Monthly Real Estate Monitor -...

Pulse Monthly Real Estate Monitor

Market Highlights

November 2014

OCTOBER 2014

Office space leasing activity remained upbeat across cities

Demand remained stable across all cities except for Delhi.

Demand remained stable except for Delhi Mumbai and Pune

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Pulse Monthly Real Estate Monitor November 2014

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Legend: Market Sentiment

Ahmedabad – A rising star Ahmedabad's real estate market has witnessed a rapid development as compared with other cities of India mostly driven by the high rate of industrial growth. The city is rich in textile, pharmaceutical and chemical industries and is poised to be an automotive manufacturing hub of India. The favourable factors of safety, security and good infrastructure make it a desirable residential and business destination. The quality infrastructure and highly competitive real estate cost along with well administration of law and order make Ahmedabad a desirable residential and business destination. The current residential real estate market in Ahmedabad is diverse. It has residential units starting from as low as INR 0.5 million in affordable category and it goes up to as high as INR 50 million in ultra- luxury category. Added to this Ahmedabad has both mall and high street retail developments with presence of key retail brands such as Reliance, Future Group, Shopper’s stop etc. Meanwhile Prahaladnagar and Satellite area have emerged as the new office hub of Ahmedabad. Along with all the above the Gujarat International Finance Tech City (GIFT) an 886 acres development near Ahmedabad is planned to be developed as a “smart city” with high quality infrastructure. Ahmedabad has quality infrastructure with India’s most successfully running Bus Rapid Transit System (BRTS). This project contributed towards the rise of real estate prices at a few pockets on the outskirts of the city. There is a plan to increase FSI and have a Transit Oriented Development along the BRTS corridor. These will further boost the economic and allied activity in Ahmedabad. The city has Sabarmati Riverfront project which plans to provide large open spaces for public use. In addition, there is a proposal to connect Gandhinagar with Ahmedabad using the metro system. This is expected to rise the real estate prices along certain sections of the metro corridor between Ahmedabad and Gandhinagar. Moreover large-scale industrial developments at Sanand and Bechraji (near Ahmedabad), are planned to be developed as an automobile manufacturing hub in India. The government has also taken initiative to develop affordable housing which will not only check the slum growth in the city but also provide employment opportunities. With relatively low costs compared with other large cities in India coupled with the proactive development approach of the government and local authorities, Ahmedabad is poised to grow at a faster pace, providing ample opportunities in the real estate sector in near future.

The Foreign Direct Investment (FDI) guidelines for construction sector has been eased to attract investments in October. The new rules, proposed include - Reduction of the built-up area of the project

to 20,000 sq mts from 50,000 sq mts - The minimum capital requirement has to be

reduced to USD 5 million from USD10 million earlier.

Real estate industry hailed this decision as it will help cash-starved developers raise significant amount of foreign funds and also complete the projects stuck due to lack of funds

Investment sentiment strengthens with new policies being announced

Flipkart has closed India's largest office space leasing transaction ever in October by leasing 3 million sq ft of built to suit campus in Bangalore with Embassy group.

Four hitech satallite towns are planned to be developed along the 302 Kms Lucknow-Agra Expressway project. The expressway would pass through 10 districts including Firozabad, Kannauj, Etawah, Mainpuri, Auraiya, Kanpur Nagar, Unnao and Hardoi.

Coimbatore city corporation has planned to increase green cover in the city by using 25 acres of vacant lands of closed mills. They have received approval from the National Textile Corporation Limited (NTCL) for the same.

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For more information about our research, contact Ashutosh Limaye Head, Research and REIS +91 98211 07054 [email protected] Trivita Roy Assistant Vice President, Research +91 40 4040 9100 [email protected] Research Dynamics 2014 Pulse reports from JLL are frequent updates on real estate market dynamics. www.joneslanglasalle.co.in

Cities Office Rental Value

Retail Rental Value

Residential Capital values

AHMEDABAD

DELHI

MUMBAI

PUNE

BANGALORE

CHENNAI

HYDERABAD

KOLKATA

Legend

Growing Stabilise Stagnate Falling

Weather Map

DELHI

KOLKATA

CHENNAI

BANGALORE

HYDERABAD

PUNE MUMBAI

AHMEDABAD

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV

Demand/Vacancy Rental Value (RV) / Capital Values (CV) Increasing Moderate Increase Stable Moderate Fall Falling


Ahmedabad

Policy/ Infrastructure The Central Government has given its approval to the Ahmedabad Metro Project. The first phase is likely to cover 35.96 km.

The office space demand in Ahmedabad rose notably during the month of October. Select pockets such as Prahlad Nagar and S G Highway showed notable traction. Select companies from BFSI and manufacturing executed transactions. Major transactions: • Mizuho Bank leased space in SBD

Ahmedabad retail market witnessed notable transaction activity in the month of October. Select fashion brands & QSR preferred spaces on high streets to increases the footprints.

A noteworthy traction was recorded in the Ahmedabad residential market. Affordable projects in the outskirts of the city witnessed notable demand. New Launches: • Yash Arien in Memnagar • Aryan Gloria in South Bopal

Key Precincts Rental Value (INR per sq ft

per month)

Capital Value (INR per sq ft)

Prahlad Nagar 35 - 50 6,000 – 7,000 S G Highway 35 - 50 6,000 – 7,000 Ashram Road 32 - 42 5,500 – 6,500 Navarangpura 32 - 44 5,500 – 6,500

Koba 22 - 35 4,000 – 5,000


per month)


CG Road 100 - 125 16,000 – 18,000 SG Highway 80 - 110 11,000 – 13,000

Ashram Road 110 - 130 14,000 – 16,000 Chandkheda 60 - 80 9,000 – 12,000

Koba 50 - 70 8,000 – 10,000

Key Precincts

Rental Value (INR per month for a 1,000 sq ft

2BHK apartment)


Naroda 4,000 – 6,000 2,200 – 2,500 Gota 5,000 – 8,000 2,500 – 2,800

Navrangpura 15,000 – 20,000 6,000 – 7,000 SG Highway 10,000 – 15,000 5,500 – 7,500

Satellite 12,000 – 15,000 4,000 – 6,000 South Bopal 8,000 – 12,000 3,000 – 4,000

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Bangalore

Policy/ Infrastructure No new policy was announced in October.

Corporate expansion continued in the city while the market witnessed completion of The Address, Prestige Excelsior and Prestige Technopolis. The scarcity of space is likely to create upward pressure on rents Major transactions: • Flipkart, Sonus Networks, Sapient

and Snapdeal, all in SBD • TCS in Whitefield

Bangalore’s retail market continued to witness improved demand. Rents increased marginally across all submarkets. Major transactions: • Inmark on Commercial Street • Sarafina in Koramangala • Banjara in Indiranagar

Sub-markets across the city witnessed marginal improvement in residential demand. New Launches: • Golden Gate Presidential Towers in

Yeshwanthpur • Pride Enchanta on Mysore Road • Spectra Palm Woods in Whitefield • Nitesh Chelsea on Hosur Road • The Tree on Tumkur Road


per month)


CBD 80–130 10,000–22,000 Old Airport Road 60–75 7,000–12,000

Outer Ring Road (Eastern) 48-60 5,500–7,500 Old Madras Road 45–65 5,000-7,000

Electronic City 27-32 2,800–3,500


per month)


Koramangala 90–160 9,000–18,000 Indiranagar 90–180 12,000–18,000

New BEL Road 60–80 6,000–12,000 Commercial Street 175–250 16,000–20,000

Jayanagar 100–170 8,000–18,000

Key Precincts


2BHK apartment)


Old Madras Road 15,000–25,000 5,000–7,000

Indiranagar 20,000–30,000 10,000–25,000

Bellary Road 12,000–18,000 4,500–9,000

Hosur Road 10,000–14,000 3,000–6,500

Whitefield 18,000–25,000 5,000–8,000

Tumkur Road 8,000–12,000 3200–6,500

Kanakapura Road 8,000–12,000 3,200–6,500

Mysore Road 8,000–10,000 3,000–4,000

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Chennai

Policy/ Infrastructure • Highways department accelerated the construction of the flyover at

Moolakadai junction in North Chennai. Now the four-lane flyover is expected to be completed by March 2015.

• Chennai Metro Rail Limited (CMRL) decided to call for tenders for the design of Metro stations in the phase-I extension from Washermanpet to Wimco Nagar.

Office absorption remained steady. Office occupiers were attracted towards CBD and SBD, while limited leasing activity was witnessed in the peripheral sub-markets. Major transactions: • Encore IT Services & Oil tech in

Guindy • CMA CGM & Star Union Dai-ichi in

CBD sub-market

Demand for quality high street properties remained stable, while limited vacancy in quality malls restricted the leasing activity in the malls. Major transactions: Saravana Store opened a 0.15 million sq ft showroom in Chrompet.

Lukewarm demand coupled with slow approval processes continued to pressure residential supply during the month. Capital values and rents remained stagnated amid high inventory levels. New Launches Four Greens in Oragadam


per month)


Mount Road 60-85 9,000-15,000 RK Salai 65-85 10,000-15,000

Pre-toll OMR 40-67 5,000-6,500 Post-toll OMR 25-35 3,500-5,000

Guindy 45-65 6,500-9,000


per month)


T. Nagar 120 - 180 12,000-15,000 Nungambakkam 130 - 150 13,000-16,000

Velachery 80 - 120 10,000-12,000 Pre-toll OMR 80 - 100 8,000-11,000 Anna Nagar 120 - 150 11,000-13,000

LB Road (Adyar) 100 - 140 10,500-13,500

Key Precincts


2BHK apartment)


Adyar 20,000 – 30,000 15,000-22,000 Medavakkam 7,000-14,000 3,750-5,500

Tambaram 6,000-12,000 3,500-4,500 Anna Nagar 15,000 – 25,000 9,000-15,000

Porur 5,000-10,000 4,000-6,200 Sholinganallur 9,000-12,000 4,250-5,800

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Delhi NCR

Policy/ Infrastructure • A 3-lane flyover parallel to the existing one at Rao Tula Ram Marg

has been approved for easing traffic congestion in the road linking South Delhi to NH-8

• Noida authority approved four-lane underpass on Master Plan Road Number 3 at sector 94-95 crossing which will make the stretch between Kalindi Kunj and National Highway -24 signal-free.

Demand remained healthy with relocation and consolidation along with fresh expansion activity being visible in the office markets. Major transactions: • TCG Hamilton in Sohna Road • Dentsu Advertising in NH-8

Cybercity • My Zeal IT Solutions & Tech

Ahead in Noida City

Demand remained slow with some activity seen in under construction malls. Retailers considered looking only at prime operational malls and would reduce store size as well. Alternately, they continued preferring high streets.. Major transactions: • Allen Solly & Cobb in Ghaziabad,

Despite prevalent price discounts and attractive payment plans, sales conversions remained slow. With the festive season bringing only marginal cheer, demand would likely to remain within a narrow range. Launches reduced during the past month. New Launches: • Accolade by Eldeco in Sohna • Golf Links on Sohna Road


per month)


Barakhamba Road 170-400 28,000-35,000 Jasola 110-170 17,000-21,000

DLF Cybercity 85-90 NA MG Road 115-140 17,000-19,000

Golf Course Road 90-110 12,500-15,000


per month)


South Delhi 180-330 24,000-32,000 West and North Delhi 140-230 15,000-23,000 Gurgaon-MG Road 140-270 17,500-23,000

Rest of Gurgaon 60-100 8,000-14,000 Noida 130-220 14,000-25,000

Ghaziabad 90-150 10,500-16,000

Key Precincts


2BHK apartment)


Golf Course Road 26,000-32,000 13,000-19,000 Sohna Road 16,000-20,000 5,800-7,500

Golf Course Extension Road 18,000-22,000 8,500-11,000 Dwarka Expressway NA 5,500-7,500 Noida- Greater Noida

Expressway 13,000-15,000 4,300-6,500

Noida City 12,000-14,500 4,700-6,000 Indirapuram 11,000-12,000 4,500-5,300

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Hyderabad

Policy/ Infrastructure The Hyderabad Metro Rail is likely to be the first metro rail project in India to be solar powered. The roofs of metro stations are likely to be used for fixing solar panels.

Leasing activity continued to remain stable in Hyderabad in October. The limited supply in key submarkets continued to push rents upwards. Major transactions: • Open Text and JPMC leased space

at Hitec City • Birlasoft and Indus Towers leased

space at Gachibowli

High streets and malls both continued to witness good demand on October. Demand for cash and carry outlets and built to suit options in retail has also seen a rise. Major transactions: • Big Bazaar leased space at

Gachibowli • Reliance Foot Print leased space

at City Center Mall and Kompally.

Residential sales were stable in October. There were many new launches over the month. Major launches. • Aparna Cyber Life by Aparna

Constructions launched at Nallagantla

• TNR Sulakshana by TNR Builders launched at LB Nagar.

• Srinivasa Heights by SHL Group was launched near Uppal Junction


per month)


Begumpet 45–55 4,500–6,500

Banjara Hills 50–65 4,500–8,500 Hitec City 36–45 4,000–6,200

Gachibowli 36–42 4,000–5,500 Uppal 25–35 3,000–4,000


per month)


Banjara Hills 110–140 11,000–14,000

Jubilee Hills 130–160 13,000–16,000 Secunderabad 80–110 8,000–11,000

Hitec City 110–130 11,000–13,000 Kukatpally 110–130 11,000–13,000

Dilsukhnagar 110–120 11,000–12,000

Key Precincts


2BHK apartment)


Banjara Hills 20,000–30,000 7,500–14,000 Begumpet 12,000–20,000 4,000–5,500 Kondapur 10,000–20,000 3,200–5,000

Gachibowli 10,000-18,000 3,500-4,200 Tellapur 8,000–15,000 2,800–3,500

Kukatpally 8,000–15,000 3,500–4,000 Miyapur 8,000–10,000 2,400–3,700

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Kolkata

Policy/ Infrastructure In an effort to make Rajarhat - New Town more business-friendly, the 10.5-km Rajarhat Main Arterial Road connecting the airport to Salt Lake Sector V will soon become a Wi-Fi enabled stretch where one would be able to connect to the net while travelling on a car or a bus. The stretch has already been declared as a green corridor.

Enquiries improved across all the peripheral sub markets of the city. However, SBD continued to remain out of focus for the occupiers. Projects with better facilities continued to be the key behind the market activities.

Demand for retail spaces in organised malls remained stable. However, low vacancy in prime malls restricted the number of transactions in the market. Meanwhile prime high streets continued to be at the focal point of retailers.

Residential demand in the city was stable. However, absorption levels remain low amid the availability of the large inventory. The number of launches continued to be stable. New Launches • Siddha Eden Lakeview at

Bonhooghly, BT Road • MBPS Waterview at Malancha near

Baruipur


per month)


Park Street 110-135 13,000- 20,000 Topsia 70-90 7,500-10,000 Kasba 75-90 8,000-11,000

Salt Lake Sector V 40-45 4,000-4,800 New Town and Rajarhat 32-36 3,200-4,100


per month)


Elgin Road 300-325 24,000-28,000 Park Street (high street) 325-375 25,000-31,000

Prince Anwar Shah Road 150-200 15,000-18,000 Salt Lake 185-225 15,000--20,000

New Town and Rajarhat 60-80 6,500-8,000 Gariahat (high street) 200-250 16,000-22,000

Key Precincts


2BHK apartment)


Alipore 43,000-52,000 14,000-22,000 Prince Anwar Shah Road 19,000-30,000 7,000-14,000

EM Bypass (Topsia) 15,000-25,000 6,000-10,000 Lake Town 11,000-17,000 3,800-7,500

New Town (AA- I, II & III) 10,000-16,000 3,500-6,000 Rajarhat 8,000–14,000 2,500-4,700 Behala 8,000-14,000 3,000-5,500

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Mumbai

Policy/ Infrastructure No new policy or new infrastructure has been introduced in October.

Mumbai office market witnessed a notable growth in transaction activity. SBD BKC exhibited some signs of demand revival. The submarket was characterised by lease renewals and new entrants taking up spaces. Major transactions: • MSD renewing in SBD BKC • Synchronuss Technologies SBD

North

Leasing continued to remain moderately healthy, mostly driven by F&B and edutainment brands. Developers were favouring brands that would help their mall to offer consumers a differential experience. Major transactions: • British Brewing Company,

Theobroma and Hamley’s in Suburbs

Despite of festive season, the new launches in the month of October witnessed a marginal fall over the previous month mainly due to developers shifting their focus to reduce the unsold inventory levels. New Launches: • One Hiranandani Park at Thane • Codename The Centre at

Dombivali


per month)


Lower Parel 160 - 185 17,000 - 21,500 BKC 250 - 330 25,000 - 34,000

Andheri 105 - 140 10,000 - 14,600 Goregaon-Malad 85 - 105 9,000 - 11,900

Wagle Estate 50 - 65 5,200 - 6,900


per month)


Lower Parel 260-390 22,000-32,300 Malad 160-250 12,500-20,000

Ghatkopar 130-220 10,100-18,300 Mulund 125-200 9,500-15,500 Thane 100-185 8,000-14,500

Navi Mumbai 75-150 7,000-12,000

Key Precincts


2BHK apartment)


Lower Parel 60,000-1,10,000 25,000– 40,000 Wadala 35,000-55,000 15,000–23,000 Andheri 32,000-55,000 12,500–21,500

Ghatkopar 30,000-45,000 11,500–17,000 Ghodbunder Road 12,000–25,000 6.000–9,500

Kharghar 10,000–18,000 6,000–9,000

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OFFICE

Demand Vacancy

RV

CV

RETAIL

Demand Vacancy

RV

CV

RESIDENTIAL

Demand Launches

RV

CV



Pune

Policy/ Infrastructure No new policy or new infrastructure has been introduced in October.

Demand for office spaces in Pune remained notably high during the month of October. The SBD submarket witnessed most of the traction. Select BFSI and IT/ITeS companies executed expansions in office buildings with large floor plates. Major transactions: • Anchor Electricals in CBD • Courion IT in SBD

Overall demand remained stable at malls & high streets in Pune . Apparel & fashion brands were the major contributor towards demand. Major transactions: • Kawediya Jewellers in Prime City

high street • Nike in suburbs

Demand continued picking-up in select projects that were newly launched where customers find the pricing attractive. However, under-construction projects continued witnessing subdued demand owing to high prices. New Launches: Lodha Codename Albatross, Skyi Manas Lake and Pinnacle Neelanchal, all at North West Submarket


per month)


Hadapsar 45-65 5,500-7,500 Kharadi 45-65 4,500-6,500

Hinjewadi 33-40 4,000–5,500 Viman Nagar 55–65 6,500–7,500

SB Road 55–75 6,500–8,000


per month)


MG Road 100-160 15,000–21,000 Bund Garden Road 90–130 13,000–17,000

FC Road 100–150 15,000–20,000 JM Road 100–150 15,000–20,000 DP Road 90–130 12,000–16,000 SB Road 80-140 13,000-16,000

Key Precincts


2BHK apartment)


Wakad 10,000–13,000 4,700–5,700 Hinjewadi 9,000–11,000 4,800–6,500 Kharadi 11,000–15,000 4,800–5,800

Hadapsar 13,000–18,000 5,000–7,500 Undri 8,000–11,000 4,000–5,200

Pimri-Chinchwad 8,000–13,000 4,500–6,000

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For more information about our research, contact Ashutosh Limaye Head, Research and REIS +91 98211 07054 [email protected] Trivita Roy Assistant Vice President, Research +91 40 4040 9100 [email protected] Research Dynamics 2014 Pulse reports from JLL are frequent updates on real estate market dynamics.

About JLL Jones Lang LaSalle (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $4 billion, JLL operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 3.0 billion square feet. Its investment management business, LaSalle Investment Management, has $47.6 billion of real estate assets under management. JLL has over 50 years of experience in Asia Pacific, with over 27,500 employees operating in 80 offices in 15 countries across the region. The firm was named ‘Best Property Consultancy’ in three Asia Pacific countries at the International Property Awards Asia Pacific 2013, and won nine Asia Pacific Awards in the Euromoney Real Estate Awards 2013. For further information, please visit our website, www.jll.com About JLL India JLL is India’s premier and largest professional services firm specializing in real estate. With an extensive geographic footprint across 11 cities (Ahmedabad, Delhi, Mumbai, Bangalore, Pune, Chennai, Hyderabad, Kolkata, Kochi, Chandigarh and Coimbatore) and a staff strength of over 6800, the firm provides investors, developers, local corporates and multinational companies with a comprehensive range of services including research, analytics, consultancy, transactions, project and development services, integrated facility management, property and asset management, sustainability, industrial, capital markets, residential, hotels, health care, senior living, education and retail advisory. The firm was named the Best Property Consultancy in India (5 Star Winner) at the International Property Awards – Asia Pacific for 2012-13. For further information, please visit www.joneslanglasalle.co.in

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