India, China, Asia Pacific, South and Central America, Middle East and Africa and parts of East Europe are set to see the most dynamic growth for construction in 2013, according to the Royal Institution of Chartered Surveyors (RICS).
China, India and Brazil are likely to drive in the highest real estate growth over the next decade, its latest insight report shows.
‘In these countries, the opportunities for infrastructure development and construction will be driven by increasing purchasing power, labour mobility, demands for higher living standards and major upgrades in transport systems, utilities and buildings,’ it points out.
‘China will be the world’s leading construction market by 2018. However, the construction growth rate will be higher in India. It is expected to touch the double digit in both the residential and non-residential markets on the short term basis,’ it adds.
This is happening because emerging markets are expected to grow by a110% to become a $7 trillion market, representing a massive 17.2% of GDP in 2020. Conversely, developed countries will only grow by 35% from $4.2 trillion today to an estimated $5.7 trillion market by 2020.
The report also points out that fiscal deficits in developed countries have constrained government spending and that along with austerity measures, rising raw material prices, a lack of availability of finance and weak consumer spending will keep them in the doldrums.
Read more: Property Wire
Demand for mid-segment luxury surges in Gurgaon
In the last few years Gurgaon has become synonymous with luxury housing owing to the launch of a plethora of high end projects. These projects have always been in demand by the high end buyers for whom luxury is a way of life. However, what is now visible is the growing demand for mid-segment luxury. One of the possible explanations is that maximum number of properties available in Gurgaon today is priced to cater to mid-segment range. This in turn has positioned Gurgaon as a mid-segment luxury destination in addition to the high-end projects.
As per data on MagicBricks.com, properties priced between Rs 60 lakh to Rs 2 crore saw the maximum demand in Gurgaon during the Oct-Dec 2012 quarter. The supply was also found to be largely limited to this category. More than 60 per cent demand and supply was recorded in this category during this period.
“While the ultra-luxury and premium projects have witnessed a drastic dip in demand, it is the mid-segment luxury residential projects that have flourished in the recent times. Developers have been smart to tap this segment by providing posh lifestyle and premium facilities at a price range of about Rs 60 lakh to just over a crore,” says Ravi Saund, COO, CHD Developers Ltd.
Consumers are making hay while the sun shines. “No builder in Gurgaon today wants to be termed as low budget or a mid-segment developer,” exclaims Sanjay Sharma, director, Qubrex. Thus, a buyer who wants to live in Gurgaon does not have an option but to buy in these projects. However, no one is complaining. Saund explains that the “buyers are being offered innovative design themes, international architecture and world-class facilities at prices way lower than an ultra luxury project. This has accelerated demand for such projects to a great extent as the buyer can experience luxury which fits into his pocket.”
Economy has probably bottomed out: Sharma
In view of marginal improvement in industrial output and exports, Commerce Minister Anand Sharma on Thursday hoped that the worst is over for the economy, and also pitched for lower interest rates to spur investments.
RBI is slated to review the monetary policy next week amid widespread demands for cut in interest rates by the central bank.
“We do hope that the downturn that we have seen has bottomed out…We do hope that next year will be different from last year. We will see more foreign direct investment coming… We feel our exports will definitely grow and GDP will grow above 6 per cent in FY 2013—14,” Sharma told reporters on the sidelines of the India Engineering Sourcing Show here.
Talking about inflation, which raised to 6.84 per cent in February from 6.62 per cent in the previous month, the minister said it remained a matter of concern.
However, non-food inflation has moderated, raising hopes of rate cut.
“Growth is a national priority. Inflation remains a matter of concern. I am sure every effort is made to address this challenge,” he said.
He pitched for a rate cut by the RBI on Tuesday saying the government is in favour of the industry getting access to cheap credit.
“Of course, RBI has autonomy to take its decisions.
But the need of the economy is more investments and dollar credit window,” he said.
Read more: Business Line
Govt promises to make Capital a ‘city of dreams’
With an eye on upcoming assembly polls later this year, the Delhi government today promised to make the Capital a ‘city of dreams’ by ratcheting up efforts to meet aspirations of all section of the citizens.
In his address at the assembly on the first day of budget session, Lt Governor (LG), Mr Tejendra Khanna, while speaking about various initiatives of the government, resolved to regularise all unauthorised colonies and provide housing accommodation to slum dwellers in the city.
“The confidence in my government reposed by the citizens of Delhi has inspired the government to dream big. We are not inclined to accept that growth and development have to be based on small incremental steps,” said Mr Khanna in his half-an-hour-long speech.
Claiming that the city has witnessed ‘unprecedented’ and ‘sweeping changes’ in the last 15 years, he said the government has aimed at making Delhi an ‘efficient, productive and caring city’ in the 12th Plan period (2012-2017).
“A whole generation that believes and takes for granted the metro, low-floor buses, 24-hour electricity supply and even the increased green cover as features of Delhi life does not realise that these were non-existent 12 years ago. The fact is that these are result of major initiatives taken by the government over the last 15 years,” said Mr Khanna.
Read more: The Statesman
Britain, India sign pact to support R&D projects
Britain and India have clinched a multi-million-pound agreement to support industry and businesses by working together on the commercialisation of research in key areas like energy and healthcare.
As part of the deal, Global Innovation and Technology Alliance (GITA) sponsored by the Indian government’s Department of Science and Technology and UK’s Technology Strategy Board (TSB) will support UK and Indian businesses and academics in joint R&D and innovation projects over a three-year period.
“These programmes not only help build and strengthen links between countries but will help build the international partnerships between businesses so vital in today’s global economy,” said Iain Gray, Chief Executive, TSB after signing the ‘Programme of Co-operation’ at the Innovate UK conference here.
He added that the new programme is aimed at strengthening the UK-India research and innovation partnership, which was one of the key themes during Prime Minister David Cameron’s high profile visit to India last month.
Britain’s minister for universities and science, David Willetts was also present at the occasion.
The latest agreement is the first-ever international partnership the Technology Strategy Board (TSB), Britain’s government-sponsored innovation agency, has signed outside Europe.
GITA, a not-for-profit PPP company, is promoted jointly by the Confederation of Indian Industry (CII) and the Technology Development Board of the Indian government’s Department of Science and Technology.
Read more: Business Line
PE investments in real estate robust despite sector slowdown
The total value of private equity investments in real estate rose 7% in 2012 to Rs.6,200 crore, according to the latest Real Estate Investment Market Report from consultant Cushman and Wakefield, amid a slowdown in the sector.
In terms of value, most of the investments were in ready income generating and operational office assets, up 34% to Rs.3,230 crore, according to the report.
“Investment in ready income generating/operational office assets have gained strength over the last few years due to lower risk and steady cash flows associated with this type of investment. With an increase in the number of high-value transactions in this sector, the market is moving towards a mature phase,” said Sanjay Dutt, executive managing director (South Asia), Cushman and Wakefield.
The residential segment, on the other hand, witnessed private equity investments at Rs.2,850 crore in 2012. The average ticket size of investments in the segment in 2012 was Rs.114 crore, rising 4% on average over 2011. Bangalore saw the highest number and value of private equity investments at Rs.3,250 crore in 2012 followed by Mumbai with Rs.1,300 crore and the national capital region with Rs.700 crore.
Read more: Mint