Category: Real Estate

Is Dubai’s real estate sector poised for a slowdown?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Dubai! This word itself bridges the way to a world of imagination that’s full of luxurious homes, beautiful skylines, and extravagant lifestyles that possess unparalleled grandeur. Perhaps such a wish to live in this man made paradise resulted in investors flocking to the city of skyscrapers.

Despite the global slowdown and spiking interest rates, Dubai witnessed a sharp increase in the value of home mortgage approvals, property prices, and residential rents. But has the real estate market reached its peak? Will there be a downturn?

Considering the spiking inflation, the US Federal Reserve started increasing interest rates on March 17, 2022, by 25 bps. In July 2023, federal fund rates reached 5.25% to 5.50% levels, which were the highest since the 1980s. The Emirates effectively mirrors the Fed’s monetary policy because of its currency peg to the US dollar. Considering interest rates had never shot up so drastically in 22 years, a slowdown was expected in Dubai’s real estate market. 

But despite this uptrend, last year the value of home mortgage approvals in the city witnessed a 40% increase. In this same period, the UAE’s mortgage rates climbed to 5% at the end of 2023 from below 2% in early 2022. The property prices in the Emirates continued a sharp ascent. In fact, in the first half of 2023, the country recorded a 16.9% YoY spike, which was the fastest increase in nearly a decade.

“Dubai is presently one of the most affordable luxury destinations in the world in comparison to many of its counterparts, including Hong Kong, Singapore, etc., said Morgan Owen, Managing Director – Middle East & North Africa, ANAROCK Group. He added that ever since the pandemic, there has been an uptick in interest in the Dubai residential market by the wealthy, including not just businessmen but also top professionals in banking and financial services and even crypto millionaires.

Residential rents in Dubai also outpaced sales price growth and soared by 21.7% in the first half of 2022. This trend continued into 2023. According to Betterhomes research, Russians topped the chart of non-resident buyers of homes in the first quarter of 2023 but slipped to third place by the end of the year. 

Investors from India and the United Kingdom also flocked to the city and accounted for most of the transactions during the twelve months. The number of buyers from Egypt, Lebanon, Pakistan, and Turkey too saw a notable rise.

Owen enumerates the reasons behind Indian investors’ interest in Dubai’s market. “Besides lowered prices and its proximity to India, another reason why Indians are investing in Dubai is due to favouring government measures. The UAE is issuing long-term visas, between five and 10 years, to entrepreneurs, professionals, investors, and specialists in the medical, scientific, research, and technical fields,” he mentioned.

While Indian high-net-worth individuals (HNIs) remain among the top investors in Dubai, changing buyer preferences post-COVID-19 and declining property prices have attracted interest from a diverse range of businessmen and professionals.

According to Reuters, in 2023, a record 431 homes were sold for more than 10 million dollars in Dubai, making it the largest such market in the world. But what factors led to this boom?

Following the 2008 financial crisis, Dubai underwent a significant transformation, emerging as one of the world’s leading financial hubs. Real estate, constituting 8.9% of the economy, became a pivotal indicator of this shift. Secondly, the city’s handling of the pandemic was considered a textbook case, which further attracted investors. 

The UAE’s banks continue to provide additional mortgage offers to secure the top spot. Under schemes like ‘Ramadan Specials’, banks rolled out 5-year fixed rate mortgage plans. This provided relative stability for the borrowers. Also, if rates fell in the future, there was a liberty to refinance the deal. Cherry on the cake! 

 So what’s next for Dubai’s real estate market?

“It is unlikely that there will be a major slowdown anytime soon because the UAE government’s open door policy for foreign investors has helped them tide through the tough and tumultuous times post-pandemic,”  believes Owen. He adds that the luxury segment in Dubai is likely to continue to grow as demand remains upbeat. Also, the right product at the right location with world-class amenities will continue to garner attention.

Even though Chinese and Russian inflows tapered off, increased interest among Indian investors could keep any downturn mild. According to Knight Frank’s Dubai Market Review, Dubai is set to deliver just 13,000 homes annually over the next six years.  This figure is well below the run-rate of 30,000 units over the last 15 years. The exposure of the UAE’s 10 largest banks to the real estate sector has also seen a decline. In 2008, during the financial crisis, this exposure stood at approximately 30%, decreasing to 16.2% by the third quarter of 2023.

Uncontrollable inflation and a dynamic global interest rate policy had already hampered market growth. Now, geopolitical factors like the tensions in West Asia and the unabated Russia-Ukraine war are also causing uncertainty.

All these factors indicate a high chance of a slowdown in Dubai’s real estate sector. But the city’s historic resilience needs to be considered before jumping to any conclusion.

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Why invest in REITs? Karan Bhagat of 360 ONE outlines four compelling reasons

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Karan Bhagat, Founder, MD & CEO of 360 ONE, says many of their high-net-worth clients typically allocate 50 to 60% of their portfolios to stocks, with another 30 to 40% dedicated to fixed-income investments.

Within this fixed-income category, real estate investment trusts (REITs) are considered a viable option, accounting for 15 to 20% of the fixed-income portion.

Consequently, REITs generally make up about 5 to 10% of the total portfolio for most clients.

Currently, with only four listed REITs in the country, Bhagat expects this allocation to potentially increase from 5% to 10% as the sector expands

Q: REITs are a newer asset class. How do you see its potential and how do you feature this in a diversified portfolio? What are your thoughts on that?

A: REITs are a very interesting asset class especially from a portfolio allocation perspective. Given the change in debt taxation in the last budget, REITs have become especially attractive. All fixed-income mutual funds are now taxed at marginal tax rates. REITs, however, continue to have slightly preferred tax, because the tax has already played in the special purpose vehicle before getting distributed to the clients. So if you compare it to the 10-Year G Sec, today, REITs are giving us about 5.8 to 5.9% on a post-tax basis.

So a client, effectively, is getting four things. One, he is getting a 5.8-5.9% on a post-tax basis. Second, he is able to allocate and take advantage of the capital appreciation in commercial real estate over the next 10 to 15 years. Thirdly, he can take advantage of the increase in rental over the next 5, 10, 15 years. And lastly, take benefit of the fact that there is a multiple set of properties rolled into one, and as occupancy increases from the current yields of 80 to 83% to 100% that benefit would also flow into the REIT.

So overall, I think the 5.8% to 6% can move towards the 9% to 10%. It’s nowhere close to equity alternative. It does not substitute equity in a client’s portfolio. But some very interesting part of his fixed income portfolio, which can potentially give 8 to 10% post-tax over the next three to five years.

Q: If you really compare this with investment in other property asset classes, like a real estate company stock, or a property investment, how do you rate REIT vis-a-vis them?

A: So maybe I will correct myself a little bit, I don’t think it can be compared to equity so I think the risk-reward is really very different. Because a REIT by definition has a yield distribution of approximately on pre-tax 7.15-7.50%. Obviously, when you buy a stock, you’re subject to slightly much more volatility and you are seeking higher returns from a growth perspective. So from a risk REIT, I wouldn’t compare it to stocks.

But overall, I think both have their place in the portfolio. Most of our high net worth clients today would have 50 to 60% of their portfolio in stocks, and still would have about 30 to 40% of the portfolio on the fixed income side, within the fixed income side of 30 to 40% REITs offer a serious alternative to be around 15 20% of that 40%. So effectively for most clients today, REITs would make up close to 5 to 10% of their portfolio. We only have four listed REITs in the country but as the sector becomes deeper and wider, I think this allocation would move from 5% to 10%.

Q: How do you see the potential going forward for this particular asset class? You said it’s only 5% to 10% and obviously it is only in the commercial real estate segment. We haven’t even touched on the residential side and other subsets of real estate which are really growing in a meaningful way. How do you see the potential going forward and your company also has a licence for REIT, what are your plans for that, given the potential outlook that you have?

A: Overall, the potential for REITs as a broad asset class continues to be fairly large. I think globally apart from having REITs on the commercial side, even residential housing REITs are very popular and extremely large. Apart from that you have got co-living REITs, you have got hostel REITs and so on and so forth. I think generally speaking in India, residential real estate prices have always been slightly on the higher side for the right set of reasons and therefore the yields on residential apartments continue to be lower at 4 or 5% as compared to commercial at 7 to 8%.

Once kind of, there is a little bit of more stability in the rental yields on the residential side, you will see some of them converting into REITs. I think it’s not a question of if, it’s a question of when. So eventually it will happen. Whether it happens over the next 12 to 18 months or the next 24 to 36 months is something which time will tell. But overall, I think REITs will grow across all of these spaces, whether it’s senior living, hostel living, co-living, commercial REITs, or even residential REITs.

Commercial REITs obviously are the easiest to understand and now we have got also mall REITs, which is listed which is Nexus. So I think across these six broad strategies, you will see enough increase in the depth and the width of the market over the next three to five years. On our own side, I think we have got our own REIT licence we have approximately 12 to 15 months to still decide whether we launch our own REIT or not. So we are still forming our plans there, early days, but over the next three to six months, we like the space. If we find ourselves having a sweet spot or a unique opportunity to develop our own REITs, we will definitely look at it.

Read Here | Mutual funds need to increase focus on REITs and InvITs: SEBI ED Pramod Rao

Q: In terms of the suggestions how this can become a more attractive asset class, what would you say? Because on the tax side, it is attractive, but more can be done there. Even equity classification is what the industry is lobbying for any suggestions that you have?

A: Overall tax has come out well, I think both the regulator, the ministry, as well as the tax department have done a good job. I think it’s going to pass through. So the taxes rightfully paid in the special purpose vehicle at the recipient’s level, it is exempted from tax. So honestly, I think from a tax perspective, a lot has been done. Obviously more can be done. But a lot has been done. So I am quite comfortable there.

One pending demand was really the SEZs regulation being modified, which too has kind of come in some format or the other over the last two and a half, three months. So I think the utilisation of the REITs definitely has moved up from the current 80 to 83% closer to the 90-95% which will also help the REITs. Finally, maybe both classification as equity and also more importantly, the REITs trade in larger lot sizes, if they can be traded in smaller lot sizes, especially the larger ones, I think it will allow a greater pool of people to access the REITs.

Q: What’s your view on the market in the near term? Some of the big events happening in election season, interest rate cut, expected geopolitics, how do you see all this really impacting our markets in the near term?

A: We can’t escape from the fact that the markets are slightly expensive on the valuation side, I think if you look at price to book, historical multiples for the last 10 years, 15-20 years, we are closer to towards the 3.5 to 3.7 times as compared to the long term average of closer to the 3 to 3.2 times. So we are definitely a one, one and a half standard deviation away from the long-term averages.

Having said that, I think generally speaking, if I look at the largecap and the large midcap space, which broadly would include the top, maybe 300 to 400 stocks, as well as some midcap stocks, which have large institutional ownership, I think these two categories may correct a bit, but they definitely are not going to correct in such a meaningful way that you have an opportunity to get out of equities and get in again.

I think broadly FII investors across the world over the last 24 months have under allocated to India, and especially these two segments, if the markets correct, will get a huge amount of investor appetite from these set of investors. So for these set of stocks, I wouldn’t really worry I would stay invested. There will be a little bit of volatility, a little bit of shocks, which event will cause it, we really don’t know, but I think I would kind of hang in there.

On the midcap side and the smallcap side, there are again very stock-specific but there are excesses there. And that’s where it would be a little bit wary. And if there’s a deep correction in the market, some of those stocks could potentially correct 15 to 40% and therefore we need to be very, very careful on which small midcap and smallcap stocks we own. But outside of that from a five-year perspective, the markets continue to look constructive.

Also Read | Why Keki Mistry thinks REITs are a good investment option

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Home buyers in Noida threaten to boycott Lok Sabha polls — here’s why

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Unhappy over the issue of pending registries, homebuyers and residents of several group housing societies in Noida and Greater Noida West have launched a “No Registry, No Vote” campaign ahead of the 2024 Lok Sabha elections.

They said that either they will not exercise their franchise or choose NOTA in the upcoming Lok Sabha polls later this month if registries of their flats are not done. In some housing complexes residents have also put up large banners reading “No Registry, No Vote” on their society gates and balconies for politicians visiting their societies.

Lok Sabha elections in Noida, Greater Noida and Yamuna Expressway regions that fall under Gautam Budh Nagar constituency will take place on April 26, 2024.

Frustrated with false promises by politicians on getting their registries done in the past, the residents have put up “No Registry-No Vote” posters for politicians visiting their societies in Noida and Greater Noida areas under the Gautam Buddha Nagar constituency for Lok Sabha poll campaigning.

Societies where residents are running “No Registry, No Vote” campaign include Gaur Saundaryam at Techzone 4 in Greater Noida West, Gardenia Glory in Noida Sector 46, Futec Gateway in Sector 75, Himalaya Pride at Techzone 4 in Greater Noida West, Nirala Greenshire society in Sector 2 Greater Noida West, Ajnara Homes in Greater Noida West and Shivalik Homes at Surajpur in Greater Noida, among others.

Homebuyers’ grievances

Pushkar Kaushik, a resident of Gaur Saundaryam housing complex at Techzone 4, said there are more than 300 homebuyers in the society whose registries are pending since February 2021. He said that the Greater Noida Industrial Development Authority (GNIDA) had in February 2021 stopped registries in the society after the builder failed to deposit ₹17 crore as an additional compensation to farmers following which the matter went to the Allahabad High Court.

Kaushik said in December 2023 the Uttar Pradesh government adopted the recommendations of Amitabh Kant Committee on legacy stuck projects and directions were issued to the Authority to execute the registries in three months starting January 2024 but nothing has happened so far.

“There are nearly 2,000 flats, out of which over 300 flats of Tulip tower are yet to be registered. Homebuyers who have invested their hard earned money are troubled without any of their faults. Every time political leaders promise to address our woes but nothing changes so we have decided not to cast votes in this Lok Sabha election unless our demands are met,” Kaushik told Moneycontrol.

Dinkar Pandey, a resident of Ajnara Homes said that homebuyers in his society have been waiting to get the ownership of their apartments for the last 6-7 years. He said there are around 600 flats in Ajnara Homes where registries were pending since 2016-2018.

“As a sign of protest against pending registries we have decided to boycott Lok Sabha polls 2024. Our slogan is ‘No Registry, No Vote’. It is high time that the Authorities understand the homebuyers’ plight as we are suffering even when we are not at fault,” he said.

Another homebuyer, Anuj Kumar Singh, a resident of Gardenia Glory Society, echoed the concerns saying that nearly 1,400 homebuyers have been waiting for their registries since 2016. “We will either not cast votes in this general election or if we have to, then we will select NOTA to register our protest,” he said.

Pending registries

According to the data from the district’s three development Authorities — Noida, Greater Noida and Yamuna Expressway Industrial Development Authority, registries of around 1.15 lakh stalled flats are pending under the Amitabh Kant committee relief package. Officials said that registries of only around 3,400 apartments have been executed till April 5 since March 1 in Gautam Budh Nagar.

Saumya Srivastava, OSD, Greater Noida Industrial Development Authority (GNIDA), said that several builders have deposited 25% of their dues and registries in their projects have been opened.

“The Authority is making all out efforts to execute all pending registries at the earliest. We are allowing registries in those projects where builders are depositing 25% of their dues. As many as 7,500 registries have been allowed in Greater Noida and out of which around 1,800 have been executed,” Srivastava told Moneycontrol.

Abhishek Kumar, president, Noida Extension Flat Owners Welfare Association (NEFOWA), said that the homebuyers are frustrated with false promises by political leaders about getting the pending registries done so that’s why in many societies, where registries are pending, residents are planning to boycott the general elections.

“Though the registries have started happening after the Uttar Pradesh government agreed to adopt the Amitabh Kant committee recommendations, it is very small. Not all recommendations of the Kant committee were accepted by the government. For instance, the committee said that the registry of flats should be delinked from builder dues but it was not adopted. Registries are still linked with builder dues, however, the Authorities have brought a payment reschedulement scheme to ease the payment of dues but homebuyers are still suffering,” he said.

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Brigade Enterprises to invest ₹400 crore to build office space in Chennai

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Realty firm Brigade Enterprises Ltd on Monday said it will invest ₹400 crore to build an office complex in Chennai. In a statement on Monday, Bengaluru-based Brigade Enterprises said it has entered into a Joint Development Agreement (JDA) with Agni Estates & Foundations Pvt Ltd to develop ‘Brigade Tech Boulevard’, a ‘Grade A’ office space on Pallavaram-Thoraipakkam Radial Road, in Chennai.

“With an investment of around ₹400 crore, the project will have a leasable area of 8.36 lakh square feet spread across two towers,” it added. This will be the next commercial project launched by Brigade Group after the successful completion of the ‘World Trade Centre’ on OMR.

Nirupa Shankar, Joint Managing Director, Brigade Enterprises, said, “Chennai is a diverse office market with demand from not only IT and ITeS sector but also from several other industry verticals including engineering, automotive and banking, etc.” Offices that conform to sustainability, with seamlessly integrated digital connectivity and A Grade office certification are in great demand, she added. “Given the pre-leasing commitments that Radial Road has had in the past, we are confident that the leasing momentum would increase further with this development,” Shankar said.

Commenting on the transaction, Agni Estates & Foundations Chairman R N Jayaprakash said, “We have partnered with Brigade for this project given their business acumen on delivering good returns on investment.” Brigade Group is one of India’s leading property developers. Instituted in 1986, the company has developed many projects across South India, namely ‘Bengaluru, Chennai, Hyderabad, Mysuru, Kochi, and Thiruvananthapuram.

It is into the development of projects across all segments — residential, office, retail, hospitality, and education. Since its inception, Brigade has completed 280+ buildings amounting to over 83 million square feet of developed space.

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Brigade Enterprises to invest ₹400 crore in commercial project in Chennai

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Brigade Enterprises Ltd on Monday announced a new office space project in Chennai, Tamil Nadu. In filing with the stock exchanges, the leading real estate developer said that it has entered into a joint development agreement (JDA) with Agni Estates and Foundations Pvt. Ltd to develop Brigade Tech Boulevard, a ‘Grade A’ office space in the Pallavaram-Thoraipakkam Radial Road area in the capital city of Tamil Nadu.

The company will invest ₹400 crore in the commercial project, Brigade Enterprises informed the bourses.

The project is set to feature two towers encompassing a total leasable area of 8.36 lakh square feet.

“With an investment of around ₹400 crore, the project will have a leasable area of 8.36 lakh sqft, spread across two towers. This will be the next commercial launch by Brigade Group after the successful completion of the landmark ‘World Trade Center’ on OMR,” the company said in a press release.

With this project, Brigade Enterprises aims to cater to the varied demands of Chennai’s diverse sectors including IT, ITeS, engineering, automotive, and banking.

Commenting on the project, Nirupa Shankar, Joint Managing Director, Brigade Enterprises, said, “Chennai is a diverse office market with demand from not only the IT and ITeS sector but also from several other industry verticals including engineering, automotive and banking, etc.”

She added that offices that conform to sustainability, with seamlessly integrated digital connectivity and A Grade office certification are in great demand.

“Brigade Tech Boulevard will be of world-class quality, with a significant focus on sustainability, similar to all our commercial developments across cities. Given the pre-leasing commitments that Radial Road has had in the past, we are confident that the leasing momentum would increase further with this development,” Shankar said.

Meanwhile, RN Jayaprakash, Chairman of Agni Estates and Foundations, highlighted the strategic nature of their partnership with Brigade, noting Brigade’s reputation for delivering projects that enhance asset value and attract top-tier business occupants.

Shares of Brigade Enterprises settled 2% lower at ₹982 apiece on the NSE at closing.

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Shivalik Group launches instant home concept

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shivalik Group, a real estate developer in Ahmedabad, has unveiled instant homes concept. This initiative redefines the traditional home-buying experience by presenting fully furnished, ready-to-move-in homes, crafted to streamline the transition into a new living space, the company said.

Marking a first in Gujarat, Shivalik Group sets a new industry standard with this launch, the company added.

The instant homes concept is designed to encompass a model show house.

This initiative simplifies the buying process by allowing the option to purchase the model house and caters to the increasing demand for quick-settlement solutions, the group said.

Taral Shah, Managing Director of Shivalik Group said “Instant Homes ensure that our customers’ transition into their new homes is as seamless as possible, requiring them only to bring personal items, as everything from kitchen essentials to electronic appliances is provided by us.”

Chitrak Shah, Managing Director of Shivalik Group said, “Our Instant Homes address the evolving demands of modern homebuyers. This concept is particularly relevant in the context of rapid urbanisation and economic growth, providing a fully furnished home ready for immediate occupancy.”

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Keystone Realtors: Demand for luxury homes remains robust, expect property prices to stay firm

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Boman Rustom Irani, the CMD of Mumbai-based real estate company, Keystone Realtors, which markets its properties under the ‘Rustomjee’ brand, sees sustained strength in demand for premium and luxury homes in Mumbai.

There is more demand than supply in the Mumbai Metropolitan Region (MMR), with Thane being the fastest-growing market, he noted.

“The supply also gets restricted because of real estate being a longer cycle and when you tie up a project, there is almost a 13-14 month wait before you can launch it and that is if all goes well,” Irani added.

While the affordable housing market is also picking up, he said, it will require some more push through government initiatives such as lower stamp duty, reasonable construction costs, etc.

Keystone, which mainly focuses on developing housing projects in the MMR region, shared its operational updates for January-March 2024 on April 8.

Its pre-sales stood at ₹843 crore during the period, registering a growth of 37% quarter-on-quarter (QoQ) and 78% year-on-year (YoY).

Irani said township sales are nearly 38-40% of the total sales and the rest is from redevelopment projects.

Also Read | Keystone Realtors’ FY24 pre-sales soar to ₹2,266 crore, surpassing projections with a 41% YoY growth

In the Mumbai suburbs, he mentioned that Versova holds significant development potential, and Rustomjee is directing attention towards this area.

Prices in Chembur are also rising due to infrastructure improvements and better connectivity, making the Chembur market quite attractive.

There is considerable interest in the real estate market spanning from Mira Road to Vasai and Virar, as well as in Kalyan, Dombivli, and Thane, where strong sales have been observed, he said.

Also Read | Ajmera Realty, Rustomjee partner for redevelopment project, aims for GDV of ₹760 crore

The market capitalisation of Keystone Realtors is around ₹7,721.62 crore. Its shares have gained close to 49% in the past year.

For more details, watch the accompanying video

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Vietnamese real estate moghul sentenced to death in multi-billion fraud case

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Vietnamese real estate tycoon Truong My Lan was sentenced to death on Thursday by a court in Ho Chi Minh City in the country’s largest financial fraud case ever, according to a media report.

The 67-year-old chair of the real estate company Van Thinh Phat was accused of taking out $44 billion in loans from the Saigon Commercial Bank, according to a BBC report. The verdict requires her to return $27 billion, a sum prosecutors said may never be recovered, it added.

The trial was the most dramatic chapter so far in the “Blazing Furnaces” anti-corruption campaign led by the Communist Party Secretary-General, Nguyen Phu Trong, the report further said.

She illegally controlled the Saigon Joint Stock Commercial Bank between 2012 to 2022 to siphon of these funds through thousands of ghost companies and by paying bribes to government officials.

Lan’s arrest in October 2022 was among the most high-profile in an ongoing anti-corruption drive in Vietnam that has intensified since 2022.

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Godrej Properties sells homes worth ₹22,500 crore in FY24; beats guidance by 61%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Godrej Properties Ltd., the Mumbai-based real estate developer has sold homes worth ₹22,500 crore in financial year 2024, it said in an exchange filing. The figure is a growth of 84% compared to last year and 61% higher than the initial guidance provided by the company at the start of the year.

This is the highest ever annual sales announced to date by any publicaly listed real estate developer in India, Godrej Properties said.

For the March quarter, Godrej Properties’ bookings grew by 135% from last year to over ₹9,500 crore. It sold 5,331 homes with a total area of over 8 million square feet during the last three months of the financial year.

Godrej Properties sold 14,310 homes with a total area of over 20 million square feet for the financial year gone by. The highest ever quarterly sales for Godrej Properties came from the Mumbai Metropolitan Region where it sold homes worth over ₹4,000 crore.

The real estate developer attributed the sales to strong consumer demand in some new project launches. On Monday, the company achieved a booking value of over ₹3,000 crore in “Godrej Zenith” in NCR, while last week, it reported a ₹2,600 crore booking from “Godrej Reserve” project in Mumbai’s Kandivali suburb.

Both of these projects were the best ever launches for Godrej Properties in their respective markets.

Godrej Properties bookings in the NCR region nearly tripled to over ₹10,000 crore, while that in Mumbai Metropolitan Region doubled to over ₹6,500 crore.

“This sales growth was on the back of both an improving product mix as well as strong volume growth of 31%,” Godrej Properties CEO Gaurav Pandey said. “We continue to have a strong pipeline for the current year which will also be bolstered by our recent entry in the Hyderabad market,” he added.

These numbers come after Bengaluru-based Prestige Estates reported their financial year 2024 sales figures of over ₹21,000 crore and also surpassed its own guidance of ₹20,000 crore in sales.

Shares of Godrej Properties have opened 6% higher on Tuesday morning and are trading at a record high of ₹2,751.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

RERA, PMAY, SWAMIH changed the face of real estate in India under Modi govt, says report

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a decade marked by reforms and economic shifts, India’s real estate sector has emerged as a powerhouse, contributing significantly to the nation’s growth trajectory. A recent report by the real estate industry offers insights into the sector’s evolution under the Modi government, highlighting its challenges, reforms, and future prospects. 

The report underscores the sector’s exponential growth, with its value estimated at around $120 billion in 2017 and projected to skyrocket to a staggering $1 trillion by 2030. This growth trajectory is coupled with the sector’s substantial contribution to India’s GDP. The report finds that housing inventory overhang has seen a significant drop over the last 10 years. The pan-India housing inventory overhang stood at 15 months at the end of 2023, displaying a positive decline from 41 months in 2017, when available inventory was at its peak.

The report called ‘Real Estate- Unboxed’ by the National Real Estate Development Council (NAREDCO) and ANAROCK, puts a spotlight on issues in the real estate sector prior to the implementation of several regulatory measures. Major problems included misuse of funds, lack of accountability, project delays, bureaucratic hurdles, and the absence of standard practices. The introduction of the Real Estate (Regulation and Development) Act, 2016 (RERA), marked a significant turning point, aiming to address these issues and ensure transparency, timely project completion, and accountability among developers. According to the data cited in the report, more than 1 lakh projects have been registered and 1,20,000 complaints have been disposed of under the RERA Act as of February 2024. 

The report also puts a focus on the government schemes targeted at the growth of housing and real estate in India in the last decade. Government initiatives such as the Pradhan Mantri Awas Yojana (PMAY) have played a pivotal role in promoting affordable housing and addressing the housing needs of urban and rural populations.

The residential sector has witnessed considerable transformations, driven by economic scenarios, government regulations, and the COVID-19 pandemic. Despite fluctuations, there has been a persistent demand for housing, with significant new launches and sales recorded over the past decade. Looking ahead, the real estate sector is poised for sustained growth, with projections indicating a market size of $1 trillion by 2030.

Anuj Puri, Chairman, ANAROCK Group, says, “The report tracks how India’s residential real estate sector has thrived in the past decade. The findings are convincing—housing demand and new supply in the top 7 cities have soared in the last 10 years, particularly post-pandemic, and housing sales are now aligned with new launches.”

“The report finds that approximately 28.27 lakh units were sold in the top 7 cities between 2014 and 2023, while cumulative new launches stood at over 29.32 lakh units. Residential property prices have also registered significant demand-led growth across the top 7 cities. Over the last decade, average housing prices have appreciated in the range of 25–60% across these cities,” adds Puri. 

Since its inception in 2019 until December 2023, the SWAMIH Fund has completed approximately 26,000 homes in the country, and 80,000 more are projected to be completed over the next three years. The government-backed SWAMIH (Special Window for Affordable and Mid-Income Housing) Fund aims to provide financial support to stalled affordable and mid-income housing projects that were struggling due to capital shortfalls.

It has played a crucial role in addressing the sector’s liquidity issues, especially amid challenging economic conditions. It has also boosted the growth of many ancillary industries in the real estate and infrastructure sectors, having successfully unlocked liquidity of more than ₹35,000 crore. 

Niranjan Hiranandani, Chairman, NAREDCO, says, “In light of the Indian government’s reforms over the last decade, NAREDCO and ANAROCK collaborated to assess the Indian real estate sector’s growth. Over the last decade, India’s economy has impressively leapfrogged to the fifth position on the global economic performance ladder. The Indian economy has maintained its status as the fastest-growing major economy for three consecutive years, a beacon of hope in a contractionary global economic climate.”

“A market size of $1 trillion is expected by 2030, up from $200 billion in 2021. This market size is expected to contribute 13% to India’s GDP by 2025, making the sector a pivotal contributor to economic development, employment, and government finances,” adds Hiranandani.

Employment generation has been a key hallmark of the real estate sector, engaging over 18% of India’s workforce and fostering the growth of more than 250 ancillary businesses. As the sector continues to expand, employment opportunities are expected to multiply, further bolstering the nation’s economy. Foreign direct investment (FDI) has poured into the sector, with construction ranking third in terms of FDI inflows. Between April 2000 and September 2023, FDI in the real estate sector amounted to a staggering $58.5 billion, highlighting its allure to international investors.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow