Land is scarce and the only way in urbanisation is to go up where more FSI/FAR would mean increasing the supply and bringing the price down, goes an old philosophy of the Indian developers. In reality, nearly all the high rises across the Indian cities are high-end luxury projects and seem to fulfil the aspirational needs of the Richie Rich.
Since the hospitality sector was previously considered a part of Commercial Real Estate (CRE) and was subject to the same risk exposure, the cost of such debt was high. In September 2009, new guidelines on CRE released by the Reserve Bank of India, asserted that the hospitality sector would no longer be treated as a part of CRE and risk exposure would be based on the profile of the borrower and the nature of the project.
The much talked about and widely anticipated Real Estate Regulation and Development Bill may not get cleared in the current Budget Session of Parliament, since the government is getting cold in the wake of the Union Government running into opposition from the states on a host of issues, including the proposed National Counter Terrorism Centre and Lokpal Bill.
Pranay Vakil: The problem is when having sanctioned the loan, there is no fear of revoking it. You can change your mind because these funds are kind of committed. When engage Shapoorji Pallonji or L&T to execute a project, you enter into a contract and you say that this is how we are going to make payments. Suddenly, if you are to switch off the tap, it is going to cause a lot of embarrassment to the developer.
Real estate developers rallied on Tuesday, April 3, as some banks have cut home loan rates for new borrowers, sparking hope of increased property sales in the country.
Greater emphasis needs to be awarded to project delivery in light of the human, physical and monetary resources that are lost as a consequence of such delays. Even in the most robust economy, the challenges involved in construction and delivery of projects are enormous. There are common worries focused on timeliness, costs, performance and delivery. Stakeholders involved across the development process are often insufficiently coordinated to deliver a finished product within budget and on time.
While the government is trying to regulate the developers with provisions of penalty and up to imprisonment, the developers in Maharashtra have decided expose the policy paralysis through RTI route.
Launching its multi-pronged strategy to focus attention on the real estate industry’s unending series of problems, CREDAI (Confederation of Real Estate Developers’ Associations of India) has decided to send an ‘SOS’ to the Prime Minister and planned for a nationwide developers strike to sensitize the policy makers.
India’s growth story has many facets; one of the integral parts of growth – and arguably the most important one – is urbanization. In fast-growing economies, cities are significant investment and employment generators, which in turn carry the growth momentum forward. The sustainability and livability of any city depends largely on the quality of its infrastructure and real estate stocks. Needless to say, cities also require large sums of money to create urban asset stocks, including buildings and infrastructure.
An emerging segment to attract the hotel industry of India has been the MICE (Meetings, Incentive, Conventions and Exhibitions) segment as it has the potential to change the face of several upcoming Indian cities. The overall international visitors are likely to grow many fold due to MICE as it allows for the sale of several hundreds or even several thousands of room nights as opposed to the transient travellers who utilise only a few room nights at a time.