Gurgaon has emerged amongst the top ten business cities in the country over the past 15 years. It is home to more than 50 Fortune 500 companies and accounts for almost half of all revenues for its state. Real estate values have risen sharply in a city that has become a roaring engine of growth. To discuss this and more issues, GIREM (Global Initiative for Restructuring Environment and Management) will be holding a conference on April 14 on “Planning Forward”.
Eminent leaders from the administration and industry will talk about the vision and plans that should be adopted for sustaining the city growth.
Among key speakers would be Gurgaon police commissioner, HUDA administrator, Naveen Puri of Genpact, Sanjay Dutt of Cushman & Wakefield. Other key speakers at the event are MP Deepender Hooda and MLA Sukhbir Kataria.
Gurgaon has 40 million square feet of commercial space, a tenfold increase from 2001 and expected to add another 60 million in the next two decades, there is no stopping this growth unless we fail to respond to growing needs for creating next-gen urban infrastructure, said a spokesperson.
“The city administration has a long to-do list: Fix the roads, sewers, electrical grid, drainage, the lack of public transport buses, lack of water and lack of planning,” he added.
The agenda for this meeting in Gurgaon includes issues such as inbound and outbound investment, policy reforms, urban services, role of private participation in development, capacity building, housing – and demand-side measures, investing in soft and hard infrastructure, re-designing social safety nets and whether the current residential trends in Gurgaon are sustainable, especially pricing and civic services.
“We have to question ourselves whether clubs and swimming pools are more relevant than power and water,” said the spokesperson.
Source: The Times of India
Silicon boost for realty
The real estate scenario in the tricity area has by and large remained placid in the first three months of 2013 with sales not picking up in the periphery areas in Mohali and Panchkula.
However, experts maintain that the current low sentiment is not going to last for long as the demand for quality housing in and around Chandigarh is building up steadily.
An expanding IT sector in the tricity area is one of the major factors behind an increase in the demand for housing.
Chandigarh that has traditionally been known as the city of babus and retired people, has seen an upswing in the number of Information Technology/ITeS/BPO professionals. Chandigarh Administration, under the overview of Department of Information Technology, had set up the Society for Promotion of IT in Chandigarh (SPIC), in its bid to promote the IT industry in the UT.
Similarly, the Rajiv Gandhi Chandigarh Technology Park (RGCTP) has come to be known as the IT complex within the city, which houses the biggest names in the IT sector.
According to official records Rs 62 billion were invested in 2011-12 in the IT sector in Chandigarh, which helped generate 67,700 direct jobs in the IT sector.
Read more: Tribune India
Bill to regulate real estate will not clip wings of players
The proposed bill to regulate the real estate sector seeks to establish a transparent system of delivery and would not hamper the growth of the sector, a top government official said today.
Addressing a conference of CREDAI, Ministry of Housing and Urban Poverty Alleviation Secretary Arun Kumar Misra assured the developers that the proposed Real Estate (Regulation and Development) Bill is “comprehensive” and “will not clip your wings”.
CREDAI, the realtors’ apex industry body with more than 9,000 members across the country, has been opposing the proposed law saying that the Bill in the current form is not practical and only favours property buyers.
Misra, however, said: “The Bill is trying to establish transparent and open system of delivery,” Misra said.
Earlier this week, Housing and Urban Poverty Alleviation Minister Ajay Maken had said the bill would soon be brought before the Cabinet for approval and the government plans to introduce the Bill in the Budget Session of Parliament.
The bill aims to establish a regulatory authority for enforcing fair practice and accountability norms and fast track dispute resolution mechanism in realty transactions.
The government plans to set up a tough regulator for the real estate sector with provisions for even jail term for the developer for putting out misleading advertisements about projects.
Read more: The Economic Times
Circle rates raised by up to 15%
The district administration on Saturday raised the circle rates in Gurgaon by up to 15%, considered an average hike.
The revision will lead to a substantial hike in the price of land and plots across residential, commercial and industrial areas. Deputy commissioner PC Meena announced the rates which will come into effect from April 1.
According to the new rates for the financial year 2013-14, value of up to two acres of land adjoining National Highway 8 and the Northern Peripheral Road (Dwarka expressway) will increase by 20%. Similarly, the value of up to two acres of land at Gurgaon-Sohna Road and Gurgaon-Pataudi Road will increase by 10%.
These revisions will lead to shooting of agricultural land prices in Gurgaon.
Like last year, no changes have been made in the stamp duty rates on land less than 1,000 square yards. It will continue to be treated as residential land for stamp duty collection.
Read more: Hindustan Times
Realtor body against Budget proposal of 1% TDS on property deals
Confederation of Real Estate Developer’s Associations of India (CREDAI), has sought withdrawal of Budget proposal to levy 1% tax deducted at source on any property deal other than agriculture land.
In a recent representation sent to the finance ministry, the realtors’ body has argued that implementation of this proposal will lead to more complexities and harassment of consumers. “We are seeking withdrawal of this proposal completely. This will lead to harassment of consumers, especially the buyer who is being burdened with additional responsibility to withhold the amount, deposit this to tax authorities and file returns,” said Lalit Kumar Jain, chairman, CREDAI.
CREDAI, the apex body representing organised real estate developers and builders across the country, has sent a written representation to the finance ministry in this regard. Under the proposal, the tax is mandated to be paid if the property consideration is over 50 lakh in specified urban areas and 20 lakh in any other area. The transaction will be registered only after the buyer provides proof of deduction and payment of TDS. The proposal will be effective from June 1, 2013.
According to Jain, around 80% of realty transactions in top six markets in the country including Mumbai Metropolitan Region, Delhi, Bangalore, Chennai, Pune and Hyderabad will be affected by the proposal, given the current property rates.
Source: The Economic Times
PE funds may prefer large cities, looking for mature markets
Though smaller cities are offering a great deal of opportunities for real estate investments, private equity funds will flow into large cities this year as investors look for mature markets, says realty consultants Jones Lang LaSalle.
“Currently, smaller cities are offering real estate investment opportunities, but cities like Mumbai, Delhi-NCR and Bangalore among others will see more PE activity this year as investors prefer more mature markets than speculation- driven ones,” JLL research head Ashutosh Limaye told PTI.
“Investors are looking at more mature markets with lots of activities, from the occupiers’ perspective. They want to invest in markets which are more comfortable and not the ones which are driven by speculation,” he said.
PE funds will raise distressed real estate funds and are likely to buy into bad loans of banks which have been sold to asset reconstruction companies (ARCs), Limaye said.
Also, a number of funds which had invested in 2007-08 will be looking at exiting this year, some of them at low internal rate of returns.
“Investors are not ready to take higher risks and therefore would prefer to exit even at lesser returns. We expect some of the funds which had invested during 2007-08 may look at exiting. But given the overall uncertainties, these funds may also look at postponing exits to 2014,” he added.
A number of new domestic real estate PE funds backed by corporate entities are also likely to be launched this year, he said.
Read more: The Economic Times
Minimum FDI in construction likely to be increased to $10 m
In a bid to attract more serious and long-term foreign investors to the construction sector, the government is likely to increase the threshold for foreign direct investment (FDI) in such projects to $10 million in all cases and remove the condition that the funds need to be brought in not later than six months from the start of operations.
The FDI policy, thanks to the ongoing review, is likely to hike the $5 million minimum capitalisation base for joint ventures (JV) in “construction development” projects also to the same level of $10 million for wholly owned subsidiaries (WOS) in this segment. This is after taking into account increasing realty prices across the country and upon the finding that funds below $10 million could not be deemed to confirm the investor’s serious intent, sources in the know of the developments told FE.
The review would also see foreign funds being brought in at any stage of the commencement of business of the company. However, this relaxation would come with a rider that the amount is used for the specific projects that the company has applied to undertake and not for any other purpose including speculative activities.
This is being done as there are several projects stuck at different stages of completion due to the economic slowdown and the consequent financial crunch, sources said.
Read more: Financial Express