Keeping a ceiling on home prices

India's journey towards a home-owning democracy, and Padmakshi Financial Services' continued recommendation to buy the dominant property financiers leads me to wonder if the Indian and US property markets are in different stages of the same journey.

While the US cycle is in a temporary downturn, if the Indian cycle is behind but revolving in the same direction, it has to be worth a status report.

For that, I delved into the recent Padmakshi Real Estate update.

For the non-NRI (non-resident Indian) investor, there is only so much Sensex volatility you could take.

It is all right for the future residents of India to take the long term view and hold onto the handle-bars of the Sensex roller-coaster.

They are not exposed to currency risk and future lifestyle risks that non- NRI, non-Indian investors face.

Exposed? Consider this: the Sensex advanced around 10 percent in April, but retreated 5 percent in a week when I last looked. While still holding out for a good long-term story, its going to be bumpy.

Rohit Chothani at Padmakshi says: Its vital to temper expectations of equity investors the 16 percent to 18 percent per annum longer term average will be nearer in terms of management of realistic expectation than the 45 percent per annum of the last five years.

The Padmakshi brief reads:

Commercial

1. Go green is the new mantra adopted by all the leading developers across the country to lure clients through its long-lasting benefits. Chennai is leading with the highest number of existing green buildings.

2. Bangalore, Chennai and Pune markets are witnessing a fair flow, and non-IT space demand continues to ascend.

3. Average gross yields in commercial real estate across the metros range between 10 percent and 13 percent.

Residential

1. Demand in the luxury segment in city-center properties continues to outpace the supply in all the metro markets.

2. The domination by a few players is declining and giving rise to competition in developing good quality projects. This is attracting buyers.

3. Average gross yields hovered in a range of 4 percent to 8 percent across these metros.

I recall looking at some fancy Victorian but run-down premises in fairly central Mumbai. Built by the Britishers and run down by time and rules that encourage squatting at low rents. That's all changing, says Chothani.

Property developers are forming a significant voice in India Inc and by degrees we will see the asset class mature.

Supporting the statement, Chothani notes the increasing interest shown by private equity players. The biggest property deal saw a consortium led by Delhi-based BPTP buying a 38-hectare commercial plot in Noida for 50.06 billion rupees (HK$9.11 billion). This is a price per square meter of 130,207 rupees.

What does this all mean for the outlook of Indian property. Chothani is bullish due to strong demand, strong FDI inflow, and the support of government-led infrastructure development.

But he warns: Developers will have to adopt innovative techniques to keep a check on spiralling construction. With finance costs also on the rise, developers and private equity projects will be pressured into delivering affordable housing solutions.

Ian Jackson is the general manager at wealth management consultancy Financial Partners

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Top realty players set to enter warehousing

It’s a road less travelled but real estate developers are revving up. After building luxury homes and corporate offices, top-of-the-line property developers such as Akruti City Ltd, Emaar MGF Land Ltd, K Raheja Corp., and Nitesh Estates are planning to build warehouses as organized retail booms and traditional realty market slows.

Organized warehousing, though in its nascent stage, has whipped up a huge demand—nearly 340 million sq. ft is needed by 2015, according to Jones Lang LaSalle Meghraj (JLLM), a property consultancy firm. With international companies coming to India, warehousing is set to change from old-fashioned storage sheds to planned hubs that are designed to serve as inventory management and storage spaces for retail chains.

Retailers ranging from Wal-Mart Stores Inc., the world’s biggest, to domestic firms such as Reliance Retail Ltd, have set aside millions of dollars to pump into the Indian market so they can get in early as organized retail gets set to take off in a country dominated by small stores and street-side selling.

All retailers have said storage, warehousing and logistics is the weakest part of the retail infrastructure in the country that needs development—and realtors see an opportunity. Developer Akruti City, formerly known as Akruti Nirman Ltd, targets building warehouses at 20 locations across the country.

Bangalore-based Nitesh Estates, which is now heading for a national footprint with several residential projects, has announced a Rs2,000 crore plan for warehousing, with space in Chennai, Bangalore and Pune.

Future scope: A ProLogis warehouse in China. The firm is collaborating with an Indian realty group to set up similar warehouses in India.

Ours “would typically be areas close to large-sized mandis or markets where there is a huge requirement for storage infrastructure,” said Hemant Shah, chairman of Akruti City, which is investing Rs250 crore in the first lap and is finalizing tie-ups with national and global warehousing firms. And these are not unplanned storage areas that are cropping up. Mahesh Laxman, regional director of south at JLLM, said unused land banks between a metro such as Bangalore and its extended suburbs are ideal places to build warehouses.

With land prices in Indian cities having shot up many times, real estate firms are using their land banks that cannot be currently utilized for residential and commercial development to develop storage spaces. Though analysts said that returns in warehousing may not be immediate, they could be 18-20% on investment if the rentals are around Rs15 per sq. ft, say property consultants.

“Typically, developers with large land banks would get into the business. Not only does the land bring you decent returns, there is a huge demand for storage space with both national and global retail giants expanding their operations in India,” Laxman said.

Developing warehouses needs a bit more work than just building four walls and roof, which was typically how old warehouses were built in the country. “The business is a lot like developing a property but to certain technological specifications,” said R.S. Mani, chief executive officer of Nitesh Estates, which is tying up with an international player for its new venture.

Specifications for warehousing, which could be both technological and design-oriented, incorporate aspects such as flooring, storage space, height and dock-door proportions to move goods in varying sizes. In fact, higher and better the quality of the specifications, higher would be the rentals, said Laxman.

Developers admit that joint ventures and strategic partnerships with global warehousing companies are the best way to go about this new business. This year, the joint venture between Mumbai-based realty group K Raheja Corp. and Colorado, US-based warehousing multinational ProLogis was not only the first partnership of its kind but charted the way for more such tie-ups.

“Warehousing is a specialized, long-term business and real estate developers don’t have the required experience, which is why they would tie up with a warehousing brand like ours,” said Abhijit Malkani, director of India operations at ProLogis.

A brand such as ProLogis, Malkani added, would not only bring the expertise but the huge client base that it has been servicing across the globe. The company, which aims to create 25 million sq. ft of warehousing space globally in the next five years, set its eyes on India after China, both of which are emerging markets for this business.

Mani of Nitesh Estates added that warehousing experts would bring in the latest trends of the business in their projects and would market such projects better.

International experts could customize design elements for every segment, be it automobile or furniture, and most importantly, provide infrastructure to retail and industrial clients to set up such warehousing hubs.

Given the interest shown by several developers and landowners, analysts say that the future of warehousing is being currently written but its long-term success would depend on many factors.

Vivek Dahiya, director of DTZ Holdings Plc., a real estate advisory company, said, “The emergence of professional developers and operators who can create a national-level portfolio, availability of low-cost land near road and rail networks, and continued investments from institutional and private equity investors in this segment would determine the success of this market in India.”

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ValuePROPS.com, a New Portal For Real Estate Deals

 

 

Those who want to finalize their real-estate deals now have a new portal to look up to. Kult Infotech has launched its new online real estate bank called valuePROPS.com; it offers service for advanced search and mapping to help to find a preferred property destination.
ValuePROPS offers the service of advanced search for preferred area, mapping via GoogleMaps for exactly identifying the selected destination, financial calculations, blogging space, and other features that can help guide users through the entire process --from buying and selling a property, to completion of transactions.
In addition, valuePROPS.com has a multi-lingual interface available in Tamil, Telugu, Kannada, and Hindi. The website claims to provide access for about 5000 registered agents and transparent dealings along with the revenue sharing model. Currently, the service is limited to properties across the southern cities of Chennai, Bengaluru, and Hyderabad.

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Slowdown in Chennai property transactions

A. Srivathsan

CHENNAI: The number of property transactions in Chennai and its immediate neighbouring districts has come down by 10 to 15 per cent in 2007-08.

In 2006-07, the three zones within the city registered about 3.7 lakh documents and netted about Rs.1,384 crore in terms of registration charges and stamp duty. Of these transactions, about 80 per cent was property related. The second half of 2007-08 witnessed a slowdown. Without exception, transactions in all the three zones of city – North, South and Central and the neighbouring Kancheepuram and Chengalpattu districts have come down. South Chennai was the worst hit, a drop exceeding 15 per cent. Chengalpattu followed this with more than 10 per cent. In 2006, these two districts along with Kancheepuram registered high growth in property transactions across the State.

Prakash Challa, President, Confederation of Real Estate Developer’s Associations of India (CREDAI), Tamil Nadu confirms that the property transaction and sale of apartments have come down in the recent times. He attributes the high interest rate, rise in the construction cost and additional charges as reasons. The steep rise in land prices and reduced funding for real estate projects have added to the situation, he said.

In spite of the fall in transaction, the revenue generated for the Government in terms of stamp duty has not come down. An upward revision in guideline values, between 50 and 150 per cent, which have been in force since August 1 last year, helped improve revenue collection.

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International Institute of Real Estate, Investment and Finance

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Affinity Consultant – Helping you in Real Estate Investment in India

Affinity Consultant is a Real Estate Agent in India operating since last 10 years. A team of dedicated professionals is headed by A.K. Jain with more than 10 yrs of experience in real estate services

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Dream Houses

Aniruddha Deshpande is aiming to create a new kind of township. Sucheta Dalal and Debashis Basu met him in Pune and heard his interesting plans

A few kilometres from Pune, a new township called Amanora is taking shape. It is the brainchild of Aniruddha Deshpande, a man who was known for a long time as someone who brought Motocross to India in the 1980s and a regular participant and winner of the gruelling Himalayan car rally. Given this background, it should be no surprise that his plans for Amanora are Himalayan in scale. It is a Rs4,500 crore, fully wired, intelligent township that will be controlled by a central data system. All homes will be IT-enabled to monitor everything from the daily vendor system to the security. Every resident will have a portal in the Intranet that will be connected to various vendors. Explains Deshpande: “You can order anything from any shop or any hotel in the township through this portal. If you are going out of town and need less milk, then some simple clicks on a smart screen will allow you to change your requirement from, say two litres to one. The laundry, the housekeeping and any other supplier will be connected to this portal.”

Deshpande calculates that one needs 68 such functions or verticals to run a township and the cost of such a data-centre would be Rs100 crore. It is not viable to spend this amount for constructing a few thousand houses. But then Deshpande is not setting up a few thousand houses; he is creating a township of 30,000 at which the data-centre becomes very profitable. The centre will be set up by a township management company called City Development Corporation, which is controlled by Deshpande.

In fact, the Amanora concept changes the relationship between the developer and the buyer. You don’t get to buy an Amanora property; you lease it for 999 years. Will this be acceptable to buyers? Deshpande’s rationale is: “We will change the customer into a citizen. So we don’t sell you the apartment; we give it to you on lease and we provide you water, electricity, education, healthcare, a marketplace, entertainment, gardens, security – everything that you need. We will be able to offer this at a much lower cost and much higher quality because we will be able to negotiate better terms as a bulk buyer of water, electricity and everything else from the suppliers.” He proposes many novel solutions to ensure that Amanora’s infrastructure remains top-class. One such is a water bank or dam, which he admits is nowhere near being accepted by the government. But, he says, “The government is short of money for irrigation projects. We are willing to spend money to dam the water and sell it to the Pune Municipal Corporation. We want to be able to sell the surplus water at the rate that the irrigation department sets for water.”

How did Deshpande come into this business and develop these novel ideas, when he is neither an architect nor an engineer? It was – as happens with most entrepreneurs – a matter of chance. “Both my parents are doctors and nobody in my family is into business. I have been only in the real estate business so far, except for an automobile dealership that I had for a few years till 1988.” That too happened because Deshpande was connected to automobiles in an indirect way. “I was organising motor sports in India and was vice-chairman of the Federation of Motor Sports in India for a long time, and then of the Pune Automotive Racing Association. I also used to race and won the Himalayan car rally in 1980-81. I also started the Motocross here in Pune and we even hosted the world championship at the Nehru Stadium. I was the executive chairman of that body for a long time – almost eight-nine years. We had collected Rs35 lakh, which was a big amount for a sports body in 1988.” After the world championship was over, there was a lot of infighting and so Deshpande quit. As soon as he resigned in 1988, he stumbled into the real estate business quite by chance.

Deshpande had a friend who had a 5,000 sq ft plot in Bibwewadi in Pune. He asked the friend whether his father would let him develop the plot. He replied, “I don’t think he will, because he is looking for a well-established developer.” Deshpande said, “If we tie up with an architect and a developer, will he give it to me?” This architect was a member of the racing association. Deshpande also knew a developer who had done construction for 10 years. “The idea was that the we would take two flats and the developer would sell the remaining six apartments. All of us went to meet my friend’s father.” He told them, “If you three are going to do it, then I am willing to take the risk; I will give you my plot.” The hitch was that the trio had to make a down payment of Rs120,000 but did not have any money. They suggested that bookings would be announced in six to eight months and once the cash was raised, they would hand over Rs120,00 to the plot-owner. The owner agreed. They completed the project in six months and Deshpande has never looked back ever since. “We did 10 projects in that area alone. Many people saw the quality of the project and approached us with their plots. All the plots were the same 5,000-sq-ft size. That was how I got into this business. It was by default. Nothing was planned until after I resigned from the Pune Automotive Racing Association. Deshpande does not rally anymore but his passion for cars has not diminished. “Every time I go to London, I rush to the automobile showroom on Park Lane to see the gleaming models of classic cars,” he says.

Building small residential projects is one thing but taking on the task of creating a landmark township on a gigantic scale is quite another. How did Deshpande get involved with Amanora? Before Amanora, he was involved with another unique project, called Lavasa, which is a township atop a hilly area, near Pune. Lavasa is today billed as a hill-station where you can live, and travel to work in Pune. When Deshpande started work on it, it was the most unlikely destination. “It had no road, no hospitals, no hotels, no communication facilities, no educational facilities, nothing. For the first one year, we used to get off from our cars and walk for two hours to and from the site each way. No developer would walk four hours a day to buy land, especially six years ago.” Why did he take the trouble? “The only reason was that nobody had built a private hill-station after the British left India.”

Deshpande bought his quota of land and then applied to start a project under the Maharashtra government’s hill-station policy. However, having developed the project up to a point, he has just sold his interest in it to Hindustan Construction Company, of Ajit Gulabchand, who is supposed to be close to Sharad Pawar.

Deshpande claims that the Lavasa project was planned very well and has won prizes all over the world for master planning. “A very sensitive environmental planning was done with the help of the UN Environment Department, because Varasgaon, where Lavasa is located, is one of the 18 bio-diversity hot-spots but was the most degraded. In the first four years, with the help of the government officials, forest authorities and everyone involved, we planted 300,000 trees. The UN officials in Paris were sceptical that we would be able to plant even 100,000 trees – which is what we had promised.” Deshpande sold out his stake in Lavasa when the project became large and banks insisted on his personal guarantees for loans which were growing too large for comfort.

Apart from Amanora, Deshpande has planned two other townships. The next one is at a lower price point (between Rs10 lakh-20 lakh), deploys a new fabrication technology (consumes less of cement and uses a chemical that expands) to lower the cost and will come up in less than 1,200 days. The township will have all basic facilities including and a transport hub to connect Pune. The third project is a golf estate – a very high-end project with only golf villas. It will have 10-12 towers and will offer an unrestricted view of the golf course. Deshpande has already bought the land and will launch the project before the end of the year.

Can Deshpande take his model and learning across the country? No way, he says. He explains: “Real estate in India is not a national game. I have been going to Bangaluru, Gurgaon and Chennai and studying these places for expansion. I have good contacts there through my interest in motor sports. But it is not easy to buy land if you are not a local developer. If you are doing a joint venture with a local developer, then you are not in control. So, Mumbai-based developers cannot easily do projects in Pune or Delhi-based ones in Chennai. I can buy 500 acres of land in an instant in Pune because I know hundreds of people and how they are connected to whom, etc. But I will be at sea in other cities.” In any case, for now, Deshpande’s hands are full – delivering what is aimed to be a showpiece of India’s frenetic real estate development.

http://www.suchetadalal.com/articles/display/2766/2814.article

How to rent a hassle-free house

Almost two years ago, Suneel Padale, 36, a development professional, moved to Delhi from Bharuch, Gujarat, on an assignment. Initially, he stayed with his friends and he acted quickly on their suggestion to look for a house in Mayur Vihar Phase-I. He visited the area and liked it. With friends and newspapers disgorging details of property agents in the area, the house search started.

He was, however, disappointed at the results, as most of the apartments that he checked did not live up to his needs. He stuck with the location in spite of that. Finally, he moved into one that he liked. But, eventually, it turned out to be a sour deal as, Padale says, "The landlord wanted to sell his house and in the intervening period he wanted to get some rent." For Padale, the search process began again.

Happy House Hunting D-I-Y

• Locality. Select the locality; look for proximity to markets, hospitals, schools and your office, and its connectivity
• Rent. Look at property portals and find out the reasonable rent in that area
• Reference. Get references of property agents from people in the locality, or refer to newspapers and property portals
• Dealer. Check the agent's office; look at the size of his set-up; ask for references of past clients; a service tax registration means he takes his business seriously
• Details. Shortlist the property agents; tell them about the size of property and the rent that you want to pay; check the security deposit and brokerage fees. Ask the agent to shortlist properties for you a day before you visit the area
• Property. Check the condition of the property. Make sure it has not been vacant for long
• Utilities. Check the water and electricity supply; ensure there is no leakage and that all electricity connections work
• Interiors. Check for warped doors, windows, broken panes; stress on getting a whitewash and pestcontrol done
• Lease. The terms and conditions should be clearly mentioned in the agreement; get it notified/registered; Comple-te all paper work before you move in

This time, however, he changed his strategy. During his stay he had acquired some new friends, in particular, older residents of the area. From them he took references of property agents. "These agents had a larger supply of flats as compared to the earlier ones," says Padale. Still, it took two months before he found a flat. He summed it up wryly: "The experience is quite painful and time consuming."

The demand. Painful indeed, is the process, especially if you are searching for a house in the April-June period as a lot of job openings are created then. Also, campus placements of most business schools usually ends around that period.

"This adds to the demand for rental properties; primarily, this demand is created in the Rs 5,000- 15,000 bracket," says Prashan Agarwal, business head, www.allcheckdeals.com, India's first, online brokerage for residential real estate.

The effect. It is now established that sales volume of ready-to-move-into properties has taken a beating. The main reason behind this fall is the high cost of real estate, with credit becoming costly. The outcome of this is that many people are effectively postponing buying their dream home.

As a result, this has driven the demand for properties on rent to move upwards. "In the last 6-12 months, rentals have risen, on an average by 15-20 per cent," says Agarwal. For rents to stabilise or fall, volume of property purchase transactions needs to move up. With that not happening, at least in the short-term, rentals will continue to move up. Against this backdrop, if you are rent-bent, you need to look at a few things.

The location. The first step is to zero in on the locality. Then find out the regularity of both the water- and electricity-supply. Check the distance to your office, local markets and other amenities like schools and hospitals. Also, go through the property portals to get an idea of what is the fair rent for that locality.

The agent. Get in touch with the property agents. You could also sound out your office colleagues, in case they are planning to rent out their property, or if they know someone who is willing to do so. This makes sense as, by getting rid of the agent  you save on brokers' fee, which is typically a month's rent.

If you are not that lucky, start short-listing agents. If you know people in the area, take references from them or else check out the classifieds. Bigger property agents usually publish many advertisements for different properties. You can also visit the property portals. Zero in on the agents who have the largest supply.

Once you have identified the broker, visit the office and check if he has a permanent address or not. "A service tax registration indicates that the broker takes his business seriously," says Naresh Malkani, CEO, www.indiaproperties.com. Also, ask the agent if he is a member of any local real estate association or a national association. "At the end of the day, you should use your own judgement," says Padale.

The landlord. Once you have identified the property, the agent arranges a meeting with the landlord. There are a few things that you should clarify. Ask him why the property was vacant. "Given that, ask him what plans he has to move into the property or to sell it," says Agarwal.

The rent. In Delhi-NCR, the landlord would generally ask for two months rent as security deposit (SD) and a month's rent in advance. While advance rent is a prevalent practice, the amount of SD varies. For example, in Mumbai and Bangalore you have to pay up to 10 months rent as SD.

The inspection. "One should always take the meter reading of all utility services during pre-possession walk-through. The readings should be attached as an addendum to the lease and signed by both the parties," says Malkani. Stress on the fact that the landlord must get the electricity connections checked before he hands over the house to you.

Ensure that the wiring is earthed properly and that everything else is where it should be. If any doors or windows are warped, get them rectified. Furthermore, check if locks in the house are in working condition and if you find a faulty one, get it changed.

Finally, ask the landlord for pestcontrol and to get the house whitewashed.

The lease. These are of two types - company and personal. Most landlords are comfortable with a company lease. "A company lease protects the landlord from any potential tenancy holdover provisions," says Malkani. But if you are unable to furnish a company lease, there is the personal lease option. "Convince the landlord that you are a person of integrity," says Agarwal.

Whichever option you choose, certain things have to be stated clearly, especially, the duration of lease and the SD. If it's a personal lease for 11 months, get it notified. On the other hand if it's a company lease for more than a year get it registered with the help of a lawyer. "The lease then becomes a legal document that secures your rights as a lessee," says Agarwal. At the end, pressure the agent to complete all the documentation before you actually move into the property.

Renting may not be an ideal solution, but if you pay attention to a few basic issues, then that can well ensure years of living on rent, trouble-free.

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Enticing buyers with freebies

The Hindu Business Line : Enticing buyers with freebies

LIC to buy land worth Rs 2,000 cr

Life Insurance Corporation of India (LIC), which is among the largest property owners in India, is planning to acquire land worth Rs 2,000 crore this year to develop commercial and residential complexes.

This will be in addition to the Rs 1,100 crore it spent last year for purchasing lands across the country.

The public sector insurance giant has identified Kolkata, Jaipur, Agra, Vishakhapatnam and Bangalore as possible cities where it may acquire land and develop it.

LIC had hired consultants, which had identified the growth centres in the country and based on the report, the company intends to invest in real estate. "We will evaluate the locations, which earn higher returns when we invest," a company executive said.

The insurer is next only to Indian Railways in terms of property ownership in the country and, at present, it holds 1,708 properties in the country which are estimated to be worth around Rs 20,000 crore. In the eastern region alone, the life insurer owns 187 properties.

While a part of the real estate has been acquired by LIC in the last five decades of its existence, it also inherited a majority of the properties owned by it at the time of nationalisation in 1956. Most of the inherited real estate is in prime location, typically in central business district in most cities, including the metros.

A bulk of the commercial complex developed by LIC is being used to earn rental income, company executives said.

In Kolkata, for instance, the state-owned company is developing around 700,000 square feet of commercial area opposite the Science City, LIC zonal manager R R Dash said.

The company acquired the five acre plot from the Kolkata Municipal Corporation for over Rs 276 crore through a bidding process and is working on a 50-storied commercial building that may be the tallest building in the eastern city. It has already shortlisted around 10 design consultants for the project that is estimated to cost around Rs 400 crore.

LIC Chief Engineer BK Banerjee said that during the last five years, the PSU's rental income has increased four folds and during 2007-08, in the eastern zone it stood at Rs 22 crore.

"We expect that in the current fiscal the rental income would be close to Rs 30 crore in the Kolkata region. We would like to double this in the next two years," Banerjee said.

LIC to buy land worth Rs 2,000 cr

Online portals an advantage to NRIs

Online portals an advantage to NRIs

Approvals on slow track

The Tamil Nadu Government has to streamline building approval processes in Chennai and the rest of the State to fully realise the investment potential in the real-estate sector. The State has earned an unenviable reputation for delays in sanctioning building plan approvals and clearances — a clearance for a multi-storeyed building could take 18- 24 months, that is almost as long as it takes to construct the building.

Talk to anybody in the construction industry, the complaint is the same: Delay in approvals within the Chennai Metropolitan Development Authority (CMDA) jurisdiction in Chennai Metropolitan Area, and that of the Directorate of Town and Country Planning (DTCP) which is responsible for clearances elsewhere. Just the formalities involved in getting land use conversion — from agriculture to non-agriculture — alone could take nearly a year. Other States such as Karnataka, Andhra Pradesh or Maharashtra have a system for fast-track clearances of projects. Approvals are obtained in about 4-6 months, including land usage conversion.

Need to speed up

The Tamil Nadu Government has acknowledged the need for expediting the clearance procedures and has started taking steps to speed up approvals for IT and industrial buildings.

At a high-level meeting last February, called by the Chief Secretary, Mr L. K. Tripathy, the officials connected with various agencies involved in plan approvals, including the CMDA, DTCP, Chennai Corporation, Municipal Administration, Fire Department, Traffic and industry promotion agencies, had expressed an intention to put in place a system to accord clearances within 60 days for IT and industrial buildings. But the proposal continues to be on paper and is yet to take off.

At the meeting, the Electronics Corporation of Tamil Nadu (Elcot) was identified as the nodal agency that would act as a single window facilitation agency to accept the applications from IT building developers and SEZ developers and coordinate the process of obtaining clearances from various agencies. The Guidance Bureau, the agency under the Tamil Nadu Industrial Development Corporation, created to attract investments into the State, would play a similar role to get approvals for industrial buildings.

The plan was to institutionalise this structure with an appropriate legislation, a draft of which was to have been prepared during the Budget session of the Assembly. The legislation was to provide for a 60-day time limit for building plan approval, 30 days for issue of final building plan clearance by the local bodies and the formation of a single window facilitation authority. However, nearly three months after the proposal there does not appear to be much progress in this direction.

Shortage of space

The State Government has estimated that over 20 million sq.ft. of built-up space for the IT industry is needed within the SEZs over the next 18 months. If building approvals are not given on time, IT investments could migrate to other States where such space is available.

There is also an acute shortage of office and retail space which is driving up the costs. Industry estimates peg the demand for office space in Chennai at about 7-8 million sq.ft. and for retail space about 2 million sq.ft. this year. Developments have to be speeded up to meet the demand.

The Hindu Business Line : Approvals on slow track

CENTURY 21 Real Estate LLC Expands into India

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Khaleeji Commercial Bank raises US$163 million for Indian project

Business Intelligence Middle East - bi-me.com - Khaleeji Commercial Bank raises US$163 million for Indian project - News, analysis, reports

Residential rentals in Delhi up 13 pc in 2008

Rentals of residential properties in central Delhi has appreciated up to 13 per cent in the first quarter of 2008 as demand continues to be buoyant despite the capital witnessing saturation in development of new space, a report says.

Global real estate consultant Cushman & Wakefield said central Delhi locations have witnessed appreciation in rentals in the range of 7-13 per cent in the first quarter as demand in these locations was driven by expatriates who have the ability to pay higher rentals.

"Majority of the south Delhi locations registered an increase in the range of 7-11 per cent primarily due to limited scope of development and buoyant demand," the report said.

Leasing activities were active across all micro-markets as the end-users had deferred their purchase decisions due to expected corrections in the prices in near future, it added.

As per the estimates of C&W, the rental values in Noida and Gurgaon rose by 10 per cent and 12 per cent respectively.

The capital values of the south Delhi locations had also risen in the range of 10-34 per cent over the quarter mainly due to limited supply and relatively high demand.

"The suburban locations of Gurgaon and Noida witnessed marginal appreciation of 2 per cent over the quarter. End- users as well as investors have adopted a wait and watch policy in anticipation of correction in apartment prices and home loan interest rates," the consultant firm viewed.

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