Beruflich Dokumente
Kultur Dokumente
SUBMITTED BY:
SHAHIN ALI
(SHAHIN ALI)
TABLE OF CONTENTS
1. Acknowledgment
2. Project title
3. Company introduction
(i) Brief history of the company
(ii) Ongoing project
(iii) Upcoming project
(iv) Realty boom in imt manesar gurgaon
(v) Map of the propsed project
4. Major competitors of the company
5. Common terms used in real estate
6. About the real estate industry in india
7. Adout IT-ITES sector in india
8. Market overview
9. Indian economy- overview
10. Future collaboration of real estate and IT-ITES sector in india
11. Ongoing real estate projects in IT-ITES sector
12. Scope of investment for small investors in real estate
13. Initative taken by yhe government to safeguard the interest of
investors in real estate
14. Propsed bill by the government
15. Regulatory development in real estate
16. Benefits of REMF
17. Cost-comparison of office space in india with other countries
18. demand of office space in different cities of india
19. Factors which are hindering the growth of real estate in india
20. The real approach of investors while investing in real estate
21. Effect of economic slowdown on real estate sector
22. Suggestion for effective development in real estate in india
23. Conclusion
24. Market strategy
25. questionare
ACKNOWLEDGEMENT
SHAHIN ALI
Project title:
Project objectives:
Vision
To reach the pinnacle of industry by 2020 following high ethical
standards, transparency in transactions and quality in development.
Mission
PAST PERFORMANCE
It’s a 15 year old company, functioning earlier under the banner name of
Shree Ganesha Estate & Developers.
The company has developed several successful projects; some of them
are as follows
• Mohan Garden in West Delhi.
• Rural Infrastructure Township Project in Nahar Park, Faridabad
covering 400 acres of land with 300 farm houses.
• A Trans-Yamuna Group Housing Society development project
titled as “Rosewood Apartment” in Mayur Vihar.
UPCOMING PROJECTS
India is the fastest growing IT hub in the world and IT-ITes industry
outsourcing is growing at 58% (NASSCOM). Gurgaon has emerged as an
important hub for IT companies and MNCs in India. The Haryana
government is also taking some vital steps to support and promote
infrastructure development. Haryana State Industrial Development
Corporation (HSIDC), a Haryana Govt. undertaking, is promoting a
campus of 150 acres as a proposed Special Economy Zone (SEZ) for
Technology parks in IMT, Manesar. The proposed SEZ will be the
biggest IT corridor in North India.
The central government has promulgated the SEZ act in 2005; these SEZs
have been declared duty free enclaves with no restriction in investments
and import of goods and services. To attract FDI the government has
offered several incentives like:
• Access to domestic tariff area.
• Hundred percent FDI under automatic route
• Flexibility w.r.t FOREX earnings.
The campus promoted by HSDIC for setting up the technology park can
be used for several purposes including
• IT /ITeS
• Robotics, Nano Technology.
• Chip Manufacturing
• Bio-Technology including Genetics.
• Research and Development facilities.
• Mobile Computing/communication, other frontier technologies.
Investors get returns @ 12% per annum for 5 Years on their full deposit
against their investment for space they book.
Example:
Assured Return
Total Area Bought 1,000 Sq. Ft.
Rate per Sq Ft. Rs.7,500
Total Area (1000 Sq. Ft.) x Rate (Rs.7,500) =
Total Investment
Rs.75,00,000
Assured Rate of Interest per Annum 12%
ROI / Annum 75,00,000 x 12% = Rs.9,00,000
ROI / Month Rs.9,00,000 / 12 = Rs.75,000
ROI p.a. (Rs.9,00,000) x No. of Years (5) =
ROI for 5 Years
Rs.45,00,000
Industry Growth Rate(Real Estate) 30%
Total Value Rs.75,00,000 x 5Yrs x 30%=Rs.1,87,50,000
Rs.1,87,50,000-Rs.75,00,000+Rs45,00,000 =
Net Profit Rs.1,57,50,000
Example:
PAYMENT PROCEDURE
Sample design of the New Propsed Project
Reality Boom in IMT Manesar(Gurgaon)
Manesar's inclusion in the integrated plan is good news for the entire
district. Home to global industrial units, and now part of the Millennium
City, it is all set to give competition to Noida.
With the commercial and residential hub in Gurgaon town and the
industrial base in Manesar, the entire district is expected to gain an upper
hand over Noida. Said D S Dhillon, chief administrator of HUDA,
“Manesar has expanded very fast. Investments from all over the world are
pouring in. This needs to be encashed. Moreover, in order to curb illegal
developments which had started mushrooming; Manesar had to be
included in the integrated plan. This has benefited both Gurgaon and
Manesar. Manesar is located on the intersection of NH-8 and Kundli-
Palwal-Manesar expressway. This will show it in a better light than even
Noida.”
The development of Manesar will not only aid Gurgaon but also Delhi.
Said the deputy general manager of HSIDC, Rajesh Sharma, ``Almost all
industries of the Capital have their units in Manesar. The trend witnessed
a growth after the sealing drive in Delhi. We give incentives to
companies with an investment of
Better connectivity
Said Rajeev Arora, MD, HSIDC, “We are developing wide roads. The
area of the open space has been increased. There is a 12-km long green
belt traversing Manesar-Gurgaon boundary. HSIDC has a dedicated
power station of 220 KV and four substations of 66 KV to cater to the
needs of both the industrial and residential areas. Apart from the vast
industrial base, institutionally also, Manesar is being developed. We have
a resort, Heritage Village, the NSG base and the National Brain Research
Centre here which attract both MNCs and the general public.''
Leisure activities
Distance
Connectivity
Map:
MAJOR COMPETITORS OF THE COMPANY:
AMARPALI GROUP
PURVANCHAL GROUP
TDI LTD.
MAPSKO DEVELOPERS.
SPIRAL ADGE
(i) Carpet area- Useable area that can be carpeted from wall to wall.
(ii) Covered area- Carpet area plus area of peripheral walls. As per
the industry standards, it is the sum of carpet area plus 4% of the total
carpet area.
(iii) Super area- Covered area plus 40% of the covered area. It means
covered area plus proportionate area that is used by the customers to
access a shop, like common passage, corridor, and stairways area.
(iv) Common Area Mall Maintenance (CAMM) - It is the cost of
utilities needed to heat, cool, light and clean and maintains common
areas such as atrium, corridors, toilets, etc. Including power
consumption and security. The operational cost of these services is
borne by the tenents of the unit/shops on pro-rata basis. It is charged
on super are on per sq.ft basis.]
ABOUT THE REAL ESTATE INDUSTRY IN INDIA
Further, the IT and BPO industries are poised to clock revenues worth
US$ 64 billion by the end of fiscal year 2008, registering a growth of 33
per cent with exports expected to cross US$ 40 billion and the domestic
market estimated to clock over US$ 23 billion, according to a study.
Simultaneously, the Indian IT services market is estimated to remain the
fastest growing in the Asia Pacific region with a CAGR of 18.6 per cent,
as per a study by Springboard Research.
Outsourcing
MARKET OVERVIEW
Market Structure
• Dominated by a few large national developers with pan-India
presence
• Regional players are expanding to achieve a Pan-India presence
• Shift in the type of operations from Sale Model to Lease & Maintain
Model
Segmentation
Outlook
Growth Drivers
• Rapid Urbanisation: Urban Population expected to touch 590
million by 2030
• Decreasing Household size: Average H/h size fell from 5.4 in 1981 to
5.1 in 2000
• Increasing working age population (Almost 64% in 16-64 age
group)
• Increasing income levels: Average salary levels increased by 13.5% in
2005
• Easier access to mortgae, long tenure loans and tax incentives
Market Structure
• Highly fragmented and unorganized
• Regional players are expanding to achieve a Pan-India presence
Segmentation
Outlook
• Current shortage close to 25 million units, predominantly in
middle and low income group
• Expected to grow at CARG of 18-19% upto by 2010
• Mortage finance will be increasing penetration into the urban housing
finance sector
Retail Space
Growth Drivers
Market Structure
• Dominated by unorganised retail
• Large corporate houses entering the organized retail sector
• International retail brands are tying up with Indian partners
Growth of Retail Industry
Organized
Unorganized
FY2004 $210 billion
FY2005 $2224 billion
FY2006 $238 billion
FY2010 $306 billion
100
80
60 East
40 West
North
20
0
1st Qtr 2ndQtr 3rdQtr 4thQtr
Segmentation
• Organized retail contribution to the retail industry grew from 2% in
2003 to 4.4% in 2006
• International retailers are present through franchise route
Outlook
• FDI norms are likely to be relaxed in next 2-3 years
• Oranised retail expected to grow at around 30%
• Share of organised retail, by sales expected to reach 10% by 2010
Absorption of Organised Retail Space
Total Absorption: 19 million sq. ft (2006-07)
Hospitality Space
Growth Drivers
• More than 4.4 million international visitors and 430 million domestic
tourist visits in 2006
• Low cost airlines
• India recquiring recognition as a medical tourism destination
• International events such as Commonwealth Games
• Imergence of India as a MICE destination
Market Structure
• Entry of several corporate houses such as Reliance
• Existing hotel operators are scaling up their opetations
• Developers are tying up with major international chains
• Developers have set up RE funds to finance their Ventures
Segmentation
• Classification on the basis of Star Rating of 1 to 5 star deluxe
• 100,000 hotel rooms in India in various categories, Five Star and Five
Star Deluxe contributing close to 30,000 rooms
Outlook
• Demand to grow at 10% CAGR for the next 5 years
• Room supply to increase
• Tremendous potential for budget hotels
• Service Apartments, Hostels, Wellness space gaining popularity
Electronics
Hardware, IT/ITES/Electronics/ Pharmaceuticals
Biotechnology
Gems
& Jewellery
Engineering
Textile
Others
69%
4%
5%
2%
5%
4%
11%
Dubai
Indonesia
Singapore
Malaysia
Others
Rationalization of process:
• Rationalization of the regulations in governance affecting real estate
• For example, improved land records, rationalizing stamp duty across
states, simplifying urban development guidelines etc.
Social Infrastructure:
• Focus from both public and private sector
• Different models for foreign investment being evaluated
Government incentives:
• SEZ Act, 2006 provides major Tax benefits,
• Tax relief and Single window clearance and approval
Foreign Investors
ASCENDAS, Singapore
EMAAR, Dubai
DLF
• Developed Asia’s largest private township DLF City at Gurgaon,
Haryana spread over 3000 acres
• Present across all the asset classes: Residential, Commercial and
Retail.
• Developed more than 220 million sq.ft. Of BUA
• Specialises in planning Hotels, Infrastructure and SEZs 574 million
sq. ft. of BUA under planned Projects
• Pan-India footprint, major presence in Gurgaon & Kolkata
K Raheja Corp
• Present in Commercial, Retail & Residential asset classes
• Developed over 5 million sq. ft. of BUA
• Developing 15 self-contained townships and 10 hotels
• Planning to construct 13.2 million sq. ft. of BUA
• Major presence in Mumbai with operations in Banglore, Ahamedabad,
Goa, Pune and Hyderabad.
Ansal Properties
• Operates primarily in Residential & Commercial asset classes
• Developed over 2850 acres in Gurgaon and Delhi
• Developing integrated townships, malls, hotels IT parks and SEZs
• Plan to construct 157.6 million sq.ft. Of BUA
• Pan-India footprint with major presence in 16 North-Indian cities
acress 4 states
Sobha Developers
• Asset classes include Residential, Commercial, Development of plots
and Contractual projects
• Developed over 4.5 million sq. ft. of BUA
• Planning residential and retail projects
• 101 million sq. ft. of BUA is planned under various projects
• Major concentration in Banglore with presence in other areas such as
Cochin, Chennai and Pune.
Parsvnath Developers
• Presence in Residential, Retail Commercial asset classes
• Developed over 3.8 million sq. ft. of BUA
• Plans to develop IT Parks and 12 SEZs across the country
• Plannin to construct around 46.5 million sq. ft. of BUA
• Major Presence in National Capital Region
• Increasing Pan-India Footprint, active in over 46 cities across 17 states
Low–cost Housing
Rationale for Investment
Overheating market
• On the real estate front, persistent demand-supply gap has led to
spiraling property prices
• Capital values raised by more than 100% in all key markets
• Oversupply expected in few product classes – IT SEZs, Luxury end
residential
Absence of REITs
• REITs are a significant source of capital and liquidity for real estate
industry globally
• Absence of REITs in India has restricted retail investor participation
and limited capital flows
Regulatory issues
• ULCRA is yet to be repealed in some key states, such as Maharashtra,
Karnataka and West Bengal • Stamp duty rates are still high in many
states resulting in high transaction costs
• Tenancy laws are not in favor of owner
Unclear titles
• A high percentage of land holdings do not have clear titles
• Land is typically held by individuals/families, which hinders easy
transfer of title
Time-consuming Approval
• Approvals required from multiple agencies,
• Time consuming and circuitous procedures
• Leads to project delays and affects marketability of projects
Speculative Supply
• Certain pockets witnessing speculative supply
• Some pockets are purely investor driven, end-user and genuine
consumers suffering
• Oversupply leading to downward pressure on prices - “price
correction”
Overindulgence
• Overindulgence of Developers on asset classes which are not demand
driven
• Overstretched commitments and hence quality risks
After IT Parks and IT SEZs, the government has cleared a proposal for
creating much larger Information Technology Investment regions (ITIRs)
to give a fillip to the country's growing IT and ITeS sector.The Cabinet
Committee on Economic Affairs, which met under the chairmanship of
Prime Minister Manmohan Singh on Thursday, cleared the policy for
setting up ITIRs, each having an area of at least 40 sq km.
"ITIRs were conceptualised keeping in view the need to boost the growth
of both IT/IT enabled services (ITeS) and Electronic Hardware
Manufacturing (EHM) units," an official statement said. These regions
would become major magnets for investment, creating employment
opportunities and economic growth in the area while reducing the
pressure on existing urban centres by enabling growth of new townships,
it added. The ITIRs will be much larger than IT SEZs. Each ITIR is
expected to be specifically notified investment region with minimum area
of 40 sq km planned for IT and ITeS and EHM units. The minimum
processing area would be 40 per cent of the total area of the ITIR.
New Delhi: The realty sector is projected to grow at the rate of 30 per
cent annually over the next decade, attracting foreign investments worth
USD 30 billion, with a number of IT parks and residential townships
being constructed across-India, industry body Assocham said.
Commenting on the problem faced by the sector, the Assocham said that
the involvement of Center and a number of state agencies in setting up of
townships is needed.
Is real estate financing one of the catalysts behind the boom that India is
witnessing in residential, retail and commercial real estate? Are REITs
and REMFs here to stay? What are the implications of these on the real
estate industry? These are some questions that one thinks of when
analyzing the trends of what used to be a largely disorganized industry in
the recent past. Read on for a perspective.
The Securities and Exchange board of India (SEBI) has been actively
screening proposals to structure an investment instrument known as Real
Estate Investment Trust (REIT). This comes in conjunction with the Real
estate Mutual Funds (REMF), for which norms are expected to be
finalized soon. Mutual Fund houses, such as Kotak Group, ICICI and
HDFC have already expressed interest in floating these funds.
The money that these instruments raise will help structure the entire
financial system supporting the real estate industry.
These could potentially become instruments for long term savings for
small investors and help in diversification of individual portfolios.
Developers will have access to funds generated from across the country.
INITIATIVES TAKEN BY THE
GOVERNMENT TO SAFEGUARD THE
INTEREST OF INVESTORS IN REAL ESTATE:
New law is being enected to regulate real estate developers. Now they
have to exclude common space and balconies, from the floor space of
residential units.Mandatory for the builder to specify the area of an
apartment in the sale agreement.
Builder will be required to provide a break-up of what is being charged
for the apartment, along with a separate calculation for charges lavied for
commen spaces like corridors, parking and lifts.
While rentals in Mumbai grew at 40.7% in the last one year, they went up
by 22.6% in banglore and by 15.3% in Delhi. However, Mumbai slipped
from 2nd place in November 2007 to the 4th place at present. On the scale
of most expensive office markets in the world, London’s west end,
Moscow and Tokyo dominate the list of costliest places in the world, in
that order, Delhi continuous to be at 7th spot.
The drop in the ranking in most of India’s cities is due to the significant
increase in the rentals in Moscow, where they almost doubled in the last
one year. Although the number four position fo Mumbai is still very high
and is reflective of the tight supply of prime office space in Mumbai and
Delhi, and demand remaining constantly active
According to the report, office space in Mumbai and Delhi are costlier
than Paris, New York, Stockholm, Milan, Geneva, among others.
What is encouraging in all this that no one doubts the Indian growth story
on a long term, despite the fact that stock market is in jittery. Inflation is
high and RBI’s measure to contain inflation has created a liquidity crunch
in the market. This might affect the economic growth in near future
DEMAND OF OFFICE SPACE IN DIFFERENT CITIES IN INDIA
Despite correction in the stock market, demand for office space in the
country remained buoyant with some moderation. According to a report
on office space by Cushman and Wakefield, the demand for office space
during jan-march 2008 remained upbeat across major cities and stood at
approximately 14 million sq.ft
There has been certainly a marginal slowdown in the rate of growth
across all segments of real estate and its probably good news for the
industry to have some degree of correction, since the long-term demand
continues to look robust and next cycle could be more sustainable and
strong
However, good demand growth for the real estate space suggests that
demand for residential real estate will pick up sooner or later. When
CITIES 2007(S) 08(S)* Q1/08(S) ABSORPTION PRE-COMMIT DEMAND
/Q1/08 /Q1/08 /Q1/08
BANGLORE 9.59 14.7 5.95 3.63 1.51 5.14
CHENNAI 10 12 1.09 0.83 0.55 1.38
HYDERABAD 4.10 6 0.37 0.30 0.38 0.68
MUMBAI 0.45 13.7 2.13 2 0.60 2.60
PUNE 7.8 12.8 2.52 1.22 0.14 1.36
KOLKATA 2.25 4.5 0.70 0.38 0.74 1.12
NCR 11.5 18 2.78 0.62 1.58 2.20
TOTAL 45.6 82.8 15.54 8.2 5.5 14.48
space is readily not available, tenants commit for the space that is likely
to be built shortly. Such demand is known as pre-commited demand.
In the first quarter of the FY 2008, the NCR of Delhi witnessed a supply
of 2.8 million sq.ft, accounting for 15% of the total supply likely to enter
during the year. The entire supply likely was concentrated in Gurgaon
and Noida, with each accounting for 1.4 million sq.ft. The IT-ITES sector
accounted for about 65% of the total supply in the first quarter, of which
major portion came from Noida.
Interestingly, as more supplies are expected to enter the market, the
demand has also increased. This has resulted in the rental value.
90
80
70
60 BANGLORE
50 CHENNAI
40
30 HYDERABAD
20
10 MUMBAI
0
PUNE
08
8
)
08
S)
)*
(S
KOLKATA
/0
(S
8(
07
1/
1/
Q1
08
/0
/Q
/Q
20
NCR
Q1
D/
IT
ON
AN
M
TOTAL
TI
M
RP
CO
DE
SO
E-
AB
PR
S-SUPPLY
Values in million sq.ft
Sources: Cushman and Wakwfield Research
*Expected
In the last half of the year the cost of cement, steel and other
All developers would make us believe that the projects are primarily end
user driven. But, the fact remains that majority of the investment is being
done by the hardcore investors, who is characterized as an early entrant in
a project, especially at the launch stage , and he exit equally fast, as
opposed to the end user who enters at the fag end of the project and stays
on until he occupies the premises.
An investor should know his actual time for entering and exiting
from a project, one must take in view the targeted ROI(return on
investment) and than decide to exit a project
Before foraying into new geographies, one should assess the place,
the developer and type of project.
Investment in commercial projects yields high return but with high
risk factor. It will require a minimum investment of Rs. 50 lakh.
The decision of investment should be best on factors such as
demand and affordability and hence certain price points where one
could look at investing to grow money
It is worthwhile to talk to the developer who may give the sense of
what RoIs to expect from any investment.
100
80
60 East
40 West
20 North
0
1st Qtr 2ndQtr 3rdQtr 4th Qtr
TELEPHONIC INTERVIEW.
SOURCE OF CONTACT-
NEWS PAPERS.
INTERNET.
LEADS GIVEN BY THE OFFICE.
Name –
Address –
Mob. No -
viii. Why ?
Ans-
ix. Given the option which one will you opt for investment ?
(1) Residential (2) IT-Park (3) Commercial (4)
Others
xiii. Out of the following which one you think is the best option for
investment?
(1) Real estate (2) Mutual Funds (3) Stocks (4)
Others
xiv. Why ?
Ans-
xv. (15) Have you heard about Real Estate Mutual Fund [REMF] and
Real Estate Investment Trust [REIT]
(1) Yes (2) No
xvi. (16) Do you refer to real estate magazines and journels before
nvestment in real estate ?
(1) Always (2) Sometimes (3) Never
ii. To know how channel partners react to the certain real estate
products like commercial, residential, hospitality, and it-ites sector.
iii. To know the market strategies of the competitors.
BIBLIOGRAPHY
www.realestateonline.in
www.indianrealestateforum.com
www.ibef.org
www.realtybytes.com
www.zameen-zaidad.com
Times of India
Hindustan times
Business Today
Business World