Ashutosh Limaye, National Director – Research, JLL India
The area has a good mix of housing options that range from affordable apartments starting at Rs 3,500 per sq ft to the exclusive luxury villas at prices of Rs 13,500 per sq ft. Local, regional and national players are all present here. Eastern sub-market
Pune has seen a rapid growth in office rents over the last four-six quarters. This is due to absorption having increased during the same time period while Grade-A supply remained subdued. Interestingly, this rise in rentals is across Grade-A and B buildings. Project-specific rents also increased significantly higher than the market average during the period.
Among the three industries that constitute BFSI, banks have been doing the maximum number of lease transactions in Mumbai and Delhi’s CBDs. The latter has seen many financial services and insurance companies leasing or buying office space actively.
Average transacted office lease sizes across Mumbai, Bangalore, Chennai and Pune have increased from the uncertain times seen in 1Q14 – prior to the general elections.
Developers are wondering why end-users are not buying their projects even after offering numerous discounts and schemes. The latter, on the other hand, are playing the wait-and-watch game, expecting prices to go down given the continued slump in sales.
Mumbai has got another wake-up call to relook at its exorbitant real estate prices. With average prime district office rentals falling by 4% in 1Q15, Mumbai has performed better than only two cities in a global Jones Lang LaSalle survey.
Mumbai has hardly seen any new launches in the last few years. This will have implications in the next three years, with the supply pipeline drying up in the right locations like BKC Core and SBD (Central). On the other hand, peripheral areas such as Thane and Navi Mumbai will see an oversupply, which will actually be the supply that had got delayed due to the global financial crisis and would get constructed during this time period.
While prices in many established areas of Delhi declined, property prices across Mumbai increased in 2014
Already, developers in India need countless approvals, and the several steps that must be taken to obtain construction permits can take as much as two years. The World Bank’s 2014 report on ‘Dealing with Construction Permits’ ranks India 184th out of 189 countries.
The plan also did not provide an adequate vision and stance for facilitating affordable housing that the city requires so desperately. The DP was unclear about whether the densification measures would do any good for housing of low income groups and middle income groups, which form the backbone of residential activity for any Indian city.