Hyderabad’s unsold residential inventory at five-year low

HYDERABAD: With steady absorption coupled with improving demand, Hyderabad's unsold residential inventory has come down to their lowest point since 2010, bringing some cheer to the lacklustre market, said a report by property consultant Knight Frank. 

There was absorption of 14,093 units in 2015 as against the 11,197 launched as new launches dropped by 14 per cent in 2015, continuing the trend from 2014. 

"The annual trend in launches shows a clear decline. However, the half yearly trend over the last three periods shows supply numbers stabilising gradually," said Vasudevan Iyer, Branch Director, Knight Frank, Hyderabad. 

The report also hinted towards a recovery of 5% in absorption year-on-year during the first half of 2016. According to city developers, price correction is inevitable as Hyderabad property prices are already rock bottom and hence there will be a price appreciation. Residential units witnessed a growth of 3.1 per cent year on year during the second half of 2015. 

On the other hand, the office market, despite a minor dip in absorption, posted robust numbers indicating an upward trend in office space absorption. In 2015, there was absorption of 4.6 million square feet as against 4.7 million sft a year ago. 
Office space absorption is likely to push up by 23% year-on-year in the first half of 2016, while an approximate 1.9 million sft space is expected to come up, the report said. 

Robust absorption coupled with falling supplies pushed vacancy levels to 14.4 per cent at the end of 2015 from 17.7 per cent in 2013. Interestingly, the second half of 2015 experienced the highest absorption levels of any half-yearly period in history on the back of big-ticket transactions by Qualcomm, Salesforce, Unitedhealth Group and J.P. Morgan. 

Simultaneously, rentals have been increasing steadily since 2012 and picked up momentum after the second half of 2014, post the resolution of Telangana issue. Also, severe shortage of good quality office space in prime areas has turned the market in favour of landlords, who are asking for higher rents from tenants with each passing quarter. The rentals are expected to rise by 7 per cent in the first half of 2016. 

Blackstone may invest Rs 450 crore in Salarpuria’s Hyderabad office property


BENGALURU | MUMBAI: Blackstone Group, the world's biggest private equity real estate investor, is in advanced talks with Salarpuria Sattva Group to put in about Rs 450 crore in its upcoming, 30-acre commercial property in Knowledge City in Hyderabad, three people familiar with the development said. 

"This would be a pure equity transaction and is expected to be concluded in the next few weeks. The fund is picking up this stake on its own and not through any of its joint ventures with Embassy Group or Panchshil Realty," said one of the people.


This will be the first real estate investment by New York-based Blackstone in 2016 after being one of the most active buyers of office property across India last year. This will be one of the few under-construction properties that Blackstone is investing in - the fund has mostly picked up ready and income-producing office real estate projects. Blackstone declined to comment for this story. "Blackstone, as a matter of policy, does not comment on market speculation," the fund said in an email    response to ET's query. Mahesh Khaitan, director of Bengaluru-based Salarpuria Sattva, declined to comment.

Knowledge City in Hyderabad is spread over 200 acres of land that was sold to some 13 companies for Rs 2,000 crore by the Andhra Pradesh government in 2008. Salarpuria Sattva bought 30 acres in the project for over Rs 400 crore. The proposed Salarpuria project is estimated to have total saleable office space of 6.5 million square feet, which will be developed in phases over the next five years. Swiss pharmaceutical company Novartis picked up 1.15 million sq. ft. of space in this project last year to consolidate and expand its operations in Hyderabad. 
Blackstone concluded some of the major office property transactions in 2015. Among them was its buyout of Gurgaon-based builder Alpha G: Corp for Rs 1,600 crore, the first full acquisition of a real estate company in India. Blackstone also acquired 247 Park at an enterprise value of Rs 1,050 crore and paved way for the exit of investors Milestone Capital and listed construction firm HCC. 
Private equity real estate companies deployed over $5 billion in Indian real estate companies and projects in 2015 - the highest since the financial crisis of 2008. These firms made 90 investments in India last year, of which 85 transactions had an announced value of $5.06 billion, according to research from Venture Intelligence.Investment values surged from $2.2 billion in 2014, when there were 75 transactions. Demand in India's commercial property market in the top seven cities has risen, with deals covering a record 38 million sq. ft. in 2015.

Pune, Hyderabad, Navi Mumbai among 10 affordable property markets

Pune, Hyderabad, Navi Mumbai among 10 affordable property markets


NEW DELHI: Hyderabad, Pune, Navi Mumbai, and Ahmedabad are among the 10 affordable property markets in the country where flats are available within the budget of Rs 30-50 lakh, according to JLL India.

The other six cities are Kochi (Kerala), Ghaziabad(Uttar Pradesh), Jaipur (Rajasthan), Nagpur (Maharashtra), Surat (Gujarat) and Coimbatore in Tamil Nadu.

In its latest report, property consultant JLL India has listed 10 cities that offer great lower-budget real estate investment prospects over medium to long term.

"These towns and cities offer a wide spectrum of investable options in real estate with relatively lower property price levels, providing the incentives for future capital appreciation and healthy returns," JLL India Chairman and Country Head Anuj Puri said.

On Hyderabad, Puri said it is perhaps one of the most affordable cities among all tier 1 cities of India. Even the well-developed residential localities in Hyderabad, such as Manikonda, Kukatpally, Miyapur and Sainikpuri offer housing properties in the budget range of Rs 30-50 lakh.

The report mentioned that Hyderabad's realty market is now set for an upswing after a prolonged slump due to the global recession followed by political turmoil.

About Pune, JLL said the city has recorded good growth in the affordable housing segment over the last couple of years. Such projects are located on the periphery of the city and offer small 1-2 BHK flats with basic, no-frills amenities.

"While property prices have increasingly become unaffordable in Mumbai, Navi Mumbai still provides numerous options for residential housing within the budget of Rs 30-50 lakh," Puri said.

The proposed SEZs at Dronagiri, Ulwe and Kalamboli, and the upcoming international airport at Panvel are expected to help generate employment and boost demand for commercial and residential developments.

On Ghaziabad, JLL said that the city is an emerging residential neighbourhood of NCR which has a very high supply of flats in the budget of Rs 30-50 lakh.

"Well connected via metro and roads to the job markets of Delhi-NCR region, the city caters largely to the mid-segment home buyers. The city has a high supply of ready-to-move-in properties offered by renowned developers," the report said.

Infrastructural developments such as extension of the Metro Rail and widening of the NH 24 will further boost Ghaziabad's realty market, it added.

On Kochi, JLL said: "Gone are the days when the city's builders focused only on affluent buyers. Today, the Kochi residential real estate market is dominated by affordable housing segment, which accounts to about 60 per cent of the total housing projects in the city."

Conmen find new ways to dupe greedy realtors


HYDERABAD: As realtor K Rajeev was showing a real estate project (site) at Nanakramguda to a potential buyer in November, he received a call on his mobile phone. The caller, who spoke to him in Telugu and sounded that he was in a hurry, told him that he was a Non-resident Indian (NRI) based in Dubai and was looking for a prime property. In the brief conversation, he dropped enough hints that a handsome commission would be up for the grabs in the deal.

After some days, Rajeev received another call. The caller, this time was a person desperate and racing against time to dispose of his property, even at a loss. Rajeev, who decided to broker a deal between the Dubai NRI and the desperate property owner, ended up getting conned. This is the new modus operandi adopted by fraudsters to dupe greedy realtors. In the last couple of months, six realtors have complained to the Cyberabad police claiming that they lost lakhs of rupees in fraudulent real estate deals.

The 'NRI conman' dials a real estate agent and says that he would pay a short visit to Hyderabad and seal the property deal during his stay here. A little later, the con calls the realtor again, this time as a prospective seller, who wants to dispose of his property immediately as he needs money urgently. "The seller even throws a tantrum and threatens to approach someone else offering 10% of the value as commission. When the realtor asks for property papers, the seller puts a condition that it will be given only on payment of Rs two lakh or so as it is a high-value property. In their greed to clinch the deal, from the buyer and seller, realtors are paying token amounts (in a few lakhs) and getting duped,'' Cyber Crime cop M Riyazuddin said.


‘No local or non-locals, all are Hyderabadis’


Union Minister for Urban Development M. Venkaiah Naidu on Sunday asserted that regardless of their States of origin, everyone who lived in the ‘City of Pearls’ that is known for its ‘tehzeeb’ were Hyderabadis.

He pooh-poohed the ‘tactics of the Telangana Rashtra Samithi’ and the way its leaders were whipping up a frenzy by using words that had no relevance.

“There are neither settlers nor is there anything called local or non-local. Everyone who lives here is first an Indian and then a Hyderabadi. We are one nation, one country, one people. That is India and its speciality,” he emphasised.

Mr. Naidu, together with his colleague, Union Minister for Labour Bandaru Dattatreya were present at a breakfast meeting convened by the Telangana unit of the Uttar Bharatiya Manch here.

They sought to drive home the point that the Bharatiya Janata Party stood for development, for unity and for the fact that it all boiled down to everyone living here being Indian.

Reeling out statistics, he recalled how it was a combination of the BJP-TDP combination that was proven to be the best in terms of proven development orientation. “If it started with Atal Bihari Vajpayee as Prime Minister and N. Chandrababu Naidu as Andhra Pradesh Chief Minister earlier, it will now also, only be a similar combination with Prime Minister Narendra Modi that will usher development,” he said, adding that it was in the best interests of the people of Hyderabad to vote for the alliance.

Making a specific mention of houses and the way Telangana Chief Minister K. Chandrasekhar Rao had on Saturday, offered to contribute from the State on the housing programme, Mr. Naidu said snidely that while the housing programme was taken up with Central funds, it was all money that belonged to the people. “Actually, there is nothing called State or Central funds. It is your money,” he said, to applause, urging voters to cast their ballot for the ‘Lotus and Cycle’ combination.

Infrastructure development will not hurt taxpayer’s wallet: KTR

Speaking at a select gathering largely comprising business professionals, Mr. Rao asserted that no individual or government could take credit for shaping a city like Hyderabad, which by virtue of its geography and trade importance shaped into the metropolis of today. Recounting some of the city’s history, he said governments could only have been catalysts and that individuals who seek credit for what the city is have in fact gained reputation working for the city, he said while taking a dig at TDP and Congress.

Invitees to the gathering were by registration. Nearly 600 people representatives from various professions attended the Minister’s presentation at a luxury hotel on Sunday.

Following his presentation, Mr. Rao took questions from the gathering. One of the audiences asked him whether the ruling government’s welfare initiative will hurt the taxpayer and if borrowings of the government to improve GHMC will result in increased taxes.

Mr. Rao responded saying his government was committed to welfare and cross-subsidisation was imperative. He also added that the taxpayer in GHMC would in some way eventually pay for the city’s development but the government will ensure the impact is minimal. “Let me not be sly about it,” the Minister said while speaking about taxpayer burden.

He expressed disgust at open urination in the city and also said efforts will be made to improve green cover, when pointed out that city’s green cover is less than mandated 30 percent of land-use.

Audiences sought responses on women empowerment, commitment to industry, and also improvement of neglected areas like Malkajigiri. “Pipeline works currently underway in Malkajigiri will soon bring water to the area and the condition of roads will improve,” he assured one questioner from Anandbagh who rued that the area had become a disaster.

“No right to seek people’s support”

Mr. Rama Rao, who spearheaded the TRS campaign for GHMC elections on Sunday, said none of the Opposition parties, including AIMIM have a single reason to seek people’s support. However, the TRS has every reason to do so by the virtue of its commitment shown to improve infrastructure in the city during the last 19 months, Mr. Rama Rao said minutes before the high-decibel campaign came to an end on Sunday.

“Congress, TDP-BJP and Majlis have no reasons as to why people should vote for them as they are the one responsible for all problems in the city. It was they who headed the civic body in the past. But the TRS has proved what it is capable of doing,” he said. He reiterated that TRS would win the Mayor’s seat on its own and there was no room for any talk of taking support from other parties as of now, he said in response to a question.

Musical touch to GHMC polls

The lyrics praise the contestants and their ‘achievements’ apart from the party leaders they belong to. Well, music has become an integral part of the campaign of all the contestants irrespective of the parties. What was confined to just major political parties in the State or National elections has now caught on with small time contestants as well.

And small time writers and musicians have used it to the full potential. It is not just money but also an opportunity for these artistes to present their talent to people in the film and television industry. And they get paid pretty decent amount for the work, which they finish off in two or three days. Singers, writers and musicians make around Rs. 30,000 to Rs. 1 lakh depending on the financial status of the candidates and their rivals. “Songs play a key role in the campaign as they introduce the candidate and his work to the voters easily and effectively,” says Gadari Kishore, MLA from Tungaturthy, who has helped Kothapet TRS candidate, G.V. Sagar Reddy in creating an album for the campaign. “Thanks to the album we are way ahead of others in the campaign.”

Narsi Reddy, a singer from Nalgonda, who has sung for a few albums for contestants from different parties, says rural singers with folk background are sought-after for such albums. The lyrics are mostly rustic with little focus on literary aspect of it and singers effortlessly go about singing the racy numbers. The musicians are mostly those working for television serials or those working for the local bands. Most candidates prefer popular film tunes.

Misalignment of girder triggers panic

Panic spread among shopkeepers here at Palika Bazaar in Secunderabad, when a launching girder above a viaduct was slightly misaligned at a point during the ongoing Metro Rail works. Engineers at the site said that the incident took place at around 2 a.m., and that it was a minor thing.

The area was cordoned off for more than 100 metres, in which all the shops and establishments, including Alpha Hotel were closed.

“The launching girder slightly went out of line on Saturday night. We don’t know the exact time, and the work was done in evenings mostly,” said an L&T engineer, who was present at the site on Sunday morning.

The girder misalignment took place above the viaduct being built above the famous Alpha hotel, and adjacent the St. Thomas SPG Tamil Church on the Old Gandhi Hospital to Jubilee bus stop line.

When contacted, a Metro Rail official however said, “Nothing went wrong. It was part of the ongoing works, and the place had to be cordoned off as planned. We did it on a Sunday, as it was a holiday,” he added.