Citibank property-insights-q1-2014

1

India recorded a growth of 4.7% in Q3 FY14

(October-December 2013) over Q3 FY13. This was a

marginal decline compared to Q2 FY14’s growth rate

of 4.8%. Majority of the growth during the quarter

was driven by services sector. The ‘financing,

insurance, real estate and business services’ sector

registered maximum growth of 12.5% during the

quarter, followed by ‘community, social and personal

services’ sector, which grew at 7% and ‘trade, hotels,

transport and communication’ at 4.3%. Apart from

this, all other sectors witnessed a slowdown in the

growth rate as compared to the previous quarter. The

pick-up in manufacturing activity during Q2 FY14

failed to sustain its momentum and registered a

negative growth rate compared to the same period

last year. The ‘Construction’ sector’s performance

also remained almost at par with levels observed last

year, recording only a 0.6% growth. The overall GDP

growth for April-December 2013 was estimated at

4.6%, registering a marginal improvement from 4.5%

during the same period last year.

The Reserve Bank of India (RBI) raised the repo

rate by 0.25 basis points to 8% in January 2014. This

decision was driven by the need to set the economy on

the disinflationary path; targeting CPI below 8% by

January 2015 and below 6% by January 2016.

Apprehension of a further decline in growth during Q3

2013-14 due to subdued outlook evident in the

industrial and services sector also aided this decision.

The Asian Development Bank (ADB) revised India’s

2014-15 growth forecast to 5.5% from an earlier

estimate of 5.7% in October 2013. The RBI also

suggested that though a revival from around 5.0%

growth in 2013-14 is certain in the coming year,

downside risks to central estimate of 5.5% for 2014-15

remain. This prediction came on the back of

apprehensions that India might face a weak monsoon

season this year. Additionally, there have been no

clear indicators on sustained revival of industrial and

services sector amidst a moderation in global

economic activity. The easing of supply bottlenecks,

revival of exports with pick-up in the world economy

and the implementation of stalled projects all have to

play a role in sustaining this positive outlook. The

INDIA MARKET OVERVIEW

GROSS DOMESTIC PRODUCT GROWTH RATE

PROPERTY INSIGHTS

India Quarter 1, 2014

Subdued Demand, Stable Outlook

Gro

wth

Rate

(%

)

Source: Central Statistical Organisation, Govt. of India

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

Oct-D

ec 0

7

Jan-M

ar 0

8

Apr-Jun 0

8

Jul-Sep

08

Oct-D

ec 0

8

Jan-M

ar 0

9

Apr-Jun 0

9

Jul-Sep

09

Oct-D

ec 0

9

Jan-M

ar 10

Apr-Jun 10

Jul-Sep

10

Oct-D

ec 10

Jan-M

ar 11

Apr-Jun 11

Jul-Sep

11

Oct-D

ec 11

Jan-M

ar 12

Apr-Jun 12

Jul-Sep

12

Oct-D

ec 12

Jan-M

ar 13

Apr-Jun 13

Jul-Sep

t 13

Oct-D

ec 13

Economic Trends

Trends & Updates

2

EXCHANGE RATE MOVEMENT (INR/USD)

BSE REALTY INDEX

Source: RBI

INR

/US

D

Ma

r-12

Ap

r-12

May

-12

Ju

n-1

2

Ju

l-12

Au

g-1

2

Se

p-1

2

Oct-

12

No

v-1

2

De

c-1

2

Ma

r-13

Ma

r-14

Ap

r-13

May

-13

Ju

n-1

3

Ju

l-13

Au

g-1

3

Se

p-1

3

Oct-

13

No

v-1

3

De

c-1

3

Ja

n-1

3

Ja

n-1

4

Feb

-13

Feb

-14

70

65

60

55

50

45

40

IND

EX

Source: BSE

Jun-10

Jun-11

Jun-12

Jun-13

Sep-10

Sep-11

Sep-12

Sep-13

Dec-10

Dec-11

Dec-12

Dec-13

Mar

-11

Mar

-12

Mar

-13

Mar

-14

4000

3500

3000

2500

2000

1500

1000

500

500

1 Top eight cities include Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, NCR and Pune.

Current Account Deficit (CAD) shrunk to 0.9% of

GDP during Q3 2013-14 due to a narrowing trade

deficit resulting from higher exports and

moderation in imports. However, it is expected to be

around 2% of the GDP for 2013-14, much lower than

the 4.8% of GDP in 2012-13. External financing

conditions improved in February, as investors

started responding to the economic developments

in emerging markets by the way of reallocations

considering the probable impact of the U.S. Fed

tapering. However, exports growth dipped during

the quarter, amidst decline in global demand due to

overall slowdown.

The commercial office space across top eight 1 cities of India recorded total net absorption of 5.9

million square feet (msf) during the first quarter of

2014. Nearly 92% of this net absorption was in Grade

A developments. Hyderabad contributed 30% of the

total net absorption during the quarter followed by

NCR with 25% share. Majority of the absorption in

Hyderabad (which recorded more than 100%

quarterly rise) was driven by pre-commitments. The

total leasing during this period across the top eight

cities was 8.5 msf, indicating the continuing trend of

relocation. These cities recorded a total supply of

nearly 7.3 msf during the quarter and an overall

vacancy of 18.9%. In the retail sector, only 0.35 msf of

mall space supply was added across the eight cities

compared to 1.18 msf in Q4 2013. Due to this supply

decline and stable transaction activity, mall vacancies

dropped or remained stable in most of the cities

except Ahmedabad and Pune.

In 1Q 2014, residential unit launches across the top

eight cities recorded a quarter-on-quarter (q-o-q)

increase of 42%. Nearly 55,500 units were launched

in this quarter, with Bengaluru contributing around

30% to the total launches. The capital values

continued to remain sticky across segments in these

top cities. However, GST submarket in Chennai

recorded the highest quarterly capital value

appreciation of 10% in the mid-end segment due to

persistent demand for residential properties located

in proximity to the workplaces. Quarterly mid-end

segment capital value appreciation of upto 8% was

recorded in certain submarkets of Bengaluru,

Hyderabad and Pune. NCR witnessed a correction

across segments in certain submarkets of the city due

to sluggish demand and unsold inventory pile-up.

Thus, although the launch activity picked up during

the quarter, residential markets across cities

continued to exhibit a subdued demand trend with

buyers adopting a wait-and-watch approach due to

prevailing economic scenario and uncertainty on

results of upcoming general elections.

After the repo rate hike in January 2014, headline

inflation receded from 11.2% in November 2013 to

8.1% in February 2014. This decline in inflation could

be attributed to the sharp seasonal correction in food

prices. The ex-food and fuel CPI inflation has remained

sticky at around 8% for nearly 20 months in a row,

posing significant threat to growth and making a

strong case for retightening of monetary policy to

align with country’s fiscal targets. The WPI inflation

also eased to 4.7% in February 2014 from 7.5% in

November 2013. This was led by the disinflationary

impulses in food prices; however, the inflation in non-

food manufactured products rose marginally from

2.2-2.6% in May-September 2013 to 3.1% in February

2014. The RBI has stated that though the inflation

FDI INFLOW IN HOUSING AND REAL ESTATE SECTORhas started to moderate, further easing of

inflationary pressures will depend on the impulses

from policy actions, the play of food inflation and the

extent of negative output gap. Thus, although the

inflation is expected to moderate, it is likely to

remain above the comfort zone.

The Indian economy recorded a GDP growth of

4.7% in Q3 2013-14. Although this was marginally

higher than the growth recorded during the

corresponding quarter of previous year, concerns of

growth revival escalated because the economy now

needs to record a 5.5% growth in Q4 2013-14 in order

to meet estimates of 4.9% GDP targeted for the fiscal

year. This seems difficult considering Q3 2013-14 was

the seventh consecutive quarter with a sub 5%

growth. Although moderation in inflation provided

some room for recovery, the downside risks continued

to remain due to weak performance of the

manufacturing sector and increased risks to the

agricultural sectors’ performance due to

uncertainty of south-west monsoons. Thus, recovery

remains largely dependent on improvement in the

investment climate, external demand facilitated by

improvement in global financial and monetary

conditions and improvement in business and

consumer confidence aided by the formation of a

stable central Government. The Rupee closed at INR

60.1 against the U. S. Dollar in March 2014 almost

reaching levels prior to the devaluation/volatility

slide in June 2013. This improvement in the Rupee

value could majorly be attributed to the decline in

inflationary pressures during the past two-three

months. In addition, reallocations and improvement

Residential capital values remained stable across

the high-end segment in Ahmedabad, Chennai,

Hyderabad and Mumbai. Mid-end segment capital

values in Ahmedabad and Mumbai also remained

stable; however GST Road in Chennai registered a

10% appreciation on a q-o-q basis, mainly driven by

high demand from working professionals and new

projects being launched at higher price points.

Though high-end capital values for Bengaluru mostly

remained stable, certain areas such as Koramangala,

JP Nagar, Bannerghatta, Kanakpura, etc. in the

southern region registered a marginal q-o-q

in the external financing conditions also played a

pivotal role in strengthening of the Rupee.

The tightening of financial conditions during

beginning of the year, the downslide of inflation and

the improvement in the Rupee contributed to the

recovery in BSE Realty Index. The index touched 1468 stpoints on 31 March 2014 at the close of the financial

year, rising nearly 35 points above its December

closing of 1433 points.

India witnessed total FDI inflows of INR 24,632

crore in Q3 2013-14 (October-December 2013). The

Construction Development sector contributed 6%

(INR 1,432 crore) to the total FDI, registering a 55% q-

o-q decline. This decline could majorly be attributed to

the fact that the previous quarter registered highest

FDI in Construction Development in sixteen quarters.

In addition, FDI numbers for July-September 2013

were revised to 45,153 crore, leading to overall q-o-q

decline of 45%. Thus, the improvement in market

sentiment evident from the pick-up in FDI inflows

during the last quarter failed to sustain in Q3 2013-14.

Residential Trends

RESIDENTIAL CAPITAL VALUES GROWTH INDEX

3

INR

Cro

re

Source: Dept. of Industrial Policy & Promotion, Govt. of India

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

-

171

20

05

-06

20

06

-07

20

07-0

8

20

08

-09

20

09

-10

20

10-1

1

20

11-1

2

20

12-1

3

1 2

013

-14

2 2

013

-14

3 2

013

-14

2,121

8,749

12,62113,586

5,149

3,443

7,248

946

3,210

1,432

Source: Cushman & Wakefield Research

2001

2002

2003

2004

2005

2006

2007

2008

2009

1Q20

102Q

2010

3Q 2

010

4Q

2010

1Q20

112Q

2011

3Q 2

011

4Q

2011

1Q20

122Q

2012

3Q 2

012

4Q

2012

1Q20

132Q

2013

3Q 2

013

4Q

2013

1Q 2

014

1,000900800700600500400

300200100

-

Bengaluru (Brunton Road Lavalle Road) Chennai (Boat Club)

Kolkata (Ballygunge)

NCR (Satya Niketan and Anand Kiketan)

Hyderabad (Banjara Hills)

Mumbai (South)

Pune (Koregaon Park)

appreciation. The quarterly mid-end segment

appreciation ranged from 1-7% across Bengaluru. In

Hyderabad, areas such as Madhapur, Gachibowli,

Miyapur, Nizampet and Kukatpally registered a 3% q-

o-q capital value appreciation in the mid-end segment.

Prices in Kolkata also remained sticky except in high-

end properties of South-east (comprising of locations

such as EM Bypass, Christopher Road and Pancha

Sayar) where new units were launched at higher price,

leading to 3% q-o-q capital value increase. A few

micro-markets in Pune witnessed 2-3% q-o-q

increase in capital values in the high-end segment

and 2-8% increase in the mid-end segment. This was

primarily due to project launches at higher prices

and higher demand for properties in close proximity

to the commercial hubs. NCR was the only location

that witnessed q-o-q capital value correction of 3-

9% in certain locations in both the high-and-mid-end

segments, primarily due to subdued demand and

decline in transaction activities.

Nearly 55,500 units were launched in the first

quarter of 2014. The launch activity picked up by 42%

compared to the last quarter of 2013. Ahmedabad

and NCR were the only two cities that registered a

quarterly decline of new launches; 8% and 18%

respectively. Conversely, number of launches almost

tripled in Kolkata and Chennai. The increase in the

number of launches in Kolkata was mainly due to the

launch of a large township project. Maximum number

of project launches was witnessed in Bengaluru

among the top eight cities; it contributed nearly 30%

of the total number of launches in the 8 cities during

the quarter. Mumbai contributed almost 19% of the

units launched. Although NCR witnessed a decline in

the number of new launches, it still featured among

the top three cities with maximum project launches

for the quarter. Pune registered new launches in the

range of 3,500-4,000 units for the third consecutive

quarter. Hyderabad, which registered the lowest

number of launches this quarter (930 units), recorded

a 25% increase from Q4 2013. Going forward, new

launch activity in Hyderabad is likely to remain stable

or increase marginally as several delayed projects are

expected to be launched in H1 2014.

4

NEW RESIDENTIAL UNIT LAUNCHES ACROSS LOCATIONS IN 1Q 2014


35%

30%

25%

20%

15%

10%

5%

0%

Ahm

edab

adBen

galu

ru

Chenn

aiHyd

erab

ad

Kolka

ta

Mum

bai

NCR

Pune

4%

30%

13%

2%

12%

19%

12%

7%

5

Index

Ahmedabad................................................................................... 6

Bengaluru...................................................................................... 9

Chandigarh.................................................................................... 14

Chennai.......................................................................................... 17

Hyderabad..................................................................................... 23

Kolkata........................................................................................... 30

Jaipur........................................................................................... 27

Mumbai.......................................................................................... 35

National Capital Region.............................................................. 40

Pune............................................................................................... 44

Ahmedabad

Market Overview

In 1Q 2014, nearly 2,300 units were launched in

Ahmedabad, a q-o-q decline of 8%. However, the

number of projects launched more than doubled,

indicating absence of any significantly large project

launch in 1Q 2014. Around 30% of the new launches

were concentrated in West Ahmedabad at locations

such as Makarba, Thaltej and Vasna, followed by

Vastral in East (21%) and Ranip in the North (19%).

Approximately 55% of the new unit launches catered

to the mid-end segment and 45% cater to the

affordable segment. Due to stable demand, capital

values remained unchanged during the quarter.

Developers in the city primarily focussed on clearing

existing unsold inventory rather than launching new

projects.

In 1Q 2014, overall net absorption in Ahmedabad

office market was 608,000 sf, more than double the

previous quarter. The substantial increase in net

absorption was due to earlier pre-commitments that

were absorbed during this quarter. The city also

witnessed healthy supply addition of 1 msf office space

during the quarter, an increase of 9% from the

previous quarter.

Given the limited availability of quality spaces and

no new malls becoming operational in the last two

years, overall transaction activity in Ahmedabad’s

mall segment has been insignificant. However, main-

streets in the suburban business districts such as

Prahladnagar and S.G. Highway witnessed increased

enquiries from the BFSI (bank branches, financial

advisors, etc.) and Food & Beverages (F&B) sectors. A

few lifestyle and home improvement brands have also

relocated and expanded operations in these areas. In

1Q 2014, rental values remained stable across all major

malls and main-street locations of the city.

Due to stable demand, ready residential

properties’ capital values remained stable compared

to the previous quarter, across all micro-markets in

the mid-and-high-end segments. End-users’

Trends & Updates

Ready Residential Property Update

preference for emerging locations on the S.G.

Highway and Bopal was high due to availability of units

between INR 20-40 lakhs mainly at these locations.

6

READY RESIDENTIAL PROPERTY VALUES IN MARCH '14

Source: Cushman & Wakefield Research Represents Mid and High End segments

Alitus

Orchid Woods

Maple County

Godrej Garden City

Smarana Apartments

Agora Residency

6,000

5,000

4,000

3,000

2,000

1,000

0

5,400

4,400 4,500

3,3003,600

2,900

In 1Q 2014, number of new launches in Ahmedabad

declined by 8% on a quarterly basis. Launches during

the quarter were scattered across West, East and

North Ahmedabad. Affordable project launches were

primarily in the peripheral locations of South and East

New Residential Launches

Ahmedabad while launches in the mid-segment were

in the West and North Ahmedabad. Approximately

49% of the units launched were 2 BHKs whilst 40%

were 3 BHK and the remaining were 1 BHK and 4 BHK.

* Estimated and as per market information

Project Name Developer Location Number of Units* Type Area of Units (sf)

Malabar County II 442 Apartment 3 BHK: 1,620 to 1,701Ganesh Housing Near Nirma University (S.G. Highway)

Suryam Elegance –

Phase 1322 Apartment 2 BHK: 1,161 to 1,269Suryam Developers Vastral

Aakruti Aangan 320 Apartment 1 BHK: 4052 BHK: 873

Aroma Reality Narol

Satyadeep Heights 320 Apartment 2 BHK: 1,050 3 BHK: 1,450

Deep Group Makarba

Rajyash Reevanta 272 Apartment 2 BHK: 535Rajyash Group Vasna

Aarohi Pratistha 208 Apartment 2 BHK: 1,092 to 1,285Siddhi Developers South Bopal

Silver Casa 176 Apartment 2 BHK: 1,180Avirat Group Thaltej

Suryam Pride 132 Apartment 2 BHK: 1,098 3 BHK: 1,359

Suryam Developers Vastral

Aaryan Opulence 78 Apartment 3 BHK: 2,6754 BHK: 3,450 to 3,520

Aaryan Developers Bopal Ambli Road

Suryam Placid 41 Villas 3 BHK: 1,485Suryam Developers Vastral

Average Capital Values – High End (INR '000/sf)

Satellite

Vastrapur

S.G.Highway

Prahlad Nagar

Location

4.0 - 4.8

3.7 - 4.0

3.7 - 4.3

4.2 - 5.3

2010

4.3 - 6.0

3.7 - 5.0

3.7 - 4.5

4.2 - 6.0

2011

4.3 - 6.0

3.7 - 5.0

3.7 - 4.5

4.2 - 6.0

2012

4.3 - 6.0

3.7 - 5.0

3.7 - 4.5

4.2 - 6.2

2013

4.3 - 6.0

3.7 - 5.0

3.7 - 4.5

4.2 - 6.2

1Q 2014

Source: Cushman and Wakefield Research

Note: The above values for high-end segment typically include units of 2,000-4,000 sf

Average Capital Values – Mid-Segment (INR ‘000/sf)

Satellite

Vastrapur

S.G.Highway

Prahlad Nagar

Location

2.8 - 3.8

2.6 - 3.5

3.0 - 3.8

2.8 - 3.6

2010

2.8 - 4.3

2.6 - 3.8

3.3 - 4.3

3.2 - 4.2

2011

2.8 - 4.3

2.6 - 3.8

3.3 - 4.3

3.2 - 4.2

2012

2.8 - 4.3

2.6 - 3.9

3.0 - 4.3

3.2 - 4.3

2013

2.8 - 4.3

2.6 - 3.9

3.0 - 4.3

3.2 - 4.3

1Q 2014


Note: The above values for mid-end segment typically include units of 1,200-1,800 sf

7

Under Construction Residential Property Update

During 1Q 2014, locations in West Ahmedabad

such as Bopal and South Bopal and Vaishnodevi in

the North witnessed healthy construction activity in

the affordable and mid-end segments. In this

quarter, stable demand levels resulted in stagnating

capital values for under construction projects across

all sub-markets.

Commercial Office Sector

In 1Q 2014, office space net absorption was

concentrated in submarkets of Gandhinagar (66%),

Prahladnagar (25%) and Sarkhej-Gandhinagar

Highway (10%). BFSI (49%), IT-ITeS (33%) and

Pharmaceutical (6%) were the highest contributors

to transaction activity during the quarter. Despite

significant supply, healthy transaction activity

helped to keep vacancy levels under control. In 1Q

2014, Grade A developments’ vacancy levels

increased marginally to 36.3%. Rental values

continued to remain stable from the previous

quarter across all major sub-markets.

Retail Sector

Increasing vacancy levels were noted in a few

malls along the S.G. Highway, resulting in overall mall

vacancy increase of 1.3 percentage points, which was

noted at 31.6% in 1Q 2014. Despite increase in mall

vacancy, landlords continued to quote similar

rentals across all sub-markets. In 1Q 2014, only a few

retailers exited mature main-streets such as C.G.

Road, Law Garden and Satellite Road. In addition,

limited availability of quality spaces led to marginal

opportunities for new retailers to expand at these

locations. Due to the limited transaction activity,

rental values remained stable from the previous

quarter across all main-streets of Ahmedabad.

Outlook

Stable residential real estate demand is likely to

result in stagnant capital values during the next

quarter. However, with economic conditions likely to

improve in H2 2014 (post elections); demand in the

residential segment might improve gradually. The

new Development Control Regulations, which are

now under effect, are likely to result in increased

redevelopment activity in the old city areas (which

have been given higher Floor Space Index - FSI, as a

part of R1 zone).

Approximately 500,000 sf of Grade A space is

expected to become operational at Prahladnagar in

the second quarter of 2014. With low pre-

commitments in these developments, vacancy is

likely to increase in the upcoming quarter. This could

result in a downward pressure on rentals at select

locations in the city.

Healthy demand for main-street locations such as

Prahladnagar and S.G. Highway could result in rental

increase at these locations. In the short-term, mall

rentals at S.G. Highway might witness a correction

due to existing high vacancy levels. Considering

higher preference for main-streets and prevailing

high vacancy levels in malls, developers are not presently

undertaking any new mall construction in the city.

8

Bengaluru

Market Overview


Trends And Updates

In 1Q 2014, quarterly uptrend of 3-7% was noted in

capital values of select mid-end submarkets.

Submarkets like North appreciated as the Hebbal-

Airport expressway became operational, North-west

due to commencement of metro rail line between

Peenya-Sampige Road and Off-Central** because of

supply paucity. Increased interest from employees of

IT-ITeS companies led to a similar trend in Far South

submarket; while demand spill-over from prominent

residential localities like Jayanagar, Banashankari,

etc. led to capital value appreciation in the West.

In 1Q 2014, the Bengaluru residential market

witnessed significant activity with more than 16,800

unit launches, a q-o-q increase of about 22%. Mid-

end segment offerings continued to dominate (75%

of total number of launches) due to continued

demand generated from mid-level employees of IT-

ITeS companies. Similar to the previous quarter, the

Southern submarket contributed heavily (47%) to

the new launches, followed by the Eastern

submarket contributing 36%. Only select

submarkets like North, Off-Central**, North-west,

Far South and West witnessed 3-7% q-o-q capital

value appreciation for the mid-end properties.

In 1Q 2014, nearly 750,000 sf supply was added to

the Bengaluru office sector. Owing to deferment of

select under construction projects, q-o-q supply

declined nearly by 23%. Reiterating last year’s

trend, Outer Ring Road (ORR) accounted for 79% of

the supply in 1Q 2014 approximately. Better

connectivity, close proximity to residential

developments and competitive rentals led to a high

occupier interest at this location, leading to a

significant traction in activity in this region.

Similar to the last year’s trend, in Q1 2014, no new

mall supply was added in the retail market.

Consequently, overall mall vacancy was recorded at

approximately 7.5%, a marginal q-o-q decline of 1%.

Healthy demand from apparel, footwear and F&B

retailers contributed to this decline. Although there

was a drop in overall vacancy, the average quoted

rentals still remained the same as spaces were

leased to premium brands at relatively lower rentals

with an aim to optimize tenant mix in the malls.

Excellent demand existed for upcoming malls in

Northern areas owing to scarcity of operational

malls in this submarket.


9


14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

12,000

10,000

7,250 6,750 7,250 5,250

Brigade Gateway

Prestige Acropolis

Sobha Petunia

Elita Promenade

Brigade Metropolis

Purva Venezia

Key to locations:

High-end Segment

Central: Lavelle Road, Off Palace Road, Off Cunnigham

Road, Ulsoor Road, Richmond Road

South: Koramangala, Outer Ring Road, Bannerghatta

Road, JP Nagar

Off-Central: Frazer Town, Benson Town, Richards Town,

Dollars Colony

East: Whitefield (villas)

North: Hebbal, Yelahanka, Jakkur, Devanahalli

Mid-end Segment

Central: Brunton Road, Artillery Road, Ali Askar Road,

Cunningham Road

East: Marathalli, Whitefield, Old Airport Road

South-East: Sarjapur Road, Outer Ring Road, HSR

Layout

South: Kormangala, Jakkasandra

South-West: Jayanagar, J P Nagar, Kanakpura Road,

Bannerghatta Road, BTM Layout

North: Hebbal, Bellary Road, Yelahanka, Dodballapur

Road, Jalahalli

Off-Central*: Vasanth Nagar, Richmond Town,

Indiranagar

Off-Central**: Cox Town, Frazer Town, HRBR, Benson

Town, etc

North-West: Malleshwaram, Rajajinagar

10


Note: The above values for mid-end segment typically include units of 1,600-2,000 sf.

Average Capital Values – Mid-Segment (INR’000/sf)

Location

Central

East

South-East

North

South-West

Off-Central*

Off-Central**

North-West

South

2008

5.8 - 7.0

2.7 - 3.1

2.9 - 4.0

3.0 - 4.0

2.8 - 4.2

3.5 - 6.0

4.0 - 6.0

4.2 - 5.8

5.0 - 6.5

2009

5.0 - 6.0

2.4 - 2.7

2.5 - 3.2

2.8 - 4.0

2.7 - 3.9

3.3 - 5.7

3.7 - 5.7

3.5 - 5.2

4.6 - 5.7

2010

5.5 - 7.0

2.7 - 3.1

2.8 - 4.0

2.8 - 4.4

3.2 - 4.5

4.0 - 6.2

3.8 - 6.2

3.8 - 5.6

4.8 - 6.0

2011

6.0 - 7.5

3.2 - 3.8

3.4 - 5.0

3.0 - 4.8

3.6 - 5.0

4.5 - 6.7

4.3 - 6.7

4.3 - 6.2

5.0 - 6.5

2012

6.0 - 8.0

3.8 - 4.8

4.0 - 5.5

3.5 - 5.5

4.0 - 5.5

5.0 - 7.5

5.0 - 7.0

4.5 - 6.5

6.0 - 9.0 6.0 - 9.0 6.0 - 9.0

1Q 2014

9.0 - 12.0

4.0 - 5.5

4.5 - 6.0

4.5 - 6.5

7.0 - 10.0

6.5 - 8.5

6.0 - 6.5

2013

9.0 - 12.0

4.0 - 5.5

4.5 - 5.9

4.5 - 6.5

7.0 - 10.0

6.0 - 8.0

5.5 - 6.5

3.8 - 5.53.5 - 5.5


Note: The above values for high-end segment typically include units of 2,000-4,000 sf.

Location

Central

South

Off-Central

East

North

2009

12.0 - 14.5

6.0 - 8.5

5.0 - 6.8

5.6 - 7.0

5.5 - 7.0

2010

13.5 - 17.5

6.0 - 9.5

5.0 - 7.0

6.5 - 7.5

5.5 - 7.0

2011

14.0 - 18.0

6.5 - 10.0

6.0 - 8.5

6.8 - 8.0

6.5 - 8.0

2012

18.0 - 28.0

6.5 - 10.0

7.0 - 9.0

6.5 - 9.0

6.5 - 8.2

1Q 2014

18.0 - 30.0

7.0 - 10.3

8.0 - 11.0

6.5 - 10.0

7.0 - 9.5

2013

18.0 - 30.0

6.8 - 10.3

8.0 - 11.0

6.5 - 10.0

7.0 - 9.5

Average Capital Values – High-end (INR’000/sf)

2008

14.0 - 18.0

7.0 - 9.0

6.5 - 7.5

6.5 - 9.0

6.0 - 8.0


In 1Q 2014, 16,800 units were launched in

Bengaluru, a q-o-q increase of around 22%.

Reiterating past trends, mid-end segment continued

to dominate launches with around 75% contribution

while affordable segment accounted for an

additional 18%. Majority of the demand was

propelled by junior to mid-level employees working

in IT-ITeS companies; developers focussed on mid-

end segment offerings. Locations such as Sarjapur

Road and Electronic City located in the Southern

submarket accounted for 47% of the new launches

while the Eastern submarket including Varthur Road

contributed additional 36%. Availability of adequate

social infrastructure and proximity to workplaces

has been instrumental in sustaining buoyant

demand for Eastern and Southern submarkets.

Location Number of Units* Type Area of Units (in sf)Project Name Developer

Prestige Lakeside Habitat

Prestige Group Varthur Road 3,426 Apartment 2 BHK: 905 to 1,3463 BHK: 1,655 to 2,3384 BHK: 2,830

Purvankara Palm Beach

Purvankara Developers

Hennur Road 1,323 Apartment 2 BHK: 1,2323 BHK: 1,481 to 1,846

Republic of Whitefield Divyasree Developers

Whitefield 1,306 Apartment 2 BHK: 712 to 1,3723 BHK: 1,724

Indya Greens - Phase II

Indya Estates Attebelle-Anekal Road 1,278 Apartment 2 BHK: 695 to 8903 BHK: 1,118 to 1,202

Shriram Summit Shriram Properties Electronic City 947 Apartment 1 BHK: 670 to 7802 BHK: 1,190 to 1,3103 BHK: 1,370 to 1,640

Sobha Silicon Oasis Sobha Developers Kudlu Junction, Hosur Road

918 Apartment 2 BHK: 1,3503 BHK: 1,500 to 1,850

Purvankara West End Purvankara Developers Hosur Road 740 Apartment 2 BHK: 1,1843 BHK: 1,415 to 18,91

MJR Clique MJR Group Electronic City 585 Apartment 1 BHK: 6652 BHK: 1,140 to 1,3153 BHK: 1,425 to 1,720

SJR Hamilton Homes SJR Developers Off Sarjapur Road 408 Apartment 1 BHK: 6232 BHK: 9373 BHK: 1,229 to 1,400

Hiranandani Queensgate

House of Hiranandani

Bannerghatta Road 400 Apartment 1 BHK: 5652 BHK: 985 to 1,2053 BHK: 1,685

VRR Fortuna VRR Builders & Developers

Sarjapur Road 388 Apartment 2 BHK: 1,300 to 1,3703 BHK: 1,680 to 1,745

Kolte Patil Mirabilis Kolte Patil Horamavu 386 Apartment 2 BHK: 1,100 to 1,3893 BHK: 1,488 to 1,5934 BHK: 2,266

Alpine Fiesta Alpine Developers Whitefield 320 Apartment 2 BHK: 936 to 1,2213 BHK: 1,399

Unishire Spacio Unishire Developers Bannerghatta Road 300 Apartment 2 BHK: 1,266 to 1,2943 BHK: 1,539 to 2,156

Hiranandani Glen Gate House of Hiranandani Hebbal 288 Apartment 2 BHK: 1,245 to 1,4203 BHK: 1,630 to 1,665

Prestige Lakeside Habitat

Prestige Group Varthur Road 271 Villas 3 BHK: 3,117 to 3,1304 BHK: 4,003 to 4,934

Bren Woods Bren Corporation Electronic City 254 Apartment 2 BHK: 1,046 to 1,0623 BHK: 1,281 to 1,377

11

12

HRC Ibbani HRC Developers Jakkur 243 Apartment 2 BHK: 1,279 to 1,4503 BHK: 1,645 to 1,687

Supertech Micasa Supertech Developers Thanisandara Main Road

224 Apartment 2 BHK: 1,100 to 1,1363 BHK: 1,386 to 1,735

ND Orchids ND Developers Sarjapur Main Road 220 Apartment 2 BHK: 810 to 9953 BHK: 1,235 to 1,360

Manar Pure Earth Manar Developers Sarjapur Road 208 Villas 3 BHK: 1,675 to 2,3164 BHK: 3,972

GR Sankalpa GR Constructions Sarjapur Road 185 Apartment 2 BHK: 1,175 to 1,3503 BHK: 1,440 to 1,450

Lilium Gardenia Dhammangani Developers

Off ThanisandaraRoad

185 Apartment 2 BHK: 977 to 1,0453 BHK: 1,431 to 1,593

LGCL New Life LGCL Developers Harlur Road 170 Apartment 3 BHK: 1,300 to 2,5004 BHK: 2,500 to 3,000

Trifecta Starlight Trifecta Developers Mahadevpura 166 Apartment 2 BHK: 1,045 to 1,2123 BHK: 1,313 to 1,337

Aparna Elina Aparna Group Yeshwantpur 152 Apartment 3 BHK: 1,940 to 2,1004 BHK: 2,610 to 3,8355 BHK: 5,310

Sai Vadana Brindavanam

Sai Vadana Developers

Sarjapur Road 150 Apartment 2 BHK: 1,118 to 1,4013 BHK: 1,465 to 1,666

Concorde Amber Concorde Group Sarjapur Road 150 Apartment 2 BHK: 1,100 to 1,2003 BHK: 1,300 to 1,400

Max Meridian Maxworth Realty Yelahanka 147 Apartment 2 BHK: 975 to 1,5703 BHK: 1,880

Pride Wilasa Pride Housing JP Nagar 138 Apartment 3 BHK: 2,791 to 2,9294 BHK: 3,498 to 3,621

TG Lakeside Vista TG Developers Begur 128 Apartment 2 BHK: 1,097 to 1,2083 BHK: 1,341 to 1,625

Nester Harmony Nester Group Whitefield 127 Apartment 2 BHK: 9483 BHK: 1,183 to 1,644

Cauvery Serenity Cauvery Developers Yeshwantpur 124 Apartment 2 BHK: 1,223 to 1,3583 BHK: 1,783 to 1,9994 BHK: 1,936 to 2,387

President Leone President Properties Yelahanka 109 Apartment 3 BHK: 1,150 to 1,845

Mahaghar's Vajra Mahaghar Developers Kanakpura Road 96 Apartment 2 BHK: 850 to 1,1953 BHK: 1,300 to 1,535

Mantri Courtyard Mantri Developers JP Nagar 95 Villas 3 BHK: 1,690 to 2,1004 BHK: 2,795 to 3,495

VRR Vista Sarovar VRR & Co. Whitefield 72 Apartment 2 BHK: 1,100 to 1,2403 BHK: 1,360 to 1,420

Eternity Astral Eternity Structures Bellandur 72 Apartment 2 BHK: 980 to 1,1253 BHK: 1,360 to 1,430

Chartered Grasshopper

Chartered Housing Off Hosur Road 56 Villas 3 BHK: 3,5004 BHK: 3,990

Unishire Signature Unishire Developers Jakkur 53 Apartment 3 BHK: 2,300 to 2,5004 BHK: 2,700 to 2,900

Samruddhi Bliss Samruddhi Developers Hosa Road 40 Apartment 2 BHK: 1,2003 BHK: 1,400

Purva Coronation Square

Purvankara Developers

JP Nagar 20 Villas 4 BHK: 6,095 to 6,400


Retail Sector

Most main streets witnessed q-o-q stability in

rental values. However, there was a q-o-q rental

decline of around 7% for properties located on the

Vittal Mallaya Road, due to a drop in trading densities.

In addition, main streets like Commercial Street,

Brigade Road, Jayanagar 4th Block and Kormangala

80 Feet Road continued to witness demand from

apparel, electronics, footwear and F&B retailers.


In 1Q 2014, 1.5 msf of office space was leased in

Bengaluru whilst net absorption accounted for only

33% of the leasing activity. Nearly 68% q-o-q decline

in net absorption was noted primarily due to

downsizing and relocations of a few select companies.

94% of the leasing activity was in Grade A

developments, indicating tenants’ preference for

quality commercial spaces. In line with the past trend,

IT-ITeS sector accounted for more than 81% of the

transaction activity in 1Q 2014. Pre-commitments

(700,000 sf) recorded a q-o-q drop of nearly 19%, all

of which was concentrated in the peripheral

submarket of ORR (Sarjapur-Marathahalli) and were

committed by IT-ITeS occupiers.

Capital values for mid-end projects in North, East

and North-west submarkets are expected to

improve in the future periods due to a variety of

factors, including commencement of Hebbal-airport

expressway and metro rail along with existing

inherent demand from IT-ITeS population.

Due to continued high level of enquiries for small

and mid-sized spaces, office leasing activity is

expected to increase in the next quarter. Going

forward, rental values are anticipated to remain

stable due to significant pipeline of under

construction projects.

Outlook

Rentals for most of the malls are expected to

remain in a similar range during the future periods.

Also, most main streets are anticipated to witness

stability in rentals. Although prominent main streets

have been witnessing healthy enquiry levels, there is

a delay in deal closures. However, there might be a

downward pressure on rentals of main streets such

as Indiranagar, 100 Feet Road and MG Road owing to

non-availability of optimum sized spaces.


Under construction residential projects in the

Southern submarkets (Sarjapur Road, ORR,

Sarjapur-Marathahalli, etc.) witnessed q-o-q capital

value appreciation of upto 9% while projects in

Eastern (Whitefield, Old Madras Road, etc.) and the

Northern (Doddaballapur Road, Malleshwaram, etc.)

submarkets recorded q-o-q rise of upto 5%.

Sustained demand from IT-ITeS employees working

in nearby places led to price hike in Southern and

Eastern locations. Commencement of infrastructure

projects such as Hebbal-Airport expressway and

metro rail led to rise in prices at Northern locations.

Bren Celestia on Sarjapur Road and Rohan Jharoka-

Phase II on Old airport road are select residential

projects nearing completion as of 1Q 2014.

13

Market Overview

Chandigarh

The residential sector of the Tri-City depicted a

sluggish launch trend with no new units added in the

first quarter of 2014. Slow pace of construction also

resulted in no project being handed-over to the

buyers during this quarter. However, GMADA’s

(Greater Mohali Area Development Authority)

issuance of Letter of Intent (LoI) for allotment of

approximately 50 acres of land to Infosys improved

buyer interest in the adjoining submarkets of

Zirakpur and Mohali. Capital values remained

stagnant in the high-end segment with a marginal

decline in the mid-end segment from the previous

quarter.

Due to completion delay in many projects, the Tri-

City did not witness any new office space supply

addition in 1Q 2014. The demand for office space in the

Tri-City was primarily driven by the Media and the BFSI

sectors. The rentals of Grade A office space increased

by approximately 10% from the previous quarter.

Approximately 1.1 msf of new mall space was added

to the Tri-City in the first quarter of 2014. As the

transaction activity was primarily concentrated in

main-street locations, mall vacancies increased. The

increase in mall vacancy was further fuelled by new

supply added to the market. During the quarter,

prominent main street locations of Sector 17, 20 and

35 witnessed healthy demand from apparel and F&B

retailers.


Trends And Updates

In 1Q 2014, demand for residential property

remained subdued across the Tri-City as expectations

of probable decline in capital values kept end-users at

bay. Due to the subdued transaction activity, the high-

end segment capital values in central Chandigarh

remained stable from the previous quarter. However,

the mid-end segment's capital values declined by 5-

10% in ready properties.


14


14,000

16,000

3,650

Marble Arch

Gilco Towers

Motia Heights

Orchard County

Pearls Group

ATS Gold Meadows

3,500 2,950 3,350 3,100

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

Location

Chandigarh Sector: 2-11

Chandigarh Sector: 28

Panchkula

Manimajra

4Q 2012

160,000 - 180,000/sqyd

140,000 - 170,000/sqyd

110,000 - 145,000/sqyd

13,000/sf

1Q 2013

160,000 - 180,000/sqyd

140,000 - 170,000/sqyd

110,000 - 145,000/sqyd

13,000/sf

2Q 2013

160,000 - 180,000/sqyd

140,000 - 170,000/sqyd

110,000 - 145,000/sqyd

13,000/sf

1Q 2014

155,000 - 170,000/sqyd

140,000 - 160,000/sqyd

110,000 - 145,000/sqyd

14,000/sf

4Q 2013

155,000 - 170,000/sqyd

140,000 - 160,000/sqyd

110,000 - 145,000/sqyd

14,000/sf

3Q 2013

160,000 - 180,000/sqyd

140,000 - 170,000/sqyd

110,000 - 145,000/sqyd

13,000/sf

Average Capital Values - High-end segment (INR)


Note: The above values for high-end segment typically include units of 2,000-4,000 sf, both apartments and villa *sqyd: Square Yard

Location

Zirakpur

Mohali

Dera Bassi

Panchkula

4Q 2012

2,500 - 3,600

3,000 - 4,000

3,000 - 3,200

2,700 - 3,300

3Q 2013

2,500 - 3,600

3,000 - 4,000

3,000 - 3,200

2,700 - 3,300

1Q 2014

2,800 - 3,400

3,000 - 3,800

2,800 - 3,200

2,800 - 3,400

4Q 2013

2,800 - 3,600

3,200 - 4,000

3,000 - 3,200

2,800 - 3,500

2Q 2013

2,500 - 3,600

3,000 - 4,000

3,000 - 3,200

2,700 - 3,300

1Q 2013

2,500 - 3,600

3,000 - 4,000

3,000 - 3,200

2,700 - 3,300

Average Capital Values – Mid Range (INR/sf )


Note: The above values for mid-segment apartments typically include units of 1,600-2,000 sf

15

Mid-end Segment:

Mohali: Sectors - 114, 115, 127

Panchkula: Sector - 20

High-end Segment:

Panchkula: Sectors - 2, 4, 6, 7, 8, 9, 15

Key to Locations:

Due to significant unsold inventory and cautious

buyer sentiment, the Tri-City did not witness any

new launches in the first quarter of 2014. Also, no

new projects were “soft-launched” in this quarter as

developers focussed primarily on clearing existing

unsold inventory.


The Tri-City did not witness any project completions

during the first quarter of 2014. Moreover, capital values

of under-construction projects declined by 5-7% due to

unsold inventory pile-up.



Rental values of commercial office spaces in the

Tri-City improved q-o-q by nearly 10% during the

first quarter of 2014. This was primarily due to

demand generated from media, BFSI and

manufacturing companies. Quoted rentals for IT

Parks and SEZs was around INR 50-60 per square

feet per month (psf per month) and commercial

spaces was INR 70-90 psf per month.

Demand for retail spaces was noted primarily in

the main street locations with apparel and F&B

brands such as Louise Phillipe and Subway

strengthening their market presence in the Tri-City.

Retail space in malls was primarily taken up by the

Retail Sector

automobile sector with brands such as Volvo and

Land Rover opening stores in the city. New supply

addition led to increase in vacancy levels. Rental

values in malls maintained status quo at around INR

300 psf per month during the first quarter of 2014.

Due to subdued buyer interest, capital values are

likely to remain under pressure in the region during

the next quarter. With the new international terminal

at Mohali airport nearing completion, the adjoining

areas may witness increased interest from buyers.

Furthermore, with elections around the corner,

developers are pinning hopes on better sales during

the next quarter.

Demand for office space is expected to be stable

in the second quarter of 2014. More than 450,000 sf

of new office space is scheduled for completion in

the next quarter. Rentals are likely to remain stable

over the next quarter.

Outlook

Approximately 150,000 sf of new supply is likely

to be added in the Tri-City retail sector during the

second quarter of 2014. Although there is a steady

demand for quality retail spaces, significant supply

addition during this quarter led to higher vacancy.

As a result, the rentals are likely to remain stable

during the next quarter.

16

Trends And Updates


Prominent real estate developers such as Jain

Housing and Constructions, Land Marvel, Navin

Housing, KGEYES Residency and Vijay Shanthi

Builders handed over projects in locations such as

Kilpauk, Mylapore, Manapakkam, Besant Nagar and

GST Road. In 1Q 2014, 1,400 residential units were

completed, of which 77% belonged to the mid-end

segment, followed by 12% in the high-end segment.

Capital values largely remained stable for almost all

locations in Chennai. However, Poes Garden (high-

end segment) which is a prime residential location,

witnessed 6% q-o-q capital value appreciation due

to continued strong demand. Also, T.Nagar (mid-end

segment) witnessed 4% q-o-q capital value

appreciation due to high demand amongst end-

users for this central location, which is in proximity

to primary and secondary business centres.

Chennai

Market Overview

In 1Q 2014, 7,400 units were launched in the

Chennai residential real estate market, recording a

substantial increase from the previous quarter.

Locations such as Rajiv Gandhi Salai and Grand

Southern Trunk (GST) Road witnessed maximum

number of launches (51%) in 1Q 2014. Of the total

units launched, 90% were in the mid-end segment.

The high-end segment witnessed 37% q-o-q

increase in the number of launches; locations such

as Nungambakkam, Kotturpuram and Anna Nagar

accounted for majority of new units in this segment.

In 1Q 2014, overall leasing (all grades) in Chennai’s

office property market declined 26% on a q-o-q

basis and was recorded at 865,000 sf. Corporate

occupiers continued preference for Grade A spaces.

This was evident as 85% of leasing transactions

were concluded in such assets. However, significant

downsizing along with relocations reduced the net

absorption level, which was noted at 90,000 sf for

Grade A assets. 176,000 sf of supply across all

grades was infused into the market, of which only

18% was Grade A (in Suburban-South West

submarket). The overall vacancy rate in Chennai

dipped marginally by 0.1 percentage point and was

noted at 15.3%.

In 1Q 2014, Chennai’s retail market did not witness

any new mall supply addition. However, growing

demand for select shopping malls in Chennai-CBD

and Chennai-South led to a marginal q-o-q decline of

0.2 percentage points in mall vacancy and was noted

at 6.2%. However, enquiries from domestic retailers

of apparel, footwear and F&B remained high in these

sub-markets. Rentals for most high streets largely

remained stable during the quarter.


17


20,000

16,000

12,000

8,000

4,000

0

17,00018,500

15,000

10,00012,000

9,150

Appaswamy Midtown

Lancor Coral

Golden Altius

Newry Shreenidhi

True Value Homes Eden

Ceebros Boulevard


In 1Q 2014, 7,400 new residential units were

launched in Chennai, which is a substantial rise of

190% from the previous quarter. 44% of these units

were in large projects, in peripheral locations of

Kelambakkam, Perumbakkam and Padur in Rajiv

Gandhi Salai. Developers such as True Value Homes,

Adroit Urban Developers, Vijay Shanthi Builders,

Casa Grande and Voora Group were the key

developers of these projects. This quarter also

witnessed more than 120 unit launches in the luxury

segment in locations such as Kotturpuram and

Nungambakkam.


Note: The above values for mid segment typically include units of 1,000-2,000 sf

The time series have been adjusted to reflect the updated values

Location

Adyar

Average Capital Values – Mid Segment (INR ’000/sf)

Rajiv Gandhi

Salai (Perungudi)

Velachery

T. Nagar

Mylapore

Mogappair

Kilpauk

2009

4.5 - 6.5

2.5 - 2.8

3.5 - 4.0

4.0 - 6.5

NA

NA

4.5 - 6.0

2008

4.5 - 6.5

2.5 - 3.6

3.8 - 4.2

4.0 - 6.5

NA

NA

4.5 - 6.0

2010

6.0 - 8.5

3.5 - 4.5

3.5 - 5.0

7.5 - 10.5

NA

NA

6.0 - 8.0

2011

8.0 - 11.0

4.0 - 5.5

3.5 - 5.5

8.5 - 11.5

8.0 - 12.5

5.0 - 5.5

7.5 - 9.5

2012

9.0 - 13.0

5.0 - 6.3

4.5 - 6.5

8.5 - 14.0

10.0 - 15.0

5.0 - 6.5

9.0 - 12.0

10.0 - 14.0

5.0 - 6.3

6.0 - 8.0

10.0 - 16.0

12.0 - 17.0

5.0 - 7.5

9.0 - 12.0

1Q 2014

10.0 - 14.0

5.0 - 6.3

6.0 - 8.0

10.0 - 16.0

12.0 - 17.0

5.0 - 7.5

9.0 - 12.0

2013



The time series have been adjusted to reflect the updated values

*RA Puram also includes Alwarpet and Abhiramapuram

**Poes Garden also includes Venus Colony and Kasturi Rangan Road

Location 2008

18.0 - 24.0

13.0 - 15.0

NA

NA

5.5 - 10.0

14.5 - 20.0

13.0 - 16.0

6.0 - 9.0

4.0 - 8.0

Boat Club

R.A Puram*

Besant Nagar

Kotturpuram

Adyar

Poes Garden**

Nungambakkam

Anna Nagar

Kilpauk

2010

18.0 - 23.0

13.0 - 16.5

NA

NA

8.0 - 12.0

14.5 - 20.0

13.0 - 16.5

7.5 - 10.5

8.0 - 12.0

2009

18.0 - 20.0

13.0 - 15.0

NA

NA

5.5 - 9.5

14.5 - 18.0

13.0 - 16.0

6.0 - 9.0

4.0 - 8.0

2011

20.0 - 25.0

14.0 - 17.0

12.5 - 13.5

12.0 - 14.0

11.5 - 13.5

17.5 - 24.5

13.0 - 17.0

8.0 - 11.5

9.0 - 15.0

2013

23.0 - 33.0

17.0 - 23.0

13.5 - 15.0

14.0 - 20.0

14.0 - 17.5

20.5 - 28.0

14.0 - 25.0

12.0 - 17.0

12.0 - 16.0

2012

23.0 - 27.0

15.0 - 19.0

13.0 - 14.5

14.0 - 16.0

13.0 - 14.5

18.5 - 25.0

17.0 - 20.0

12.0 - 14.0

12.0 - 15.0

1Q 2014

23.0 - 33.0

17.0 - 23.0

13.5 - 15.0

14.0 - 20.0

14.0 - 17.5

20.5 - 33.0

14.0 - 25.0

12.0 - 17.0

12.0 - 16.0

Average Capital Values - High-End Segment (INR ‘000/sf)

18

Project Name Developer Location Number of Units* Type Area of Units (in sf)

VGN Hazel VGN Developers Avadi 781 Apartments 1 BHK: 570 to 578

2 BHK: 1,057 to 1,167 Eden Park - Phase II L&T Realty Siruseri, OMR 720 Apartments 1 BHK: 580

2 BHK: 1,100 to 1,135

3 BHK: 1,655 to 2,155

Santorini - Phase I Tata Value Homes Sriperumbudur 512 Apartments 1 BHK: 576

2 BHK: 855 to 1,008

3 BHK: 1,385 to 1,539

Vidyasagar Oswal Garden - Phase II

ISP Infrastructure Pvt. Ltd. (Voora Group)

Korukkpet 388 Apartments 2 BHK: 1,029

3 BHK: 1,281 to 1,634

4 BHK: 2019 Vasanthaa - II Arun Excello Padappai 388 Apartments 1 BHK: 375 Alexandriea ASV Constructions Before

Shollinganallur, OMR

374 Apartments 3 BHK: 1,850

4 BHK: 2,750

The Terraces Unitech Vandalur 300 Apartments 3 BHK: 1,374 Ruby Landmark Ruby Builders Varadhararjpuram 298 Apartments 2 BHK: 1,101 to 1,141

3 BHK: 1,360 to 1,518 District S - Phase I Adroit Urban Developers Thalambur

Main Road264 Apartments 1 BHK: 606 to 626

2 BHK: 922 to 978

3 BHK:1,254 to 1,278

Tiana Hiranandani Developers Egattur 262 Apartments 2 BHK: 975 to 1,205

3 BHK: 1,095 to 1,435

Purva Swanlake Sky Condos Series

Puravankara Projects Ltd Kelambakkam 234 Apartments 2 BHK: 1,075 to 1,330

2.5 BHK: 1,539 to 1,579

3 BHK: 1,699 to 1,805

Pristine Acres - Phase II

Plaza Group Perumbakkam 232 Apartments 1 BHK: 567 to 570

2 BHK: 910 to 973

3 BHK: 1,206 to 1,499 TVH Aura True Value Homes Padur, OMR 190 Apartments 2 BHK: 1,235 to 1,245

3 BHK: 1,447 to 1,525 Aldea Casa Grande Private

LimitedThoraipakam 184 Apartments 1 BHK: 574 to 583

3 BHK: 1,423 to 1,695

4 BHK:1,919 to 1,986

Oceanique Altis Properties East Coast Road 180 Apartments 2 BHK: 1,252 to 1,255

3 BHK: 1,632 to 2,584 Ashraya BBCL Thoraipakkam 160 Apartments 2 BHK: 1,070 to 1,120

3 BHK: 1,110 to 1,480 Malles Aatmika Malles Constructions Mannivakkam 154 Apartments 2 BHK: 923

2.5 BHK: 1,120

3 BHK: 1,217 to 1,453 Daffodils Deva Constructions Potheri 152 Apartments 2 BHK: 982 to 1,112

3 BHK: 1,119 to 1,400 Suncity - Phase II Amarprakash Developers Tiruvallur 136 Apartments 1 BHK: 450 to 580

2 BHK: 650 to 725

BBCL Vajra BBCL Mogappair 134 Apartments 2 BHK: 1,306

3 BHK: 1,846 to 1,850 Shreyas Villas Sare Homes Singaperumalkoil 130 Villas 3 BHK: 2,316 to 2,616 Pavillion - Phase II Casa Grande Pvt. Ltd Thalambur 127 Apartments 3 BHK: 1,193 to 1,771

4 BHK: 2,325 Artistica Adroit Urban Shollinganallur 124 Apartments 3 BHK: 1,444 to 2,250

4 BHK: 2,500 to 4,700 Shriram OneCity Shriram Properties Valarpuram 118 Apartments 2 BHK: 1,032 to 1,048

3 BHK: 1,200

4 BHK: 1,555

19


Advaya Royal SplendourDevelopers

Porur 81 Apartments 2 BHK: 715 to 1,130

3 BHK: 1,346 to 1,435

Royal Creek Raba Promoters (P) Ltd Mangadu Village 72 Apartments 2 BHK: 750 to 1,050

2.5 BHK: 1,120

3 BHK: 995 to 1,330

Euphoria Doshi Housing Perungudi 67 Apartments I BHK: 414 to 825

Pace Aagam Pace Builders Medavakkam 66 Apartments 2 BHK: 1,177 to 1,181

3 BHK: 1,632 to 1,847

VGN Imperia - Phase IV VGN Developers ML Nagar, Velappanchavadi

64 Apartments 2 BHK: 986 to 1,077

3 BHK: 1,300 to 1,320

Vogue Casa Grande Pvt. Ltd Perumbakkam 56 Apartments 2 BHK: 1,218 to 1,271

3 BHK: 1,453 to 1,701

RKC Subrabath Raj Kishore Developers Pvt. Ltd.

Kumaran Colony, Vadapalani

48 Apartments 2 BHK: 1,100 to 1,394

3 BHK: 1,496 to 1,600

Park Residence Olympia Group Kotturpuram 32 Apartments 3 BHK: 2,766 to 3,047

4 BHK: 3,155 to 3,581

5 BHK: 5,137

Lantern's Court Casa Grande Private Limited

Thoraipakkam 32 Apartments 3 BHK: 1,392 to 1,633

Firm's Tranquility Firm Foundations & Housing

Velachery 32 Apartments 2 BHK: 1,055

3 BHK: 1,375

Matrix Mini P dot G Constructions Potheri 32 Apartments 2 BHK: 630 to 892

Athena Sreerosh Properties Nolambur, Mogappair (W)


3 BHK: 1,405 to 1,630

The Art Vijay Shanthi Builders Nungambakkam 21 Apartments 4 BHK: 5,498 to 5,969

Galileo KGEYES Anna Nagar (East)


Urbano - Phase II Casa Grande Pvt. Ltd. Ponmar, Near Medavakkam

20 Apartments 3.5 BHK: 1,486 to 1,960

Celestyn - Phase II Jeyyes Housing Developers Perumbakkam 16 Apartments 1 BHK: 557

2 BHK: 786

3 BHK: 1,015 to 1,180

Ananya BBCL Five Furlong Road, Velachery


Serenity Newry Properties Gandhi Nagar, Adyar


I Sky Villas Vijay Shanthi Builders Corporation Rd,Perungudi


Livia@Luz Church Livia Spaces Mylapore 12 Apartments 3 BHK: 3,200

4 BHK: 5,800

Rampon Flats Rampon Infratech Ram Nagar (S), Madipakkam

12 Apartments 2 BHK: 784 to 900

3 BHK: 998 to 1,314

Amara Avana AR Group Nungambakkam 11 Apartments 4 BHK: 4,200

Ananta KG 5 Poes Garden 8 Apartments 3 BHK: 3,800 to 6,000

Navin's Sumathi Navin Housing Alandur 8 Apartments 3 BHK: 1,264

LCS Natraj LCS City Makers Pvt. Ltd. Shastri Nagar, Adyar


Y Block Vishwakarma Properties Anna Nagar (W) 8 Apartments 2 BHK: 900 to 1,100

3 BHK: 1,250

Pleasant Agni Estates & Foundations Perungudi 8 Apartments 2 BHK: 1,132

Elite Newry Properties Cathedral Garden Road, Nungambakkam


Mayfair Newry Properties CBI Colony, Perungudi

8 Apartments 2 BHK: 954 to 1,026

3 BHK: 1,518 to 1,556

20


Sirius Adroit Urban Developers T. Nagar 7 Apartments 3 BHK: 1,979 to 2,700

Carnation Newry Properties New Avadi Road, Kilpauk


Aurum Atikramya Tambaram - West 6 Apartments 2 BHK: 1,005 to 1,056

Padmalaya India Builders Anna Nagar 6 Apartments 3 BHK: 1,461 to 1,492

Newry Daffodils Newry Properties Thiruvika 3rd Street, Mylapore

6 Apartments 2 BHK:1,336

3 BHK: 1,784

Mithila Pushkar Properties Pvt. Ltd. Shenoy Nagar East, Kilpauk


JBM Manas JBM Shelters Pvt. Ltd. Chrompet 6 Apartments 2 BHK: 812 to 1,008

Imperia Adroit Urban Developers Nungambakkam 5 Apartments 3 BHK: 2,375 to 2,670

4 BHK: 5,012 to 5,143

By The C Ceebros East Coast Road 4 Apartments 4 BHK: 3,650

Dhanalakshmi Sreenivas Housing Pvt. Ltd. Madipakkam 4 Apartments 2 BHK: 1,015 to 1,022

The Nest Pushkar Properties Pvt. Ltd.

Anna Nagar 4 Apartments 3 BHK: 1,550

Bonsai Spero Spero Holdings Kotturpuram 3 Apartments 4 BHK: 2,850

Shiv Krish India Builders Anna Nagar (E) 3 Apartments 4 BHK: 2,775


Current market conditions remain subdued and this

continued to impact the end-user sentiment, leading to

a slower pace of construction activity in several micro

markets. More than 6,600 residential units scheduled

to complete in 1Q 2014 were not delivered and are


expected to be ready by 2Q 2014. However, due to end-

users’ interest in projects at final stages of completion,

prices of a few under-construction projects in Rajiv

Gandhi Salai, Besant Nagar and Velachery marginally

improved from the previous quarter.


Grade A spaces in Suburban-Rajiv Gandhi Salai

and Suburban-South West accounted for the

maximum share in net absorption. IT and IT-SEZ

buildings accounted for a major chunk of the leasing

activity for Grade A properties with an average

ticket size of 37,000 sf. IT-ITeS and Automobiles

sector accounted for 39% and 23%, respectively, of

the total gross absorption for Grade A assets. The

weighted average rentals depicted a marginal q-o-q

improvement of 2.5% primarily due to an increase in

net rentals for Peripheral-GST; only buildings with

higher rentals were currently vacant in this area.

In 1Q 2014, prevalent cautious sentiments amongst

retailers prevented any upward bias in rentals for

most high streets of Chennai. However, q-o-q rentals

increased by 5% on Khadar Nawaz Khan Road due to

high retailer interest at this prime location. Some

Retail Sector

retailers in Velachery and Usman Road-North

preferred to relocate to nearby shopping malls due to

which, rentals at both these high streets witnessed a

q-o-q decline of around 3.6%.

21

More than 4,200 units are currently in the pre-

launch stage and are expected to be launched during

the next six months. Of these, 76% belonged to the

mid-end segment in locations such as Rajiv Gandhi

Salai and Suburban-South. The high-end segment is

likely to account for 17% of these proposed launches

with new units at Nungambakkam and Kotturpuram.

In addition, more than 6,100 units are likely to

complete during 2Q 2014, which will infuse

significant new supply in the market and might lead

to short-term stability in capital values.

In 2Q 2014, 566,000 sf new office space supply is

likely to be infused in Chennai, of which 490,000 is in

Grade A. This sizeable upcoming supply will mainly

be concentrated in Suburban-South West, CBD and

Peripheral-GST, which might increase the vacancy

levels in these micro markets and bear a negative

impact on 2Q 2014 weighted average rentals.

Outlook

No new mall supply is likely to be infused in 2Q

2014. Amongst high streets, only Khadar Nawaz

Khan Road might witness rental appreciation in 2Q

2014 owing to availability of quality retail premises

at this prime location. Limited availability of quality

mall spaces and high-level of enquiries from apparel,

electronics and footwear retailers might lead to an

improvement in Chennai-CBD and Chennai-South

rentals.

22

Market Overview

Hyderabad

In 1Q 2014, approximately 900 new residential

units were launched in Hyderabad, a q-o-q increase of

25%; mid-end and high-end segment accounted for

77% and 21%, respectively. The launches were

primarily concentrated in North-west quadrant of the

city in locations such as Gachibowli and Kompally.

Continued cautious buyer approach led to stability in

capital values from the previous quarter across most

micro-markets. The North-west quadrant of the city

continues to be the most active in terms of new

launches and construction activity. Approval delays

led to retention of many projects in the pre-launch

stages and are likely to be launched in the

subsequent quarters.

In 1Q 2014, Hyderabad office market witnessed

overall (all grades) office supply addition of more than

2.2 msf, of which Grade A spaces accounted for

around 98%. The quarter also witnessed pre-

commitments (primarily by IT-ITeS companies) of

around 588,000 sf in Grade A developments. First

quarter of 2014 witnessed office space leasing of 2.1

msf and net absorption of 1.8 msf, majorly

contributed by pre-commitments of 2012 and 2013.

Supply almost equivalent to net absorption for this

quarter kept the vacancy stable.

The first quarter of 2014 witnessed continued

interest amongst retailers for quality main street and

mall spaces. Due to deferment of a 200,000 sf mall

planned at Attapur, no new mall space was added in 1Q

2014. Moderate demand and supply kept the main

street and mall rentals stable.


Trends And Updates


Demand for ready residential property remained

moderate across the city. Continued cautious buyer

approach led to stability in capital values. However,

slight upward capital value movement of 2-4% was

recorded in Madhapur and Gachibowli due to continued

demand from employees working in nearby IT-ITeS

offices. Completion of certain phases of a few projects in

Kukatpally and Gachibowli led to residential supply

additions of nearly 600 units in 1Q 2014.

23


12,100

9,050 8,700

5,350 5,650 5,500

Aparna Orchid

Trendset Ville

Aditya Hill Paradise

Hill Ridge Springs

Aditya Swapnalok

Reliance Manor

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0



Banjara Hills

Jubilee Hills

Himayatnagar

West & East Marredpally

Begumpet, Somajiguda

Madhapur, Gachibowli

Kukatpally

Miyapur, Nizampet

Average Capital Values - Mid Segment (INR ‘000/sf)

Location 2009

2.4 - 2.9

1.8 - 2.5

3.6 - 4.2

3.5 - 4.0

2.7 - 3.0

2.5 - 2.8

2.6 - 3.1

2.5 - 3.1

2010

2.7 - 3.2

1.8 - 2.5

3.6 - 4.5

3.7 - 4.0

2.7 - 3.5

2.7 - 3.0

2.8 - 3.5

2.6 - 3.4

2011

2.9 - 3.5

2.4 - 3.0

3.8 - 4.6

4.0 - 4.2

2.7 - 3.7

2.8 - 3.2

2.9 - 3.6

2.8 - 3.5

2012

2.9 - 3.6

2.2 - 3.4

3.8 - 4.8

4.0 - 4.2

2.8 - 3.6

2.7 - 3.2

2.8 - 3.6

3.0 - 3.8

2013 1Q 2014

3.3 - 4.0

2.7 - 3.6

4.0 - 5.0

3.8 - 4.4

3.0 - 3.8

3.0 - 3.5

3.0 - 4.0

3.6 - 4.3

3.1 - 4.0

2.7 - 3.4

4.0 - 5.0

3.8 - 4.4

3.0 - 3.8

3.0 - 3.5

3.0 - 4.0

3.5 - 4.2


Note: The above values for high-end typically include units of 1,600-4,000 sf

Average Capital Values - High-end Segment (INR ‘000/sf)

Banjara Hills*

Jubilee Hills *

Himayatnagar

West & East Marredpally

Begumpet, Somajiguda

Madhapur, Gachibowli

Kukatpally

Miyapur, Nizampet

Location 2009

3.3 - 4.0

2.6 - 3.3

5.8 - 6.5

5.5 - 6.3

3.3 - 4.0

3.3 - 3.8

3.9 - 4.5

3.5 - 4.3

2010

3.5 - 4.5

2.7 - 3.4

6.0 - 7.2

6.0 - 7.0

3.7 - 4.0

3.5 - 4.0

4.1 - 4.5

3.8 - 4.9

2011

3.8 - 5.1

2.8 - 3.5

6.4 - 7.5

6.2 - 7.2

3.7 - 4.2

3.6 - 4.3

4.3 - 4.8

3.9 - 5.3

2012

3.8 - 5.1

2.9 - 3.5

6.5 - 7.5

6.1 - 7.2

3.6 - 4.2

3.6 - 4.3

4.3 - 4.7

4.1 - 5.3

2013 1Q 2014

4.0 - 6.0

2.9 - 3.5

7.0 - 9.5

6.5 - 9.5

4.0 - 5.5

4.0 - 5.5

4.5 - 5.5

4.5 - 6.0

4.0 - 6.0

2.9 - 3.5

7.0 - 9.5

6.5 - 9.5

4.0 - 5.5

4.0 - 5.5

4.5 - 5.5

4.5 - 6.0


First quarter of 2014 witnessed more than 900

residential unit launches, a 25% q-o-q increase.

Gachibowli, HITEC City, Chandanagar, Kondapur,

Velimella and Kompally accounted for majority of

the new launches during this quarter. Approximately

47% of the units launched were 3 BHKs whilst 32%

were 4 BHKs and the remaining were 2 BHKs. Mid-

end segment recorded the highest number of new

launches (77%), followed by 21% and 2% in the high-

end and affordable segments, respectively. Around

65% of the total launches were concentrated in

Madhapur, Gachibowli micro-market due to

persistent demand from employees working in the

nearby IT-ITeS offices and developing physical

infrastructure in the region.

24


Vertex Panache - Phase I Vertex Homes Gachibowli 338

Apartment 2 BHK: 1,265

3 BHK: 1,435 to 1,890

Ashoka A-La Mansion - Phase II

Ashoka Developers and Builders Ltd.

Kompally 200 Villas 3 BHK: 2,700 to 4,500

Vasantha City Vasantha Group HITEC City 197 Villas 4 BHK: 2,700 to 4,500

Tree Walk SVC Ventures Kondapur 128 Apartment 3 BHK: 1,622 to 2,052

Orchid Avenue Vitus Infrastructure Velimella 52 Villas 3 BHK: 1,855

Maruti Fortune Lucid Constructions Chandanagar 15 Apartment 2 BHK: 1,000 to 1,150


25


Capital values of under construction properties in

Madhapur, Gachibowli, Miyapur, Kukatpally and

Tellapur appreciated around 1-4% from the previous

quarter. This increase was primarily due to proximity

of workspaces from these locations and burgeoning

physical infrastructure. However, prices of under

construction projects in other parts of the city

remained stable from the previous quarter due to

subdued market sentiments. Construction delays also

led to completion deferment of many projects in

Gachibowli, Madhapur and Kukatpally

In 1Q 2014, Hyderabad’s office market witnessed

an influx of 2.2 msf, 98% of which were Grade A

spaces. IT-SEZ space addition continued to remain

high in 1Q 2014 and was in-line to the previous

quarter. The leasing activity in this quarter was 2.1

msf, of which largely 54% was pre-committed in

2012 and 2013. Approximately 77% of the leasing

activity in 1Q 2014 was concentrated in Madhapur


micro market, on the back of significant pre-

commitments of 2012 and 2013. Grade A vacancy

marginally increased due to supply slightly

exceeding absorption. However, absorption

exceeded supply for All Grade properties leading to a

slight dip in vacancy level. Rentals largely remained

stable in this quarter.

The main street and mall rentals across the city

remained stable in 1Q 2014 as compared to the

previous quarter. Apparel, sportswear, telecom and

F&B retailers took up space in prominent main

streets such as A.S. Rao Nagar and Jubilee Hills.

Retail Sector

Although enquiries remained high in areas such as

Banjara Hills Road No. 2, lack of apt-sized space

affected the transactions. Deferment of 200,000 sf

mall supply at Attapur, due to delay in approval, led

to a marginal decline in vacancy.

Cautious buyer approach is likely to result in

moderate demand and stable rentals (for the next 3-6

months) in the residential real estate market.

However, select micro-markets such as Madhapur,

Gachibowli, Kukatpally and Miyapur are likely to

witness marginal capital value appreciation in the

mid-end segment, primarily due to interest generated

from employees working in the nearby IT-ITeS and

BFSI offices. The North-west quadrant of the city is

likely to witness robust launches in the next quarter

with approximately 1,500 units already in the pre-

launch stages.

During the next quarter, approximately 3 msf of

office space is expected to become operational, of

which nearly 50% is Grade A development. As

majority of this Grade A spaces are already pre-

committed, the vacancy levels for these

developments are likely to remain stable in the future

periods.

Outlook

Approximately 500,000 sf of mall space influx at

Kukatpally is likely to increase the overall city-level

vacancy in the short-term. Demand for both main

street and mall spaces is anticipated to remain stable

due to decent enquiries witnessed in this quarter.

Stable supply and demand are likely to result in

stagnation of main street rentals. However, mall

rentals might remain under pressure due to

substantial influx of new space in the next quarter.

26

Market Overview

Jaipur

With the change of regime in the state

government, Jaipur residential real estate sector

depicted mixed trends with prices increasing in

January 2014 and then normalizing towards the end

of 1Q 2014. In this quarter, more than 1,500 units

were launched primarily in the mid-segment.

Developers continued to launch projects in

peripheral areas such as Mansarovar, Jagatpura,

Ajmer road and Vidyadhar Nagar. These regions and

a few areas in proximity to the Mahindra SEZ

witnessed high buyer interest with capital values

increasing by 8-10% from the last quarter.

In 1Q 2014, around 100,000 sf supply was added to

the Jaipur office sector. Compared to the previous

quarter, there was a decline in office space demand

with no significant deals recorded in this quarter. The

rentals remained stable from the previous quarter

across major locations in the city.

As mall space scheduled for completion during 1Q

2014 was deferred, the city did not witness any new

supply addition. Continuing with the trend witnessed

in the previous quarters, transaction activity in the

city was primarily in the main street locations of

Mirza Ismail (MI) Road, Vaishali Nagar and Malviya

Nagar. Rental values remained stable both in malls

and main-street locations from the previous quarter.

Trends And Updates


In 1Q 2014, central submarkets of Jaipur such as

C-scheme, Swage Farm and Bani Park witnessed

continued interest from end-users. Stable demand in

the central submarkets led to capital values

appreciating by 5-6% from the previous quarter. In

1Q 2014, the mid-end segment witnessed quarterly

capital appreciation of 8-12%.


27


8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

7,5007,000

6,200

4,500

3,3002,700

Grand Geejgarh

Kalpvriksha

Anukampa Grandeur

The Royal Paradise

Mahima Panorama

Hanging Gardens


Note: The above values for high-end segment typically include units of 2,000-4,000 sf, both apartments and villas

*sqyd: Square Yard

Average Capital Values – High End (INR ‘000/sf)

Location

C- Scheme

Bapu Nagar

Civil Lines

Malviya Nagar

3Q 2013

7,000 - 9,000 /sf

6,500 - 7,500 /sf

80,000 - 95,000 /sqyd*

70,000 - 80,000 /sqyd

1Q 2014

8,000 - 10,500 /sf

7,000 - 9,000 /sf

80,000 - 100,000 /sqyd*

75,000 - 95,000 /sqyd

4Q 2013

7,500 - 10,000 /sf

7,000 - 8,000 /sf

80,000 - 100,000 /sqyd

75,000 - 90,000 /sqyd

Average Capital Values - High-end segment (INR)


Note: The above values for mid-segment apartments typically include units of 1,600-2,000 sf, both apartments and villas

*sqyd: Square Yard


Location

Malviya Nagar

Vaishali Nagar

Mansarovar

Jagatpura

3Q 2013

55,000 - 65,000 /sqyd

2,700 - 3,000 /sf

2,700 - 3,000 /sf

2,650 - 2,900 /sf

1Q 2014

60,000 - 75,000 /sqyd

2,900 - 3,300 /sf

3,000 - 3,400 /sf

2,900 - 3,200 /sf

4Q 2013

60,000 - 70,000 /sqyd

2,700 - 3,100 /sf

2,800 - 3,200 /sf

2,800 - 3,000 /sf

Average Capital Values – Mid Segment (INR ‘000/sf)


The largest supply in Jaipur during 1Q 2014 was

from residential plots in Jaisinghpura close to Ajmer

road, being developed by the Jaipur Development

Authority. This scheme (Anand Vihar) is proposed to

be developed on 250 bigha of land with more than

1,500 plots. Developers launched nearly 1,500 units

in the first quarter of 2014 in peripheral submarkets

of Jaipur such as Mansarovar, Jagatpura and Ajmer

Road. The new launches were mainly in the mid-

segment priced around INR 2,200-3,200/sf.


Vedanta Ashadeep Group Jagatpura 670

Apartment

Apartment

Apartment

Apartment

2 BHK: 1,308 to 1,318

3 BHK: 1,803 to 2,136

4 BHK: 2,638

Unique Joy Unique Builders Jagatpura 270 Studio: 420

1 BHK: 616 to 730

2 BHK: 1,090 to 1,363

Pinnacle Anukampa Group Mansarovar 250 2 BHK: 1,020 to 1,260

3 BHK: 1,425 to 2,170

Siddha Aaangan Phase II Siddha Group Ajmer Road 240 Apartment 2 BHK: 1,040 to 1,094

3 BHK: 1,330 to 1,500

Midas Touch Mojika Real Estate and Developers

Vidyadhar Nagar 148 2 BHK: 1,100 to 1,211

3 BHK: 1,496 to 1,760

4 BHK: 2,293


28


The first quarter of 2014 witnessed steady

construction activity in peripheral areas of Tonk

Road, Ajmer Road and Sirsi Road. A number of

affordable and mid-end segment projects in these

areas started giving possession in this quarter.

Approximately 1,200 units in nearly 10 projects were

handed-over during this period.


Jaipur witnessed nearly 100,000 sf of office

supply addition in the first quarter of 2014. The

supply was added in proximity to JLN (Jawahar Lal

Nehru) Marg. The rental values in the Central

Business District (CBD) of MI Road and C-Scheme

remained stagnant from the previous quarter at INR

65 psf per month and for Secondary Business

District (SBD) at INR 35-50 psf per month.

Demand for retail space in malls was primarily

driven by BFSI, F&B and apparel segment in the first

quarter of 2014. Brands such as Pizza Hut, John

Player, Titan continued to strengthen their presence

by opening new stores in the city. Demand in the

Retail Sector

main street locations was driven by Lifestyle brands

such as Adidas besides apparel brands such as Lee

and Wrangler. In 1Q 2014, rentals remained stable in

malls as well as main street locations.

Capital values in the Jaipur residential sector are

likely to appreciate in the next quarter both in

central as well as peripheral locations. With space in

the Mahindra SEZ being taken up by IT-ITeS

companies, residential demand around this location

is likely to increase. Work on 9.2 km metro

connecting Mansaorvar to Chandpole via Civil Lines

is expected to complete soon and a part of this route

is expected be operational towards the end of next

quarter. This is likely to increase buyer interest for

projects in Mansarovar, Shyam Nagar and Ajmer

Road.

No new office space is likely to be added in Jaipur

during the next quarter. Rental values are expected

to remain stable as vacancies are quite high in

recently added stock in Malviya Nagar submarket.

Outlook

Overall city-level vacancy is expected to remain

range-bound as demand is likely to pick up only after

the elections.

Demand for quality retail space is likely to remain

stable especially in prominent main street locations

of MI Road and select malls such as MGF

Metropolitan, Elements and Gaurav Towers. With no

new mall supply expected to be added in the next

quarter, vacancy in both malls and main street

locations are expected to decline over the next

quarter. As a result, rentals are likely to improve in

certain locations of the city.

29

Market Overview

Kolkata

Kolkata residential real estate sector witnessed

substantial increase in new unit launches during 1Q

2014. Around 6,700 units were launched, which is

almost 3.5 times the number of new launches in

previous quarter. This quarter also witnessed a

marginal demand uptick in a few submarkets

compared to the previous quarter. However, capital

values remained stable during the quarter across

micro-markets in both mid and high-end segments.

During 1Q 2014, Kolkata’s commercial office

sector witnessed total supply addition of 72,500 sf, a

significant q-o-q decline of 90% owing to

deferments and slow pace of construction. Net

absorption also declined by about 62% on q-o-q

basis and was recorded at 156,700 sf. The average

deal size also decreased from 5,300 sf to 4,400 sf

due to lack of large-ticket deals. Overall vacancy

levels dropped marginally by about 0.4 percentage

points and were noted at 32.4% in 1Q 2014. Weighted

average rentals remained stable across submarkets

owing to low leasing activity.

In 1Q 2014, Kolkata’s retail sector witnessed

healthy leasing activity from apparel, accessories

and F&B segments, wherein malls witnessed more

demand than the main streets. No new mall supply

was added to the Kolkata retail market in 1Q 2014,

leading to the total mall stock remaining stagnant at

3.7 msf. Overall vacancy level in malls dropped to

3.6% due to healthy leasing activity and lack of new

mall supply. Rentals remained stable during the

quarter across main streets as well as malls.

Trends And Updates


During 1Q 2014, transaction activity in the mid-end

segment of ready residential properties improved

from the previous quarter. However, transaction

activity in the high-end segment did not witness any

momentum owing to subdued demand. The capital

values remained stable during the quarter across

submarkets in mid-and-high-end segments. However,

select projects in the mid-end segment of North-east

submarket that were completed during the quarter

witnessed minor q-o-q capital value appreciation of

about 3%. Around 3,000 units were completed in 1Q

2014, of which around 60% catered to the mid-end

segment while 30% catered to the high-end segment.

Similar to previous quarter, in 1Q 2014 nearly 52% of

the completed projects were concentrated in the

North-east submarket. Some of the prominent

projects that were completed in 1Q 2014 include Sri

Avani (a luxury project located in prime South Central

submarket) and Cascades (part of Uniworld City

located in North-east submarket).



11,80010,750

12,600

7,650

6,400 5,800

Mani Karn

Silver Springs

South CityUjjwala

Green wood Sonata Utsa

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

30

High End Segment:

South: Southern Avenue, Hindustan Park, Triangular

Park, Lake Terrace.

South Central: Ballygunge, Queens Park, Rainy Park,

Gurusaday Road, Ballyguange Circular Road, Dover Lane.

South-East: EM Bypass - Science City, Christopher Road,

Pancha Sayar.

South-West: Alipore Park Road, Ashoka Road, Burdwan

Road, Belvedere Road.

Central: Park Street, Camac Street, Shakespeare Sarani,

Minto Park, Elgin Road, Lee Road, Loudon Street, Rowdon

Street.

North: Kankurgachi, Lake Town, VIP Road, Ultadanga,

Narkeldanga Main Road

East: Salt Lake

North-East: New Town, Rajarhat

Mid-Segment:

South: Golf Green, Tollygunge, Lake Gardens, Jodhpur

Park.

South Central: Deshpriya Park, Hazra Road, Bhawanipur

South-East: Ajoy Nagar, Hiland Park, PA Shah

Connector

North-East: Rajarhat, Rajarhat Chowmatha

South West: Tollyguange Circular Road, New Alipore,

Behala

North: Jessore Road, Ultadanga, Shyambazar, Bagbazar,

Girish Park, Manicktala, Dum Dum.

Key to Locations:Key to Locations:



*The values for North-East micro market have been revised due to increased market coverage

Average Capital Values – Mid Segment (INR ‘000/sf)

Location

South

South - Central

South - East

North - East

North

2009

2.7 - 3.9

4.2 - 5.3

2.4 - 2.8

1.9 - 2.2

1.8 - 3.4

2010

3.2 - 4.5

4.5 - 6.0

2.5 - 3.2

2.2 - 2.7

2.2 - 4.7

2011

3.8 - 5.5

5.5 - 8.0

2.8 - 4.5

2.4 - 3.0

2.8 - 5.2

2012

3.8 - 5.5

5.5 - 8.0

2.8 - 4.5

2.4 - 3.5

2.8 - 5.2

2013

3.8 - 6.5

5.8 - 8.8

2.9 - 5.0

2.7 - 4.0

3.0 - 5.8

1Q 2013

3.8 - 6.5

5.8 - 8.8

2.9 - 5.0

2.7 - 4.0

3.0 - 5.8

Average Capital Values -Mid-Segment (INR ‘000/sf)



*The values for Central, East and North-East micro markets have been revised due to increased market coverage.


East

North - East

Location

South

South - Central

South - East

South - West

Central

4.0 - 5.2

3.0 - 4.0

2009

4.8 - 5.9

8.5 - 9.6

4.5 - 5.7

8.6 - 9.8

7.2 - 10.0

4.5 - 6.0

3.5 - 5.0

2011

6.3 - 8.5

10.0 - 18.0

5.8 - 9.2

10.0 - 15.0

9.0 - 15.0

4.5 - 6.8

3.8 - 5.7

2012

7.0 - 12.0

10.0 - 18.0

5.8 - 9.5

10.0 - 15.0

10.0 - 17.0

5.0 - 7.7

4.2 - 6.5

2013

7.5 - 13.0

12.5 - 18.5

6.0 - 10.5

12.0 - 17.0

12.0 - 19.5

5.0 - 7.7

4.2 - 6.5

1Q 2014

7.5 - 13.0

12.5 - 18.5

6.0 - 11.0

12.0 - 17.0

12.0 - 19.5

Average Capital Values - High-end Segment (INR ‘000/sf)

Location

4.0 - 5.5

3.2 - 4.5

2010

5.3 - 6.8

9.5 - 13.0

4.5 - 8.0

8.9 - 13.0

8.0 - 12.5

2010

31

In 1Q 2014, around 6,700 residential units were

launched in Kolkata, 3.5 times the number of units

launched in the previous quarter. This was primarily

due to a few high-density affordable and mid-end

projects launched in southern peripheral locations

such as Joka and Maheshtala. These projects

contributed almost 70% to the total new unit launches


during the quarter. In 1Q 2014, affordable segment

overall accounted for 57% of total new unit launches

followed by the mid-end segment with 40% share.

This quarter witnessed launch of a theme-based

project in collaboration with Disney UTV, which is first

of its kind in the region.

Hiland Green

Hiland Group

Maheshtala 3,817

Apartments

2 BHK: 712

The County - Phase I

Team Taurus

Joka 850

Apartments

1 BHK: 869

2 BHK: 919 to 1,053

3 BHK: 1,253

Ivy Green

Vedic Realty

Vedic Village, Rajarhat

480 Apartments

2 BHK: 867 to 967

3 BHK: 1,174 to 1,274

North Grande

Mounthill Realty

Belghoria 474

Apartments

2 BHK: 1,022

3 BHK: 1,231 to 1,903

4 BHK: 2,311

Merlin Paradise

Merlin Group

Dum Dum 264

Apartments

2 BHK: 960

3 BHK: 1,365 to 1,663

4 BHK: 1,888

Ideal Aquaview (Tower A, B)

Ideal Group

Maheshbathan, New town

234 Apartments

2 BHK: 1,080 to 1,090

3 BHK: 1,475 to 1,510

4 BHK: 1,950

Eternia

Unimark Group & Concast Group

EM Bypass

104 Apartments

3 BHK: 2,398 to 2,573

4 BHK: 2,857 to 3,297

Rohit Apartments

Parasrampuria Realty

VIP Road 80

Apartments

2 BHK: 977 to 1,159

3 BHK: 1,431 to 1,530

Goldwin Ganpati Sharnam

Goldwin & Ganpati Group

Kaikhali

72 Apartments

2 BHK: 964 to 1,083

3 BHK: 1,045 to 1,114

Ideal Heights: Ph II (Cirrus)

Ideal Group

Sealdah

60 Apartments

2 BHK: 1,330 to 1,355

3 BHK: 1,715 to 1,995

Yahvi

A. Sarkar & Associates

Joka 46

Apartments

2 BHK: 993

3 BHK: 1,165 to 1,195

Curiocity

Realtech Nirman

Rajarhat 44

Apartments

2 BHK: 996 to 1,018

3 BHK: 1,398 to 1,502

The Address

PS Group

EM Bypass 40

Independent Floors

3 BHK: 2,440 to 2,486

4 BHK: 2,688 to 2,734

Ivory Tower

Shrishti Comotrade

Kudghat Metro 39

Apartments

2 BHK: 1,387

3 BHK: 1,556 to 1,656

Inia

JC Infratech

Park Circus Connector

37 Apartments

3 BHK: 2,180 to 2,450

4 BHK: 4,300

5 BHK: 4,630

Fort Rejoice

Fort Group

Behala 24

Apartments

3 BHK: 1,555

Florenza

Vinayak Group

Diamond Harbour Road

22 Apartments

3 BHK: 1,765

4 BHK: 2,100

Sukhmani Imperia

Sukhmani Developer

Diamond Harbour Road

22 Apartments

3 BHK: 1,858 to 1,881

Euphoria

Multicon

Ballygunge 15 Apartments

4 BHK: 5,000



32


In 1Q 2014, capital values largely remained stable in

both mid and high-end segments across most

submarkets. Most of the developers kept prices stable

to garner sales in the current subdued environment.

However, select projects in north, north-east and

south-east submarkets witnessed around 3-5% q-o-q

capital value appreciation. The construction activity

picked up pace during the quarter and nearly 2,100

units are likely to be completed in Q2 2014; majority of

this upcoming supply will cater to the mid-end

segment. North-east submarket would continue to

see maximum number of project completions as lot of

projects have been launched in last couple of years.

Some of the prominent projects that are nearing

completion include Promenade and Orbit Royale in

prime south central and south west submarkets.


The commercial office sector witnessed total

supply addition of 72,500 sf, a q-o-q decline of about

90%. 1Q 2014 did not witness any new Grade A

supply addition due to slow pace of project

construction in Salt Lake and Rajarhat micro-

markets, which together constitutes majority of

Grade A stock in Kolkata. Net absorption also

declined by about 62% on q-o-q basis and was noted

at 156,700 sf. Average deal size in Q1 2014 fell to

4,400 sf as against 5,300 sf in the preceding

quarter. IT-ITeS sector continued to witness highest

share (50%) in total net absorption, followed by

BFSI and Consulting sectors together accounting

for nearly 20%. The overall quarterly vacancy

dropped marginally by about 0.4 percentage points,

primarily due to lower supply infusion than net

absorption in this quarter. Weighted average rentals

remained stable across micro-markets owing to low

leasing activity.

During 1Q 2014, no new mall supply was added to

the Kolkata retail sector, leading to total mall stock

remaining unchanged at 3.7 msf. The malls in Central

location (Elgin Road) and East Kolkata (EM Bypass)

witnessed healthy leasing activity from F&B and

apparel retailers. Lack of new mall supply and

healthy leasing activity in a few malls led to a q-o-q

decline of 0.3 percentage point in vacancy level,

which was noted at 3.6% at the end of 1Q 2014. Main

street locations witnessed negligible transactions

despite demand from apparel, accessories and F&B

retailers due to lack of quality retail space on the

main streets. This in turn benefited the mall leasing

activity during 1Q 2014.

Retail Sector

In 1Q 2014, rentals remained stable during the

quarter in both main streets and malls. Also, a few

locations having retail space availability did not

witness significant leasing activity due to lack of apt

catchment area to attract shoppers towards these

locations.

33

Outlook

North-east submarket along with peripheral

locations such as Narendrapur, Sonarpur and Joka in

South and Madhyamgram and BT Road in North are

expected to witness majority of new launches in 2Q

2014. Demand in the mid-end segment may further

improve in the upcoming quarter, post general

elections and establishment of a stable government.

However, capital values are expected to remain

stable across most submarkets with minor

appreciation in the north-east region owing to

continued demand.

Kolkata office space sector is expected to witness

supply infusion of around 1.8 msf in 2Q 2014,

majority of which was supposed to have been added

during 1Q 2014 but got deferred due to slow pace of

construction. Net absorption is expected to improve

considering current pre-commitment levels. Overall

vacancy is expected to remain high due to

anticipated supply addition. Weighted average

rentals are expected to remain stable with slight

downward pressure in Salt Lake micromarket, owing

to existing high vacancy levels and likely new supply

addition.

In 2Q 2014, new mall supply of about 120,000 sf is

likely to be added to the south Kolkata retail market.

Retailers are likely to depict a higher preference for

malls over main streets primarily due to lack of

quality retail spaces on the main streets. The

upcoming quarter might witness leasing of a few

premium and upscale apparel brands. In 2Q 2014,

rentals are expected to remain stable across both

main streets and malls.

34

MARKET OVERVIEW

Mumbai

In 1Q 2014, around 10,700 new residential units

were launched in Mumbai, which is double the

number of the previous quarter. This substantial

increase was primarily due to the launch of new

phase in a large township project located on the

outskirts of city. This project received healthy

response from the market due to its lower ticket size

offerings. New launches in the quarter were

concentrated in the sub-markets of Dombivli (56%),

Western Suburbs (15%), Thane (15%) and Central

Suburbs (19%). In 1Q 2014, capital values remained

stable across sub-markets due to the subdued

demand and new launches at competitive prices.

Mumbai’s commercial office sector witnessed an

overall net absorption of approximately 750,000 sf

during the first quarter of 2014, a q-o-q decline of

35%. Majority of the net-absorption was in Grade A

developments concentrated in the sub-markets of

Thane-Belapur Road (29%), Lower Parel (29%),

Central Suburbs (19%) and Vashi (10%). Office space

demand was primarily driven by the IT-ITeS (48%),

E n g i n e e r i n g ( 3 0 % ) , B F S I ( 1 6 % ) a n d

Pharmaceuticals (4%) sectors. Lower demand in the

CBD resulted in the weighted average rental decline

of 3.7% from the previous quarter.

Retailers’ demand for space in malls and main-

streets remained stable during the first quarter of

2014. Demand from the apparel segment was high,

especially in Lower Parel, resulting in mall rentals

increasing by 4% during the quarter. Due to stable

demand, mall rentals in other suburban locations

such as Andheri, Malad, Goregaon, Ghatkopar,

Thane and Vashi remained stable from the previous

quarter. Overall mall vacancies also remained

unchanged and were noted at 15.3% for 1Q 2014.

Demand for spaces on main-street locations was

driven by the F&B and apparel sectors. However,

stable demand resulted in landlords quoting similar

rentals from the previous quarter across all major

sub-markets.


TRENDS AND UPDATES

With low demand levels, capital values of ready

residential properties continued to remain stable

during the quarter. Even in submarkets with healthy

supply and continued end-user demand such as

Thane and Navi Mumbai, capital values remained

stable during the quarter. With a number of under-

construction projects facing completion delays, end-

users preferred ready projects over under

construction properties.

35



Planet Godrej

Ashok Towers

Summer Trinity

Orchard Residency

Rustomjee Athena

Godrej Riverside

50,00046,000

44,000

14,0009,800

6,000

50,000

40,000

30,000

20,000

10,000

0

Source- Cushman and Wakefield Research

Note: The above values for high-end segment typically include units of 2,500-6,000 sf for South, South-Central, Central and North and units of 1,650-3,000 sf

for North (Santacruz & Juhu), Far North and North-East

South

South Central

Central

North

Far North

North East

Location 2008

43.0 - 55.0

47.0 - 67.0

27.0 - 31.0

9.0 - 13.0

33.0 - 53.0

14.0 - 18.0

34.0 - 55.0

10.0 - 16.0

42.5 - 58.0

42.0 - 66.0

22.0 - 30.0

10.0 - 16.5

2009

35.0 - 55.0

10.0 - 16.0

43.0 - 60.0

45.0 - 70.0

24.0 - 32.0

11.0 - 16.5

2010

48.0 - 70.0

46.0 - 78.0

34.0 - 58.0

28.0 - 40.0

12.5 - 18.0

14.0 - 22.0

2012

48.0 - 75.0

46.0 - 83.0

27.0 - 65.0

28.0 - 48.0

12.5 - 18.0

15.0 - 22.0

1Q 2014

48.0 - 75.0

46.0 - 83.0

27.0 - 65.0

28.0 - 48.0

12.5 - 18.0

15.0 - 22.0

2013

32.0 - 54.0

10.0 - 18.0

45.0 - 65.0

45.0 - 75.0

24.0 - 32.0

11.0 - 16.5

2011

Average Capital Values -High-end Segment (INR ‘000/sf)

South

South Central

Central

North

Far North

North East

Location 2008

27.0 - 34.0

34.0 - 43.0

13.5 - 19.5

7.0 - 9.0

18.0 - 28.0

6.0 - 7.4

15.0 - 26.0

6.4 - 8.5

28.0 - 37.0

35.0 - 45.0

16.0 - 24.0

8.5 - 11.5

2009

17.0 - 30.0

6.5 - 8.5

30.0 - 40.0

40.0 - 48.0

16.0 - 25.0

9.0 - 12.0

2010

35.0 - 45.0

43.0 - 52.0

22.0 - 37.0

18.0 - 27.0

10.0 - 14.0

8.5 - 12.5

2012

40.0 - 50.0

45.0 - 58.0

23.0 - 40.0

20.0 - 30.0

10.0 - 14.0

8.5 - 12.5

1Q 2014

40.0 - 50.0

45.0 - 58.0

23.0 - 40.0

20.0 - 30.0

10.0 - 14.0

8.5 - 12.5

2013

17.0 - 35.0

6.5 - 10.0

30.0 - 40.0

43.0 - 52.0

16.0 - 25.0

9.0 - 13.0

2011

Average Capital Values – Mid Segment (INR'000/sf)


Note: The above values for mid-end segment typically include units of 1,400-2,500 sf for South, South-Central, Central and North and units of 900-1,400 sf

for Far North and North-East

South: Colaba, Cuffe Parade, Nariman Point, Churchgate, etc.

South Central: Altamount Road, Carmichael Road, Malabar

Hill, Napeansea Road, Breach Candy, Pedder Road, etc.

Central: Worli, Prabhadevi, Lower Parel/ Parel

North: Bandra (W), Khar (W), Santacruz (W), Juhu, etc.

Far North: Andheri (W), Malad, Goregaon, etc.

North-East: Powai

Key to Locations:

36


Approximately 10,700 units were launched in 1Q

2014, which is close to double the previous quarter.

Mid-end segment accounted for about 67% of the

total units launched in the quarter whilst high-end

segment contributed 33%. New residential launches

during the quarter were concentrated in Dombivli

(56%), Western Suburbs (15%), Thane (15%) and

Central Suburbs (19%). Launches in the Western

Suburbs were concentrated between Goregaon-

Kandivali whilst in the Central Suburbs were located

at Chembur and Mulund. Thane also witnessed a few

launches at Kolshet and along the Ghodbunder road.

Lakeshore Greens

Lodha Developers

Dombivli 6,000

Apartment 1 BHK: 729 to 774

2 BHK: 927 to 1,026

3 BHK: 1,197

Ariisto Siesta

Ariisto Realty

Mulund 576 Apartment 2 BHK: 1,310 to 1,335

3 BHK: 1,715 to 1,925

Eastern Heights

Satara Properties

Chembur 480 Apartment 1 BHK: 367

1.5 BHK: 442

2 BHK: 503

BBJ Worldwide Roma

BBJ Worldwide

Andheri 432 Apartment 2 BHK: 1,095

3 BHK: 1,580

Rajesh Whitecity

Rajesh Lifespaces

Kandivali 416

Apartment 1 BHK: 745

2 BHK: 980

3 BHK: 2,015

4 BHK: 2,685

Rajesh Tattva

Rajesh Lifespaces

Thane 368 Apartment 3 BHK: 1,935

4 BHK: 2,985

Runwal Eirene

Runwal Developers

Thane 304 Apartment 1 BHK: 620

2 BHK: 830 to 1,075

2.5 BHK: 1,335

3 BHK: 1,510 to 1,535

Raheja Ridgewood

Raheja Universal

Goregaon 262 Apartment 1.5 BHK: 690

2 BHK: 1,274

3 BHK: 1,663 to 1,742

4 BHK: 2,232 to 2,465

La Riveria

Lakhani Builders

Panvel 234 Apartment 1 BHK: 640 to 720

2 BHK: 1,000 to 1,135

Omkar Ananta

Omkar Developers

Goregaon 221 Apartment 2 BHK: 1,050

Rosa Neo Orbis

Rosa Group

Thane 192


Acme Ozone - Phase 2 (Alpinia)

Acme Developers

Thane

180 Apartment 2 BHK: 1,066

3 BHK: 1,318

Unique Vistas

Unique Shanti Developers

Thane


Acme Ozone - Phase 2(Herbelia

Acme Developers

Thane


Puranik Hometown Smart Homes

Puranik Developers

Thane

100 Apartment 2 BHK: 715

3 BHK: 957

Neona

K Hemani Developers

Mulund 90


2 BHK: 1,190

Tridhaatu Harsh Aangan

Tridhaatu Princecare Group

Chembur

80 Apartment 2 BHK: 743

2.5 BHK: 881

White Orchid

Kamala Landmarc

Kandivali 80


2 BHK: 1,110

Marina

Shree Tirupati Group

Thane 80


2 BHK: 1,060

Iris

Hubtown Developers

Mira Road 77


2 BHK: 945


37

38

Rosa Oasis - Phase 2

Rosa Group

Thane 68

Apartment 2 BHK: 950 to 985

Pashmina Lotus

Pashmina Developers

Andheri 60

Apartment 4 BHK: 2,350 to 2,400

Celeste

Hubtown Developers

Worli 60


2 BHK: 1,048

Raheja Reflections Odessy

K. Raheja Universal Pvt. Ltd

Kandivali




In 1Q 2014, Mumbai witnessed an overall office

space supply addition of 1.1 msf, 70% of which was in

Grade A developments. Overall supply increased by

21% from the previous quarter and was

concentrated in the sub-markets of Vashi (34%),

Lower Parel (24%) and Kanjurmarg (24%). With a

few companies deferring plans to take-up new space,

there was a decline in net-absorption during 1Q 2014.


With similar levels of supply and net-absorption in

Grade A developments, q-o-q vacancy declined

marginally to 19.7%. Rentals at all sub-markets

remained stable during the quarter except CBD,

which witnessed a decline due to lower demand.

Attractive rentals at Thane-Belapur road resulted in

pre-commitments of approximately 450,000 sf

during the quarter.

Western and central suburban locations witnessed

healthy construction activity during the quarter. With

new launches at attractive prices, capital values in

under construction projects remained stable during


the quarter. A few developers also offered attractive

discounts in the high-end segment under

construction projects.

Retail Sector

Main street locations in Colaba, Andheri (West)

and Borivali continued to witness high level of enquiry

from F&B retailers. Limited availability of quality

spaces remains a concern especially in mature main-

streets such as Colaba, Breach Candy and Borivali.

With limited transactions and churn, rentals remained

stable across main-street locations. Mall rentals at

Mulund declined 4.6% during the quarter due to

existing high vacancy. A number of apparel and

footwear brands are expanding operations in

peripheral main-streets of Vasai and Virar due to

increasing residents in this region.

Outlook

Mumbai’s residential real estate demand is likely

to remain stable in 2Q 2014, resulting in stagnant

capital values from 1Q 2014. Developers are likely to

delay new launches and focus on clearing existing

unsold inventory. With economic fundamentals

likely to improve in 2H 2014, post general elections,

demand in the residential real estate sector might

revive.

In 2Q 2014, office space supply of 1.9 msf is

expected to be added in sub-markets of Goregaon

and Vikhroli. Net-absorption is likely to remain stable

in the upcoming quarter with transaction activity

concentrated in Andheri, Goregoan and Thane-

Belapur Road. Also, with stability in demand, rental

values are likely to remain unchanged in all major

submarkets in the short-term.

Demand for quality mall space is expected to

remain high from retailers who are planning store

expansions in the city. Limited availability and high

demand from F&B and apparel sectors for mall

spaces at Lower Parel, Malad and Goregaon could

result in rental appreciation in the short-term.

Demand for space at main-streets such as Chembur,

Borivali and Vashi is also expected to increase in the

upcoming quarter, resulting in rental values

appreciation at these locations.

39

National Capital Region

MARKET OVERVIEW

Due to current state of the economy and political

situation, NCR witnessed fewer launches in the first

quarter of 2014. New launches declined by 18% over

the previous quarter and were noted at around

6,500 units. More than 95% of the new units

launched in the quarter were in the mid-segment

and the remaining 5% were in the affordable

segment. This is a notable shift from the previous

quarter, which witnessed majority launches in the

affordable segment. Low demand continued to

impart pressure on rental and capital values across

most submarkets of NCR, resulting in capital and

rental value decline of 3-5% in many submarkets.

In 1Q 2014, NCR office sector also witnessed a

decline in supply due to completion delays in many

buildings. At 1.7 msf, Grade A supply in NCR declined

around 53% from the previous quarter.

Approximately 1 msf of pre-commitments were

noted during the quarter primarily from the IT-ITeS

companies. IT-ITeS sector also led the leasing

activity during this quarter, accounting for 46% of

total leasing followed by the Consulting and

Engineering sectors. Net absorption declined 18%

from the previous quarter and was noted at 1.4 msf.

The first quarter of 2014 did not witness any new

addition to the existing mall supply of NCR. Some

amount of transaction activity was witnessed in

select malls of South and North Delhi only. Main

street locations witnessed a number of transactions

in Connaught Place, Khan Market, South Extension

and DLF Galleria. In mall space, vacancy remained

almost similar to the previous quarter and was noted

at 13.4%. Rental values maintained status quo in

malls and main street locations.

TRENDS AND UPDATES


In 1Q 2014, capital and rental values declined in the

range of 3-5% across submarkets of South Delhi,

primarily due to subdued transaction activity

prevailing for the past few quarters. Capital values in

Central Delhi maintained status quo owing to stable

supply-demand dynamics. Gurgaon and Noida

markets reported stagnant capital values in the high-

end segment from the previous quarter. In the luxury

and mid-end segment of Gurgaon, capital values

declined q-o-q by 5% and 3% respectively due to

sluggish demand and availability of ready-to-occupy

projects in the vicinity.

40



18,000

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

16,500

11,500 11,50013,250

9,750

8,250

ITC Laburnum

Uniworld City

ATS Greens Village

Richmond Park

Vatika City

Eldeco Utopia

High-end Segment:

South-West: Shanti Niketan, Westend, Anand Niketan,

Vasant Vihar

South-East: Friends Colony East, Friends Colony West,

Maharani Bagh, Greater Kailash - I, Greater Kailash – II.

South Central: Defence Colony, Anand Lok, Niti Bagh,

Gulmohar Park, Hauz Khas Enclave, Safdarjung

Development Area, Mayfair Gardens, Panchsheel Park,

Soami Nagar, Sarvodaya Enclave.

Central: Jorbagh, Golf Links, Amrita Shergil Marg,

Aurangzeb Road, Prithviraj Road, Sikandara Road, Tilak

Marg, Ferozshah Road, Mann Singh Road, Sunder Nagar,

Nizamuddin, Tees January Marg, Chanakyapuri.

Mid-Segment:

South-East: New Friends Colony, Kalindi Colony, Ishwar

Nagar, Sukhdev Vihar, Kailash Colony, Pamposh Enclave.

South Central: Uday Park, Green Park, Saket, Asiad

Village, Geetanjali Enclave, Safdarjung Enclave,

Sarvapriya Vihar, Panchsheel Enclave, Navjeevan Vihar.

Key to Locations:


Location

South-West

South-East

South Central

Central

Gurgaon

Noida




Note: The above values for mid-segment typically include units of 1,600-2,000 sf

Average Capital Values – Mid End (INR '000/sf)

South-East

South Central

Gurgaon

Noida

Location

NCR witnessed new launches of approximately

6,500 units in the first quarter of 2014. Majority of the

new launches belonged to two projects in Sector 118 of

Noida. Shifting from the last year’s trend when

launches were primarily in the affordable segment,

95% of the launches in 1Q 2014 were in mid-end

segment. Besides Noida, new units were also launched


on Sohna Road with an aim to capitalise on the fact

that it lies in proximity to the Golf Course road and Golf

Course Extension road. Some projects were launched

in Noida extension as well, a few of which were

additions to already existing projects. Due to the

uncertainty of upcoming elections, many developers

continued the soft-launch status of their projects.

41

29.0 34.0

21.0 24.0

21.0 25.0

40.0 45.0

5.3 12.5

5.2 6.5

2009

36.0 43.0

24.0 30.0

25.0 32.0

50.0 57.0

6.2 18.0

5.5 7.0

2010

42.0 50.0

25.0 35.0

27.0 40.0

50.0 65.0

8.5 21.0

5.5 7.5

2011

50.0 60.0

25.0 45.0

27.0 50.0

60.0 80.0

10.5 32.0

6.2 8.1

2012

25.0

42.5

25.0

27.0

60.0

11.0

7.0

57.5

40.0

48.0

90.0

8.5

1Q 2014

45.0 60.0

25.0 40.0

27.0 50.0

60.0 - 90.0

11.0 27.5

7.0 8.5

2013

14.5 16.5

18.5 20.5

4.0 6.5

3.2 5.5

2009

15.0 20.0

20.0 23.5

4.5 7.5

3.8 5.6

2010

15.0 - 28.0

25.0 - 30.0

5.0 - 9.0

4.2 - 5.8

2011

25.0 30.0

25.0 35.0

6.8 10.5

4.3 6.2

2012

22.5 27.5

25.0 35.0

7.5 11.0

5.0 6.0

1Q 2014

25.0 30.0

25.0 35.0

7.5 11.5

5.0 6.0

2013

Romano ApartmentsSupertech Sector 118, Noida 2,100 2 BHK: 1,020 to 1,260

3 BHK: 1,425 to 2,170

Ambrosia ApartmentsAjnara Group Sector 118, Noida 2,000 2 BHK: 1,095 to 1,225

3 BHK: 1,475 to 1,995

Arete ApartmentsILD Sector 33, Sohna,

Gurgaon

800 2 BHK: 1,275 to 1,325

3 BHK: 1,765 to 1,998

Mahagun Meadows ApartmentsMahagun Group Sector 150, Noida 550 2 BHK: 1,050 to 1,225

3 BHK: 1,355 to 1,656

La Solara ApartmentsEmenox Group Sector 16, Greater

Noida (West)

560 2 BHK: 1,145

3 BHK: 1,550 to 1,960

Riverview ApartmentsAmrapali Group Tech Zone IV,

Greater Noida (West)

264 2 BHK: 855 to 955

3 BHK: 1,155

The Halt ApartmentsEarthcon + Vertical

Limits

Sector 4, Greater

Noida (West)

200 1 BHK: 525

Vedic Suites-II ApartmentsVardhman Group Knowledge Park III,

Greater Noida

185 1 BHK: 600

Platina – The Hermitage II

ApartmentsSatya Group Sector 103, Gurgaon 88 3 BHK: 1,947

4 BHK: 2,605



Developers continued to focus on completing

projects and clearing unsold inventory rather than

launching new projects. With projects nearing

completion and significant unsold inventory,

developers are hoping to increase sales with


possession linked plan wherein the buyer pays 40-

60% of the amount in the initial stages and the

remaining only on possession. In 1Q 2014, around 8-10

projects gave phase-wise possession in their projects

across submarkets of Noida and Gurgaon.


The first quarter of 2014 witnessed Grade A

supply of 1.7 msf in the NCR office space sector, a

decline of 53% from the previous quarter. With some

completions in Aerocity, Delhi contributed nearly

30% to the new supply with the rest being in

Gurgaon. On the demand side, with a few deals in the

excess of 100,000 sf, IT-ITeS sector companies had

the highest share of leasing at 46%, followed by the

Consulting sector at 19% and Engineering taking up

9% of the total leased space in the quarter. The net

absorption was recorded at 1.35 msf for Grade A

space during the quarter.

Overall vacancy levels in Grade A properties

declined by 0.2 percentage points in the quarter.

Gurgaon’s CBD witnessed highest q-o-q decline of 1.8

percentage points with absorption mainly in the IT-

ITeS office spaces. Marginal weakening of rental

values was also noted across most of the

submarkets in NCR, primarily due to increased

availabilities in properties quoting lower rents.

42

43

The first quarter of 2014 did not witness any new

mall completions in NCR. However, four mixed-use

developments with retail space totaling 220,000 sf

became operational in Gurgaon and North Delhi.

Transaction activity during the quarter was primarily

in main street locations across submarkets of NCR.

The average store size take-up was noted around

Retail Sector

1,500 sf during this quarter. The demand was mainly

driven by apparels, F&B and personal care brands such

as Max, Louis Philippe, United Colors of Benneton,

Starbucks and Cafe Coffe Day. The rental values

remained stable during the quarter as both tenants

and landlords refrained from any rental change

amidst weak economic conditions.

With elections due in the short-term, residential

real estate transaction activity is expected to remain

subdued in the upcoming quarters. This is likely to

result in further weakening of capital and rental

values in NCR, especially in the south Delhi

submarket. Developers are expected to focus mainly

on completion of on-going projects and delay any

new launches. With sizeable number of units

scheduled for completion in the upcoming quarters,

rental and capital values in Noida and Gurgaon are

likely to remain under pressure.

Although the demand is likely to remain stable in

the next quarter, more than 4.7 msf of office space

supply is expected to be added to the NCR market in

Outlook

the next three months. More than 38% of the

upcoming supply is in Delhi and approximately 33%

in Gurgaon. This is likely to increase vacancy levels in

the submarkets and put pressure on the rental

values.

Lack of tenant interest and slow construction

activity have led to completion deferment of a few

malls in NCR. Similar to this quarter, no new mall

supply is expected to be added in the next quarter.

The anticipated churn in select South Delhi malls in

subsequent quarters is likely to strengthen the

rental values. However, the rental values across most

main streets are likely to remain stable considering

the steady demand.

MARKET OVERVIEW

Pune

Nearly 3,950 residential units were launched in

Pune during the first three months of 2014. The q-o-

q increase in number of unit launches was only 4%

as developers decided to delay launches post Gudi

Padwa and/or general elections, with an expectation

of pick-up in the transaction activity. In 1Q 2014, mid-

end segment contributed nearly 80% to the new

launches; the remaining came from the high-end

segment. High-end segment capital values

registered a 2-3% q-o-q capital appreciation in areas

such as Koregaon Park, Boat Club Road, Kalyani

Nagar, Viman Nagar, Aundh and Baner. Mid-end

segment capital values witnessed a mixed trend

during the quarter with some markets witnessing

appreciation while some others remained sticky at

the existing levels.

In 1Q 2014, 301,500 sf of office space was added to

the Pune market, none of which was IT-ITeS

development. 49,500 sf of supply was contributed by

Grade A developments located in CBD, which was the

only Grade A supply during the quarter. The total net

absorption in this quarter was only 622,900 sf. This

led to a decline of 0.7 percentage points in the overall

vacancy, which was noted at 25.6% in 1Q 2014.

In 1Q 2014, Pune’s organized retail sector

continued to depict a preference for main streets as

compared to the malls. Rentals at most of the main

streets remained stable or depicted a slight upward

shift from the previous quarter. However, majority of

the malls excluding Hadapsar micromarket

witnessed a q-o-q decline in rentals or registered no

price movement during the quarter. New supply

addition of 350,000 sf in this quarter pushed up the

overall city-level mall vacancy by 1.0 percentage

point and was noted at 27.5%.

TRENDS AND UPDATES


The capital values remained stable in the

secondary market amidst sluggish demand.

However, subsequent phases of new projects were

launched at higher capital values. Nearly 400 units

were handed over in Ivy Estate, Wagholi during this

quarter. The upcoming quarter is likely to witness

one more significant project completion apart from

handover of more units at Ivy Estate.

44



Supreme Palacio

Clover Belvedere

Clover Acropolls

Kumar Palm

groves

Mont Vert

Tropez

10,50010,000

7,200

5,100 5,500

15,000

10,000

5,000

0

Average Capital Values – Mid End (INR '000/sf)

Location

Koregaon Park, Boat Club

Aundh

Baner

Wakad

Kalyani Nagar

Wanowrie, NIBM Road, Kondhwa

2008

4.5 - 5.0

3.5 - 4.0

3.0 - 3.8

2.5 - 3.0

4.5 - 5.5

3.0 - 3.2

2009

4.5 - 5.5

3.6 - 4.2

2.9 - 3.6

2.2 - 2.8

4.5 - 5.5

2.8 - 3.1

2010

6.0 - 7.0

4.0 - 5.0

3.5 - 5.5

3.5 - 4.0

6.5 - 7.0

4.0 - 5.5

2011

6.0 - 7.0

4.5 - 5.5

4.0 - 5.5

3.7 - 4.5

6.5 - 7.5

4.0 - 5.5

2012

8.0 - 10.0

6.0 - 7.0

5.0 - 6.0

4.0 - 4.7

7.0 - 8.0

4.8 - 6.0

1Q 2014

8.0 - 10.0

7.0 - 8.0

6.0 - 7.0

4.8 - 5.5

7.0 - 8.5

4.8 - 6.0

2013

8.0 - 10.0

6.5 - 8.0

5.7 - 6.8

4.7 - 5.5

7.0 - 8.0

4.8 - 6.0






Koregaon Park, Boat Club

Wanowrie, NIBM, Kondhwa

Location

Aundh

Baner

Kalyani Nagar

2008

3.4 - 4.5

9.6 - 12.7

4.9 - 6.1

NA

7.6 - 9.6

2009

3.3 - 3.6

8.5 - 10.7

5.0 - 5.2

NA

7.3 - 9.2

2010

4.0 - 5.0

9.0 - 13.0

5.0 - 5.5

5.0 – 6.5

8.0 - 12.0

2011

4.0 - 5.5

13.0 - 15.5

5.0 - 6.0

6.5 – 7.5

8.0 - 12.5

2012

5.0 - 6.2

14.0 - 17.0

8.0 - 10.0

8.0 – 10.0

12.0 - 14.0

1Q 2014

15.0 - 17.0

9.0 - 11.0

8.5 – 10.5

12.0 - 15.0

5.2 - 7.0

2013

14.0 - 17.0

9.0 - 11.0

8.0 – 10.0

12.0 - 15.0

5.2 - 6.5


Number of new launches in the city hovered at

around 3,500-4,000 units for the third consecutive

quarter. In 1Q 2014, 3,950 units were added to the

Pune residential market, a 4% q-o-q increase. This

decline in launches could majorly be attributed to

inventory pile-up amidst sluggish sales which forced

developers to postpone new project launches. Areas

such as Balewadi, Tathawade, Wakad and Marunji

along the NH4 Bypass stretch accounted for nearly

33% of new launches during the quarter, with

additional 18% being contributed by peripheral

locations such as Talegaon, Gahunje, Katraj, etc.

45


Kolte Patil NIBM Annexe Apartment 1 BHK: 915 to 9252 BHK: 1,015 to 1,1853 BHK: 1,475 to 1,575

110 Florence Margosa Heights - Phase 4

Kolte Patil Pimpale Nilakh Apartment 2 BHK: 1,2103 BHK: 1,575

22424K Glitterati 2 (Jazz)

Kolte Patil Marunji Apartment 1 BHK: 589 to 7482 BHK: 1,004 to 1,161

528Life Republic Third Avenue (2 towers)

The Phoenix Mills Limited Viman Nagar Apartment 3 BHK: 3,039 to 3,5584 BHK: 4,688 to 5,532

75Fountainhead

Goel Ganga Kharadi Apartment 2 BHK: 1,250 to 1,9863 BHK: 1,776 to 2,7194 BHK: 2,690 to 4,142

416Ganga Platino

Puranik Builders Baner Apartment 1 BHK: 450 to 4812 BHK: 776 to 798

128Aldea Espanola - Phase 4

Montvert Balewadi Apartment 3 BHK: 1,989 to 2,0144 BHK: 3,282 to 3,405

40Montvert Lumiere

Pharande Spaces Tathawade Apartment 2 BHK: 1,055 to 1,1373 BHK: 1,7214 BHK: 2,523 to 2,547

552Pharande Spaces Pune Ville

Areas such as Hinjewadi, Baner, Balewadi,

Mahalunge and Wakad along the NH4 Bypass stretch

witnessed significant construction activity during the

quarter. Majority of the areas along this corridor

witnessed q-o-q and y-o-y capital appreciation of

nearly 6% and 11% respectively in the mid-end

segment. This appreciation was primarily due to


demand for residential units in proximity to the

commercial hubs in Pune. Significant construction

activity was also noted along the southern stretch of

NH4 Bypass comprising of areas such as Bibwewadi,

Katraj, Ambegaon and Sinhagad Road. Construction

activity along the eastern corridor was dominated in

areas such as Hadapsar, Manjri, Kharadi and Wagholi.

In 1Q 2014, 731,600 sf of total office space was

leased in Pune which was concentrated mainly in

areas such as Hinjewadi, Viman Nagar, Aundh and

Yerwada. These four areas were the major activity

hotspots of the quarter, contributing to 85% and

68% of the leasing respectively in Grade A and All


Grade spaces. 1Q 2014 recorded total net absorption

of 622,900 sf, a 13% q-o-q and 26% y-o-y decline. IT-

ITeS occupiers accounted for 53% of the leasing in

1Q 2014. Weighted average rentals witnessed a

mixed trend across submarkets, with overall city

rentals remaining stable from the previous quarter.

46


Sanskruti Lifespaces &

Yashoda Properties

Aundh Apartment 3 BHK: 2,19744 Terraza

Marvel Realtors Salisbury Park Apartment 3.5 BHK: 2,6903.5 BHK: 3,550 to 3,725

10 Marvel Claro

Marvel Realtors Law College Road Apartment 4 BHK: 4,0456 Marvel Aeries

Eiffel Group & Nahar

Developers

Balewadi Apartment 2 BHK: 1,033 to 1,1223 BHK: 1,875 (PH)

80 F Residences

Viijcon and Brikone JV Chandkhed Apartment 1 BHK: 6582 BHK: 905 to 1,0133 BHK: 1,310

230 Abanna

The Scapers Group -

Tyagi Properties and

Rameshwar Group JV

Kondhwa Apartment 2 BHK: 954 to 991142 The Leaf

Calyx Constructions

Pvt. Ltd.

Pirangut Apartment 1 BHK: 542 to 6152 BHK: 920 to 1,0033 BHK: 1,275 to 1,285

520 Calyx Navyangan

Sanraj Realty Katraj Apartment 1 BHK: 646 to 6642 BHK: 926 to 1,013

208 Antara Apartment

Soft Corner India Talegaon Apartment 1 BHK: 625 to 7002 BHK: 878 to 950

165 Deccan Height

Kasturi Housing Wakad Apartment 4 BHK: 2,350120 Epitome

Lodha Developers Gahunje Apartment 1 BHK: 711352 Springwood Towers

(Tower 10 and 11) -

Lodha Belmondo


47

Koregaon Park and Camp submarkets witnessed

9.1% and 3.3% dip in mall rentals respectively. Due to

persistent demand, Nagar Road registered stability

in mall rental values from the previous quarter.

However, pick-up in leasing activity in a newly

opened mall led to 10% quarterly rise in rental values

at Hadapsar. Amongst main streets, JM Road and

Retail Sector

Bund Garden Road depicted stability in rentals. MG

Road, FC Road and Aundh registered 3.2%, 2.1% and

2.9% q-o-q rise due to increase in enquiries and

comparatively limited supply. Koregaon Park was

the only main street location, which registered a

3.7% quarterly decline in rentals, primarily due to

reduced enquiries from the retailers.

The residential launch activity is expected to

pick-up in the coming quarter as many developers

are planning new launches after Gudi Padwa and/or

general elections. Capital and rental values are

however likely to remain stable due to existing high

unsold inventory. New launches are expected to be

concentrated in the mid-end segment along the

peripheral locations of the city.

Nearly 4.9 msf of office supply is expected to be

delivered by the end of 2014, a significant portion of

which has been already delayed. Considerable

amount of supply might spill over to the next year due

to construction delays and only 1.5 msf is likely to be

delivered in the next two quarters. However, the

vacancy levels are likely to remain constant in the next

six months as transaction activity is expected to

Outlook

remain stable. In the short-term, rental values are also

expected to remain stable at current levels.

Pune is likely to witness stability in rental values

in majority of its main streets in the upcoming

quarter. However, mall rentals are likely to witness a

mixed trend with stability in Nagar Road and

Hadapsar due to new supply addition and a likely

decline in Camp and Koregaon Park amidst dip in

enquiries from retailers. Due to expected mall supply

of 430,000 sf and subdued leasing activity, overall

vacancy levels might increase in the next quarter.

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