Bullish on the revival of the economy after general elections, real estate consultancy firm Cushman & Wakefield expects nearly 132 million sqft of office space, across the eight major metros, to get absorbed by 2017.
However, the report said the current year (2013) will see a 26 per cent fall in office space absorption to around 22.5 million sqft over the past year due to the ongoing slump in the economy.
The supply of office space between 2013 and 2017 in the top eight cities-Delhi-NCR, Mumbai, Bangalore, Chennai, Hyderabad, Ahmedabad, Kolkata, and Pune is expected to be around 143 million sqft.
Of this 143 million sqft, around 90 million sqft are currently under various stages construction and is expected to get completed by 2015, the report said.
“The office market is expected to remain attractive for occupiers with steady increase in absorption after a trend of decline in 2013.
“With the economy expecting more stability in the post-election phase from 2015, the absorption trend is also expected to pick pace especially in established markets of Bangalore, Mumbai and Delhi-NCR,” Cushman & Wakefield executive managing director for South Asia Sanjay Dutt said.
Read more: The Economic Times
Otis sees scope for growth in India’s real estate market
Leading manufacturer of elevators, US-based Otis, is betting big on India’s real estate market, mostly vertical, to grow its business in the country. In spite of all the talk of a slowdown in real estate, Otis Elevator Company’s president (Asia Pacific area), Patrick Blethon, who’s here for a week, told Business Standard that the pace of construction in India could create a new Chicago every year for the next 30 years in terms of the built-up area. The company, part of the $58-billion United Technologies Corp, whose links with India began more than a century ago with the elevator at Kolkata’s Raj Bhavan, is not just doubling the manufacturing capacity at its Bangalore factory from 5,000 to 10,000 units a year, but a second plant in India could also be in the offing.
“The plan is on the drawing board,” Blethon said, when asked if Otis wanted to open a second manufacturing plant in India. While the venue of the second plant has not been decided, it could be a toss between the South and the West. While currently the Bangalore facility only caters to consumption in India, there are plans of making India a manufacturing hub for global exports as well. At present, 65 to 70 per cent of its global volume is manufactured in Chinese plants. In fact, seven of its manufacturing plants are located in China out of a total of 14 worldwide.
Globally, China tops the list with its consumption of elevators at 500,000 a year, making for 60 per cent of new equipment around the world, and India is at number two with 47,000 units. North America is far behind in demand for new elevators at just 18,000 units per annum. Apart from being a saturated market, real estate growth in the American residential market is mostly horizontal. India, on the other hand, is in the middle of a vertical construction boom in the residential segment, though it’s facing a temporary blip.
Read more: Business Standard
Bank credit to commercial real estate picks up in FY14
After recording sluggish growth in the previous financial year, bank credit (loan) to commercial real estate (CRE) projects has picked up in the current financial year, registering a 17.4 per cent growth in August, compared to 8.6 per cent during the corresponding period of FY13.
In FY13, bank credit to the commercial real estate sector grew by 11.5 per cent, compared to overall credit growth of 14.3 per cent.
According to the latest data released by the Reserve Bank of India (RBI), in the first five months of FY14, credit growth to this sensitive sector was 7.9 per cent compared to 2.8 per cent during the same period of last year.
In absolute terms, banks have extended Rs 9,900 crore of loans to the commercial real estate sector in the first five months of the current financial year compared to Rs 3,200 crore during the April-August period of FY13.
Read more: Business Standard
Banks post faster growth in first half FY14
Indian banks’ loans and deposits grew faster in the first six months of the current fiscal year ending March from the same period a year earlier, according to the Reserve Bank of India data released on Tuesday.
Banks’ loans grew about 10.1 percent to 57.94 trillion rupees during March-end to September 20 faster than 3.4 percent a year earlier, while deposits rose about 9.3 percent to 73.77 trillion rupees compared with 6.5 percent a year earlier.
Banks’ investments in securities grew about 8.9 percent to 21.84 trillion rupees during March-end to September 20 compared with 12.1 percent in the same period of the previous year.
Solar energy startups out to power rural India with cost-effective and less toxic solutions
Numerous solar energy startups are delivering cheap and accessible power to rural India. These ventures have come up with solutions – ranging from solar off-grids to solar-powered home systems – that are not just cost-effective but also less toxic than traditional fuels like kerosene.
“In a country, where large swathes of population have little or unreliable access to basic power, off grids is the solution,” said Shyam Patra, 36, founder of Naturetech Infrastructure. The four-year-old, Lucknow-based startup provides electricity to more than 25 villages across Uttar Pradesh and Bihar by offering power directly to homes and micro and small enterprises.
“UP alone has 20 million rural households that have no access to electricity. Even if we choose to work only here, we will not be able cover more than 10% of the market,” said Patra, who was formerly with infrastructure companies Lanco and GMR.
Naturetech’s off-grid is installed underground, with cables attached to households. Customers pay through a tamper-proof prepaid meter. Consumers pay up to 150 a month for 24-hour electricity, almost half of what they spend on kerosene and diesel.
Read more: The Economic Times