The Indian realty sector is facing an acute scarcity of labour as on today. The fast emerging problem will soon drive the realty sector to take to large scale mechanization and what is often referred to as project management. The propensity can be clearly understood based on the premise that the shortage of labour is projected to rise to about 65% mark by the next decade.
Track2Realty: Though the opening of the Indian retail sector to foreign direct investments may have brought cheers to the commercial real estate sector in the country, it is expected that the supply of distressed properties within the commercial segment will increase during the second quarter of 2013, according to the RICS India Commercial Property Survey Q1 2013.
Track2Realty Exclusive: Developers have also been trying to get the government to introduce the concept of single window clearance. It is common knowledge that time taken to grant approvals directly affects property prices. It has been found that delays in approval processes alone increase sale value of houses by 40%.
Track2Realty Exclusive: While the concept is being touted as the next big thing for the realty industry, there are both pros and cons to be weighed with integrated townships. There, of course, is the flip side too. Long gestation periods for these projects to take off and reluctance on the part of people to move to an isolated location are challenging from the developers perspective.
Track2Realty Exclusive: Neeraj Bansal, Partner-Real Estate & Construction at KPMG India says although more and more developers are rooting for integrated township projects, the project execution has been disappointing owing to multiple factors. The primary among them is delays in obtaining approvals from various departments.
Track2Realty Exclusive: Many urban planners maintain the genesis of the model integrated township in India lies in Jamshedpur, developed by the TATA Group. However, modern realty analysts maintain no one understands the grandeur of an integrated township better than Jaypee Group due to its locational vantage point and large tract of land bank. The infrastructure major has to its credit state-of-the-art township along the Yamuna Expressway.
Track2Realty: Tata Housing has announced the outstanding over-subscription of its newly launched project – Gateway Capital, located at sector 112, Gurgaon. The company claims that for the first time in the history of Indian real estate industry, Tata Housing introduced a unique strategy of selling its units through an IPO-styled concept by floating a range of Basic Sales Price in the market, from Rs.9000 psf to Rs.11000 psf.
Track2Realty Exclusive: The realty market has been pretty exposed to the greedy investors and vulture funding, not venture funding. In desperation the developers often lost track of what kind of funding was required and met with the disaster. Amidst the cyclic very high and very low there has been off balance debt-equity ratio as well. Of late, some developers tried within the box and some outside it. The needs and solutions are different for listed and unlisted companies. Still the sector is in search of right funding mechanism and as Track2Realty finds, are guinea pigs in the funding market.
Track2Realty Exclusive: Integrated township in the Indian context is a baby that everyone was expecting with their own set of expectations. And hence, within a decade the term was so over-used that it lost its relevance. Any and every mixed land use was projected as an integrated township and it often lacked the basic DNA of affordability, convenience, lifestyle and walk-to-work. As a matter of fact, Trck2Realty noted township projects were also conceptualized by many as safe investments in India at a time when funds were on the look out to deploy and developers needed more projects in the kitty to bag that.
Track2Realty Exclusive: What Indian realty needs is holistic reforms and for that what is needed is change in mindset. We wonder why every person in office doesn’t realise that his indecisiveness hurts interest of the country. Why authorities are trying to take a pro-publicity and anti-development stand whereby nobody gains?