HomeGlobalWeekly Real Estate News Tracker – 2 July 2023
Weekly Real Estate News Tracker – 2 July 2023
July 2, 2023
1. Mumbai’s Property Sales Decline By Over 6% Year-On-Year
Year-on-year biannual data of property registrations done in Mumbai shows a 6.39% decline. In 2022, between January and June, a total of 66,760 agreements for sale were registered with the Department of Registration and Stamps. On the other hand, during the first six months of 2023, which is up to June 30, 62,492 agreements for sale were registered. In June 2023, a total of 10,319 property sale agreements were registered, as per data available from the state government. The previous June, 9,919 agreements for sale were registered in Mumbai.
2. Macrotech Developers emerges top bidder for Mumbai-based V Hotels
Lodha Group’s listed entity Macrotech Developers has emerged as the successful bidder for Mumbai-based V Hotels Ltd, owner of Tulip Star, formerly known as Centaur Hotel Juhu. The Committee of Creditors (CoC) of bankrupt V Hotels have declared the real estate developer as the successful resolution applicant in relation to the Corporate Insolvency Resolution Process (CIRP) of the hospitality company. V Hotels has real estate assets that can be developed for residential and allied uses, Macrotech Developers said in a regulatory filing.
The hotel has a 6.1-acre land parcel on Juhu Tara Road in Mumbai’s western suburb Vile Parle. The existing development has around 367 keys with restaurants, large banquets, and a small retail component. However, the hotel is currently non-operational.
3. Mumbai accounts for 77% of India’s tallest building; here’s all you need to know
Mumbai ranks 17th and 14th in Asia among cities with the maximum number of tall buildings. Almost 77 percent of tall buildings in India – those higher than 150 metres – are located in Mumbai. Hong Kong has one of the highest numbers of tall buildings in the world. Shenzhen, New York City, Dubai, Guangzhou, Shanghai, and Tokyo rank high on the Global Financial Centres Index, according to CBRE India. ndia has about 250 tall buildings that are completed or under construction. Mumbai is followed by Hyderabad, where planners are keen to grow vertically, according to a report by real estate consultancy CBRE India. Of the 10 tallest buildings in India, 5 are complete and 5 are under construction.
4. Highest-ever half-yearly stamp duty collection in Mumbai on record registrations
Mumbai, the country’s biggest and most expensive property market, has continued its record-setting spree as demand continued to be robust and its conversion in actual sales remained unaffected despite higher mortgage rates and property prices. The country’s commercial capital witnessed registration of over 10,113 properties in June, taking the number to record 62,285 in the first half of 2023. The higher tally of registration has helped the state exchequer collect over Rs 837 crore in June through stamp duty charges pushing the half yearly collection to nearly Rs 5,600 crore.
5. K Raheja Corp enters into development agreement for luxury project in Mumbai
K Raheja Corp has entered into a development agreement with Cinevista Ltd to develop a land area in a Mumbai suburb where the real estate developer plans to set up a luxury housing project. K Raheja Corp’s share of the market value of the project is ₹272 crore while the owner’s share is ₹78.4 crore. Cinevista is the owner of the property and development will be undertaken by K Raheja Corp. The total plot area is 15,817.5 square metres and the permissible built-up area is 52,117 square metres of which the developer’s share is 75.5 per cent and the owner’s share is 24.5 per cent.
1. Delhi court sends Supertech’s chairman to ED custody till July 10
In its application seeking R.K Arora’s 14-day custody, the ED told the court that the accused was required to be interrogated to unearth the larger conspiracy in the case. R.K Arora was arrested on Tuesday under the criminal sections of the Prevention of Money Laundering Act (PMLA) after three rounds of questioning.
2. Conscient Infrastructure acquires 6.6 acre land in Gurgaon
Gurgaon based real estate developers Conscient Infrastructure has acquired 6.6 acre land for around Rs 80 crore. Apart from doing projects separately, Conscient Infrastructure has partnered with Hines, the international real estate firm for a project in Gurgaon. The land parcel has a development potential of more than one million sq ft and the company will develop a residential group housing project.
3. Hero Realty launches premium plotted development project in Gurugram
Hero Realty Pvt Ltd (HRPL), one of India’s leading real estate developers, has announced the launch of its new brand, ‘Hero Earth’, dedicated for its premium plotted development projects. The company has also launched its project ‘The Ark’ in Sector 85, Gurugram.
‘The Ark’ is spread across 5 acres of prime land, and offers 77 meticulously designed plots ranging from 139 to 175 square yards. The project boasts abundant common open spaces, creating a harmonious environment for residents.
4. DDA’s phase 4 housing scheme for 5,500 flats to open soon: Price, location, booking amount in 10 points
The Delhi Development Authority (DDA) will start the registration process for 5,500 flats on June 30 as part of its Phase IV housing scheme under online first come, first serve basis. The flats are in Jasola, Dwarka, Lok Nayak Puram, Rohini, Siraspur and Narela in addition to flats for low-Income group and Economic Weaker Section. A non-refundable registration fee of Rs 1,000 will be charged.
5. The Golden Ring: Unlocking tremendous real estate potential in Delhi-NCR’s tier-2 cities
The real estate sector in Delhi-NCR has witnessed a significant transformation in recent years. While the capital remains a hub of economic and cultural activity, the development of tier-2 cities around it has emerged as a game-changer, especially for the real estate sector. The establishment of the “Golden Ring”, a network of connectivity encircling Delhi-NCR, has led to the rapid growth of significant cities such as Bhiwadi, Bahadurgarh, Alwar, Sonipat, Jewar, Manesar, and Meerut. These cities offer tremendous investment potential, with promising growth prospects, excellent connectivity, and a plethora of amenities.
1. India’s housing sales hit record high in Q2 despite high loan rates, economic challenges
India’s housing sales hit an all-time high in the second quarter, defying challenges such as soaring home loan rates and global economic uncertainties including layoffs. Approximately 115,100 units were sold in the second quarter across India’s top seven cities, according to the latest data from ANAROCK Research. This represents a significant 36% increase compared with about 84,940 units sold in year-earlier period.
2. Prestige Group aims for a 10x growth in office rentals
The Prestige Group is looking at 10x growth in its rental income from office assets in excess of Rs 3,000 crore over the next five years. It plans to rebuild its income-generating office after selling it to the private equity firm Blackstone two years ago.
The company plans to develop 40 million sq ft office assets across significant markets like Bangalore, Mumbai and Hyderabad, amongst other markets, over the next five years. It currently has 40 mn sq ft of completed office assets across these markets.
3. KLA Tencor leases 3.2 lakh sq ft at DLF Downtown in Chennai
KLA Tencor, a California-based provider of process control systems, has leased 3,20,000 sq ft of office space in the upcoming DLF Downtown Taramani in Chennai. It is one of the largest transactions the city has seen in the commercial leasing segment. The company is expected to relocate to the new office within the next three months.
4. Mohali development body all set to launch 550 flats in second phase of Purab Premium Apartments
The Greater Mohali Area development Authority (Gmada) is all set to launch second phase of Purab Premium Apartments project with allotment of 550 apartments. The Gmada authorities stated that around a month’s time had been given for submitting applications as the scheme opens on June 30 and will close on July 31.
Rajiv Kumar Gupta, Gmada chief administrator, said the authority was offering total 550 apartments, including 130 type-I apartments (one BHK) priced at Rs 54 lakh, 200 type-II (2-BHK) of price Rs 80 lakh and 220 type-III (3-BHK) apartments at Rs 1.01 crore.
5. Robust warehousing demand across India drives institutional investors’ interest
The robust growth in demand for warehousing and logistics sector across India is driving the appetite for these assets among institutional investors including real estate funds, alternate investment funds (AIF), sovereign funds, pension funds.
Given the growth in warehousing occupancy activity, especially after the pandemic, demand for these assets is high and non-availability of operational assets for investments poses a key challenge. In the first quarter of 2023, investments of $216 million have already been received in the warehousing sector, highest among all other sectors.
6. The Executive Centre invests Rs 100 crore to lease 200,000 sq ft
The Executive Centre (TEC), a Hong Kong-based flexible workspace provider, has invested Rs 100 crore in the first half of 2023 to lease over 200,000 sq ft across 8 centres. The company intends to grow at a similar pace in the second half though getting quality space remains a challenge.
According to a CBRE survey, 56% of the office space occupiers plan to allocate more than 10% of their total office portfolio to flexible spaces by 2025.
7. Firms looking to increase use of flexible office space: Survey
Flex office spaces have emerged as the leading short-term real estate portfolio strategy for corporations, with nearly 47% of them saying they intend to increase the use of flexible office spaces over the next 12 months, revealed a survey conducted by property consultant CBRE.
Researchers noted a growing interest in tier-2 cities, which can be attributed to the availability of skilled talent pools and improving infrastructure.
8. UP RERA slaps Rs 3 crore penalty on Ansal API for fund misappropriation
The Uttar Pradesh Real Estate Regulatory Authority (RERA) on Tuesday said it has barred realty firm Ansal API from sale or transfer of any residential property in its hi-tech township project in Greater Noida over violation of norms. The real estate developer, separately, has been slapped with a penalty of Rs 3.05 crore on charges of misappropriation of Rs 60.57 crore funds collected from home buyers in three different projects.
Reloy, a homeowner loyalty and referral platform for builders has raised Rs 7.2 Crore in a pre-series A2 funding round. The investment will be used to fuel the company’s growth and expansion plans.
The funding round was led by four investors from the previous round along with several other prominent angels. It had raised Rs 5.9 crore last February. The current round saw participation from all the existing investors and have incoming investors of BlueLotus VC, Dream Green Capital and several prominent angels.
10. Sundaram Alternates plans to raise up to Rs 1,500 cr through realty private credit fund
Sundaram Alternates Assets, a subsidiary of the Sundaram Group, is planning to raise up to Rs 1,500 crore through its fourth real estate private credit fund, the Private Credit High Yield Real Estate Fund IV (RE Credit Fund IV) that will focus on investments in growth and special situation opportunities.
The total targeted mop up for the fund includes a green-shoe option of Rs 750 crore.
11. Private equity funding in realty sector declined 20 per cent in January-June to $2.58 billion
Private equity investment in the real estate sector dropped 20 per cent in January-June 2023 to USD 2.58 billion. In a report ‘Trends in Private Equity Investment in India – H1 2023’, it cited that the real estate sector in India received USD 2.6 billion in private equity (PE) investments across offices, warehousing, and residential sectors in the first half of 2023.
1. Is Airbnb in trouble? Revenue drop of 50% in some cities raises housing market crash fears
A potential revenue crisis looms for Airbnb, the renowned platform that enables property owners to rent out their spaces to travellers, signaling trouble in the real estate market. Recent data comparing Airbnb profits in the US in May 2022 and May 2023 reveals a significant decline in revenues for the San Francisco-based company, with cities like Phoenix, Arizona, and Austin, Texas experiencing a nearly 50 per cent drop.
This alarming decrease in revenues raises concerns about a possible housing market crash, evoking memories of the infamous 2008 subprime crisis, which caused a severe economic recession in the United States.
2. Indian investors driving the surge – A dive into Dubai’s booming real estate market
According to data from the Dubai Land Department (DLD), Indian’s have been the dominant force in Dubai’s property market over the last decade. In 2022, Indian’s emerged as top home buyers in Dubai, with purchases worth Rs 35 thousand crores, according to the recent reports. Indian’s have spent almost twice the money on buying residential properties in the city over the last 2 years, with the average price of houses bought by Indians ranging from Rs. 3.6 to 3.8 crores. This trend is largely driven by businesspeople and active investors.
The high rental yields is one of the main factors that is attracting Indian investors to Dubai. Real estate investors can expect a return on investment of about 5-7% in rental yield, which has remained stable over the past few years. For many investors Dubai offers better rates than large Indian cities like Mumbai and Delhi. However, there are a number of factors that make Dubai an attractive spot for Indian investors, besides the rental yields
3. Invesco Launches Invesco Commercial Real Estate Finance Trust Private Fund
Invesco Real Estate launched Invesco Commercial Real Estate Finance Trust, Inc., or INCREF, a private fund focused on bringing private real estate credit to accredited investors. INCREF is a non-exchange traded, perpetual-life real estate investment trust. The private fund will originate, acquire, and manage a diversified portfolio of loans and debt-like preferred equity interests related to commercial real estate.
INCREF will optimize risk-adjusted returns, especially during periods of uncertainty, high inflation, and rising rates.
4. Singapore’s Skyscrapers Defy Global Commercial Downturn
Singapore’s office towers are defying a global slowdown in commercial real estate, in a sign of the Asian hub’s continuing appeal.
Prime office rents in the city-state increased 2.5% in the first half of 2023. The overall occupancy level in the central business district in the second quarter reached 94.4%, edging up from the previous quarter, according to a report from Knight Frank Singapore. As vacant skyscrapers in metropolises from New York to Hong Kong struggle to lure new tenants, Singapore stands out. Despite rising rents and a fragile global economic outlook, demand for Singapore office space is growing as multinational companies continue to relocate functions and set up headquarters in the city-state.
5. US regulators ask lenders to work with stressed commercial real estate firms
U.S. banking regulators are asking lenders to work with credit-worthy borrowers that are facing stress in the commercial real estate market. Office loans have posed concerns for some U.S. lenders as property values decline and more borrowers default on their loans. The new guidance contains short-term loan accommodations that includes an agreement to defer one or more payments, make a partial payment, or provide other assistance or relief to a borrower.