Downed shutters and To-Let boards plastered on commercial spaces in prime business areas across the city has left the business community worried. Just when the ill-effects of recession were wearing off, the Telangana-Andhra tussle has dealt a body blow to the real estate sector.
An alarming 30 per cent showrooms have shut down over the past couple of months. The city has begun to resemble a ghost town with big establishments downing shutters as they have been the worst hit. rents of commercial plots have plummeted, and some have sold property in distress sales for meagre sums. Yet, Hyderabad’s business community is thinking twice before investing in new ventures. They prefer to relinquish properties in prominent locations in favour of land that is more reasonable.
Vishwanath K., a member of IFRA and proprietor of Corporate Real Estate, says, despite prices falling by almost 50 per cent there are no takers for large plots. “Now rents in commercial areas have fallen from Rs 120 to Rs 40 per sq feet, but there are hardly any takers.”
He says the tussle over Telangana is to blame along with recession. “While real estate prices in Bangalore, Mumbai and Chennai are finally looking up, the T-tussle has come as an added blow to the city. People are thinking twice about investing in something new. Moreover, nearly three international companies have backed out from setting up shop here,” he points out.
B. Nagarjuna, proprietor of Home Guides that specialises in private and commercial realty, says there is a perceptible change in the market. “The Telangana struggle has indeed spelt bad news for real estate as far as commercial plots are concerned. Bigger establishments in areas like Banjara Hills and Jubilee Hills have suddenly taken a hit with rents becoming too expensive as compared to the footfalls. In fact, many prefer to shift base to other parts of town,” he says.
Smaller establishments are still able to survive and he finds most To-let boards hanging on plots of 5,000 sq feet and above. “Bigger plots have been abandoned. The trend is now towards smaller outlets,” he says.
hyderabad real estate, hyderaba properties, properties in hyderabad,
Showing posts with label properties in hyderabad. Show all posts
Showing posts with label properties in hyderabad. Show all posts
Saturday, February 20, 2010
Tuesday, January 19, 2010
Real Estate: Hyderabad Discounts Upto Rs 9 Lakhs!!!
Well, all those glory days of overhyping the land prices and earning crores is history. The ground reality today is that selling a flat even at half the price has become quite a challenge. This is not just for mid size realtors but also for big corporates who are stuttering badly in Hyderabad.
Reports say that giants like Aparna Constructions and others are coming up with offers wherein ready to occupy flats are being sold at a whopping discount of Rs 8- Rs 9 lakhs. This would mean that a two bedroom flat which was costing around Rs 35 lakhs is now available at Rs 26 lakhs.
The prices have been falling sharply and with the Telangana issue still burning, the market looks grim for the builders. It is heard that flats in Kompally that were priced at Rs 2100 per sft are now being sold at Rs 963 per sft so you can figure out the math now. A report says that about 18% of projects are ready to be possessed.
hyderabad city, hyderaba properties, properties in hyderabad,
Reports say that giants like Aparna Constructions and others are coming up with offers wherein ready to occupy flats are being sold at a whopping discount of Rs 8- Rs 9 lakhs. This would mean that a two bedroom flat which was costing around Rs 35 lakhs is now available at Rs 26 lakhs.
The prices have been falling sharply and with the Telangana issue still burning, the market looks grim for the builders. It is heard that flats in Kompally that were priced at Rs 2100 per sft are now being sold at Rs 963 per sft so you can figure out the math now. A report says that about 18% of projects are ready to be possessed.
hyderabad city, hyderaba properties, properties in hyderabad,
Monday, January 4, 2010
Property prices slump in 'Cyberabad'
"BEST BARGAIN: Plots measuring 200 square yards each and worth Rs 6 lakh at Shamshabad airport area are up for sale for Rs 4 lakh only. Contact Ms Nandya, Best Avenues,” reads an SMS doing the rounds in Hyderabad.
The text message reflects the grim real estate scenario in and around the cyber city. The ongoing agitation for a separate state of Telangana has crippled the sector, already hit hard in the past one year because of the global meltdown.
And since the Telangana agitation gained momentum in the last week of November, real estate transactions have come to a grinding halt in the state capital.
Builders who have completed their ventures are even ready to sell property for low profits, but buyers are preferring to wait, hoping the prices will further plummet.
“ Already, there is a drop of 20- 25 per cent in the price of flats in the last few weeks. The average cost of a flat which was around Rs 3,300 per sq ft in a fast- growing area such as Dilsukhnagar and Kukatpally has come down to Rs 2,500. Still, the buyers are waiting for the prices to fall further,” K. Vishnuvardhan Sarma of Vaishnavi Builders, which targets middle- class buyers, said.
C. Shekhar Reddy, president of AP Builders’ Forum, said the recession- hit sector had already been stagnating, as a result of which the prices already crashed.
Many real estate ventures launched in high- profile areas such as Gachibowli, Gopannapalli, Manikonda, Vattinagulapalli and Tellapur before the meltdown are either still under construction or failed to take off because of the lack of prospective buyers — mostly software professionals and entrepreneurs.
“ We had paid huge amounts as advance to landowners from whom we took the plots for building residential complexes.
But we had to stop construction midway because of the recession.
At a time when the real estate sector started showing the signs of recovery, the Telangana agitation has come as a bolt from the blue. All our activities have come to a standstill again,” a real estate developer in the Gopannapalli area said.
P. Nagaraju, chairman of the PNR group of constructions, said there were no buyers even if the builders offered the flats at low prices. “ Worse still, those who booked some of the flats are now pressuring us to return the advance amount. They are prepared to forfeit a lakh or two, but want to cancel their bookings, fearing that the property values will come down drastically in future,” Nagaraju, one of the top 10 real estate dealers in Hyderabad, said.
“ The sooner the Telangana issue is resolved, the better. We don’t mind the formation of a separate state. At least then, the real estate activity will pick up,” he said.
Interestingly, the property prices have started shooting up in the Vijayawada- Guntur area because of speculation that the belt will be made the capital of Andhra in the event of the formation of a separate Telangana.
According to reports, real estate prices in Vijayawada have gone up by 15- 20 per cent in the last month.
President of the Vijayawada Builders’ Association, Gadde Rajling, said there was a sudden increase in the sale of apartments.
“ The number of customers making inquiries about and buying new flats has shot up,” he said, adding that some buyers were even bulk- booking apartments on the outskirts of the city.
The text message reflects the grim real estate scenario in and around the cyber city. The ongoing agitation for a separate state of Telangana has crippled the sector, already hit hard in the past one year because of the global meltdown.
And since the Telangana agitation gained momentum in the last week of November, real estate transactions have come to a grinding halt in the state capital.
Builders who have completed their ventures are even ready to sell property for low profits, but buyers are preferring to wait, hoping the prices will further plummet.
“ Already, there is a drop of 20- 25 per cent in the price of flats in the last few weeks. The average cost of a flat which was around Rs 3,300 per sq ft in a fast- growing area such as Dilsukhnagar and Kukatpally has come down to Rs 2,500. Still, the buyers are waiting for the prices to fall further,” K. Vishnuvardhan Sarma of Vaishnavi Builders, which targets middle- class buyers, said.
C. Shekhar Reddy, president of AP Builders’ Forum, said the recession- hit sector had already been stagnating, as a result of which the prices already crashed.
Many real estate ventures launched in high- profile areas such as Gachibowli, Gopannapalli, Manikonda, Vattinagulapalli and Tellapur before the meltdown are either still under construction or failed to take off because of the lack of prospective buyers — mostly software professionals and entrepreneurs.
“ We had paid huge amounts as advance to landowners from whom we took the plots for building residential complexes.
But we had to stop construction midway because of the recession.
At a time when the real estate sector started showing the signs of recovery, the Telangana agitation has come as a bolt from the blue. All our activities have come to a standstill again,” a real estate developer in the Gopannapalli area said.
P. Nagaraju, chairman of the PNR group of constructions, said there were no buyers even if the builders offered the flats at low prices. “ Worse still, those who booked some of the flats are now pressuring us to return the advance amount. They are prepared to forfeit a lakh or two, but want to cancel their bookings, fearing that the property values will come down drastically in future,” Nagaraju, one of the top 10 real estate dealers in Hyderabad, said.
“ The sooner the Telangana issue is resolved, the better. We don’t mind the formation of a separate state. At least then, the real estate activity will pick up,” he said.
Interestingly, the property prices have started shooting up in the Vijayawada- Guntur area because of speculation that the belt will be made the capital of Andhra in the event of the formation of a separate Telangana.
According to reports, real estate prices in Vijayawada have gone up by 15- 20 per cent in the last month.
President of the Vijayawada Builders’ Association, Gadde Rajling, said there was a sudden increase in the sale of apartments.
“ The number of customers making inquiries about and buying new flats has shot up,” he said, adding that some buyers were even bulk- booking apartments on the outskirts of the city.
Friday, December 18, 2009
Time for realtors to accept realities
Surely, it must be a surreal feeling for those who rode the heights of real estate boom during last few years. As the boom started to crumble and with interest in property evaporating fast in the wake of a series of events from economic slowdown to Telangana and Andhra agitations, those who sold properties like hot cakes must be finding the present circumstances hard to digest.
Even before they could reconcile to the turn of events from Telangana agitation and the moves of the Centre, came the agitation in other parts. This pushed the prospective buyers, even the genuine ones, further deep into the wait and watch mode. Projects put on hold, half-completed towers, accumulating construction material and no buyers dropping in at their plush offices clearly is forcing the reality boom accept the realities.
hyderaba properties, properties in hyderabad, Real estate news, hyderabad real estate,
Even before they could reconcile to the turn of events from Telangana agitation and the moves of the Centre, came the agitation in other parts. This pushed the prospective buyers, even the genuine ones, further deep into the wait and watch mode. Projects put on hold, half-completed towers, accumulating construction material and no buyers dropping in at their plush offices clearly is forcing the reality boom accept the realities.
hyderaba properties, properties in hyderabad, Real estate news, hyderabad real estate,
Saturday, December 5, 2009
Housing projects: Living life king size
It is tough to contain dreams. Till recently, duplex houses and villas would have topped the dream list of high income group families in the city of Nawabs but with changing lifestyles, newer avenues are opening up and what could be better than owning a house in a golf community.
Catering to such aspirants, property developers are now coming up with housing projects that include golf courses, golf clubs, water bodies, spas, gyms, swimming pools and above all lush green surroundings.
These projects help them live life like a king, observed legendary cricketer Kapil Dev while promoting Dax Properties, Golf Retreat, a golf community housing project at Shadnagar.
Golf Retreat is a 300-acre project with 1,100 villas overlooking an 18-hole golf course.
Each villa would be developed in a space ranging from 5,000 sq. ft to 15,000 sq. ft and given the facilities being provided, each comes with a minimum price tag of Rs.85 lakh and goes upwards to Rs. 2.5 crore, says Dax Properties Managing Director Masood Hassan.
Projects like these are targeted at high net worth individuals(HNIs) and NRIs. If need be, they can be promoted and sold to a premium class overseas as well. There is still lot of scope for such projects in the city, explains Mr. Hassan.
“Ours is a Rs. 500 crore project with more individual investments. In phase-I, we plan to construct 250 villas overlooking a six-hole golf course. Already, the pre-launch sales have opened partially and we wish to complete phase-I in 12 to 14 months”, he adds.
hyderaba properties, properties in hyderabad,
Catering to such aspirants, property developers are now coming up with housing projects that include golf courses, golf clubs, water bodies, spas, gyms, swimming pools and above all lush green surroundings.
These projects help them live life like a king, observed legendary cricketer Kapil Dev while promoting Dax Properties, Golf Retreat, a golf community housing project at Shadnagar.
Golf Retreat is a 300-acre project with 1,100 villas overlooking an 18-hole golf course.
Each villa would be developed in a space ranging from 5,000 sq. ft to 15,000 sq. ft and given the facilities being provided, each comes with a minimum price tag of Rs.85 lakh and goes upwards to Rs. 2.5 crore, says Dax Properties Managing Director Masood Hassan.
Projects like these are targeted at high net worth individuals(HNIs) and NRIs. If need be, they can be promoted and sold to a premium class overseas as well. There is still lot of scope for such projects in the city, explains Mr. Hassan.
“Ours is a Rs. 500 crore project with more individual investments. In phase-I, we plan to construct 250 villas overlooking a six-hole golf course. Already, the pre-launch sales have opened partially and we wish to complete phase-I in 12 to 14 months”, he adds.
hyderaba properties, properties in hyderabad,
Friday, November 13, 2009
India property show to be held on November 13-14
A two-day property show will be held at Ramada Plaza in Doha on November 13 and 14 to showcase residential and commercial projects available across India for NRIs in Qatar.
Organised by Chennai based Priya Publications, publishers of real estate magazines, the ninth global show will display varied residential and commercial projects ranging from apartments, developed plots to villas and leased units. An estimated 15 exhibitors from cities like Bangalore, Chennai, Hyderabad, Kochi and Mumbai will display their projects. Home loans will be offered by housing finance companies. Spot approval of home loans will be made available to NRIs during the show on production of basic documents salary slip, employment certificate and bank statement.
A seminar on NRI investment in real estate will be held every day at 5 pm to apprise expatriate Indians in Qatar on the current Indian real estate market scenario, rules and regulations governing NRI investment and tips for tax planning. The entry is free and the timings are from 10am to 9pm on both the days.
Business, hyderaba properties, properties in hyderabad,
Organised by Chennai based Priya Publications, publishers of real estate magazines, the ninth global show will display varied residential and commercial projects ranging from apartments, developed plots to villas and leased units. An estimated 15 exhibitors from cities like Bangalore, Chennai, Hyderabad, Kochi and Mumbai will display their projects. Home loans will be offered by housing finance companies. Spot approval of home loans will be made available to NRIs during the show on production of basic documents salary slip, employment certificate and bank statement.
A seminar on NRI investment in real estate will be held every day at 5 pm to apprise expatriate Indians in Qatar on the current Indian real estate market scenario, rules and regulations governing NRI investment and tips for tax planning. The entry is free and the timings are from 10am to 9pm on both the days.
Business, hyderaba properties, properties in hyderabad,
Tuesday, November 10, 2009
One hundred per cent rent-free models
To beat the high cost of finance and lack of interest among top retailers, developers are now hitting upon novel revenue-sharing schemes. Entertainment World Developers Private Limited (EWDPL) recently announced what it claims is the country’s “first 100 per cent rent free, revenue sharing retail model. Named Treasure Showcase, on offer are 20 malls in 11 states with a space of 1 million sq.ft. in cities like Mohali, Lucknow, Agra, Bareilly, Udaipur and Bhilai. They will hawk apparel, footwear, electronics, food, cosmetics, jewellery and furnishing.
For starters, there is no rent, no CAM, no deposit, and no maintenance for the booked space. The Group is expecting a revenue generation of over 500 crore by 2011. “The concept is based on a transparent, pre-determined, margin sharing revenue model,” said Manish Kalani, managing director of EWDPL.
Incidentally, the revenue-sharing model is not unique to private projects. Last year, the National Highway Authority of India (NHAI) had awarded three mega projects worth Rs 2,150 crore over 215 km on this model, to beat the steep cost of finance in a slow market and delays by builders. The projects on this model include the Gonde-Nashik-Pimpalgaon stretch, MP-Maharashtra border Dhule project and the Kishangarh-Beawar projects.
Experts contend that this model makes sense when developers see strong prospects of market improvement. Besides creating interest among retailers, this also gives mall developers the leeway to earn more. Fixed rentals could be a dampener, especially where retailers have agreed to increase rentals only by 10-15 per cent every year.
“For upcoming malls, indications are that the rent to revenue ratio would see a dip from 40-50 per cent to 25 per cent in the next few months,” says J Suresh CEO of Arvind Brands, that markets international brands such as Arrow, Gant, Cherokee etc.
hyderaba properties, properties in hyderabad, hyderabad city,
For starters, there is no rent, no CAM, no deposit, and no maintenance for the booked space. The Group is expecting a revenue generation of over 500 crore by 2011. “The concept is based on a transparent, pre-determined, margin sharing revenue model,” said Manish Kalani, managing director of EWDPL.
Incidentally, the revenue-sharing model is not unique to private projects. Last year, the National Highway Authority of India (NHAI) had awarded three mega projects worth Rs 2,150 crore over 215 km on this model, to beat the steep cost of finance in a slow market and delays by builders. The projects on this model include the Gonde-Nashik-Pimpalgaon stretch, MP-Maharashtra border Dhule project and the Kishangarh-Beawar projects.
Experts contend that this model makes sense when developers see strong prospects of market improvement. Besides creating interest among retailers, this also gives mall developers the leeway to earn more. Fixed rentals could be a dampener, especially where retailers have agreed to increase rentals only by 10-15 per cent every year.
“For upcoming malls, indications are that the rent to revenue ratio would see a dip from 40-50 per cent to 25 per cent in the next few months,” says J Suresh CEO of Arvind Brands, that markets international brands such as Arrow, Gant, Cherokee etc.
hyderaba properties, properties in hyderabad, hyderabad city,
Wednesday, July 29, 2009
Notices served on IVRCL
The Labour Department on Tuesday served notice on IVRCL Infrastructure and Projects Limited under the Workmen Compensation Act directing it to deposit Rs. 4.40 lakh within 30 days for the benefit of two labourers who were buried alive in a trench on Monday while executing municipal works.
The victims, S. Venkatesh and N. Krishna, died due to the company’s negligence in ensuring minimum safety measures like helmets, safety shoes and other preventive measures as required under
The Building and Other Constructions Workers, said Joint Commissioner of Labour B. Ajay.
Tuesday, July 28, 2009
State against House panel probe on fee
The state government on Monday turned down a demand by the Congress MLA, Mr E. Pratap Reddy, for a House committee probe into the flouting of rules and charging of heavy fee by corporate school and college managements.
Members cutting across party lines expressed ire at the antics of corporate educational institutions.
An agitated Mr Pratap Reddy hit out at corporate managements but when he demanded an Assembly committee probe, the Chief Minister, Dr Y.S. Rajasekhar Reddy, signalled to the school education minister, Mr D. Varaprasada Rao, not to accede to it.
Following this, the minister turned down the demand and said that the government would conduct inquiries into the specific allegations.
It all started with the TRS member, Mr T. Harish Rao, alleging that colleges such as Narayana and Sri Chaitanya had monopolised intermediate education denying space for small players.
The TRS member questioned the rationale behind the government reimbursing Rs 30,000 for each poor student studying in corporate colleges instead of punishing the managements for levying high fee.
However, the minister clarified that the fee was for boarding, food bill and Eamcet coaching and requested members not to make an issue out of it as it would affect poor students.
Members cutting across party lines expressed ire at the antics of corporate educational institutions.
An agitated Mr Pratap Reddy hit out at corporate managements but when he demanded an Assembly committee probe, the Chief Minister, Dr Y.S. Rajasekhar Reddy, signalled to the school education minister, Mr D. Varaprasada Rao, not to accede to it.
Following this, the minister turned down the demand and said that the government would conduct inquiries into the specific allegations.
It all started with the TRS member, Mr T. Harish Rao, alleging that colleges such as Narayana and Sri Chaitanya had monopolised intermediate education denying space for small players.
The TRS member questioned the rationale behind the government reimbursing Rs 30,000 for each poor student studying in corporate colleges instead of punishing the managements for levying high fee.
However, the minister clarified that the fee was for boarding, food bill and Eamcet coaching and requested members not to make an issue out of it as it would affect poor students.
Thursday, July 23, 2009
Fate of penthouses on July 25
The officials of the Greater Hyderabad Municipal Corporation (GHMC) will meet on July 25 to decide on the penthouses pending under the Building Penalisation Scheme (BPS).
There are about 1,500 applications relating to penthouses on multi-storeyed buildings having five or more floors.
However, majority of the applicants have not submitted the mandatory “no objection certificate” which has to be issued by the fire services department and the Airports Authority of India.
The GHMC officials and the fire department will finalise the fire safety norms to be stipulated for regularisation of penthouses. Also, the meeting is expected to take a decision on relaxing norms on the fire safety equipment to be installed by the penthouse owner.
Besides, an NOC from the AAI is difficult to get and a decision on this front is also likely to be taken at the meeting, sources said.
The GHMC chief city planner, Mr Purushotham Reddy, said the meeting is aimed at listing out feasible guidelines facilitating owners of penthouses to provide fire safety equipment to get an NOC. “For this reason, the director-general of fire services will be participating in the meeting to facilitate spot decisions,” he said.
Meanwhile, the GHMC has decided to conduct BPS melas every Monday and Tuesday. The building regularisation certificates would be given on these two days every week, and pending documents along with penalisation charges will be accepted on the remaining days of the week.
There are about 1,500 applications relating to penthouses on multi-storeyed buildings having five or more floors.
However, majority of the applicants have not submitted the mandatory “no objection certificate” which has to be issued by the fire services department and the Airports Authority of India.
The GHMC officials and the fire department will finalise the fire safety norms to be stipulated for regularisation of penthouses. Also, the meeting is expected to take a decision on relaxing norms on the fire safety equipment to be installed by the penthouse owner.
Besides, an NOC from the AAI is difficult to get and a decision on this front is also likely to be taken at the meeting, sources said.
The GHMC chief city planner, Mr Purushotham Reddy, said the meeting is aimed at listing out feasible guidelines facilitating owners of penthouses to provide fire safety equipment to get an NOC. “For this reason, the director-general of fire services will be participating in the meeting to facilitate spot decisions,” he said.
Meanwhile, the GHMC has decided to conduct BPS melas every Monday and Tuesday. The building regularisation certificates would be given on these two days every week, and pending documents along with penalisation charges will be accepted on the remaining days of the week.
Wednesday, July 15, 2009
Nagarjuna to go on sans Maytas
Nagarjuna Construction Company (NCC) is preparing a plan to come out of Maytas Infra's shadow in the projects being handled by both.NCC and Maytas have joined forces in eight projects. While one of these is operational and three on the backburner, NCC is making arrangements to carry out the remaining projects without waiting for Maytas to bring in funds.
For the remaining four projects, NCC is preparing to either bring in partners in place of Maytas, or contribute the funds on its own. Critical among them is the Pondicherry-Tindivanam road project. The 36 km project is estimated to cost about Rs 315 crore, with an equity component of Rs 90 crore.
While Maytas holds about 51% in this project, NCC holds 49%. "The project is about 30% complete and we are now looking for a third partner to plug the Maytas gap. This will help us in meeting the deadline of June 2010 for operationalising the project," NCC's executive VP (finance) Y D Murthy told DNA Money.
Another project is the Himachal Sorang hydro-electric project, being jointly developed by NCC and Maytas along with SSJV Projects. Taken up with an outlay of Rs 600 crore, the three partners have one-third equity in the project. The project is scheduled to commence operations in December 2010. "Maytas has brought in about Rs 18 crore so far and the future equity from Maytas is a question. If Maytas is unable to bring in the required equity, NCC will complete the project," he said.
The Western UP toll way and Bangalore elevated toll way are the other two projects. Here, however, the work is at an advanced stage. While about 80% of work is complete for the Western UP toll way, the Bangalore project is about 90% complete.
The Western UP project was taken up by Gayatri Projects (40% equity), NCC (30%) and Maytas (30%) with a deadline to make the project operational by December 2009.
Maytas is yet to bring in about Rs 5 crore into the project. For the Bangalore elevated toll way, NCC and Maytas have partnered with Soma with one-third equity each. In this project, Maytas is yet to bring in Rs 7 crore.
"For both projects, NCC and the other partner are bringing in the money that was to be contributed by Maytas to complete the projects on schedule," Murthy said. The Brindavan express toll way in Karnataka is the only project NCC and Maytas have been able to make operational. The project, built with an outlay of Rs 247 crore, has been operational for the last three years.
The three projects on the backburner include two airport projects -- at Shimoga and Gulbarga -- and the Machilipatnam port project in Andhra Pradesh. "For the airports, it is the real estate that holds the key. These are small airports and they can't survive just on air traffic. The real estate that can be created along with the airports is crucial. These projects are estimated to cost about Rs 50 crore each. Considering the market conditions, these projects are on the backburner," Murthy said.
The Machilipatnam port project is stuck in land acquisition-related issues. The project was planned with an estimated cost of about Rs 1,600 crore spread over 6,200 acres. Along with Maytas and NCC, Srei and the Chatterjee Group too are partners. While NCC has about 25% share, Maytas has 26% equity. Srei and Chatterjee hold 49% together.
"There are land acquisition issues in the project. Even otherwise, Maytas' ability to bring in equity into this project is under question now. This project is on hold," Murthy said.
NCC currently has an order book of Rs 12,200 crore. The infrastructure major, which was focusing more on road projects, is now looking at other opportunities.
"Earlier, we used have about 25% of our order book from roads. Now, it is down to 8%. There are other opportunities in power, metals, oil & gas and mining. The focus now is on having a diversified portfolio," he explained.
The company is also pinning hopes on the freight corridor plans announced by the government for finalising its foray into railways.
For the remaining four projects, NCC is preparing to either bring in partners in place of Maytas, or contribute the funds on its own. Critical among them is the Pondicherry-Tindivanam road project. The 36 km project is estimated to cost about Rs 315 crore, with an equity component of Rs 90 crore.
While Maytas holds about 51% in this project, NCC holds 49%. "The project is about 30% complete and we are now looking for a third partner to plug the Maytas gap. This will help us in meeting the deadline of June 2010 for operationalising the project," NCC's executive VP (finance) Y D Murthy told DNA Money.
Another project is the Himachal Sorang hydro-electric project, being jointly developed by NCC and Maytas along with SSJV Projects. Taken up with an outlay of Rs 600 crore, the three partners have one-third equity in the project. The project is scheduled to commence operations in December 2010. "Maytas has brought in about Rs 18 crore so far and the future equity from Maytas is a question. If Maytas is unable to bring in the required equity, NCC will complete the project," he said.
The Western UP toll way and Bangalore elevated toll way are the other two projects. Here, however, the work is at an advanced stage. While about 80% of work is complete for the Western UP toll way, the Bangalore project is about 90% complete.
The Western UP project was taken up by Gayatri Projects (40% equity), NCC (30%) and Maytas (30%) with a deadline to make the project operational by December 2009.
Maytas is yet to bring in about Rs 5 crore into the project. For the Bangalore elevated toll way, NCC and Maytas have partnered with Soma with one-third equity each. In this project, Maytas is yet to bring in Rs 7 crore.
"For both projects, NCC and the other partner are bringing in the money that was to be contributed by Maytas to complete the projects on schedule," Murthy said. The Brindavan express toll way in Karnataka is the only project NCC and Maytas have been able to make operational. The project, built with an outlay of Rs 247 crore, has been operational for the last three years.
The three projects on the backburner include two airport projects -- at Shimoga and Gulbarga -- and the Machilipatnam port project in Andhra Pradesh. "For the airports, it is the real estate that holds the key. These are small airports and they can't survive just on air traffic. The real estate that can be created along with the airports is crucial. These projects are estimated to cost about Rs 50 crore each. Considering the market conditions, these projects are on the backburner," Murthy said.
The Machilipatnam port project is stuck in land acquisition-related issues. The project was planned with an estimated cost of about Rs 1,600 crore spread over 6,200 acres. Along with Maytas and NCC, Srei and the Chatterjee Group too are partners. While NCC has about 25% share, Maytas has 26% equity. Srei and Chatterjee hold 49% together.
"There are land acquisition issues in the project. Even otherwise, Maytas' ability to bring in equity into this project is under question now. This project is on hold," Murthy said.
NCC currently has an order book of Rs 12,200 crore. The infrastructure major, which was focusing more on road projects, is now looking at other opportunities.
"Earlier, we used have about 25% of our order book from roads. Now, it is down to 8%. There are other opportunities in power, metals, oil & gas and mining. The focus now is on having a diversified portfolio," he explained.
The company is also pinning hopes on the freight corridor plans announced by the government for finalising its foray into railways.
Monday, June 8, 2009
Maytas ‘Hill County’ plan falls flat
Maytas Hill County, the prestigious project of Maytas Properties Limited, has failed to deliver over 300 bungalows and villas and 840 flats after collecting Rs 650 crore from its customers. The Hill County Home Owners’ Welfare Association, formed after the Satyam scam broke in January 2009, wants to present their case to the Company Law Board (CLB). Their demands are: directives from the CLB to the promoters for time-bound delivery of the dwelling units, compensation for the loss due to delays and punitive action in case of further delay.
The association has written to the chairman of the CLB, the Chief Minister, Dr Y.S. Rajasekhar Reddy, the chief secretary and senior officials alleging that the promoters of MPL have diverted funds. “The association secretary, Mr Anil Kumar Katakam, said many buyers had paid either the entire amount or sums ranging between Rs 40 lakh and Rs 5 crore. We now want to be impleaded as an affected party in the case pending before the CLB,” he said after a meeting on Sunday.
“The promoters have taken additional money from home owners whose units are almost complete, offering to repay such funds in around six months’ time. Some owners are trying to complete construction on their own and move in, despite inadequate infrastructure support,” said Mr Anil Kumar. The association president, Mr Satish Tirupati, said they were promised handing over of completed units by March 2008.
Only half-a-dozen independent bungalows have been completed while the apartments have only the RCC shell in some towers. Some do not have even the structure.
The promoters have virtually closed down operations, sacked most of their employees, disposed of assets and are currently lying low.
courtesy:Deccan chronicle
Tuesday, June 2, 2009
Realty funds looking at low-cost projects
The recent launch of Rs5-15 lakh homes by realtors across the nation has attracted not only homebuyers. Property funds that have stayed away from the realty sector since the global economic downturn deepened in September are looking at a comeback, primarily to back low-cost housing projects. “A year back, property funds were eyeing projects like iconic towers and exclusive homes riding on the boom. Those days are over,” said Naresh Nadkarni, chief investment officer, HDFC Realty Fund. “Funds are now only focusing on low- and middle-income housing because that’s where the movement is.” The HDFC fund is at an advanced stage of sealing a Rs200 crore investment in a middle-income project by Provident Housing and Infrastructure Ltd, a subsidiary of Puravankara Projects Ltd, two analysts familiar with the project said. They didn’t want to be identified. Nadkarni declined to give details, citing company policy.
The project in Bangalore will have at least 4,000 homes with a price tag of Rs10-20 lakh each. Puravankara recently launched a similar project in Chennai. Developers such as Puravankara and Tata Housing Development Co. Ltd have ventured into low-cost housing in the past two months, after a spate of affordable projects in the Rs30-60 lakh range launched by several developers failed to pick up.In 2008, real estate funds made 77 investments worth a combined $8.4 billion (Rs39,984 crore today) in property companies and special purpose vehicles, according to Venture Intelligence, which tracks venture capital and private equity (PE) deals in India. About 80% of these investments were for special economic zones, or mall or township projects. Of the total investments in 2008, nearly 70%, or $5.8 billion, was made in the first half of the year. Investment projections for 2009 are not available yet. This year, the focus for realty funds has moved from providing aid to developers in distress to helping construct large, cheaper projects that will sell quickly.
The Ajay Piramal-promoted Indiareit Fund Advisors Pvt. Ltd has invested Rs250 crore in four such projects—three in Mumbai and one in Hyderabad. Of these, one is in the Rs5 lakh per house category and the rest in the mid-segment range. Ramesh Jogani, managing director and chief executive officer of Indiareit, said: “This year, we will look at a mix of projects including both these segments. We want to finance projects that are just beginning construction.” The fund, which is planning a round of domestic fund-raising of Rs500 crore in 2009, last year exited a luxury project in Alibaug, a seaside destination near Mumbai. It had earlier committed Rs250 crore to the project, which was to be developed jointly with Samira Habitats. Realty funds are also trying to gauge the risk factors attached to such low-cost projects. Indiareit and Red Fort Capital Fund Advisors Pvt. Ltd say that though investing in the low- and mid-cost segments is a safe bet, they are studying the project models to ensure they have the right sourcing of material, location and price. With thin profit margins and tight costs, it is imperative the projects are completed on schedule. “Like ours, many funds are working out the actual details of a project with developers, and even restructuring aspects to make a more viable business model,” said Nadkarni. Possibilities of delays in getting approvals, construction costs rising, and a strict price point make such projects riskier than regular ventures, he said. Nayan Bheda, managing director of Neptune Developers Pvt. Ltd, which has launched a 125 acre low-cost project near Mumbai, funded by Indiareit, and has three more planned in Chennai, Nagpur and Pune, says only such projects can assure sales. For instance,
Nepture has sold 2,000 of the 2,100 units in the first phase of its Mumbai project in just 2 months. “PE funds demand higher IRR (internal rate of return) of over 24% in such projects as the appreciation of profit is not high. But we have been lucky with Indiareit as an investor,” Bheda said.
The project in Bangalore will have at least 4,000 homes with a price tag of Rs10-20 lakh each. Puravankara recently launched a similar project in Chennai. Developers such as Puravankara and Tata Housing Development Co. Ltd have ventured into low-cost housing in the past two months, after a spate of affordable projects in the Rs30-60 lakh range launched by several developers failed to pick up.In 2008, real estate funds made 77 investments worth a combined $8.4 billion (Rs39,984 crore today) in property companies and special purpose vehicles, according to Venture Intelligence, which tracks venture capital and private equity (PE) deals in India. About 80% of these investments were for special economic zones, or mall or township projects. Of the total investments in 2008, nearly 70%, or $5.8 billion, was made in the first half of the year. Investment projections for 2009 are not available yet. This year, the focus for realty funds has moved from providing aid to developers in distress to helping construct large, cheaper projects that will sell quickly.
The Ajay Piramal-promoted Indiareit Fund Advisors Pvt. Ltd has invested Rs250 crore in four such projects—three in Mumbai and one in Hyderabad. Of these, one is in the Rs5 lakh per house category and the rest in the mid-segment range. Ramesh Jogani, managing director and chief executive officer of Indiareit, said: “This year, we will look at a mix of projects including both these segments. We want to finance projects that are just beginning construction.” The fund, which is planning a round of domestic fund-raising of Rs500 crore in 2009, last year exited a luxury project in Alibaug, a seaside destination near Mumbai. It had earlier committed Rs250 crore to the project, which was to be developed jointly with Samira Habitats. Realty funds are also trying to gauge the risk factors attached to such low-cost projects. Indiareit and Red Fort Capital Fund Advisors Pvt. Ltd say that though investing in the low- and mid-cost segments is a safe bet, they are studying the project models to ensure they have the right sourcing of material, location and price. With thin profit margins and tight costs, it is imperative the projects are completed on schedule. “Like ours, many funds are working out the actual details of a project with developers, and even restructuring aspects to make a more viable business model,” said Nadkarni. Possibilities of delays in getting approvals, construction costs rising, and a strict price point make such projects riskier than regular ventures, he said. Nayan Bheda, managing director of Neptune Developers Pvt. Ltd, which has launched a 125 acre low-cost project near Mumbai, funded by Indiareit, and has three more planned in Chennai, Nagpur and Pune, says only such projects can assure sales. For instance,
Nepture has sold 2,000 of the 2,100 units in the first phase of its Mumbai project in just 2 months. “PE funds demand higher IRR (internal rate of return) of over 24% in such projects as the appreciation of profit is not high. But we have been lucky with Indiareit as an investor,” Bheda said.
Monday, June 1, 2009
Realty funds looking at low-cost projects
The recent launch of Rs5-15 lakh homes by realtors across the nation has attracted not only homebuyers. Property funds that have stayed away from the realty sector since the global economic downturn deepened in September are looking at a comeback, primarily to back low-cost housing projects. “A year back, property funds were eyeing projects like iconic towers and exclusive homes riding on the boom. Those days are over,” said Naresh Nadkarni, chief investment officer, HDFC Realty Fund. “Funds are now only focusing on low- and middle-income housing because that’s where the movement is.” The HDFC fund is at an advanced stage of sealing a Rs200 crore investment in a middle-income project by Provident Housing and Infrastructure Ltd, a subsidiary of Puravankara Projects Ltd, two analysts familiar with the project said. They didn’t want to be identified. Nadkarni declined to give details, citing company policy.
The project in Bangalore will have at least 4,000 homes with a price tag of Rs10-20 lakh each. Puravankara recently launched a similar project in Chennai. Developers such as Puravankara and Tata Housing Development Co. Ltd have ventured into low-cost housing in the past two months, after a spate of affordable projects in the Rs30-60 lakh range launched by several developers failed to pick up.In 2008, real estate funds made 77 investments worth a combined $8.4 billion (Rs39,984 crore today) in property companies and special purpose vehicles, according to Venture Intelligence, which tracks venture capital and private equity (PE) deals in India. About 80% of these investments were for special economic zones, or mall or township projects. Of the total investments in 2008, nearly 70%, or $5.8 billion, was made in the first half of the year. Investment projections for 2009 are not available yet. This year, the focus for realty funds has moved from providing aid to developers in distress to helping construct large, cheaper projects that will sell quickly.
The Ajay Piramal-promoted Indiareit Fund Advisors Pvt. Ltd has invested Rs250 crore in four such projects—three in Mumbai and one in Hyderabad. Of these, one is in the Rs5 lakh per house category and the rest in the mid-segment range. Ramesh Jogani, managing director and chief executive officer of Indiareit, said: “This year, we will look at a mix of projects including both these segments. We want to finance projects that are just beginning construction.” The fund, which is planning a round of domestic fund-raising of Rs500 crore in 2009, last year exited a luxury project in Alibaug, a seaside destination near Mumbai. It had earlier committed Rs250 crore to the project, which was to be developed jointly with Samira Habitats. Realty funds are also trying to gauge the risk factors attached to such low-cost projects. Indiareit and Red Fort Capital Fund Advisors Pvt. Ltd say that though investing in the low- and mid-cost segments is a safe bet, they are studying the project models to ensure they have the right sourcing of material, location and price. With thin profit margins and tight costs, it is imperative the projects are completed on schedule. “Like ours, many funds are working out the actual details of a project with developers, and even restructuring aspects to make a more viable business model,” said Nadkarni. Possibilities of delays in getting approvals, construction costs rising, and a strict price point make such projects riskier than regular ventures, he said. Nayan Bheda, managing director of Neptune Developers Pvt. Ltd, which has launched a 125 acre low-cost project near Mumbai, funded by Indiareit, and has three more planned in Chennai, Nagpur and Pune, says only such projects can assure sales. For instance,
Nepture has sold 2,000 of the 2,100 units in the first phase of its Mumbai project in just 2 months. “PE funds demand higher IRR (internal rate of return) of over 24% in such projects as the appreciation of profit is not high. But we have been lucky with Indiareit as an investor,” Bheda said.
courtesy:www.maaproperties.com
The project in Bangalore will have at least 4,000 homes with a price tag of Rs10-20 lakh each. Puravankara recently launched a similar project in Chennai. Developers such as Puravankara and Tata Housing Development Co. Ltd have ventured into low-cost housing in the past two months, after a spate of affordable projects in the Rs30-60 lakh range launched by several developers failed to pick up.In 2008, real estate funds made 77 investments worth a combined $8.4 billion (Rs39,984 crore today) in property companies and special purpose vehicles, according to Venture Intelligence, which tracks venture capital and private equity (PE) deals in India. About 80% of these investments were for special economic zones, or mall or township projects. Of the total investments in 2008, nearly 70%, or $5.8 billion, was made in the first half of the year. Investment projections for 2009 are not available yet. This year, the focus for realty funds has moved from providing aid to developers in distress to helping construct large, cheaper projects that will sell quickly.
The Ajay Piramal-promoted Indiareit Fund Advisors Pvt. Ltd has invested Rs250 crore in four such projects—three in Mumbai and one in Hyderabad. Of these, one is in the Rs5 lakh per house category and the rest in the mid-segment range. Ramesh Jogani, managing director and chief executive officer of Indiareit, said: “This year, we will look at a mix of projects including both these segments. We want to finance projects that are just beginning construction.” The fund, which is planning a round of domestic fund-raising of Rs500 crore in 2009, last year exited a luxury project in Alibaug, a seaside destination near Mumbai. It had earlier committed Rs250 crore to the project, which was to be developed jointly with Samira Habitats. Realty funds are also trying to gauge the risk factors attached to such low-cost projects. Indiareit and Red Fort Capital Fund Advisors Pvt. Ltd say that though investing in the low- and mid-cost segments is a safe bet, they are studying the project models to ensure they have the right sourcing of material, location and price. With thin profit margins and tight costs, it is imperative the projects are completed on schedule. “Like ours, many funds are working out the actual details of a project with developers, and even restructuring aspects to make a more viable business model,” said Nadkarni. Possibilities of delays in getting approvals, construction costs rising, and a strict price point make such projects riskier than regular ventures, he said. Nayan Bheda, managing director of Neptune Developers Pvt. Ltd, which has launched a 125 acre low-cost project near Mumbai, funded by Indiareit, and has three more planned in Chennai, Nagpur and Pune, says only such projects can assure sales. For instance,
Nepture has sold 2,000 of the 2,100 units in the first phase of its Mumbai project in just 2 months. “PE funds demand higher IRR (internal rate of return) of over 24% in such projects as the appreciation of profit is not high. But we have been lucky with Indiareit as an investor,” Bheda said.
courtesy:www.maaproperties.com
Realty funds looking at low-cost projects
The recent launch of Rs5-15 lakh homes by realtors across the nation has attracted not only homebuyers. Property funds that have stayed away from the realty sector since the global economic downturn deepened in September are looking at a comeback, primarily to back low-cost housing projects. “A year back, property funds were eyeing projects like iconic towers and exclusive homes riding on the boom. Those days are over,” said Naresh Nadkarni, chief investment officer, HDFC Realty Fund. “Funds are now only focusing on low- and middle-income housing because that’s where the movement is.” The HDFC fund is at an advanced stage of sealing a Rs200 crore investment in a middle-income project by Provident Housing and Infrastructure Ltd, a subsidiary of Puravankara Projects Ltd, two analysts familiar with the project said. They didn’t want to be identified. Nadkarni declined to give details, citing company policy.
The project in Bangalore will have at least 4,000 homes with a price tag of Rs10-20 lakh each. Puravankara recently launched a similar project in Chennai. Developers such as Puravankara and Tata Housing Development Co. Ltd have ventured into low-cost housing in the past two months, after a spate of affordable projects in the Rs30-60 lakh range launched by several developers failed to pick up.In 2008, real estate funds made 77 investments worth a combined $8.4 billion (Rs39,984 crore today) in property companies and special purpose vehicles, according to Venture Intelligence, which tracks venture capital and private equity (PE) deals in India. About 80% of these investments were for special economic zones, or mall or township projects. Of the total investments in 2008, nearly 70%, or $5.8 billion, was made in the first half of the year. Investment projections for 2009 are not available yet. This year, the focus for realty funds has moved from providing aid to developers in distress to helping construct large, cheaper projects that will sell quickly.
The Ajay Piramal-promoted Indiareit Fund Advisors Pvt. Ltd has invested Rs250 crore in four such projects—three in Mumbai and one in Hyderabad. Of these, one is in the Rs5 lakh per house category and the rest in the mid-segment range. Ramesh Jogani, managing director and chief executive officer of Indiareit, said: “This year, we will look at a mix of projects including both these segments. We want to finance projects that are just beginning construction.” The fund, which is planning a round of domestic fund-raising of Rs500 crore in 2009, last year exited a luxury project in Alibaug, a seaside destination near Mumbai. It had earlier committed Rs250 crore to the project, which was to be developed jointly with Samira Habitats. Realty funds are also trying to gauge the risk factors attached to such low-cost projects. Indiareit and Red Fort Capital Fund Advisors Pvt. Ltd say that though investing in the low- and mid-cost segments is a safe bet, they are studying the project models to ensure they have the right sourcing of material, location and price. With thin profit margins and tight costs, it is imperative the projects are completed on schedule. “Like ours, many funds are working out the actual details of a project with developers, and even restructuring aspects to make a more viable business model,” said Nadkarni. Possibilities of delays in getting approvals, construction costs rising, and a strict price point make such projects riskier than regular ventures, he said. Nayan Bheda, managing director of Neptune Developers Pvt. Ltd, which has launched a 125 acre low-cost project near Mumbai, funded by Indiareit, and has three more planned in Chennai, Nagpur and Pune, says only such projects can assure sales. For instance,
Nepture has sold 2,000 of the 2,100 units in the first phase of its Mumbai project in just 2 months. “PE funds demand higher IRR (internal rate of return) of over 24% in such projects as the appreciation of profit is not high. But we have been lucky with Indiareit as an investor,” Bheda said.
courtesy:www.maaproperties.com
The project in Bangalore will have at least 4,000 homes with a price tag of Rs10-20 lakh each. Puravankara recently launched a similar project in Chennai. Developers such as Puravankara and Tata Housing Development Co. Ltd have ventured into low-cost housing in the past two months, after a spate of affordable projects in the Rs30-60 lakh range launched by several developers failed to pick up.In 2008, real estate funds made 77 investments worth a combined $8.4 billion (Rs39,984 crore today) in property companies and special purpose vehicles, according to Venture Intelligence, which tracks venture capital and private equity (PE) deals in India. About 80% of these investments were for special economic zones, or mall or township projects. Of the total investments in 2008, nearly 70%, or $5.8 billion, was made in the first half of the year. Investment projections for 2009 are not available yet. This year, the focus for realty funds has moved from providing aid to developers in distress to helping construct large, cheaper projects that will sell quickly.
The Ajay Piramal-promoted Indiareit Fund Advisors Pvt. Ltd has invested Rs250 crore in four such projects—three in Mumbai and one in Hyderabad. Of these, one is in the Rs5 lakh per house category and the rest in the mid-segment range. Ramesh Jogani, managing director and chief executive officer of Indiareit, said: “This year, we will look at a mix of projects including both these segments. We want to finance projects that are just beginning construction.” The fund, which is planning a round of domestic fund-raising of Rs500 crore in 2009, last year exited a luxury project in Alibaug, a seaside destination near Mumbai. It had earlier committed Rs250 crore to the project, which was to be developed jointly with Samira Habitats. Realty funds are also trying to gauge the risk factors attached to such low-cost projects. Indiareit and Red Fort Capital Fund Advisors Pvt. Ltd say that though investing in the low- and mid-cost segments is a safe bet, they are studying the project models to ensure they have the right sourcing of material, location and price. With thin profit margins and tight costs, it is imperative the projects are completed on schedule. “Like ours, many funds are working out the actual details of a project with developers, and even restructuring aspects to make a more viable business model,” said Nadkarni. Possibilities of delays in getting approvals, construction costs rising, and a strict price point make such projects riskier than regular ventures, he said. Nayan Bheda, managing director of Neptune Developers Pvt. Ltd, which has launched a 125 acre low-cost project near Mumbai, funded by Indiareit, and has three more planned in Chennai, Nagpur and Pune, says only such projects can assure sales. For instance,
Nepture has sold 2,000 of the 2,100 units in the first phase of its Mumbai project in just 2 months. “PE funds demand higher IRR (internal rate of return) of over 24% in such projects as the appreciation of profit is not high. But we have been lucky with Indiareit as an investor,” Bheda said.
courtesy:www.maaproperties.com
Saturday, May 30, 2009
Light at the end of the tunnel
Real estate developers are optimistic of the industry looking up now with a stable government in place
Real estate will recover after the elections. And that happened to be the catchphrase for any discussion on property matters for the last couple of months. Developers buttonholed those who lent a ear on how projects were kept in abeyance. Most buyers did not mince words to state that buying options were on hold till the heat and dust settles down.
The government is in place and elections have delivered the verdict on Telangana that had been needling the real estate investors and developers for quite some time now. Whenever the proponents of separate Statehood showed their electoral strength, the developers with big money and big projects turned nervous.
This was proved even in the local body elections with the real estate going a bit cold when results went in favour of the T-factor.
Now that the T-factor hardly clicked, there is a sense of reprieve in the construction industry. As one of them pointed out, “at least for next five years the issue might not come to haunt”. The glimmer of hope that all will fall in place for the real estate post polls and the future seems brighter.
Buyers’ market
The industry feels that prices ‘went for a correction’ as they prefer to call. There will be no further downward cut.
“As of now, it is buyers’ market and the right time to pick up property. Once the activity picks up, there will be incremental growth in property prices,” says one.
The correction has seen the apartment prices going down by 15 to 30 per cent in most places, while sales have dwindled drastically in some other places.
Now, the industry is looking up towards the Union government for steps leading to a cut in home loan interest rates to infuse a fresh lease of life for the real estate.
At the same time, certain representations seeking rationalisation and slashing of developmental and other charges have been pending with the State government and some concessions to this effect are being anticipated.
As builders concede, the T-factor did exert certain psychological pressure on investors, there is a sense of relief in the industry. The boom-time is not expected to return, but the hope is that industry will recover and stabilise very soon.
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