cb property insights q2 2012

7/31/2019 CB Property Insights Q2 2012

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PROPERTYINSIGHTS

Cautious Demand Despite The Economic Uncertainties

India Quarter 2, 2012

INDIA MARKET OVERVIEW

The slow economic growth of India leading to a

GDP growth rate of only 5.3% during the last quarter

of the fiscal year 2011-12 was mainly due to the

poor performance by manufacturing, trade, hotels

transport and communication sectors. This was the

lowest quarterly growth recorded in the last nine

years. The wholesale price index reached its peak at

7.5% in May 2012 and depreciating rupee also touched

INR 57.15 in May 2012 around 12.3% lower than the

previous quarter. In a move to address these concerns,

the Reserve Bank of India had cut the key short term

lending rates by 50 bps at the start of the second

quarter of the year. However, without support from

the government itself inflation rose again in May &

June. These factors combined led many agencies like

Standard & Poor and Fitch to downgrade Indias rating

from stable to negative. Foreign Direct Investment

during the last quarter of fiscal year 2011-2012 was

recorded in excess of US$ 12.3 billion (Department

for Industrial Policy & Promotion, India), significantly

higher than US$ 3.4 billion during the same period

last year.

Contrary to the prevailing weak economic

sentiments, real estate sector witnessed some

positive trends during the second quarter of 2012

(April June). Office sector recorded absorption of

approximately 7.2 msqft (million square feet) across

all Grades registering an increase of nearly 16% over

the previous quarter. Almost all cities recorded an

increasing trend except Bengaluru and Pune where

there was a decline. Additionally 1.2 msqft of office

space was pre-committed during the same period.

New stock additions were recorded at 8.9 msqft

across the major cities. Residential markets remained

stable with only a few micro markets showing price

escalations. Launches of new projects remained

subdued compared to the previous quarter and were

mainly in the mid segment. An anticipated economic

revival towards the end of the year is likely to favour

the growth of the overall real estate sector in second

half of the year.

1


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INDIA TRENDS AND UPDATES

Economic Overview

Rising inflation, a long time concern, was again

aggravated in the second quarter. After some

moderation in March 2012, the whole sale price index

moved up to 7.55% in May 2012. Consumer Price

Index was recorded at 10.66% in May 2012, which is

reflective of the rising prices of food and commodities.

The Reserve Bank of India revised key rates in April

and reduced it by 50 basis points. Repo and the reverse

repo rate are at 8% and 7% respectively. However,

cash reserve ratio was left unchanged at 4.75%. This

time, the change in the central banks stance was

mainly to arrest the falling growth momentum of the

economy.

Rupee had started to depreciate since the end of

last year. However, in the second quarter the fall in

the value of the currency has been accentuated to

reach an all time low of INR 57.15 in May 2012 and it

continues to hover above INR 55 per US Dollar mark.

Inflow of Foreign Direct Investment in India

according to Department for Industrial Policy &

Promotion was estimated at US$ 36.5 Billion in 2011-

12 registering an increase of approximately 88%

over the previous year. The last quarter of the fiscal

year gained momentum and attracted investments in

excess of US$ 12.3 billion. It is also notable that FDI

outflows from India rose by nearly 12% to US$ 15.0

billion. Foreign Direct Investment in the housing and

real estate sector was estimated at US$ 731 million

during the year 2011-12 registering a decline of nearly

40% annually.

The BSE Realty Index had started to witness an

upward trend since December 2011 and had breached

the 1,800 mark in April to reach the highest for the

year. Thereafter from May 2012 onwards it started it

descent to close at 1,627.72 in June 2012 registering a

decline of 8% over the quarter.

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%12.0%

Jan-Mar07

Apr-Jun07

Jul-Sep07

Oct-Dec07

Jan-Mar08

Apr-Jun08

Jul-Sep08

Oct-Dec08

Jan-Mar09

Apr-Jun09

Jul-Sep09

Oct-Dec09

Jan-Mar10

Apr-Jun10

Jul-Sep10

Oct-Dec10

Jan-Mar11

Apr-Jun11

Jul-Sep11

Oct-Dec11

Jan-Mar12

GROSS DOMESTIC PRODUCT GROWTH RATE

Growth Rate (%)

Source: Central Statstcal Organisaton, Govt. of India

40

44

48

52

56

60

Jan-10

Feb-10

Mar-10

Apr-10

May-10

Jun-10

Jul-10

Aug-10

Sep-10

Oct-10

Nov-10

Dec-10

Jan-11

Feb-11

Mar-11

Apr-11

May-11

Jun-11

Jul-11

Aug-11

Sep-11

Oct-11

Nov-11

Dec-11

Jan-12

Feb-12

Mar-12

Apr-12

May-12

Jun-12

EXCHANGE RATE MOVEMENT (INR/USD)

INR/ USD

Source: MInistry of Finance, Govt.of India

171

2,121

8,749

12,62113,586

5,149

3,443

-

4,000

8,000

12,000

16,000

20 05 -0 6 2 006 -07 200 7-08 20 08 -0 9 2 00 9-10 2 010 - 11 2 011 -1 2

FDI INFLOW IN HOUSING AND REAL ESTATE SECTOR

FDI INFLOW IN INR Crore

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

0

1000

2000

3000

4000

Index

Source: BSE

BSE REALTY INDEX

2


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3

Residential markets across the country recorded

subdued demand during the second quarter with

reduced launches and transactions. Capital values

mainly remained stable across the major locationsbarring Hyderabad and select locations in Pune &

Gurgaon. Construction activities gained momentum

with several project completions being recorded

in Pune, Chennai and Gurgaon. Other projects in

the advanced stages of construction witnessed

appreciation across all cities.

Approximately 18,000 units were launched

across the major cities during the quarter registeringa decline of nearly 46% over the previous quarter.

Pune recorded the largest number of units launched

and accounted for nearly 37% of the total. Western

India, comprising of Mumbai, Pune and Ahmedabad

outweighed the other regions and was closely

followed by the south. In Hyderabad and Mumbai, the

reduction in the number of launches was mainly due

the apprehensions by the developers about the new

legislations, whilst in other cities, the developers are

awaiting a revival of positive market sentiments.

A further reduction in the interest rates and

improvement in the economic conditions may aid

revival of the demand in residential markets. Capital

values are likely to remain stable in the short termwhile the launches in the coming months are likely

to increase. Developers are likely to offer further

incentives to attract buyers in the upcoming festive

season to capitalize on the demand.

-

100

200

300

400

500

600

700

800

RESIDENTIAL CAPITAL VALUES GROWTH INDEX

Bangalore (Burnton Road Lavalle Road) Chennai (Boat Club)Hyd erabad (Banjara Hills) Ko lkata (Ballygunge)Mumbai (South) NCR (Satya Niketan Anand Niketan)Pune (Koregaon Park)

Source: Cushman & Wakefield Research

12%

25%

7% 5% 7% 5%

37%

2%

0%

10%

20%

30%

40%

NEW RESIDENTIAL UNIT LAUNCHES ACROSS LOCATIONS

IN Q2 2012

New unit launches (%)

Source: Cushman & Wakefield Research

Residential Overview


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4

Ahmedabad 5

Bengaluru 8

Chennai 11

Hyderabad 14

Kolkata 17

Mumbai 20

National Capital Region 23

Pune 26

Index


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5

Transaction activity in the residential market in

Ahmedabad continued to remain stable in the second

quarter of the year. Majority of the construction

activity was witnessed in upcoming locations along the

Ring Road and Sarkhej-Gandinagar Highway where

most of these projects cater to the mid segment.

Some of the prominent projects under construction

are Shantigram by the Adani Group and Apple Woods.

After healthy absorption in the previous quarterabsorption declined, and was estimated at 241,000

sqft with no supply of Grade A office space.

Demand has remained stable for both main street

locations and malls in the city. Ahmedabad is not

expected to receive any new supply of malls in the

near future.

Ahmedabad

Market Overview

Trends & Updates

Ready Residential Property Update

Capital values have remained stable during the

second quarter of the year for both the mid and high-

end segments due to the lack of demand. This is now

the case for the fourth subsequent quarter.

5,400

4,200 4,200

2,800 2,8002,333

-

1,000

2,000

3,000

4,000

5,000

6,000

Ready Residental Property Values in June'12

Price (INR/sqf) Represents mid and hi gh-end segmentsSource: Cushman & Wakefield Research

Source: Cushman and Wakeeld Research

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

Average Capital values High end (INR 000/Sq.ft.)

Location 2010 2011 1Q 2012 2Q 2012

Satellite 4.0-4.8 4.3-6.0 4.3-6.0 4.3-6.0

Vastrapur 3.7-4.0 3.7-5.0 3.7-5.0 3.7-5.0

S.G.Highway 3.7-4.3 3.7-4.5 3.7-4.5 3.7-4.5

Prahlad Nagar 4.2-5.3 4.2-6.0 4.2-6.0 4.2-6.0


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New Residential Launches

Ahmedabad witnessed a solitary launch in the

mid segment, offering over 350 units in the second

quarter of 2012. This project is located at S.G.

Highway and is priced competitively and offers the

usual amenities.

Under construction Residential Property Update

Retail Sector

Commercial Office Sector

The city witnessed healthy construction activity

during the quarter. Several large projects which were

running behind schedule have renewed their pace

to minimise any delays. Majority of the residential

projects under construction are concentrated alongthe Ring Road and S.G. Highway. Select projects

in areas like Bopal, Thaltej and Satellite road has

registered appreciation in values during the quarter

in the range of 2-8%. Some developers are offering

favourable payment schedules and incentives to

increase demand.

Both main-street and mall rentals remained stable

during the quarter and can be attributed to the lack

of major transaction activity and churn at main street

locations. Lack of quality options at prime main-street

locations have left retailers with a few options to

choose from. The food and beverage sector remained

the strongest demand driver in the city. Existing

high mall vacancies have restrained developers from

launching any new malls in the city.

Prahladnagar and S.G. Highway remained at the

centre of leasing activity contributing close to 61%

of total absorption for the quarter. Readily available

Grade A space has kept rentals stable during the

quarter. The vacancy level in the city stood at 9.7%.

The city witnessed a supply of 500,000 sqft of Grade

B space during the quarter.


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

* Esmated and as per market informaon

Average Capital values Mid Segment (INR 000/Sq.ft)

Location Q4 2010 Q4 2011 1Q 2012 2Q 2012

Satellite 2.8-3.8 2.8-4.3 2.8-4.3 2.8-4.3

Vastrapur 2.6-3.5 2.6-3.8 2.6-3.8 2.6-3.8

S.G.Highway 3.0-3.8 3.3-4.3 3.3-4.3 3.3-4.3

Prahlad Nagar 2.8-3.6 3.2-4.2 3.2-4.2 3.2-4.2

Project Name Developer Location Number of Units* Type Area of Units - in sqft

Aakruti Greenz Tirupati Sarjan S.G. Highway 352 Apartment 2BHK - 1,3053BHK - 2,205


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Capital values are expected to remain stable in

the upcoming quarter as the demand may continue to

be dampened. The festive season may see some new

launches but will mainly cater to the mid segment

and are expected to be competitively priced.

With significant Grade A commercial office

space developments nearing completion, the city

is expected to witness a fresh supply of 1.8 million

square feet (msqft). This is likely to create a downward

pressure on rentals due to prevailing high vacancies.

Ahmedabad is not expected to witness any new

mall supply during 2012. Rentals in both malls and

main street locations are expected to remain stable

to encourage leasing activity. Main street locations

at C.G. Road, Satellite Road and S.G. Highway are

expected to receive a chunk of enquiries from

retailers.

Outlook


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Bengaluru

Market Overview

Given the uncertain global economic conditions

and high interest rates, the overall demand in the

Bengalurus residential market has slowed down.

However, mid segment properties continued to

witness some interest, which encouraged developers

to launch new projects.

The office market in the second quarter was

marked by subdued absorption and a steep fall in pre-

commitments. Outer Ring Road (Sarjapur-Hebbal)micro-market witnessed maximum absorption,

around 60% of the total, followed by CBD/off CBD

micro-market. While 75% of the absorption was by

IT/ITeS sector, CBD/off CBD micro-market witnessed

maximum absorption by the non IT/ITeS sectors.

The retail segment witnessed the supply of two

new malls during the quarter admeasuring 1.05

msqft totally, at Yashwantpur and M.G. Road. These

developments became operational with more than

90% occupancy due to previous pre-commitments.

Prominent high streets continue to witness new

retailers entering and vying for quality spaces.

Trends & UpdatesReady Residential Property Update

Select markets in the mid and high-end segments

witnessed notable appreciation in capital values

of up to 13% compared to the previous quarter.

High-end micro markets such as Central and East

Bengaluru saw increased demand, primarily from

Non Resident Indians due to depreciating value

of rupee. North and South-West locations in the

mid segment category witnessed capital value

appreciation in the range of 10-13% over the last

quarter owing to increased interest.

The rentals remained stable across most micro

markets except in the North-West where there

was an increase in commercial and retail activities

marking it as an emerging residential destination.

8,750 8,500

6,350

4,925 4,7504,400

0

2,000

4,000

6,000

8,000

10,000

Ready Residental Property Values in June '12

Price (INR/sqf)Source: Cushman & Wakefield Research Represents mid an d high-end segments

Average Capital values High end (INR000/Sq.ft.)

Location 2008 2009 2010 2011 Q1 2012 Q2 2012

Central 14.0-18.0 12.0-14.5 13.5-17.5 14.0-18.0 16.0-21.0 18.0-23.0

South 7.0-9.0 6.0-8.5 6.0-9.5 6.5-10.0 6.5-10.0 6.5-10.0

Off Central 6.5-7.5 5.0-6.6 5.0-7.0 6.0-8.5 6.0-8.5 6.0-8.5

East 6.5-9.0 5.6-7.0 6.5-7.5 6.8-8.0 6.0-8.5 6.8-9.0

North 6.0-8.0 5.5-7.0 5.5-7.0 6.5-8.0 6.0-8.0 6.5-8.0




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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, Airport Road

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

Layout

South: Koramangala, 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

Key to Locations:

Average Capital values Mid Segment (INR000/Sq.ft.)

Location 2008 2009 2010 Q3 2011 Q1 2012 Q2 2012

Central 5.8-7.0 5.0-6.0 5.5-7.0 6.0-7.5 6.0-8.0 6.0-8.0

East 2.7-3.1 2.4-2.7 2.7-3.1 3.2-3.8 3.8-4.8 3.8-4.8

South East 2.9-4.0 2.5-3.2 2.8-4.0 3.4-5.0 4.0-5.5 4.0-5.5

South 5.0-6.5 4.6-5.7 4.8-6.0 5.0-6.5 5.0-7.0 5.0-7.0North 3.0-4.0 2.8-4.0 2.8-4.4 3.0-4.8 3.0-5.0 3.5-5.5

South West 2.8-4.2 2.7-3.9 3.2-4.5 3.6-5.0 3.6-5.0 4.0-5.5

Off Central* 4.0-6.0 3.7-5.7 4.0-6.2 4.5-6.7 4.5-7.0 4.5-7.0

Off Central** 3.5-6.0 3.3-5.7 3.8-6.2 4.3-6.7 4.0-6.5 4.5-6.5

North West 4.2-5.8 3.5-5.2 3.8-5.6 4.3-6.2 4.3-6.2 4.3-6.2



Despite the subdued demand witnessed by the

residential realty market, there were some significant

launches by the prominent developers like Sobha and

Salarpuria in the mid segment and Nitesh Estates and

Equinox Reality in the high-end segment.



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10

Given the subdued demand and present inventory

in the market, the under construction projects are

getting delayed. Also, the customers are being

attracted by various value added and customized

offerings by the new developers.

Under Construction Residential Property Update


Equinox Water Edge Equinox Reality Hebbal 400 Apartment 3BHK: 2,5264BHK: 3,067 to 3,870

Sobha Marvella Sobha Developers Sarjapur Road 86 Apartment 3BHK: 1,846 to 2,0684BHK: 3,700 to 3,744

Nitesh Napa Valley Nitesh Estates Jakkur 133 Villas 3BHK: 2,8594BHK: 4,243 to 5,631

Salarpuria Senorita Salarpuria Sarjapur Road 349 Apartment 3BHK: 1,540 to 1,917


Bengaluru witnessed a supply of 3.02 msqft of

office space and net absorption of 1 .06 msqft across

grades in the second quarter. Pre-commitments of

about 0.7 msqft were recorded. Maximum absorption

was witnessed in the Peripheral micro market of Outer

Ring Road where the rental values also appreciated

around 4%. The overall vacancy level decreased to

12.3%. The buoyancy in demand in the peripheral

micro markets of Outer Ring Road and Whitefield &

Electronic City, resulted in an appreciation in rental

values in the range of 4-6%.


The low availabilities in the existing malls and

lack of new supply have resulted in demand spilling

over to the main streets. As a result, rentals in the

prime main streets have appreciated by 8-9% in the

quarter.

Retail Sector

In the residential market, the capital values forthe next quarter are expected to be stable in most

of the micro markets. Factors like sustained demand

and high concentration of mid segment housing,

proximity to airport and IT hub are expected to cause

appreciation in capital values in locations like South-

East, North and East. The demand and appreciation

levels will rely on the interest rate movement in the

short term. The rental values are expected to be

stable over the next few months.

Around 7.73 msqft of new supply in the office

space is expected to come in the second half of 2012.

Subdued absorption levels are expected to prevail inthe next quarter also. However, micro markets like

Outer Ring Road might witness a marginal escalation

in the rentals by the end of 2012 because of the

healthy absorption level in this micro market.

Due to the lack of any planned malls supply during

the second half of the year, retailers may focus on

churn to secure leasing opportunities. Hence, the

rentals are expected to show slight appreciation in

select micro markets.

Outlook


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11

The residential market during the second quarter

of 2012, registered a slowdown in demand. On account

of sluggish sales activity, residential markets in

Chennai registered stable capital values as developers

refrained from increasing the rates in order to attract

consumers.

Leasing activity was also subdued during the

quarter, resulting in stable rental values across all

micro markets.

The commercial office market in Chennai registered

robust absorption during the second quarter of 2012.

Absorption of around 917,000 square feet (sqft)

registered during the quarter leading to marginally

lower vacancy in Grade A space. Despite the healthy

absorption, infusion of additional supply resulted in

stable rental values during the quarter.

Malls and main street rentals during the quarter

remained stable on account of limited leasing activity.

There was no new mall supply registered during

the second quarter of 2012. With no supply and

little leasing activity, the vacancy levels in the malls

persisted at 8.2% during the quarter.

Chennai

Market Overview

16,500

14,50013,500

9,0007,500

6,000

-

4,000

8,000

12,000

16,000

20,000

Ready Residental Property Values in June'12

Price (INR/sqf)Source: Cushman & wakefield Research Represents mid and high-end segments

Trends & Updates


The overall demand scenario in the housing market

was subdued during the quarter. The capital values

across various markets remained stable. Despite

the sales enquiry being sluggish, ready property in

the market continued to fare better than the under

construction projects as several transaction in the

high-end segment were recorded during the quarter.

Average Capital values High end (INR 000/sq.ft.)

Location 2008 2009 2010 2011 1Q 2012 2Q 2012

Boat Club 18.0-24.0 18-20 18.0-23.0 20-25.0 20-25.0 20-25.0

R.A Puram* 13.0-15.0 13-15 13.0-16.5 14.0-17.0 14.0-18.0 14.0-18.0

Besant Nagar NA NA NA 12.5-13.5 12.5-13.5 12.5-13.5

Kotturpuram NA NA NA 12.0-14.0 12.0-14.0 12.0-14.0

Adyar 5.5-10.0 5.5-9.5 8.0-12.0 11.5-13.5 12.5-14.0 12.5-14.0

Poes Garden** 14.5-20 14.5-18 14.5-20 17.5-24.5 18.5-25 18.5-25

Nungambakkam 13.0-16.0 13.0-16.0 13.0-16.5 13.0-17.0 14.0-18.0 14.0-18.0

Anna Nagar 6.0-9.0 6.0-9.0 7.5-10.5 8.0-11.5 9.0-12.0 9.0-12.0

Kilpauk 4.0-8.0 4.0-8.0 8.0-12.0 9.0-15.0 9.0-15.0 9.0-15.0

Source: Cushman & Wakeeld Research


*RA Puram also includes Alwarpet and Abhiramapuram

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


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Average Capital values Mid Segment (INR 000/sq.ft.)

Location 2008 2009 2010 2011 1Q 2012 2Q 2012

Adyar 4.5-6.5 4.5-6.5 6-8.5 8.0-11.0 8.5-12.0 8.5-12.0

Rajiv Gandhi Salai(Perungudi)

2.5-3.6 2.5-2.8 3.5-4.5 4.0-5.5 4.5-6.0 4.5-6.0

Velachery 3.8-4.2 3.5-4.0 3.5-5.0 3.5-5.5 4.0-6.0 4.0-6.0

T Nagar 4.0-6.5 4-6.5 7.5-10.5 8.5-11.5 8.5-13.0 8.5-13.0

Mylapore NA NA NA 8.0-12.5 9.0-14.0 9.0-14.0

Mogappair NA NA NA 5.0-5.5 5.0-6.5 5.0-6.5

Kilpauk 4.5-6.0 4.5-6.0 6.0-8.0 7.5-9.5 8.0-10.0 8.0-10.0

Chennais housing market registered a drop in

the supply front with close to 4,400 units launched

during the quarter, registering a 47% drop over

the previous quarter. Rajiv Gandhi Salai registered

the highest number of project launches during the

quarter. However, GST recorded the largest number

of units (28%) being launched during the quarter. Mid

segment accounted for approximately 60% of the

total number of units launched during the quarter.




Futura Casa Grande Off SH 57, 6 Lane High-way, Sriperumbudur

224 Row Houses and Villas Row Houses: 1007Twin Villas: 1381 Inde-pendent villas: 2750

Greenn Athens Green Tree Homesand Ventures

Kovalam KelambakkamRoad, (ECR KelambakkamLink Road)

40 Apartments 4BHK: 4600 to 5000

Greens Lotus GVSPL T.Nagar 11 Apartments 3BHK: 2370 to 3030Lumina Lancor Guduvanchery-Thiruporur

(Nellikuppam) Road,Guduvanchery

504 Apartments 3BHK: 1143 to 1287

Pushkara Marg Properties Kazhipattur, OMR 204 Apartments 1BHK: 5882BHK: 1075 to 11653BHK: 1265

The Gardenia Ozone Group 4th Avenue, Anna Nagar 32 Apartments 4BHK: 3640

Akash Ganga Rajkham Builders Saibaba Nagar, Pallikarnai 87 Apartments 2BHK: 919 to 10023BHK: 1182 to 1212

Groovy Woodz VIP Housing and Prop-erties, Shri JananiHomes Ltd

Kazhipattur, OMR 93 Apartments 3BHK: 21005BHK: 4000

Under construction projects during the quarter

also witnessed limited movement in capital values.

Nearly 15% of the projects registered moderate

appreciation in the range of 2-5%. However, several

projects in the suburbs were noticed to register price

increase over 8%.

During the quarter, Vijay Shanthi Builders handed

over several units of their Lotus Pond Project in

Kelambakkam.



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13

The demand scenario in the housing market is

expected to remain sluggish over the forthcoming

months. As a result the rental and capital values

across majority of the residential markets are

likely to remain stable.

As a result of the subdued demand scenario

and persisting vacancy levels, limited project

completions during the next two quarters are

expected in the commercial office sector. A

realistic supply estimate of 1.2 million square

feet (msqft) is expected to be infused during the

second half of 2012.

Despite the anticipated demand in main streets,

limited supply in these retail precincts is likely to

result in stable rentals during the third quarter

of 2012. With no new mall supply lined up for the

third quarter, the mall rentals are also expected to

remain stable.

Outlook

Low availabilities continue to prevail in the retail

main streets of Chennai. Retailers involved in the

jewellery business prefered to take up premium

properties in Anna Nagar, whereas some other luxury

retailers located in Khader Nawaz Khan Road exited

the city due to poor business prospects.

Retail Sector

Office space of over 341,000 sqft was infused during

the second quarter of 2012. The supply was restricted

to CBD and off-CBD markets. In the suburban and

peripheral office districts, developers were hesitantto complete their projects due to lack of commitments

for their under-construction inventory. Rental values

remained stable across all the micro markets during

the quarter mainly because of the addition of space

in the CBD locations and high vacancy rates in thesuburban and peripheral markets.



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14

Hyderabad

Market Overview

Hyderabads Residential Market saw an increase

in demand in the form of growing NRI investments

and enquires from end-users in the second quarter

of 2012. Due to this increase in demand, the prices

appreciated by around 7-10% in prominent mid

segment locations such as Miyapur, Chandanagar,

Kukatpally, Nallagandla etc. However there was not

much supply in the residential market due to the

uncertainty remaining over delay in announcementof revision for land reservation regulation (G.O.

45). The overall capital values witnessed marginal

appreciation in the range of 1-2% in areas such as

Himayatnagar, Madhapur, Gachibowli. The rentals

also remained stable across most locations.

There was a substantial increase in demand for

commercial office space market in Hyderabad in

the second quarter compared to the first quarter

with overall absoprtion was recorded at 870,000

sqft., nearly 23% higher than the previous quarter.

The supply was 1,510,000 sqft., which is nearly 2.7

times the previous quarter.

In the retail markets, main street rentals

reduced by 5-7 % due to reduced leasing enquiries

in the face of poor quality supply. The retail market

continued to expand into new locations such as

Chandanagar, Madinaguda, A.S. Rao Nagar.

Trends & Updates


The ready residential property witnessed stable

capital values in the second quarter of 2012. Though

there have been healthy enquiries about these

projects, prices in most of the areas have remained

mostly stable with only marginal increases in select

projects in Kondapur.

11,250

8,300 8,600

4,9005,500 5,350

-

2,000

4,000

6,000

8,000

10,000

12,000

Ready Residental Property Values in June 12

Price (INR/sqf)Source: Cushman & Wakefield Research Represents mid and high-end segments

Average Capital values High end (INR 000/sq.ft.)

Location 2008 2009 2010 2011 Q1 2012 Q2 2012

Banjara Hills 6.5-7.1 5.8-6.5 6.0-7.2 6.4-7.5 6.4-7.5 6.5-7.5

Jubilee Hills 6.5-7.1 5.5-6.3 6.0-7.0 6.2-7.2 6.1-7.2 6.1-7.2

Himayatnagar 3.4-4.4 3.3-4.0 3.7-4.0 3.7-4.2 3.7-4.1 3.7-4.1

West & East Marredpally 3.3-4.3 3.3-3.8 3.5-4.0 3.6-4.3 3.6-4.3 3.6-4.3

Begumpet, Somajiguda 3.9-4.5 3.9-4.5 4.1-4.5 4.3-4.8 4.3-4.7 4.3-4.7

Madhapur, Gachibowli 3.8-4.4 3.5-4.3 3.8-4.9 3.9-5.3 4.0-5.3 4.0-5.3

Kukatpally 3.3-4.3 3.3-4.0 3.5-4.5 3.8-5.1 3.8-5.1 3.8-5.1

Miyapur, Nizampet Road NA 2.6-3.3 2.7-3.4 2.8-3.5 2.9-3.5 2.9-3.5

Source: Cushman and Wakeeld ResearchThe above values for high end typically include units of 1,600-3,200 sq..


15/29

15

There were not many new residential launches

in this quarter due to the uncertainty over the landreservation regulation (G.O.45). Three new projects

with approximately 960 units were launched in areas

like Kukatpally, Shaikpet and Kompally, with one of them

being the launch of a new phase in an already existingproject. Approximately 4,000 units are in pre-launch

stage.


Average Capital values Mid Segment (INR 000/sq.ft.)

Location 2008 2009 2010 Q4 2011 Q1 2012 Q2 2012

Banjara Hills 3.4-4.2 3.6-4.2 3.6-4.5 3.8-4.6 3.8-4.6 3.8-4.6

Jubilee Hills 3.4-4.0 3.5-4.0 3.7-4.0 4.0-4.2 4.0-4.2 4.0-4.2

Himayatnagar 2.6-3.0 2.7-3.0 2.7-3.5 2.7-3.7 2.7-3.6 2.6-3.8

West & East Marredpally 2.5-3.0 2.5-2.8 2.7-3.0 2.8-3.2 2.7-3.2 2.7-3.2Begumpet, Somajiguda 2.5-3.0 2.6-3.1 2.8-3.5 2.9-3.6 2.8-3.5 2.8-3.5

Madhapur, Gachibowli 2.6-3.0 2.5-3.1 2.6-3.4 2.8-3.5 2.8-3.7 3.0-3.6

Kukatpally 2.4-2.8 2.4-2.9 2.7-3.2 2.9-3.5 2.9-3.5 2.9-3.5

Miyapur, Nizampet Road NA 1.8-2.5 1.8-2.5 2.4-3.0 2.3-3.2 2.3-3.3


The above values for mid range typically include units of 1,200-1,600 sq..


Project Name Developer Location Number of Units* Type Area of Units-in sqft

Lodha Meridian Lodha Builders Kukatpally 230 Apartment 2 BHK:1,278 to 1,4763 BHK: 1,854 to 2,259

Aparna Aura Aparna Constructions Shaikpet 130 Apartment 3 BHK: 1,820 to 2,406

Bhu:Sattva Saket Group Kompally 600 Apartment 3 BHK: 1,798 to 3,391

The under construction residential properties

in areas like Miyapur, Chandanagar, Kukatpally,

Nallagandla, Kondapur etc saw an increase in prices

by around 7-10%. This increase in prices was due to

growing enquiries from end-users and increasing

demand from NRI investors. However, the prices of

under construction properties were stable in areas

like Madhapur, Gachibowli, Tellapur, Pochampally.

There were a few projects like Bellezza in Kukatpally

and Vermont Projects in Begumpet where prices

increased by a huge margin of around 20-25% as

the last units of these projects were sold out in this

quarter.


In the office market, Grade A absorption (mostly

in the suburban micro market) was recorded at

over 520,000 square feet (sqft). However, there

was a downward trend in the absorption of non-IT/

ITeS space as companies are being cautious about

expansion due to the current global economic

uncertainties. The vacancy remained unchanged

from the first quarter at 16%. The office rentals

have also remained stable in most of the micro

markets.



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16

In the retail market, retailers expanded their

operations to new locations such as Chandanagar,

A.S.Rao Nagar, L.B. Nagar, Habsiguda due to adequate

supply, flexibility in leasing terms and favourable

rentals in these areas. The main street rentals

remained stable in most of the areas barring Banjara

Hills, Jubilee Hills and Ameerpet where they have

decreased by around 5-8% due to decrease in leasing

enquiries and lack of quality space.

Retail Sector

In the residential market, new launches are

expected in areas like Kukatpally, Miyapur, Nallagandla,

Shaikpet, Gopanpally in the next 3-6 months. The

overall demand is expected to increase mainly due to

NRI investors resulting in a price appreciation in primeresidential areas.

In the commercial office market, Grade A rentals

are expected to remain stable due to availability of

second generation space options. However Grade B

rentals might decrease a bit due to substantial supply

in the CBD and Off-CBD areas. Overall, the demand is

expected to remain moderate over next few quarters.

In the retail segment, there could be an overall

increase in the demand. Demand in new locations like

Chandanagar, A.S.Rao Nagar, L.B. Nagar, Habsiguda is

expected to increase as retailers continue expanding

into these new areas. Prime markets like Jubilee Hillsand Banjara Hills are also expected to attract more

foreign retailers. The lease of some malls is expected

to come up for renewals shortly, resulting in rentals

getting revised upwards in the next 3-6 months.

Outlook


17/29

17

Kolkata

Market Overview

During the second quarter of 2012, Kolkatas

residential market reflected a comparatively less

vibrant market scenario than the last quarter due

to continuing slow economic growth of the country

and high inflationary conditions. Project launches

were slightly lower than previous quarter as the

sales remained slow across the micro markets.

However, due to the existing supply demand gap

in affordable and mid segment, developers wereseen to launch most of their projects to cater to

this demand. Majority of the new projects were

launched in the peripheral locations like Sonarpur,

Nagerbazar, Birati, primarily due to gradually

improving infrastructure and affordable land prices.

The commercial office space market in Kolkata

also witnessed steady demand recording absorption

of approximately 750,000 sqft. Commercial office

space supply increased almost 61% over theprevious quarter at just under a million square feet.

The retail market in Kolkata recorded sluggish

transaction trend due to the current economic

situation coupled with lack of fresh mall supply in

the city. Major retailers pre-committed in under

construction malls and main streets. As a result,

main streets in CBD location, continued to witness

appreciating rentals.

8,500 8,5008,200

6,0005,500

4,500

-

2,000

4,000

6,000

8,000

10,000

Ready Residental Property Values in Jun '12


Trends & Updates


Mid and high-end ready properties across the

city continued to witness stable price points in view

of already high property prices and high inflation.

Capital values remained stable across most micro

markets for the quarter except for Southern

Avenue and EM Bypass where the property prices

witnessed 6% and 2% respectively.


Location 2008 2009 2010 2011 Q1 2012 Q2 2012

South 5.0 - 6.0 4.8-5.9 5.3-6.8 6.3-8.5 7.0-9.0 7.5-12.0

South Central 9.0-10.0 8.5-9.6 9.5-13.0 10.0-18.0 10.0-18.0 10.0-18.0

South East 4.5-5.7 4.5-5.7 4.5-8.0 5.8-9.2 5.8-9.2 5.8-9.5

South West 9.5-10.0 8.6-9.8 8.9-13.0 10.0-15.0 10.0-15.0 10.0-15.0

Central 7.5-8.5 7.2-8.1 7.5-9.2 8.3-10.2 8.3-10.2 8.3-10.2

East 4.0-5.0 4.0-4.7 4.0-4.9 4.5-5.5 4.5-5.5 4.5-5.5

North East 2.5-3.0 2.4-2.9 2.4-3.9 2.8-4.5 2.8-4.5 2.8-4.5


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


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Key to Locations:

Average Capital values Mid Segment (INR 000/Sq.ft.)

Location 2008 2009 2010 Q4 2011 Q1 2012 Q2 2012

South 2.8-4.3 2.7-3.9 3.2-4.5 3.8-5.5 3.8-5.5 3.8-5.5

South Central 4.5-5.5 4.2-5.3 4.5-6.0 5.5-8.0 5.5-8.5 5.5-8.0

South East 2.5-3.0 2.4-2.8 2.5-3.2 2.8-4.5 2.8-4.5 2.8-4.5

North East 1.8-2.2 1.9-2.2 2.2-2.7 2.4-3.0 2.4-3.0 2.4-3.0North 1.8-3.5 1.8-3.4 2.2-4.7 2.8-5.2 2.8-5.2 2.8-5.2


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

South*: Southern Avenue, Dover Lane

South-Central*: Ballygunge, Queens Park, Rainy Park,

Gurusaday Road, etc.

South-East: EM Bypass

South-West: Alipore Park Road, Ashoka Road,

Belvedere Road, etc.

Central: Lansdowne, Park Street

East: Salt Lake

North-East: Rajarhat

South**: New Alipore, Golf Green, Tollygunge, etc.

South-Central**: Hindustan Park

North: Kankurgachi, Lake Town, Jessore Road,

Ultadanga, etc.

Just over 1,200 residential units were launched

during the second quarter targeting the affordable

and mid segment projects. However, the number was

significantly less than previous quarters 1,600 units.

Most of the projects were launched in the peripheral

locations within the price bracket of INR.2,200 -

3,700. A small but significant project was launched in

the prime North location at Shyambazar during this

quarter.



Arihant Garden Arihant Group Rajarhat 70 Apartment 2BHK: 965 to 1,0203BHK: 1,201 to 1,334

Urban Greens (Phase-I) Loharuka Group &Baghban Developers

Rajarhat 112 Apartment 2BHK: 687 to 9813BHK: 892 to 1,0244BHK: 1,118 to 1,354

Himadri Ginni Realty (NaihatiJute Mills subsidiary)

Shyambazar 216 Apartment 3BHK: 1,623 to 2,053

Magnolia Skyview Magnolia InfrastructurePrivate Limited

Rajarhat 300 Apartment 2BHK: 980 to 11853BHK: 1,228

BCT Sonar Sansar BCT Infrastructure LLP Sonarpur 131 Apartment 3BHK: 1,028 to 1,2644BHK: 1,188 to 1,290

Subarna Bhoomi Bengal DCL NagerBazar 140 Apartment 3BHK: 1,283 to 1,310

Panchsheel Vatika Panchsheel Birati 60 Apartment 2BHK: 851 to 8833BHK: 1,173 to 1,249

Chitrakut Dham NNP & Meridian Group Rajarhat 140 Apartment 2BHK: 795 to 1,1153BHK: 991 to 1,229



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19

Under construction projects by reputed developers

in New Town Rajarhat continued to reflect a stable price

trend as the take up of the units has slowed down than

the previous quarter. However, under construction

properties alongside the emerging corridors in North

and South peripheral locations continued at a steady

pace.

Kolkatas office market witnessed an improved

transaction scenario as compared to the last quarter.

Absorption was mainly concentrated in the locations

of Salt Lake and Rajarhat, predominantly by the IT/

ITeS companies accounting for nearly 93% of the

total office space transactions. Due to availability of

Grade A supply in peripheral locations, rental values

remained steady in Rajarhat. However rentals for

Grade A properties in Park Street/Camac Street area

continued to witness nominal appreciation, mainly

due to the low vacancy prevailing in the micro market.

Kolkatas retail market exhibited a less vibrant

scenario with its slow pace of transactions. There

was no fresh supply of mall space hence, the vacancy

level remained unaltered. Due to lack of mall supply,

major retailers were seen to pre-commit in under

construction malls and main streets. Rental values

remained stable across malls except Elgin Road where

a prime mall has started renewal of its lease at a

higher rate. Main streets in CBD continued to witness

high appreciation due to increased enquiries.



Retail Sector

The growing demand-supply gap in mid ranged

residential properties is expected to keep the

residential market thriving in the next quarters.

A few high-end projects are expected to be

launched during the second half of the year on

the expectations of improvement in the overall

economic scenario. Capital and rental values are

expected to remain stable across the city.

Almost 1.7 msqft Grade A office supply is likely

to get infused this year, which will be concentrated

in Salt Lake and Rajarhat locations. The high

vacancy levels in these locations will continue to

keep the rental values stable. Rental value around

Ruby connector area will appreciate further due

to increased demand and low supply. However,

rental values along the EM Bypass, Topsia side

are expected remain stable on account of ongoing

flyover construction work.

The retail market in the city is likely to see

approximately 350,000 square feet (sqft) of fresh

mall supply during the second half of the year. This

mall supply being insufficient to meet demand,

existing malls and main streets will continue to

witness appreciating rentals.

Outlook


20/29

20

Mumbai

Market Overview

Mumbai witnessed a reduced number of new

launches during the quarter. This is primarily due to

developers ensuring compliance with the new DCR

rules and other regulations requiring allocation

of 20% of area in each new project admeasuring

2,000 square meters and more for the lower

income group.

The commercial office market in Mumbai

witnessed a healthy absorption of 1.45 millionsquare feet (msqft) of Grade A space. This is a 9%

increase over the previous quarter. Additionally

pre-commitments stood at approximately 500,000

square feet (sqft) mainly concentrated in Bandra-

Kurla Complex.

Mall and main street rentals have remained

stable during the quarter with the exception of

Vashi. Lower transaction activity, existing vacancy

levels and some churn resulted in stable rentals for

the quarter.

37,000 36,00033,000

11,0009,500

5,700

-

10,000

20,000

30,000

40,000



Trends & Updates

Ready Residential Property UpdateAll micro-markets have witnessed stable capital

values except North, Far North and North-East

where appreciation has been seen in the mid and

high end segment. Lack of quality options in North

Mumbai have resulted in rise of capital values

in premium projects at the location. Residential

leasing activity has remained at par resulting in

stable rental values across all micro markets.

Average Capital values High end (INR000/sq.ft.)

Location 2008 2009 2010 2011 1Q 2012 2Q 2012

South 43.0-55.0 42.5-58.0 43.0-60.0 45.0-65.0 45.0-65.0 45.0-65.0

South Central 47.0-67.0 42.0- 66.0 45.0-70.0 45.0-75.0 45.0-75.0 45.0-75.0

Central 33.0-53.0 34.0-55.0 35.0-55.0 32.0-54.0 32.0-54.0 32.0-54.0

North 27.0-31.0 22.0-30.0 24.0-32.0 24.0-32.0 24.0-32.0 24.0-32.0

Far North 9.0-13.0 10.0-16.5 11.0-16.5 11.0-16.5 11.0-16.5 12.0-18.0

North East 14.0-18.0 10.0-16.0 10.0-16.0 10.0-18.0 10.0-18.0 11.0-18.0


Note: The above values for high-end segment typically include units of 2,500 - 6, 000 sq for South, South-Central, Central and North and units of 1, 800 4,000 sq for North (Santacruz & Juhu),Far

North and North-East


21/29

21

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:

Average Capital values Mid Segment (INR000/sq.ft.)

Location 2008 2009 2010 2011 1Q 2012 2Q 2012

South 27.0-34.0 28.0-37.0 30.0-40.0 30.0-40.0 30.0-40.0 30.0-40.0

South Central 34.0-43.0 35.0-45.0 40.0-48.0 43.0-52.0 43.0-52.0 43.0-52.0

Central 18.0-28.0 15.0-26.0 17.0-30.0 17.0-35.0 17.0-35.0 17.0-35.0

North 13.5-19.5 16.0-24.0 16.0-25.0 16.0-25.0 16.0-25.0 18.0-27.0Far North 7.0-9.0 8.5-11.5 9.0-11.5 9.0-13.0 9.0-13.0 9.5-13.5

North East 6.0-7.4 6.4-8.5 6.5-8.5 6.5-10.0 6.5-10.0 7.5-11.0

Mumbai witnessed around 1,200 units launched

in the second quarter of 2012. The new projects were

mainly concentrated in the peripheral locations, but,

few significant ones were in the city and suburban

micro markets.



Khushi Paradise Khushi builders Dhaisar 138 Apartment 1BHK: 7452BHK: 975

Tropical Lagoon Tower 3 Soham Builders Thane 88 Apartment 2BHK: 1270 to 13303BHK: 1630

Sai Miracle Paradise Group Kharghar 110 Apartment 2 BHK: 1225 to 12653 BHK: 1685 to 1710Terrace Flat: 2500 to 3125

Indiabulls Blu Indiabulls Worli 360 Apartment 2BHK: 14803BHK: 23964BHK: 2940

Hubtown Hillcrest Hubtown Andheri East 160 Apartment 1 BHK: 730 to 7752 BHK: 1020 to 10602.5 BHK : 1150

Hubtown Sunmist Hubtown Andheri East 90 Apartment 2BHK: 17003BHK: 24004BHK: 2800

Gaurav Legend Ravi Group Andheri East 120 Apartment 1BHK: 495

Ajmera Pristine Ajmera Group Borivali 70 Apartment 3BHK: 1595

Godrej Serenity Godrej Properties Chembur 68 Apartment 3BHK: 14164BHK: 1925 to 1993Penthouse: 3538 to 3683



Note: The above values for mid segment typically include units of 1,400 - 2,500 sq for South, South-Central, Central and North and units of 1,200 - 1,600 sq for Far North and North-East


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Modest leasing activity was witnessed across

malls and main street locations across the city

during the last quarter. Transactions were mainly

driven by lifestyle and the food and beverage

segment. Both main street and mall rentals largely

remained stable during the quarter. Vashi was an

exception as it witnessed a 5% increase in mall

rentals.

The commercial office market in Mumbai

witnessed absorption of 1.45 msqft of Grade A

space. BFSI sector continued to remain the highest

demand driver with a 22% share in absorption.

Andheri (31%), Lower Parel (26%) and Nariman

Point (13%) had the highest share in absorption.

Grade A supply for the quarter stood at 1.39 msqft

a 64% increase over the previous quarter. Supply

was mainly concentrated in Andheri and Lower

Parel. Grade B supply stood at 1.08 msqft a 170%

increase over the previous quarter. Rentals have

remained stable due to prevailing high vacancies

across the city.

Retail Sector


Both rental and capital values are expected

to remain stable in the upcoming quarter. Most

upcoming launches are expected to cater to the

mid segment with Goregaon and Malad expected

to see new project launches in the near future.

Suburban locations like Malad and Goregaon

along with peripheral locations in Thane and

Navi Mumbai are expected to witness increased

interests by both end-users and investors alike.

Fresh supply of approximately 2.96 msqft is

expected to be infused in the next quarter. This new

supply is predominantly in Bandra-Kurla Complex

which accounts for a 65% share. Commercial office

rentals in the city will continue to remain stable

due to high vacancies and competitive pressure

from upcoming supply.

Mall rentals in Malad, Goregaon and Link road

are expected to witness a minor appreciation on

account of low vacancies and no new mall supply.

Construction has begun on the next phase of

Nirmal Lifestyle at Mulund. Viva City an under

construction mall at Thane is expected to be

completed in the first quarter of 2013.

Outlook

The city has witnessed healthy construction

activity during the last quarter especially in locations

like Thane, Goregaon, Malad and Navi Mumbai. Some

developers are offering payment schemes to attract

new customers. Prices have witnessed an appreciation

for some premium under construction projects.



23/29

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The residential real estate market recorded

a stable trend in the capital values across most

micro markets in the region. However, Gurgaon

was an exception as it recorded appreciation in

capital values in the mid and high-end segment by

4% and 6% respectively compared to the previous

quarter. The rental values in Gurgaon also recorded

appreciation by nearly 12% owing to the increase

in demand for commercial office spaces during the

quarter.

The office market recorded a total absorption

of 940,000 sqft during the quarter registering a

growth of nearly 57% over the quarter. This was

despite of a significant drop in the total number of

transactions. The demand was driven mainly by the

IT/ITeS and consulting companies.

Slow pace of construction and deferment has

resulted in no mall supply during the quarter.

The demand for space in the main streets was

witnessed from both domestic and international

retailers. Rental values remained stable across the

main streets and malls with the exception of Khan

Market and Gurgaon.

National Capital Region

Market Overview

15,250

9,7508,750

10,250

7,300 7,250

-

5,000

10,000

15,000

20,000



Trends & Updates


Prices of ready properties across the micro

markets of Delhi and Noida remained stable on

account of subdued demand and prevailing high

values. Apartments in the established locations of Golf

Course Road and Sohna Road in Gurgaon continue to

see appreciation and have established new peaks.


Location 2008 2009 2010 Q4 2011 Q1 2012 Q2 2012

South West 28.0-33.0 29.0-34.0 36.0-43.0 42-50.0 50.0-60.0 50.0-60.0

South East 19.0-23.0 21.0-24.0 24.0-30.0 25.0-35.0 25.0-40.0 25.0-40.0

South Central 20.0-23.0 21.0-25.0 25.0-32.0 27.0-40.0 27.0-40.0 27.0-40.0

Central 45.0-50.0 40.0-45.0 50.0-57.0 50.0-65.0 60.0-80.0 60.0-80.0

Gurgaon 5.2-11.0 5.3-12.5 6.2-18.0 8.5-21.0 9.5-25.0 10.0-26.0

Noida 5.2-6.2 5.2-6.5 5.5-7.0 5.5-7.5 5.8-8.0 5.8-8.0


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


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Average Capital values Mid range (INR 000/Sq.ft.)

Location 2008 2009 2010 Q4 2011 Q1 2012 Q2 2012

South East 14.0-16.0 14.5-16.5 15.0-20.0 15.0-28.0 20.0-30.0 20.0-30.0

South Central 18.0-20.0 18.5-20.5 20.0-23.5 25.0-30.0 25.0-30.0 25.0-30.0

Gurgaon 3.8-5.2 4.0-6.5 4.5-7.5 5.0-9.0 6.5-9.0 6.5-10.0

Noida 3.0-4.5 3.2-5.5 3.8-5.6 4.2-5.8 4.5-6.0 4.5-6.0Source: Cushman & Wakeeld Research

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

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:

Several projects were pre launched this quarter

mainly in the mid segment and are expected to be

formally launched in the coming months to capitalise

on the opportunities provided in the festive season.

The rates of these projects are also likely to move

upwards. Majority of the projects in Gurgaon expected

to be concentrated in the Dwarka Expressway and the

Southern Periphery Road

New Launches

Project Name Developer Location Number ofUnits*

Type Area of Units - in sqft

International City Phase II Shobha Developers Sec 109, DwarkaExpressway, Gurgaon

180-200 Villas 3,493

Wind Chants Experion Sector 112, Gurgaon 550 600 Apartments 2 BHK: 2,2753 BHK: 2,676 to 3,6504 BHK: 4,600Penthouse: 8,800

The Orchards Jaypee Group Sector 131, Noida 1,200 1,300 Apartments 2 BHK: 1,2353 BHK: 1,798 to 2,1054 BHK: 2,600



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25

Construction activities for projects in their

advanced stages were noticed to be brisk. Few

developments in Gurgaon were completed

and handed over. Several other residential

developments are in their final stages and are likely

to be handed over in the coming months. Almost

all the projects under construction in Gurgaon and

Noida have registered appreciation in the range of

5-8% over the quarter.


The supply of office space during the second

quarter was recorded at 925,000 sqft with Noida

accounting for nearly 725,000 sqft. The CBD

location of Connaught Place also recorded an

infusion of around 200,000 sqft all of which was

Grade B stock.


Demand for space in the prominent main

streets of Khan Market and Greater Kailash 1

was mainly from the domestic retailers in lifestyle

and jewellery segments. Rents across the main

streets remained stable except for Khan Market

recording a marginal appreciation of 2%. Leasing

activities in malls were limited during the quarter

leading to stable rentals. However, select malls in

Gurgaon offering quality retail spaces saw a rental

appreciation of 7% over the previous quarter.

Retail Sector

The rental and capital values for the residential

micro markets in Delhi are likely to remain stable in

the short term. However, the locations of Gurgaon

and Noida may witness marginal appreciation

owing to increased demand as the economy

improves.

An increased pace of absorption is anticipated

to continue in the second half of the year and will

be mainly in Gurgaon and Noida. Approximately

7.5 msqft of office space is under construction and

is likely to be added in the second half of the year,

which is likely to keep the rentals under pressure.

New mall developments of nearly 1.7 msqft are

likely to be added in the second half of the year

across all the micro markets. This is likely to exert

pressure on the rental values and prevent them

from appreciating in the short term. However,

demand across the main streets is anticipated to

remain buoyant and they may witness a marginal

rental increase by the end of the year.

Outlook


26/29

26

Pune

Market Overview

The second quarter witnessed launch of new

residential projects catering to the mid and high-

end segments and was concentrated in the western

corridor spreading across the micro markets of Wakad,

Baner, Hinjewadi, Chinchwad and Mulshi. Several micro

markets registered appreciation in capital values during

the quarter. Rental values have been stable across most

micro markets except Baner.

The city has recorded a marginal decrease of 1.9%

in absorption of commercial space, from the previous

quarter. Supply of this quarter was recorded at 110,000

sqft and the overall vacancy rate at just under 20%. The

rentals across the city have remained stable. The office

segment has observed overall slowdown due to delayed

expansion plans of the occupiers given the current

economic conditions.

The main streets in Pune continue to generate

demand among the retailers and witnessed rental

appreciation over the quarter. Despite no new mall supply,

the prevailing high vacancy levels in the malls have led to

the stabilisation of rental values as the developers are

keen to attract tenants.

8,500

7,500 7,500

4,600 4,538 4,500

-

2,000

4,000

6,000

8,000

10,000

Residental Property Values in June '12


Trends & Updates


Micro markets such as Aundh and Baner have

witnessed capital appreciation by 9% in the highend

segment in comparison to previous quarter. While

prime locations such as Koregaon Park and Kalyani

Nagar recorded a marginal upward trend, Wanowrie

also recorded a quarterly 10% increase, primarily due

to launch of new projects.


Location 2008 2009 2010 Q4 2011 Q1 2012 Q2 2012

Koregaon Park, Bundh Garden 9.6-12.7 8.5-10.7 9.0-13.0 13.0-15.5 14.0-16.0 14.0-17.0

Aundh 4.9-6.1 5.0-5.2 5.5-6.5 13.0-15.5 7.5-9.0 8.0-10.0

Kalyani Nagar 7.6-9.6 7.3-9.2 8.0-10.5 11.5-13.0 12.0-14.0 12.0-14.0

Wanowrie 3.4-4.5 3.3-3.6 4.0-5.0 4.0-5.5 4-5.5 5.0-6.0


Note: The above values for high-end segment typically include units of 1,650-3,000 sq


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Nearly 6,600 units, catering to both mid as

well as high-end segments, were launched in the

second quarter 2012. Also new locations such as

Wagholi are witnessing launch of several projects

by prominent builders. Primarily these have been

launched at prices similar to previous quarter

except few select projects which are launched at

higher prices respective to their micro markets

such as Baner, Wakad.


Average Capital values Mid Segment (INR 000/Sq.ft.)

Location 2008 2009 2010 Q4 2011 Q1 2012 Q1 2012

Koregaon Park, Boat Club 4.5-5.0 4.5-5.5 6.0-7.0 8.0-9.0 8.0-9.5 8.0-9.5

Aundh 3.5-4.0 3.6-4.2 4.0-5.0 4.5-5.5 5.0-6.0 5.0-6.0

Baner 3.0-3.8 2.9-3.6 3.5-5.5 4.0-5.5 4.0-5.5 4.5-5.5

Wakad 2.5-3.0 2.2-2.8 3.5-4.0 3.7-4.5 3.7-4.5 4.0-4.7Kalyani Nagar 4.5-5.5 4.5-5.5 6.5-7.0 6.5-7.5 6.5-7.5 7.0-8.0

Wanowrie 3.0-3.2 2.8-3.1 4.0-5.5 4.0-5.5 4.0-5.5 4.0-5.0


Note: The above values for mid segment typically include units of 1,200-1,400 sq


Project Name Developer Location Number of Units* Type Area of Units

Sereno Amit enterprises Baner 468 Apartment 2BHK: 11613BHK: 1631

Renaissance Monarch Wakad 250 Apartment 2,3 & 4 BHK: 1262 to 3200

Eon Homes Kasturi Housing Hinjewadi 160 Apartment 2BHK: 1185 to 1415

L-axis Pharande Space Mulshi 600 Apartment 2BHK: 9453BHK: 1557

Empire Square Sukhwani - Agarwal group Chinchwad 850 Apartment 2 BHK: 11603 BHK: 1550

Fria Marvel Wagholi 700 Apartment 2 BHK: 12553 BHK: 1660

Arisrolia Fortune Group Hadapsar 141 Apartment 2BHK: 1019 to 1085

Umang Kolte patil developers Kharadi 3,000 Apartment 1 BHK: 6702 BHK: 965

The second quarter of 2012 saw the completion

and handover of mid segment residential projects

located at Viman Nagar, Hinjewadi, Pashan, Baner,

and Wakad. A few projects located in the suburban

and peripheral locations like Hinjewadi, Baner and

Wagholi are in advanced stages of construction and

are likely to get completed in a few months. Fast

paced construction activities have led to capital

appreciation in under construction projects in

micro markets such as Wagholi, Wakad, and Baner.



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Major international brands such as Calvin Klein,

FCUK, and Nautica have established their presence

in the city. The prime main streets such as M.G. Road

and J.M. Road have witnessed rental escalation in the

range of 7-9%, mainly due to lack of quality main street

space available. Also, Aundh witnessed increased

enquiries from apparels, food and beverages, and

furniture stores in terms of retail space due to its

proximity to Hinjewadi.

During the second quarter, Pune witnessed a

supply of 110,000 sqft of office space in the CBD.

During the same period, the city recorded absorption

of nearly 700,000 sqft of which 70% was recorded in

Grade A properties. Rentals have been stable across

most micro markets except for a marginal increase in

Hadapsar.

Retail Sector


The residential markets in Pune are likely to

witness a capital appreciation in select locations

such as Wanowrie, Baner, Wakad, and Chinchwad

due the increasing demand for these mid-segment

residential hubs. Rentals across the micro markets

are likely to remain stable. The residential market

in Pune is expected to maintain its momentum

across the city in the medium term.

The city is likely to witness an infusion of

approximately 1.7 msqft of commercial space

during the next quarter, catering mainly to micro

market such as Viman Nagar, Yerwada, and

Kharadi. Increased development activities are

likely to be expected on the eastern corridor. The

rentals are expected to remain stable for the next

quarter.

Main street rental appreciation is likely to

continue over the next quarter. An additional

supply of 700,000 sqft is expected at the end

of the year in Hadapsar. With pre-commitments

observed in the upcoming supply at Hadapsar,

mall rentals are expected to remain stable during

the next quarter.

Outlook


29/29

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cb property insights q2 2012

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