Pune property to grow
April 1, 2008
Pune property to appreciate by over 15 %: report
BY MRITYUNJAY BOSE
MUMBAI: With Pune emerging as a promising property market, the prices are expected to rise manifold in the forthcoming months. The demand for office space is expected to remain buoyant in the forthcoming months, with an expected appreciation of around 15 to 20 per cent in office rental values. Residential and retail prices, riding on the back of the active office sector, shall continue to attract investor interest and will witness a price appreciation of around 15 to 20 per cent and 25 to 30 per cent, respectively.
The latest report of Knight Frank Research points out that the major demand drivers have been the IT/ITES sector as well as the expanding automobile industry. The Jawaharlal Nehru National Urban Renewal Fund (JNNURM) fund of Rs 270 crore is facilitating the infrastructure development in Pune. Three major flyovers have become operational along with the development of newer roads while a metro rail is being planned and a new airport is underway. "These initiatives will provide the requisite environment to support future real estate growth in the city," the international property researcher said in its latest report.
Besides, a new government legislation permits building to be built upto a height of 100 mts considering certain parameters. Consequently, Pune's skyline would be redefined with high rises in residential and office developments. Further, the recently repealed ULCA have released around 17,000 acres of land, mostly in peripheral locations, thereby auguring expectations of stabilizing the property rates in future.
The report points out that rental and capital values in the retail market in the city have been rising since 2005 and various newly developed real estate pockets have emerged as new retail destination. In the Western zone, Aundh has developed into a significant retail destination along with other residential and IT/ITES developments. Retail rental values have gone up by Rs 150/sq ft per month having a 40 per cent increased as compared to last year. In the Eastern zone, Nagar Road and Mundhawa-Kharadi bypass road are amongst the fast growing retail locations due to their proximity to various IT developments. This has led to an appreciation of 20 per cent in rental values to the present value of almost Rs 110/sq ft per month. In the Central zone, the rental values on Senapati Bapat Road have increased by around 40 per cent to Rs 180/sq ft per month owing to the presence of International Convention Centre.
A supply of 1.28 million sq ft has entered the Pune retail sector in 2007, while around 13 new malls totaling to 1.35 million sq ft of retail space is expected to enter the market by 2008. Key retail projects scheduled to be completed in 2008 are One Centre Port (200,000 sq ft) on Ganeshkind Road, Down Town (200,000 sq ft) at Erandwane, Gold Mall (313,095 sq ft) and Dolphin Mall (150,000 sq ft) at Hadapsar Road.
The Eastern and Western zones in Pune has seen the maximum real estate development over the past one year. Together with this, these regions witnessed strong leasing activity, thereby leading to reasonable appreciation in rental values for office space. Among projects on office sector, that became operational in 2007, note can be of TechPark on Airport Road, SP Infociti on Sholapur Road, Cybercity at Hadapsar and GigaSpace and Weikfield IT Park at Vimannagar. In 2008, approximately 7.02 million sq ft of office space is expected to enter the market of which the Eastern zone shall be responsible for 67 per cent of total supply. Some important projects to be completed in 2008 include Commerzone at Yeravada, Cerebrum at Kalyaninagar and Eternia at Wakdewadi.
On the residential front, the report points out that nearly 26.21 million sq ft of residential space has been added to the market in 2007, of which about 35 per cent each has been contributed by the Western and Eastern zones. Some of the prominent projects which were added to stock in 2007 are Sigma One Phase I in Kothrud, Kumar Presidency at Koregaon Park, Water Front and Fortaleza in Kalyaninagar. In 2008, 31.61 million sq ft of new residential supply is expected to enter the Pune market. However, of the total supply projected, some of the developments may get spilled over to 2009, on account of deliberate project delays in case of a slowdown in the market is perceived.
Pune property to appreciate by over 15 %: report
BY MRITYUNJAY BOSE
MUMBAI: With Pune emerging as a promising property market, the prices are expected to rise manifold in the forthcoming months. The demand for office space is expected to remain buoyant in the forthcoming months, with an expected appreciation of around 15 to 20 per cent in office rental values. Residential and retail prices, riding on the back of the active office sector, shall continue to attract investor interest and will witness a price appreciation of around 15 to 20 per cent and 25 to 30 per cent, respectively.
The latest report of Knight Frank Research points out that the major demand drivers have been the IT/ITES sector as well as the expanding automobile industry. The Jawaharlal Nehru National Urban Renewal Fund (JNNURM) fund of Rs 270 crore is facilitating the infrastructure development in Pune. Three major flyovers have become operational along with the development of newer roads while a metro rail is being planned and a new airport is underway. "These initiatives will provide the requisite environment to support future real estate growth in the city," the international property researcher said in its latest report.
Besides, a new government legislation permits building to be built upto a height of 100 mts considering certain parameters. Consequently, Pune's skyline would be redefined with high rises in residential and office developments. Further, the recently repealed ULCA have released around 17,000 acres of land, mostly in peripheral locations, thereby auguring expectations of stabilizing the property rates in future.
The report points out that rental and capital values in the retail market in the city have been rising since 2005 and various newly developed real estate pockets have emerged as new retail destination. In the Western zone, Aundh has developed into a significant retail destination along with other residential and IT/ITES developments. Retail rental values have gone up by Rs 150/sq ft per month having a 40 per cent increased as compared to last year. In the Eastern zone, Nagar Road and Mundhawa-Kharadi bypass road are amongst the fast growing retail locations due to their proximity to various IT developments. This has led to an appreciation of 20 per cent in rental values to the present value of almost Rs 110/sq ft per month. In the Central zone, the rental values on Senapati Bapat Road have increased by around 40 per cent to Rs 180/sq ft per month owing to the presence of International Convention Centre.
A supply of 1.28 million sq ft has entered the Pune retail sector in 2007, while around 13 new malls totaling to 1.35 million sq ft of retail space is expected to enter the market by 2008. Key retail projects scheduled to be completed in 2008 are One Centre Port (200,000 sq ft) on Ganeshkind Road, Down Town (200,000 sq ft) at Erandwane, Gold Mall (313,095 sq ft) and Dolphin Mall (150,000 sq ft) at Hadapsar Road.
The Eastern and Western zones in Pune has seen the maximum real estate development over the past one year. Together with this, these regions witnessed strong leasing activity, thereby leading to reasonable appreciation in rental values for office space. Among projects on office sector, that became operational in 2007, note can be of TechPark on Airport Road, SP Infociti on Sholapur Road, Cybercity at Hadapsar and GigaSpace and Weikfield IT Park at Vimannagar. In 2008, approximately 7.02 million sq ft of office space is expected to enter the market of which the Eastern zone shall be responsible for 67 per cent of total supply. Some important projects to be completed in 2008 include Commerzone at Yeravada, Cerebrum at Kalyaninagar and Eternia at Wakdewadi.
On the residential front, the report points out that nearly 26.21 million sq ft of residential space has been added to the market in 2007, of which about 35 per cent each has been contributed by the Western and Eastern zones. Some of the prominent projects which were added to stock in 2007 are Sigma One Phase I in Kothrud, Kumar Presidency at Koregaon Park, Water Front and Fortaleza in Kalyaninagar. In 2008, 31.61 million sq ft of new residential supply is expected to enter the Pune market. However, of the total supply projected, some of the developments may get spilled over to 2009, on account of deliberate project delays in case of a slowdown in the market is perceived.
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