SEE YOU IN · in Delhi and Mumbai will be passed within 60 days, thereby, bringing cheer to the...

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Venkaiah Naidu, union minister ofurban development, housing andurban poverty alleviation, recentlyannounced that housing approvalsin Delhi and Mumbai will be passed

within 60 days, thereby, bringing cheer to thereal estate sector.

Chintan Sheth, director, Sheth Corp says,“This is an excellent step taken by the govern-ment for the industry, as it will help expediteprojects, reduce corruption and malpractices,restore consumers’ faith in the sector andbring in a positive buying pattern.”

HOW IS IT GOING TO WORK?There will be an online process through whichapplications will be sent and approvals willcome within 60 days - be it while submittingthe application or approving the building lay-out or even for that matter, approving the feepayment, everything shall go digital. In casethe approval does not come on time, the devel-oper can file an affidavit and start the construc-tion. Ateet Vengurlekar, principal architect,

Blue Arch In-teriors and Archi-

tects informs,“There is an online website, which is soon go-ing to be launched for the developers of Delhiand Mumbai, where builders can apply fortheir approvals.”

The government officials are of the view thatthe system will make the approval process lesscumbersome and in turn, reduce corruption. Asenior official from the Brihanmumbai Munic-ipal Corporation (BMC) shares, “Going digitalwith approvals will ensure that the applica-tions from the developers are viewed on a real-time basis; minimum human interface will en-sure transparent communication and lastly, itwill make sure that the developers do not devi-ate from their original plans and adhere to theset rules and regulations.” While the demandfor housing in metros is on the rise, the indus-try has not been able to bridge the gap betweendemand and supply due to the already lengthyprocess of construction, which is further in-creased by the difficulty in obtaining permis-sions. Sushil Raheja, CEO, Raheja HomesBuilders & Developers says, “For any project tocommence on time and to be delivered withinthe given timeline, permissions play a crucialrole. The earlier the permissions get sorted, thebetter it is for both, the developer and the con-sumer. Any kind of delay in projects only adds

up to the overall cost and we are gladthat the concerned authorities have

taken up this issue.” At present, Raj Shah, director, Nam-

rata Group informs, “On an average,around 40 permissions have to be taken

from the government besides the otherpaperwork, which is a long-drawn and a

tiring process. Moving online is a great stepsince one can know the status of their files in

real-time, without having to physically goand visit the government offices.”

A DUAL ADVANTAGE:This move shall not only significantly reducethe time spent on approvals but also the moneyspent on the process, thus in turn, speeding upthe construction work. Online approvals willbring relief to the developers, as they will nolonger have to physically visit the governmen-tal offices for approvals. In case the approvalfails to appear on time, the developers or own-ers have the right to file an affidavit and startwith the construction process, thus making theentire process seamless. Vivek Mohanani, jointmanaging director, Ekta World points out,“Timely and quick approvals are essential ifsupply is to be generated in the affordablehousing sector. Additionally, the real estatesector has been majorly demanding a single-window clearance system since the last decadeand by implementing a 60-day cap on theprocess of approvals, we are getting a step clos-er in enabling the creation of inexpensivehousing stock. This will equally benefit thecustomers and developers alike, by fading outthe unexpected regulatory risks if any.” Ac-cording to the rules, once the building plan hasbeen approved, the builder should commencethe construction work within two years andthere should be no deviation from the sanc-tioned plans. At times, the delay in sanctioningthe plan leads to further delays in the construc-tion process with losses to be borne by the de-

velopers. In addition, the people who havebooked their properties at the initial stage,have to wait for the possession for longer thanassumed and promised.

Rajeev Mehra, a home-buyer informs, “Wehad booked a flat at Dahisar and the builder de-layed the possession by two years. He blamedthe delay in delivery on the civic officials, asthey failed to clear his proposal on time. Butnow with this new notification, I am hopefulthat in the near future, when I book a newhouse, I shall not suffer like the previous time.”

ALL IS WELL:It is a win-win situation for the buyers asthey shall get the possession on time andwould not have to shell out more money dueto the escalated construction costs. PunitAgarwal, MD and CEO, Nirvana Realtyexplains, “Moving approvals online shall givethe developers and buyers a definitetimeline, which will remove the uncertaintyaround the delivery timelines of homes. Toadd to it, the Return on Investment (ROI)would be better and the interest cost will alsoreduce substantially.” According to industryexperts, buyers are also willing to pay apremium if they are assured that their homeswill be delivered to them on time and if allthe approvals are in place.

Amit Wadhwani, director, Sai Estate Con-sultants, points out, “For genuine developerswho are interested in completing the projectson time, the policy will help save both, timeand money in the long run. They would be ableto provide possession to their clients on time,which would have been difficult earlier, due tothe multiple number of approvals needed.”

GOING AHEAD…Post the announcement, the real estate fra-ternity is only hoping that the policy issoon implemented, thereby easing theoverall construction and delivery process.Rohit Poddar, MD, Poddar Housing and De-velopment Pvt Ltd says, “The lack of atime-bound approval process has been abane to the real estate sector and particu-larly for affordable housing, for severalyears. Hence, this is a very important poli-cy, which should be enacted and gazettedimmediately.” Also, this move should not berestricted to Mumbai and Delhi alone butshould be applicable across India. ManjuYagnik, vice-chairperson of Nahar Groupconcludes by saying, “Online approvalsshould be a norm across the country. Themultiple permission process increases thegestation period of a project and with suchpositive directives being introduced, thelifecycle of a project would get trimmed-off considerably.”

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Mumbai, March 11, 2017

SEE YOU IN60days!

It was recently announced that housing approvals inDelhi and Mumbai would be granted within 60 days.The developer fraternity is hoping that post the move,woes pertaining to irregularity in construction anddelivery timelines would get resolved

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In 2016, out of the six cities,Mumbai accounted for 25 per centof the total new launchesA recently released report shed light on the performance of the real estate market of thecountry. Here are a few revelations...

Mumbai stands at 21 in the ‘citywealth index’, ahead of Toronto,Washington DC and MoscowDo the super-rich invest in real estate? Is Mumbai still an attractive realtydestination for the UHNWIs? A new report has some startling findings...

● In 2016, about 89,000 res-idential units werelaunched across six major

cities in India, which is 34per cent less than the units

launched in 2015. Out of the totalnew launches, Bengaluru accounted for 28per cent, Mumbai for 25 per cent, Pune for23 per cent, and the National Capital Region(NCR) for 15 per cent and Chennai for 9 percent.● MUMBAI SHOULD ALSO BESTIMULATED BY A PROBABLEFURTHER CUT IN THEINTEREST RATES AND THEIMPLEMENTATION OF THERERA REFORMS;● We anticipate a more active H2 2017as the gap between buyers’ and sell-ers’ expectations narrows again;● The certainty of implementation ofthe Real Estate (Regulation and Devel-opment) Act (RERA) and consumer ac-tivism in the form of various protests overtimely completion of projects have pusheddevelopers to focus on completion of exist-ing projects;

■ Out of 40 global cities, Mumbairanks 11 in the ‘future wealth’category ahead of Chicago,Sydney, Paris, Seoul, Dubai;■ According to the survey,income returns do not feature inthe top five priorities for UHNWIsin India. However, they do feelpotential fall in asset values andpolitical uncertainty are majorthreats to wealth creation in thenext five years;■ INDIAN CITIES THATSAW A RISE IN UHNWIsCOMPARED TO 2015INCLUDE PUNE (18 PERCENT), HYDERABADAND BENGALURU(BOTH AT 15 PERCENT) AND MUMBAI(12 PER CENT);■ Mumbai at 21 in the citywealth index is ahead of Toronto,Washington DC, Moscow; Delhi

at 35 is ahead of Bangkok,Seattle, Jakarta;■ Substantial proportion ofwealthy Indians are likely toinvest in residential property inthe next two years – 40 per centwithin the country and 25 percent overseas;■ The latest data on UHNWIindicates that developedmarkets are still an importantdestination to invest for UHNWIof the developing nations;■ The millennial UHNWIs in Indiafocus on capital growthcompared to the oldergeneration who also laidemphasis on wealthpreservation;■ Office is the top propertysector for investment; logisticssees a three-fold rise in terms ofinterest of wealthy Indians;■ 27 per cent of Indian UHNWIshave already invested incollectibles such as art, wine orclassic cars;

■ India houses two per cent ofthe world’s millionaires (13.6 mn)and five per cent of world’sbillionaires (2,024);

■ THE COUNTRY HASWITNESSED A12 PER CENTINCREASE OF UHNWIsBETWEEN 2015 AND2016 AND IS EXPECTEDTO GROW AT 150 PERCENT OVER THE NEXTDECADE;■ In India, Mumbai leads the racewith 1340 UHNWIs followed byDelhi (680), Kolkata (280) andHyderabad (260) UHNWIs.

SOME OF THE KEY FINDINGS OF THE REPORT ARE:

KNOWYOUR CITY

COLLIERS recently released a report – India PropertyOutlook 2017, presenting a comprehensive analysison how the realty market performed in the year gone

by and how it is expected to perform in this year. Some ofthe key insights of the report are:

● India’s y-o-yreal GDP growthreached about

7.1 per cent in2016 and is set to

remain above 6.5 per cent forthe next three years;● Office absorption has wit-nessed sustained momentumwith Grade A absorption for thenine major cities in India to-talling 41.6 million sq ft (3.9 mil-lion sq metres) in 2016, up 3.5per cent y-o-y and indicating ro-bust leasing demand from oc-cupiers;

● Bengaluru remained on ahigh growth trajectory andmaintained its leading statusamong the key cities by retain-ing a 31 per cent share of leas-ing volume last year, followedby Delhi-NCR on 18 per cent of

the total. Hyderabad and Chen-nai stood on 13 per cent eachwhile Mumbai, Pune andKolkata accounted for 14 percent, 9 per cent and 2 per centrespectively;● In the technology-driven mar-kets like Hyderabad, Bengaluru,Pune and Chennai, the de-mand-supply gap will remain aconcern in coming quarters.While a few Grade-A officebuildings are likely to see com-pletion towards end-2017,there is an expectation of anupward pressure on rents atleast over H1 in these markets;● WITH 10-12 PER CENTANNUAL GROWTH INTHE IT SECTOR LIKELYTO PERSIST TILL 2020,DEMAND FOR OFFICEGROWTH SHOULDREMAIN STRONG FORTHE NEXT FEW YEARSIN THE TECHNOLOGY-DRIVEN MARKETS;● As more and more compa-nies realise the importance ofadopting a flexible workingstrategy at the core of theirbusiness plans, use of co-work-ing space is gaining popularityin India as well. This trend waspioneered by start-ups, entre-preneurs and freelancers to ful-fil their need to work in a suit-able cost-effective environ-ment.

● With more than 50per cent of the pop-ulation below the ageof 25, the demograph-ic profile is veryfavourable, and thegovernment is pursu-ing bold, business-friendly-reforms; al-though so-called de-monetisation (i.e. thewithdrawal of high-val-ue banknotes) has hitgrowth in the nearterm;

Officemarket

Residentialmarket

● Institutional in-vestors maintained astrong interestover 2016 in financ-ing of Grade A resi-dential projects underconstruction, thushelping developers tocomplete their exist-ing projects. We ex-pect a similar trendat least in H1 2017;

● We expectdemand forquality stockin areas withgood connec-tivity and so-cial infrastruc-ture to revivein the nearterm, espe-cially in mid-segmenthousing.

KNIGHT FRANKINDIA, recentlylaunched, the 11th edi-

tion of The Wealth Report2017. The report tracks thegrowing super-rich popula-tion in 125 cities across 89countries and provides aunique perspective on the is-sues that are influencing UH-NWI (Ultra High Net WorthIndividual) investment andlifestyle decisions. SamantakDas, chief economist and na-tional director - research,Knight Frank India said,“Over the last ten years, wehave seen annually 500 newUHNWIs being added in In-dia and we expect this num-ber to double to 1000 everyyear in the coming decade.Out of 40 global cities, Mum-bai ranks 11 in terms of futurewealth accumulation aheadof Chicago, Sydney, Paris,Seoul and Dubai. Eventhough the residential mar-ket in India is reeling underpressure, 40 per cent ofwealthy Indians are likely toinvest in residential propertyin India in the next two yearswhile 25 per cent are keen foroverseas avenues.”

■ In the last 10 years,we saw additions ofaround 500 newUHNWIs annually inIndia; over the nextdecade, it will beapproximately

1,000every year;

■ India ranks 6th interms of growth rateof UHNWIs for 2016.With the current pace,the country isexpected to moveup to the 3rd spotover the nextdecade. The numberof UHNWIs in India hasincreased by 290per cent during thelast decade;

THANE - A Rs 200-crore ele-vated link is to be built onconcrete stilts, with one-thirdportion of the proposedbridge installed on the Thanecreek, culminating at theMumbai-Nasik highway.

ANDHERI –About80,000 peo-ple in Mum-bai travel toSEEPZ forwork. Being

in close prox-imity to SEEPZ, there is ahigh residential demand inthe region. For the proposedVersova-Bandra Sea Link(VBSL) project, the Maha-rashtra State Road Develop-ment Corporation (MSRDC)has secured the environmentclearance from the state envi-ronment department.

NAVI MUMBAIINTERNATIONALAIRPORT –Aimed to be one ofthe most ambi-tious projects forMumbai, the full-fledged construc-tion work on theRs 16,000 croreNavi Mumbai InternationalAirport is likely to begin onlyafter the monsoons.

VASHI - The Belapur jettynear the Panvel creek bridgehas been identified for Water-way project and the proposal isawaiting a nod from the NaviMumbai Municipal Corpora-tion (NMMC) general body.

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