India emerged as the second most risk ridden Data Centre Location among the top 30 countries in a study conducted by Cushman & Wakefield and hurleypalmerflatt. The pioneering study ‘Data Centre Risk Index’ evaluated the risks to global data centre facilities and international investment in business critical IT infrastructure.
Need for a revolution that will see the poor get access to housing is more eminent than ever before, and that, in such a revolution lies a great business potential for the realty sector. This was one of the strong messages that emerged from the South India Real Estate Conference, 2012, inaugurated in Bangalore on Friday, July 3.
Pointing out that real estate development can revive the sagging economy, developers’ apex body CREDAI has called for launching a mission to make India Housing Surplus from the current status of a housing deficit nation by 2020.
The economy is facing difficulties on several fronts, including declining GDP growth, high inflation, high fiscal and current account deficits and depreciation of the rupee. The poor performance of the stock market has attracted a lot of negative press in recent months and this was reflected in the commercial real estate market which remained tepid in Q2 2012, says a DTZ research.
The annual monsoons have always been perceived both as a rural blessing and an urban curse – they are good news for the agrarian sector and the bane of water-logging prone cities. However, this caricatured mind-set is breaking.
We are all talking about reforms in the Indian real estate. However, while a structural reform is the need of the hour, it is equally important to understand that efforts to regulate the sector by almost all possible players in the ring are actually detrimental for the overall growth of the sector. This also raises the fundamental question as to reforms at what cost and for whose benefit.
The first half of 2012 recorded total absorption of approximately 13.4 million sq ft of office space in India registering a decline of 21 percent compared to same period last year which was 16.9 million sq ft.
Anticipating a significant rate cut by the RBI, disappointed real estate community has ring alarm bells and forecast more slump due to the high interest rate regime. Pointing out that the capital and labour intensive sector plays a key role in employment generation and accelerating growth, industry body CREDAI says the government has also been losers of revenue due to neglect of the sector and risks attributed to real estate and the RBI advisories against lending to real estate have only harmed the sector and made housing costlier for consumers, apart from affecting the economy.
Over the last year, there has been an unequivocal crystallization of Indian cities that continue to attract serious investment into real estate. This is directly correlated to the economic dynamics now working in the country. If India is to achieve even a conservative GDP growth of 6% per year, it emerges that only three cities – Mumbai, Delhi and Bangalore – have the potential to deliver. The reason for this is that close to 2/3rd of the overall development of office space in the country is now taking place in Mumbai, Delhi and Bangalore.
Asia Pacific Office market report by Cushman & Wakefield – that compared the rental values of Central Business Districts (CBD) across Asia Pacific – ranks NCR as the 5th most expensive CBD location in the region while Mumbai – CBD ranked 10th most expensive location in APAC. Traditionally expensive office destinations of Hong Kong, Singapore and Tokyo (continued to hold the top three positions respectively.