Daily Real Estate briefing by PNT
Welcome to the latest edition of?PNT Real Estate Daily! Through our digital only newspaper, we aim to provide a 360 degree coverage of the latest events, stories, updates and occurrences from the real estate industry from around the world. Subscribe for daily updates!
Bollywood actor Ranbir Kapoor has recently leased his luxurious apartment in Pune's Trump Towers for an impressive monthly rent of Rs. 4 lakhs. The apartment was leased to Duroshox, a leading company in suspension solutions, for a 36-month period. The lease agreement includes an annual rent escalation. This move reflects a growing trend among celebrities to invest in premium real estate, with stars like Shahid Kapoor and others, making real estate investment a prominent choice in the industry.
A level-2 fire incident occurred at Benreez Apartment in Mumbai's upscale Worli locality, specifically in the basement area. The incident, reported around 10:39 pm, was quickly categorized as Level 2 at 10:46 pm. Fortunately, there were no casualties, and six individuals were safely evacuated from the building's basement. The Mumbai Fire Brigade (MFB) deployed seven fire engines and eight jumbo tankers to combat the blaze, which was confined to an area of around 4,000 square feet. The presence of plastic items in the basement contributed to the fire's intensity. Investigations are ongoing to determine the cause of the fire, which was extinguished around 1 am after about two hours of firefighting efforts.
Mumbai's housing market remains robust, contributing 40% to India's residential sales. After a strong recovery in 2022, residential unit launches surged by 183%. The trend is set to continue, with projections of residential sales exceeding INR 1 lakh crore in 2023 and potentially reaching INR 2 lakh crore by 2030. While mid-segment housing dominates, there's a growing interest in upper mid and premium segments. Infrastructure developments are set to improve connectivity and public transportation, reducing travel times by 50% in the next five years. These efforts also aim to increase public transport usage from 65% in 2016 to 75% in 2030, promoting sustainability.
Manipal Hospitals has acquired an 84 percent controlling stake in AMRI Hospitals, bolstering its presence in eastern India. This strategic move enhances Manipal's bed capacity, with plans to expand from 9,500 to 12,000 beds within three years. The deal, estimated at around Rs 2,300 crore, aligns with Manipal's goal of becoming the dominant healthcare chain in the region. For the Emami Group, divesting the majority of its AMRI Hospitals stake allows a sharper focus on core businesses. The deal faced complexities and legal disputes but underscored Manipal Hospitals' growth ambitions and commitment to addressing the healthcare needs of eastern India.
India Sotheby’s International Realty has secured an exclusive sales and marketing mandate for The Residency, an ultra-luxurious residential project in Worli, Mumbai. The project comprises 19 ultra-luxury residences, each occupying an entire floor and offering stunning views of iconic landmarks in Mumbai. The Residency features flexible living spaces with customizable configurations of up to 5 bedrooms, making it a highly sought-after address for Ultra High Net Worth Individuals (UHNIs). With Mumbai's rising wealth and increasing demand for high-end properties, this project represents a significant opportunity for UHNIs to own luxury residences in a prime location in the city.
In India's IT corridor, CapitaLand Investment Limited (CLI) has begun construction on Phase I of the renovated International Tech Park Hyderabad (ITPH). This Madhapur business park has a 100% lease agreement from major firms for its Block A office building. Over the course of seven to ten years, CapitaLand India Trust (CLINT) will invest in the substantial renovation of ITPH, resulting in the provision of more than 4.9 million square feet of Grade A+ office space. At ITPH, a 40-megawatt data centre will also be built. The initiative intends to boost Hyderabad's expanding information technology industry and meet the demands of major international businesses.
The Delhi Development Authority (DDA) has approved an annual 8% increase in charges for obtaining property rights in unauthorized colonies under the Pradhan Mantri-Unauthorized Colony in Delhi Awas Adhikar Yojana (PM-Uday scheme). This revision, effective from April 1, 2022, follows an amendment to the National Capital Territory of Delhi (Recognition of Property Rights of Residents in Unauthorized Colonies) Regulations, 2019, in compliance with Section 57 of the Delhi Development Act, 1957. The charges for property rights will increase by 8% each year. While this move aims to regularize unauthorized colonies, it may pose challenges for applicants seeking legal recognition of their properties in these areas.
Emirates NBD, a prominent banking group in the MENAT region, has partnered with CoriolisESG by TradeSun, a pioneer in automated ESG scoring solutions. This collaboration aims to enhance the bank's sustainability-linked transaction banking products and advisory services by leveraging CoriolisESG's extensive ESG rating framework. The partnership will provide corporate and institutional clients access to ESG scores of their supply chain partners, encouraging sustainable practices. Additionally, it enables clients to mitigate ESG-related risks that could impact profitability. CoriolisESG's AI-driven solution aligns with global sustainability frameworks and enhances enterprise intelligence, making it a valuable tool in fostering sustainable business practices.
The Uttar Pradesh government plans to amend property tax rules, effective in the next financial year, with a focus on relaxing tax rates for starred hotel properties to encourage tourism and employment growth in the state. The amendments are driven by the need to distinguish between bed and breakfast accommodations, homestays, and other budget hotels, ensuring they adhere to tax norms. Eight out of nine objections to the draft amendments came from stakeholders in Agra, a major tourist destination in Uttar Pradesh. The changes aim to harmonize tax structures for star and budget properties while addressing concerns about fairness and revenue balance.
SEBI, the market regulator in India, has announced an auction of Saradha Group properties in West Bengal with a reserve price of over Rs 3 crore to recover funds raised through alleged illicit schemes. The auction, scheduled for October 17, 2023, follows a directive from the Calcutta High Court and aims to compensate depositors who suffered losses when the Saradha Group collapsed in 2013 after raising around Rs 4,000 crore from 1.7 million investors. Potential bidders are required to conduct independent due diligence, and the successful bidder will bear transfer charges and taxes associated with the property.
The dreams of over 6,000 Mumbai policemen to own homes have been thwarted due to alleged mismanagement in the housing society created for this purpose. Policemen have taken the matter to the Bombay High Court, seeking a halt to the scheduled October elections for the housing society. The turmoil revolves around irregularities in the formation of the voter list, including the alleged expulsion of the chief promoter and subsequent approval of the voter list by an assistant registrar. The civil writ petition also calls for an investigation into malpractices and illegalities within the housing society. This situation has raised concerns about the functioning and trust of the society.
Under Chief Minister Manohar Lal Khattar's leadership, the Haryana government is taking comprehensive measures to address the issue of unauthorized commercial establishments encroaching on residential areas. These initiatives include the establishment of an Integrated Command and Control Centre in Ambala to enhance security and traffic management, and the formulation of a policy to designate areas with commercial establishments within residential zones as official commercial areas. The government is also conducting a city-wide survey to identify locations in need of CCTV surveillance integration into the Police Integrated Command and Control Centre. These proactive steps reflect the government's commitment to responsible urban development and efficient governance in Haryana.
A joint committee comprising officials from the Haryana State Pollution Control Board, Charkhi Dadri administration, and Central Pollution Control Board has successfully recovered Rs 4.01 crore as environmental compensation from 44 stone crushers in Charkhi Dadri, Haryana. They have also lodged 70 criminal cases and attached 47 properties for non-compliance with environmental norms. This initiative follows a case filed in 2017 against stone crushers operating in Charkhi Dadri, which were causing air and water pollution. The National Green Tribunal had been monitoring and reviewing the efforts of the HSPCB and the state government to control this pollution.
Chief Minister Pushkar Singh Dhami marked Prime Minister Narendra Modi's birthday by distributing housing approval letters, keys, and financial assistance of Rs 5,000 each to beneficiaries of the Pradhan Mantri Awas Yojana-Rural, aimed at providing rural homes. Additionally, he handed out financial support to self-help groups under the National Rural Livelihood Mission. Dhami's actions were lauded for empowering the marginalized, especially women, and he expressed gratitude to the Prime Minister for providing permanent homes to those in need. This heartfelt gesture extended to celebrating Modi's birthday with underprivileged children.
Visakhapatnam Metropolitan Region Development Authority (VMRDA) is embarking on a significant project, constructing 46 reconstituted (RC) layouts over approximately 1,215 acres for farmers who participated in the land pooling process for one-cent layouts. The initiative comes at a cost of around Rs 200 crore. This follows the pooling of 5,000 acres for one-cent layouts in the combined Visakhapatnam district, with VMRDA undertaking the responsibility to create these layouts. Notably, VMRDA has already developed 83 one-cent layouts, covering over 4,800 acres, benefiting around 1.42 lakh homeless individuals.
The Bhubaneswar Development Authority (BDA) is embarking on six new town planning schemes in Chandaka and Pahala areas to facilitate the holistic development of the city. Previously, BDA completed four similar schemes in Tamando and Chandaka, involving the acquisition of private plots from landowners and their subsequent development in an organized manner. These initiatives covered multiple villages and spanned approximately 1,596 acres. The BDA has a larger vision, with plans to execute 45 town planning schemes across 58 revenue villages, covering a total area of 9,171 acres, signifying a commitment to urban development and infrastructure enhancement.
In August, Canadian home sales decreased by 4.1% compared to July, following the Bank of Canada’s interest rate hike in July. Despite this decline, annual home sales were up by 5.3%. New property listings increased by 0.8% from July, bringing them closer to average levels after starting the year at a 20-year low. The Home Price Index showed a 0.4% month-to-month increase and a corresponding 0.4% annual increase, while the national average selling price rose by 2.1% year-over-year. To address housing affordability concerns, Canadian Prime Minister Justin Trudeau announced the removal of the federal 5% sales tax on new rental property construction.
In response to the affordable housing crisis in the UK, Cornwall Council has made a strategic decision. They opted to sell Grade II listed flats, valued at ￡640,000, for just ￡1 in order to ensure continued affordability in Looe. The move aims to counteract the impact of second home ownership and holiday rentals on the county’s housing shortage. The council believes that this unconventional sale would prevent the loss of affordable housing in the area and alleviate the need for temporary accommodation. Additionally, a community-led redevelopment project promises to maintain the flats for affordable housing use. The UK’s housing crisis remains dire, with a backlog of 4.3 million homes needed to accommodate the growing population, particularly in high-demand areas like London and the South East.
In Germany, apartment building permits plummeted by 31.5% in July compared to the previous year, revealing a severe decline in demand within the construction and real estate industry. Factors contributing to this downturn include high building costs and difficulties in securing financing. Germany's goal of constructing 400,000 apartments annually is struggling to materialize. Low-interest rates had previously fuelled interest in German property, but rising rates led to a freeze in deals and falling prices. Industry leaders are urging government intervention, proposing measures like reducing property sales tax and expanding low-interest rate credit programs to support new residential construction.
Amidst financial challenges, Chinese developer Country Garden has successfully obtained an extension for the last of eight onshore bonds, breathing relief into its precarious situation. This final bond, valued at 492 million yuan ($67 million), had faced multiple delays in the voting process before creditors finally voted in favour of extending its maturity by three years. The agreement also includes a significant guarantee of no less than 200 million yuan from the bond issuer, Guangdong Giant Leap Construction Co. Country Garden's efforts to extend the maturities of these bonds reflect the ongoing turbulence in the Chinese property sector.
Godrej Properties has successfully raised Rs 1,160 crore through the issuance of non-convertible debentures (NCDs) on a private placement basis. This fundraising initiative demonstrates the company's commitment to bolstering its financial position and supporting its growth plans in the real estate sector. The NCDs, which come with fixed coupon rates and distinct maturity dates, were offered to identified investors. They received strong credit ratings from agencies like ICRA and India Ratings, indicating a high degree of creditworthiness and stability. This capital infusion will enable Godrej Properties to expand its presence and contribute to innovative and sustainable real estate projects in India.
A recent report by Colliers highlights the unprecedented growth in India's real estate sector, presenting significant investment opportunities. As the real estate market gains momentum and experiences rapid infrastructure development, several micro-markets in major Indian cities are evolving into prime investment areas. Notably, investing in land and monetizing it through rental properties is yielding returns up to 10 times higher than ready apartments. Eco-friendly locations and tourist destinations are particularly popular for land investments, with Maharashtra-Neral-Matheran, known for its prominent developers, infrastructure projects, and amenities, emerging as a leading investment corridor. This trend is expected to continue, driven by ongoing infrastructure projects and heightened real estate investments.
Burger King, the second-largest burger chain in India, is in negotiations to establish an exclusive partnership with Coca-Cola, ending its decade-long association with PepsiCo. Coca-Cola's "COKE WITH MEALS" campaign, in collaboration with food delivery giants like Zomato and Swiggy, has prompted Burger King's interest in partnering to expand its reach. This move is expected to boost sales for both Burger King and Coca-Cola in dining and home deliveries. While the two brands have partnered in the United States, this marks a significant shift in India's fast-food landscape. The collaboration aims to offer a global fusion of burgers and beverages in 54 countries.
Housing.com, India’s top digital real estate firm, has launched its latest brand campaign for the upcoming festive season, building on the success of its 2022 "Parr.. se Perfect" campaign. The new campaign focuses on property owners' needs and challenges in finding genuine buyers or tenants. Housing.com introduces the Housing Assist service to simplify the process by providing verified, price-matched, and ready buyers and tenants. With four new ads and a targeted reach of over 100 million, the campaign employs humour and impactful storytelling across TV, digital, and OTT platforms.
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