer, Lifestyle, Mumbai, Panvel, Price, Private Equity, Property Consultant, Real Estate Developer, Sport
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Goldman Sachs, Deutsche Bank and another financial investor are thinking to make a shared investment of eight hundred million dollar in three special purpose vehicles being created by real estate major Emaar MGF. Each SPV will have one financial investor.
Delhi-based developer is in advanced talks with private equity players and is likely to close three separate deals within 30 days. No comment came from Emaar MGF on this issue. The deals will be the first big fund flow into the real estate firm since February.
Read More »
By Rajani
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Posted in Property News
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Also tagged Current Market, Emaar MGF, Financial Investor, goldman sachs, Indiabulls, Investment, Investor, Private Equity, Real Estate, Real Estate Investment Trusts, Real Estate Sector, Special Purpose vehicle, Spv, Unitech
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The Indian real estate sector, currently facing strong headwind due to the credit turmoil as well as high inflation, is set to get a breather from the market regulator SEBI’s move to allow Real Estate Mutual Funds, says global consultancy giant KPMG.
Mr. Jai Mayani, KPMG’s Executive Director and real estate head in India, said, “Real Estate Mutual Funds (REMFs) have a useful purpose and a role which until recently was missing in the real estate ecosystem. REMFs should help ease the situation and compensate to some degree the relative absence of public equity and challenging debt markets”. Read More »
