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India Real Estate 2020
June 24, 2008
This article has been contributed by Mr. Rohit Malhotra, CEO, Realtech. Realtech (www.realtechgroup.in) is a leading North India based Real Estate developer promoted by a team of young, dynamic entrpreneurs. Since founding the company just over 3 years ago, Realtech has undertaken projects across office, retail, residential and hospitality verticals.
India’s progress over the next 20 years will be intimately linked to events within the region and around the world. The World Bank estimates that India will become the third or fourth largest economy in the world by 2020, with the GDP per capita to double by 2020. Thus, India is viewed as a key element in the “Chindia” and the “BRIC” economies, which are seen as key emerging markets playing an expanding role in the global economies. The scale of development might end up a lot larger in India than even China. India is a two-speed market with small medium and large players. Since India’s political system is more defined, investor appetite in India is longer term 6-10 years. Read more
Is the NCR real estate market in a bubble?
June 10, 2008
Maybe, this should have been the very first topic I should have addressed on this blog. Better late than never. Over the last 6 months, the media has written a lot about the high RE prices across major metros in India. Infact, there have been several people in the media and industry who have described the Indian RE market as a bubble. I will try and examine this assertion through this writing. I will focus on the NCR for the purposes of this blog. Read more
Leverage - the new cocaine !
June 4, 2008
Have you ever wondered how private equity (PE) funds, hedge funds and other such private pools of capital, are able to generate extraordinary returns in markets that appear to be behaving quite ordinarily. Besides the genuine genius of some managers who manage these funds, they use a weapon which in normal circumstances is not available in large quantities to individuals and that is called Leverage. In keeping with the spirit of this blog which is to democratise access to “intelligent analysis”, I would like to share in this particular writing how individuals can maximize returns in RE investing by using leverage. Read more
The dirty little secret no developer wants you to know….
May 29, 2008
Ever thought what you are actually paying for when you buy a developer apartment in India? You may think you do but may be surprised to read what I’m about to tell you next. You may have heard of carpet area v/s super area. For those of you not familiar with the terminology, carpet area is the covered area inside your apartment (excluding balconies or patio or terrace) and super area is the carpet area plus the loading developers add for things such as elevators, fire escapes, staircase, etc (Yes, you pay for that too!). This loading I referred to can vary anywhere between 15 -30%!! The problem is most agreements you enter into with developers when buying an apartment only state the super area and not the carpet area. As you may have realised by now…..that is a big problem. Therefore, two apartment complexes next to each other may have different loading but an identical price. Obviously, the price is not the same (as it may appear on the face of it) as in one case you are getting less space for the same money! Read more
Is Faridabad the new kid on the block !?!
May 20, 2008
Talk of step fatherly treatment and Faridabad would be right up there when compared to the original son of the soil -Gurgaon! Haryana govt has definitely not focused adequately on developing Faridabad as an important growth center considering its strategic NCR location. Despite the state governments indifference, I feel, Faridabad is most certainly going to be an important source of RE growth over the next 5 years. Why? Because, whatever you do, you cannot take away its gene pool! It is afterall 20 minutes away from South Delhi locations such as Nehru Place, GK, Friends Colony, Maharani Bagh. In addition, Jasola is emerging as a significant business district in its own right- much like Nehru Place and Bhikaji Cama Place and is less than 20 minutes away from Faridabad. Some of the better hospitals of the city such as Apollo Hospital and Escort Heart Instt. are within 20 minutes driving distance from Faridabad. Ofcourse, the other positive factor influencing prices in Faridabad in the near term would be the implementation of the metro project. It was initially expected to have been implemented by 2010 but some “babu” in the govt office had another agenda and the metro is now expected to be in Faridabad by 2012. Read more
Anticipate the next hot spot - simply follow the metro!
May 7, 2008
Over the next 5 years the metro will have a profound impact on the NCR’s RE map. The development of the metro will alter the way its residents define a locations importance and this will have a significant impact on price movement in various parts of the NCR. Read more
Factors influencing residential RE prices in NCR
May 5, 2008
Over the next few weeks I will write about residential RE investment opportunities in the NCR. I will begin this week by analysing opportunities in Gurgaon. Read more
