Real Estate Intelligence Service, Thursday, January 07, 2010

Govt divided over continuance of fiscal stimulus package

Govt divided over continuance of fiscal stimulus package
The Hindu Business Line, January 7, 2010, Page 18

Our Bureau, New Delhi

Opinion is divided in the Government over the continuance of the fiscal stimulus beyond March.

Top Finance Ministry officials seem to be in favour of a partial withdrawal while other ministries and the Planning Commission do not want excise cuts to be reversed.

Fresh indication of this divide came today when the Finance Secretary, Mr Ashok Chawla, said at a FICCI meeting that “too much of stimulus when the body is getting healthy is injurious to health”.

This remark has triggered speculation that the industry demand for continuation of fiscal stimulus till September may not find favour with the Government.

Meanwhile, Mr Chawla told reporters on the sidelines of the FICCI meeting that consultations on the new direct taxes code have been completed.

“The architecture will now be finalised by the Revenue Department. Once the Finance Minister and policymakers give the green signal, it will be sent to the law ministry for drafting of the bill,” Mr Chawla said.

Indications are that the bill for the new direct taxes code is unlikely to be introduced in Parliament in the first phase of the upcoming budget session.

The Finance Minister, Mr Pranab Mukherjee, had recently met the Prime Minister, Dr Manmohan Singh, on the issue of new direct taxes code. A presentation was made by the Finance Ministry on the proposals of the new direct taxes code, it is learnt.

Already India Inc has opposed certain proposals in the code like levy of minimum alternate tax on gross assets basis. There is also demand from certain quarters that the exempt-exempt-tax system should not be introduced for taxation of savings.

Too much stimulus could be injurious

Too much stimulus could be injurious
Business Standard, January 7, 2010, Page 1

The Finance Ministry on Wednesday hinted that stimulus packages given to the industry might be rolled back, saying too much stimulus could be injurious at a time when the economy was on a revival path.

Too much of stimulus is injurious, says Chawla

Too much of stimulus is injurious, says Chawla
The Times of India, January 7, 2010, Page 23

NEW DELHI: A day after industry representatives met FM Pranab Mukherjee and sought the stimulus in the form of various tax sops to continue for another six months, finance secretary Ashok Chawla said too much of it could be injurious (to the industry) when the economy is on a revival mode.

"Too much of stimulus, when the body is getting healthy, is not good, it can be injurious to health," the finance secretary told reporters. Chawla's remark could mean a gradual withdrawal of many fiscal and monetary concessions the government had given early last year to infuse extra liquidity in the system other than the duty cuts to industry to make them more competitive.

Last year, after the global slowdown hit India, the government had introduced a host of stimulus measures including excise duty cuts by 6%, service tax reduction by 2% and enhanced expenditure in social and infrastructure sectors, besides agriculture loan waiver to the tune of Rs 65,000 crore and implementation of the sixth pay commission recommendations.

The fiscal and monetary sops introduced by both the RBI and the government led to the economy bouncing back with growth in the second quarter of 2009-10 standing at 7.9% against 6.1% in the first quarter and 5.8% each in the preceding two quarters.

The finance secretary also said that the government is through with the consultation process on the proposed direct tax code and a draft would be finalised very soon.

"The process of consultation is almost complete," Chawla said, adding that the revenue department is in the process of preparing a final draft of the proposed tax code that would replace the existing Income Tax Act of 1961.

After the draft is finalised, the tax code would be sent to the law ministry for vetting after which it will come up before the inter-ministerial committee. The direct tax code is proposed to be implemented from 2011-12.

Ministries at odds over stimulus exit

Ministries at odds over stimulus exit
The Economic Times, January 7, 2010, Page 1

G Ganapathy Subramaniam, ET Now

Commerce and industry minister Anand Sharma has urged against an immediate rollback of last year’s stimulus measures, wading into a debate on the
timing of the stimulus exit that has pitted ministries, policymakers and industry on different sides.

The finance ministry, trying to manage the highest fiscal deficit in 16 years and galloping food price inflation, is keen to do away with the stimulus measures on the grounds that these have helped shepherd India’s economy safely out of the worst global economic crisis since the Great Depression.

Finance secretary Ashok Chawla, the senior-most bureaucrat in the finance ministry, on Wednesday said continuing stimulus measures wasn’t good for the economy, arguing that “too much of stimulus can be injurious to health” and clearly hinting that a rollback of the stimulus measures may be on the cards. However, Mr Sharma urged caution. “We have to be cautious in withdrawing the stimulus measures. The recovery is stimulus-led and stimulus-fed. Without stimulus measures, the recession could have turned into a depression,” he told ET NOW in an interview.

The stimulus measures — a mixture of tax cuts, increased expenditure, easy credit and interest rate cuts all totalling more than 12% of GDP — were announced in three phases between September 2008 and April 2009. Around this period, economic growth slowed to nearly 6% levels after averaging more than 9% in the preceding three years. The economy has since recovered, notching 7.9% in the quarter to end-September.

The commerce minister said the improvement in leading economic indicators in the run-up to the Budget next month-end “should not lead to measures that will hurt in the long run”, pitching his views closer to that of industry that wants the stimulus measures to be kept in place for at least another six months. “Even if we have done well, we cannot afford to turn complacent,” he said.

Easy availability of credit and lower interest rates should stay, Mr Sharma emphasised, adding that Indian industry was always at a disadvantage due to higher cost of capital, and the improved liquidity in the wake of slowdown had only partially neutralised the handicap.

He, however, acknowledged that keeping fiscal deficit under control was a major challenge, and said he trusted finance minister Pranab Mukherjee to come up with fitting measures. “I know the FM has his concerns. His work is difficult.”

Mr Sharma said India needed to move onto a higher growth trajectory to lift millions of people out of poverty, and said for this to happen the country had to become a strong manufacturing hub like China. The government was planning to set up dedicated investment and manufacturing zones, much like special economic zones (SEZs), and arm them with incentive packages to boost the share of manufacturing in the country’s GDP to 25% from around 16% now, Mr Sharma said.

While SEZs will play a key role in boosting exports, the manufacturing zones will seek to shape India into a strong manufacturing hub like China. Appointed commerce minister in the UPA government’s second stint, Mr Sharma has presided over a recovery in India’s export performance. Exports rose 18.2% in November, the first rise after 13 months of decline.

Mr Sharma said while exports were on the recovery path, a ‘full and sustained’ recovery would happen only when demand picks up across the US, Europe and Japan.

Ansal ready to launch low-cost housing in Agra

Ansal ready to launch low-cost housing in Agra
The Financial Express, January 7, 2010, Page 4

Rajat Guha, New Delhi

After launching affordable housing projects in five cities across Rajasthan and Uttar Pradesh, Delhi-based realty company, Ansal API, is all set to launch a major affordable housing project in Agra. The project, under the brand name ‘Aastha’, will be part of Ansal API’s upcoming 500-acre mega township project, Sushant Taj City, in Agra, with a total investment of about Rs 1,000-1,100 crore.

The Agra affordable housing project of Ansal’s will have 1,600 units. The houses, with sizes ranging from 560 sq ft to 920 sq ft, will be priced in the range of Rs 7 lakh to Rs 11 lakh. The project is slated to be lauched next week.

This will be the third affordable housing project Ansal API will be launching in UP, the first two being in Lucknow and Meerut. While the Luknow project offered 800 units, the Meerut project had 350 units under the affordable housing category. All its affordable housing projects in UP are being launched under the common brand name Aastha. Ansal API has set a target of developing 10,000 units under its ambitious affordable housing segment over the next five year period. According to P N Misra, executive director, Ansal API, the group plans to develop the affordable housing segment as its major growth area in tier I and tier II cities.

Besides UP, Ansal API has launched three affordable housing projects in Rajasthan – Jaipur, Ajmer and Jodhpur. All its affordable housing projects in Rajasthan are launched under the common brand name Abhilasha Homes. The company is learnt to be gearing up to hand over possession of the completed units in its Jodhpur affordable housing project this month.

We are focussed on building affordable housing across northern India

We are focussed on building affordable housing across northern India
The Hindustan Times, January 7, 2010, Page 18

With over forty years of experience in developing quality residential townships and commercial projects, Ansal API is a name which comes first to your mind, when you think of real estate.

The group has been successfully catering o the ever growing demand for housing to the ever growing demand for housing and commercial real estate in the country across all sections of society by providing world-class products to consumers at affordable prices.

Needless to say, Ansal API has been doing well even as recession hit the Indian real estate market only because of their ability to understand and give people ‘what they want’ and ‘what they can pay for.’ Rakesh Kaul, Chief Operating Officer, Ansal Hi Tech Townships Limited shares with us the reasons Ansal API remains on top and the group’s growth plans which include new projects in Lucknow, Meerut, Punjab and Haryana and other Tier-II towns and cities of Northern India.

EXCERPTS FROM THE INTERVIEW: Before the world was hit by the recent recession, the real estate market was booming. In the present market scenario how are you sustaining the growth of your business?

At Ansal API, we follow a business strategy which gives us enough flexibility to adapt to the changing economic and market conditions. For instance, since more than last ten years, our group’s focus has been on developing mega township projects, which allows us to cater to all types of demands.

In India, there is still a big gap between demand and supply in the housing sector. As economic cycles change, the pending demand only shifts from one segment to other or within the sub-segments of the same asset class. With over 42 years of experience behind us, we have seen these kinds of cycles before as well.

In the present scenario, we are focussed on the affordable housing segment and have set ourselves a target of building 10000 homes in this category across the Northern India region where we are mainly present as of now.

We have also launched Megapolis, which is a 2500-acre mega township project that we are developing adjoining Greater Noida in the NCR.
Being a city in itself, it has everything that a modern day city should have and includes residential, commercial, retail, hospitality, institutional, health care, industrial, leisure (an international standard golf course, equestrian club, water sports in the 5 natural lakes) and a host of other features. With such a wide range of asset classes, Megapolis has the advantage of addressing all sections of the market, as against projects of the competition that are singularly focused.

Our ability to introduce only those products that could be absorbed in a recessionary market has helped us tide over the difficult times. Plots in attractive price range and ‘group housing’ in the affordable category sailed smoothly even in the downturn. Furthermore, Fairway Apartments that we launched in February 2009 is actually a luxury product and overlooks a golf course on one side and lake on the other, but was offered in the affordable category by value engineering without compromising on the size or the specifications. We are fully confident that we will be able to not only sustain our growth but even achieve greater heights by being able to offer the entire range of products in a world class environment with emphasis on quality while keeping the affordability factor in mind.

What are your new projects in the pipeline that Ansal API is presently developing?

Ansal API has a mixed bag of projects in the pipeline. This includes independent bungalows, premium floors, high-rise apartments at Megapolis, small and large offices in Corporate Park in Noida and IT offices in the IT SEZ in Greater Noida.

Apart from these, our Group has a heavy rollout planned for Lucknow, Meerut, Agra (UP), Haryana, Rajasthan and Punjab in the residential segments from premium to mid segment categories.

In the light of increased, increased environment consciousness, ‘green’ is the new mantra, in which way does your development work cater to this market as well as social needs?

As a group, Ansal API is socially and environmentally conscious and committed. We are presently executing approximately 4500 acres of townships which are purely ‘green’ and hi-tech in nature. Our Megapolis project has more than 50 percent green area and has obtained the environmental clearance subjecting itself to the most stringent norms.

Besides, we as a group have decided to use environment-friendly materials and products in our constructions. We also focus on renewable energy, water harvesting and waste-water recycling etc. in our residential and commercial projects.

Any real estate development work has to go hand in hand with larger infrastructural development by the government (for example, a residential complex gains in value only if it is well connected by roads), what kind of infrastructural requirements, the govt. has to put in place that would boost the growth of real estate.

No doubt, infrastructural development is the key to real estate growth. The best example is Greater Noida which can boast of the fastest access through Gautam Budh Expressway and a world class infrastructure of internal roads, drainage, sewage etc. Apart from these leisure and hospitality attractions also add value to real estate in the area.

Having said that, we feel that better connectivity through expressways, Metro/ mono rail, flyovers for lesser intersections, road over-bridges for railway crossings, water and regular power supply, schools, hospitals and public utilities are some of the areas where government spending should increase.

What are the challenges you face in land acquisition for real estate development purposes?

Land acquisition continues to be the most difficult and challenging aspect of the real estate development process. Multiplicity of laws, fragmented ownership, archaic land record system, ULCA etc. continue to be the challenges that realty companies face in land acquisition.

How do you differentiate your offering from others in this space?

Ansal API is among the leading Realty and Infrastructure Groups in India today, having established an excellent track record of over 42 years. We attribute the reason for our longstanding success to our ability to benchmark ourselves against international standards and quality parameters and also to delivery and service standards that we adhere to in all our projects/products. In the Township/Residential project segments, our Group plans and develops projects and products keeping in mind the fast changing requirements of the customers and by striking a fine balance between quality and affordability.

Besides, we handhold the clients post delivery as well, which keeps us posted on the pulse of our customers and allows us to adapt quickly.

In fact, this has been the key reason why our Group has been in the business for more than 42 years now and has always been a pioneer in each of the real estate asset classes - whether it is residential, commercial, retail or townships as a whole.

We have maximum penetration in Tier-II cities in comparison with any other developer and that has helped to keep us firmly grounded. Besides, as a policy we are looking at Mega Township rollouts which would allow the consumers to come to us for any kind of their real estate needs.

US venture capitalists bullish on Indian market

US venture capitalists bullish on Indian market
Business Standard, January 7, 2010, Section II, Page 2

Press Trust of India, NEW YORK

After a lull of investments in the venture capital space last year, the US venture capitalists are optimistic about the future prospects of this segment in 2010 and said that India and China would attract a large chunk of these fund flows, a st udy said.

According to leading global audit, tax and advisory firm KPMG, the venture capital community is signalling an uptick in overall venture capital (VC) investment in 2010 and expects IPO activity and valuations of venture-backed companies to trend upward ne xt year.

Majority of respondents were of the opinion that “China and India are expected to remain very attractive regions for 2010, while Brazil, Israel and Southeast Asia will also see an increased venture investment.”

“There is no question that the economic and market conditions of the past two years have been difficult for the venture capital community, but we are clearly seeing indications of a light at the end of the tunnel,” the KPMG partner and co-leader of its v enture capital practice, Mr Packy Kelly, said.

As many as 68 per cent of respondents said that they expect total VC investment to increase in the year ahead — a completely different perspective from a year ago when 74 per cent said they expected investment levels to decline.

Venture capitalists also expect increases in deal volume (66 per cent) and venture fund-raising (53 per cent). — PTI

GST rollout in April won't be possible, says BJP

GST rollout in April won't be possible, says BJP
Business Standard, January 7, 2010, Page 5

BS Reporter / New Delhi

The Bharatiya Janata Party (BJP) today said it would not be possible for many states to roll out the Goods and Services Tax (GST) from April 1 as proposed by Finance Minister Pranab Mukherjee, as several contentious issues regarding interest of states had not been addressed.

Senior party leader and former finance minister Yashwant Sinha, who spoke to reporters on the deliberations of the state finance ministers, said the empowered committee of the state finance ministers had worked on the issue but several matters had been left unexplained. The Centre had not shared with the states its view on some of the objections raised by them, he added.

“The BJP has been pointing out that a balance needs to be struck to protect the revenues of the state government, interests of industry and traders and benefits to the consumers at large and to specific sections of society as farmers and those living below the poverty line. The GST structure should not be such that the common man is adversely affected, either by additional tax or any consequent price rise,” the party leader said.

Differences on GST include the revenue neutral rate and revenue buoyancy, threshold limit, value added tax on imports, pending issues of compensating the Central Sales Tax, effective mechanism of levy of tax on textiles, flexibility to the state governments to exempt goods of local importance and include items in the lower rate list.

The BJP also suggested necessary amendment to the Constitution to change the federal structure, but said the issue needed more discussion.

A comprehensive compensation package operated by an independent agency was also needed, it said. Issues of an inter-state movement and the IT preparedness of states, which is imperative before the GST rollout, also needed to be discussed.

Although Sinha denied any differences on the GST issue among the BJP-ruled states (Madhya Pradesh and Gujarat are reportedly favouring the GST), the party statement said “most of the BJP states” endorsed the party view.

A diluted tax code may go to LawMin for drafting

A diluted tax code may go to LawMin for drafting
Business Standard, January 7, 2010, Page 7

BS Reporters / New Delhi

With the consultation process for the direct taxes code over, the proposals on taxation for salaried employees and income from house property may undergo some changes.

There could also be a relook at the proposals on the minimum alternate tax, capital gains tax, double-taxation avoidance agreement, general anti-avoidance rule, taxation of charitable organisations and foreign companies, and taxing investment at the withdrawal stage.

According to the code, income from a house, which is not occupied for the purpose of any business by its owner, will be taxed under the ‘income from house property’ head.

TN housing scheme for 2 million families

TN housing scheme for 2 million families
The Times of India, January 7, 2010, Page 14

CHENNAI: When it comes to proclaiming itself as the ultimate welfare state, the DMK government in Tamil Nadu is really pushing the envelope. In the annual governor’s address delivered in the assembly by Surjit Singh Barnala, it announced an ambitious housing scheme for the rural poor to cover more than two million families and introduced free professional education to students hailing from families that have not produced a graduate so far. Both schemes are the first of their kind in the country, officials said.

Having deepened its social base by supplying rice at Rs 1 a kg to ration card holders, waiving farm loans, distributing free television sets and introducing a health insurance scheme for life-saving treatment, the 44-month-old Karunanidhi regime announced more schemes aimed at strengthening its popularity for the fourth consecutive year. This year’s policy pronouncement was significant for CM personally as he has indicated that he may shed his administrative burden later this year.

The housing scheme aimed at a hut-free Tamil Nadu targets nearly 50% of the state’s rural residents by envisaging conversion of mud huts with thatched roofs into concrete dwellings. ‘‘Dalits and most backward classes will greatly benefit from this,’’ said a senior official. The rural development department will spend Rs 1,800 crore in the first year.

Real estate not long-term bet

Real estate not long-term bet
The Times of India, January 7, 2010, Page 23

MUMBAI: Stay off real estate — these are the words of wisdom offered by investment consultants to the clients now. They are also warning their clients, who are still optimistic about the prospects of the sector, to tread with ‘‘extreme caution.'' Worse, of late, even some mutual fund managers have joined the chorus, questioning the veracity of the claims of a turnaround made by realty firms.

The news comes at a time when most real estate players are claiming that they have turned the corner with many firms lining up with initial public offers (IPOs) in the coming months.

‘‘We are not recommending the sector to our clients. After the slump last year, we now find it difficult to take a call on the sector. The claims made by the companies, the financials... everything is questionable,'' says awealth manager who doesn't want to be named. ‘‘The valuations claimed by these companies, their land bank, title...these are problematic areas. There are a lot of ifs and buts involved,'' says K R Choksey, chairman, K R Choksey Shares and Securities, one of the oldest broking firms of Dalal Street.

According to stock market pundits, after the slump in the sector a year ago, thanks to the economic slowdown, many investors have turned bearish on realty. Many experts believe that the real estate players are not serious about long-term prospects of their business. ‘‘It seems like these people just want to make a quick buck. For
example, there was a pick-up in demand sometime ago, but it died down the moment developers started quoting higher prices,'' says a real estate expert. ‘‘If you are buying any business, it should have good long-term prospects. The business should be able to generate money consistently over the long term. Otherwise, there will be a lot of volatility,'' says Choksey, explaining the fluctuating fortunes of the sector.

Navneet Munot, chief investment officer, SBI Mutual Fund, says he prefers a stock-specific approach than a sector-centric one. ‘‘The sector is finding it difficult to get over the difficult times. The strength of the balance sheet is also a matter of concern,'' he says. ‘‘Still, we believe that some players may have the potential to deliver in the long term, but you have to be extremely focused on the stock,'' he adds.

Long term is a phrase almost every expert uses while recommending real estate stocks, as these stocks can be extremely volatile in the short term. ‘‘Real estate is always a long-term investment,'' says Dharmesh Jain, MD, Nirmal Group, real estate developer.

Brand land going places in north India

Brand land going places in north India
The Hindustan Times, January 7, 2010, Page 14

AS INDIA COMES OUT THE GLOBAL DOWNTURN, THE DEMAND IN REAL ESTATE SECTOR HAS RETURNED AND THE PRICES OF RESIDENTIAL PROPERTY IN NORTH INDIA ARE STEADILY GOING UP SINCE SEPTEMBER THIS YEAR. DEVELOPERS HAVE RAISED PRICES IN MOST OF THE MARKETS IN NORTH INDIA.

When it comes to development in the real estate sector, North India takes a comfortable lead as compared to other parts of the country with Delhi, Gurgaon, Faridabad, Punjab, Haryana, Himachal Pradesh, Uttar Pradesh, Madhya Pradesh and Rajasthan leading the pack.

Much of the real estate development work has been concentrated in the top 38 cities of Northern India including Delhi, Gurgaon, Chandigarh, Noida, Shimla, Ambala, Jaipur, Ludhiana, Indore, Rudrapur, Ajmer, Bikaner, Kanpur, and Agra among others.

The past few years, before the recent economic slowdown, have seen an unprecedented growth in many of the urban centres in India and most of the cities in Northern India have been at the forefront of this real estate boom creating consumer confidence, investment & employment opportunities and growth of businesses.

According to a report prepared by India Brand Equity Foundation and Ernst &Young Pvt. Ltd., the Indian real estate industry is currently estimated to be US $ 48 billion, with a CAGR of 30 per cent. The total economic value of the market is estimated to be US $ 4045 billion, accounting for four to five per cent of the GDP. `The consistently growing IT/ITes sector, increasing presence of large foreign businesses in India, the globalisation of Indian corporates and the rapidly increasing consumer class provide a huge market potential and are the key growth drivers of this sector’. Rapid urbanisation has also been fuelling the real estate boom in India, providing huge opportunities to builders, developers and investors. As a consequence to the government relaxing FDI regulations, foreign investors too have joined this boom along with private equity funds, NRIs, and High net worth individuals (HNI) driving investments in real estate.

Needless to say, the real estate market in India is still in early growth stage and can be segmented into residential, commercial, retail and hospitality asset classes with an existing demand-supply gap across all segments for quality real estate.

Before the world was hit by the recent recession, the real estate market in Northern India was booming. In fact, investment in real estate market had seen a massive increase in the last seven years with the average return on investments touching around 40-60% per annum. But the economic downturn and its crippling effects lead to an almost 20-40% fall in prices, with most of the consumers preferring to postpone their decision of buying property till the situation stabilised.

However, as India comes out the global downturn, the demand in the real estate sector has returned and the prices of residential property in North India are steadily going up since September this year. Developers have raised prices of their products in most of the markets in north India. According to a new report prepared by realty consultant Cushman Wakefield, prices however are `still lower than what they were a year ago. As the market has revived, a large number of developers have jumped in the fray with new launches and projects’.

DELHI ­NCR The Delhi ­ NCR real estate story has become a legendary tale. Real estate business in the National Capital Region (NCR) started when builders and developers started spreading their wings towards Delhi’s suburbs, viz. Gurgaon, Noida, Ghaziabad, Faridabad, Greater Noida and places like Kaushambi and Indirapuram. The rising demand for residential accommodation ably supported by the rising disposable incomes, lower rate of interests, other fiscal incentives and rapid urbanisation encouraged real estate developers to move beyond city limits towards smaller towns that are well connected with larger cities and satellite towns which have emerged as business and IT hubs in the past few years. From Gurgaon, the real estate boom also reached East Delhi and to places like Kaushambi and Indirapuram which were once considered down-market. Strategically located between three cities (Delhi, Ghaziabad and Noida), Indirapuram’s infrastructure is being seen as its biggest strength. According to realtors, before the recession, property rates in Indirapuram alone registered a 60-70 per cent appreciation. Construction of malls (like Shipra Mall), townships, numerous service apartments and business suites sent the property prices soaring and heightened the snob value of this place and many real estate developers are constructing business suites and corporate parks here as a part of their upcoming projects.

New players like the Amrapali Group have completed several projects Greater Noida, Indirapuram and other East Delhi locations, spreading over more than 100 acres. Evidently, places near Noida like Indirapuram, Kaushambi, Vaishali and Vasundhara in Ghaziabad and Greater Noida have come up as an alternative as accommodation in Noida and Gurgaon has gone beyond the reach of middle class.

Greater Noida is now coming up in a big way as an industrial and educational hub. Major players are now focussing on developing infrastructure here as the place offers good connectivity and enough unexplored land.

Ansal API, one of the oldest real estate players, is developing independent bungalows, premium floors, highrise apartments at Megapolis, small and large offices in Corporate Park in Noida and IT offices in the IT SEZ in Greater Noida. “In India, there is still a big gap between demand and supply in the housing sector. As economic cycles change, the pending demand only shifts from one segment to other or within the sub-segments of the same asset class. With over 42 years of experience behind us, we have seen these kinds of cycles before as well. In the present scenario, we are focussed on the affordable housing segment and have set ourselves a target of building 10000 homes in this category across the Northern India region where we are mainly present as of now,” states Rakesh Kaul, Chief Operating Officer, Ansal Hi Tech Townships Limited.

New companies like the 3C Company are also focussing on Noida and Greater Noida by developing `green buildings’. “Currently, Lotus Boulevard and Lotus Boulevard Espacia are the current residential projects that we are working on. Adjacent to each other, spread across 40 acres, collectively these form India’s largest green residential estate in sector -100, Noida. We are also nearing completion of Oxygen Boulevard, which is a green IT SEZ in sec-144, Noida. With 2200 plug & play work stations and over 7 lakh square feet of ready to fit out space available, this project is spread across 25 acres.

The team is also gearing to launch another green residential project in Sec-110, Noida,” informs Vidur Bharadwaj, Director, The 3C Company.DEVELOPERS REJOICE AS MARKET’S LOOKING UP According to the latest report prepared by realty consultant Cushman Wakefield, `property values in NCR has climbed up with the return of investors and end users interest in the realty market in the third quarter ending September 2009. Certain suburban markets like Noida and Gurgaon witnessed even higher growth due to heavily discounted prices in the previous quarter ending June - particularly in the new launches’. `After a sharp decline in the last few quarters, capital values have started to strengthen and register marginal appreciation across most micro-markets. Cyclical demand with festive season has resulted in strengthening of prices. The launch of new projects catering to the mid-segment witnessed heightened activity resulting in price escalation. Gurgaon and Noida are the key locations to witness this activity and registered the highest growth, 19% and 16%, respectively, during the quarter.’ RISING DEMAND FOR LOW DENSITY HOUSING Low density housing is also gaining tremendous popularity in the residential real estate segment as it entails lower risk for the developers and they can also meet deadlines since the development comprises of low-rise, low-density development and with major concentration on development of basic infrastructure, the speed of delivery is much faster compared to high-density development.

Understandably, real estate developers like the Jaypee Group, Vipul and Fire Capital Fund are attracting buyers with a number of such niche projects.

Low-density housing is premium priced units as compared to group housing and offers a range of entertainment, recreational and other facilities to the customers apart from lush greens and well-spaced dwellings. Significantly, most of these are on the outskirts of cities in Greater Noida and Gurgaon.

Jaypee Group’s 452-acre Jaypee Greens Township in Greater Noida is one of the first examples of low density housing wherein out of the total area; only 70 acres have been used for dwelling development. Besides, Jaypee Group has also announced the launch of India’s first Sports City on the Yamuna Expressway in Gautam Budh Nagar. The Sports City will have in total 12 Districts and each would be based on a theme. Approximately 875 acres of land in the Sports City will be used in providing sports facilities like motor race track, go-karting facility, stadiums for various sports and other recreational facilities. Property developer Vipul is also coming up with its `Vipul Tatvam’ villas in Gurgaon, a project which has just 255 villas spread over 50 acres, wherein homes are priced between Rs 2.2 crore and Rs 6 crore.

BURGEONING GROWTH IN OTHER TOWNS AND CITIES Apart from Delhi-NCR, other parts of Northern India are also witnessing major activity as far as real estate development is concerned with a slew of projects in the pipeline by old and new developers. The real estate boom is not confined to Delhi ­NCR alone as developers and investors have already gone beyond NCR and other big cities like Mumbai and Bangalore and started developing townships, business towers, shopping malls etc. in smaller towns like Mohali, Rudrapur, Sonipat, Manesar, Bhiwadi and Jaipur. With this new trend, the real estate sector in the country has entered its second phase, the next level of development and it’s these smaller towns that are being touted as `destination next’ for those interested in buying property for residential purposes or for investing in this sector.

Another reason for moving towards Tier III cities is that the main city and other satellite towns and suburbs like Indirapuram, Noida and Gurgaon are virtually exhausted in terms of new lands and prices of properties in these areas have hit the roof and there is but little scope for further appreciation in the prices in the short to medium term.

Real estate developers like Omaxe, Eco Terrain, Today Group, Ansal API, Alliance Nirman, MDLR, GTM Builders and AJS builders are constructing major townships in small towns like Agra, Amritsar, Punjab, Hapur, Kufri, Muzaffarnagar, Jaipur and other smaller towns. Bhiwadi, near Gurgaon is developing rapidly as an industrial town where many SEZs have been constructed or are underway. Mohali and Derabassi in Punjab are also developing speedily and real estate developers like Parsvnath Developers and AJS Builders have come up with townships here as well. Omaxe has already made its presence felt in smaller towns by developing residential and commercial projects in Sonipat, Rohtak, Bahadurgarh, Gurgaon, Palwal and Faridabad in Haryana; Noida, Greater Noida, Ghaziabad and Lucknow in UP; Rudrapur in Uttarachal; Amritsar, Ludhiana and Patiala in Punjab.

Alliance Nirman too has come up with townships in Hapur, Rudrapur and Gurgaon and developers like Assotech, GTM Builders, Piyush Group, AJS, Vipul Infrastructure, Suncity and NHIO etc. have also followed suit.

Meanwhile, these are just a few names to exemplify the plethora of quality real estate developers that are going to change the way we live and work. Real estate boom is here to stay and the government, the business houses and the common man ­ all have contributed towards making this dream a reality.

3C Company has led the way in development of green buildings in Delhi-NCR

3C Company has led the way in development of green buildings in Delhi-NCR
The Hindustan Times, January 7, 2010, Page 16

While enhancing air-quality, providing excellent day lighting and saving energy consumption by a minimum of 40%, developing a green building involves about 5% extra cost in construction but gives many fold benefit to the users. Looking at the future s a part of any revolutionary business model. The future hat the human race as an entity should ook forward to for itself cannot ignore he importance of going green. In these times of environmental turmoil, here is nothing more refreshing than an idea that put together a green future. Here is a look at one of those ideas…

reducing carbon footprints on earth, the company has been creating buildings that are truly sustainable in form, function and use. These sustainably developed projects not only use far less natural resources and energy in the process they are built but are also more durable and require less maintenance. Besides, 3C works on a dynamic integrated business model that provides an end-to-end solution to its clients.

The driving force of these green architectures, Vidur Bhardwaj , Director, 3C Company is also popularly known as the ‘initiator of sustainable development projects’ in Delhi-NCR. A graduate from School of Planning and Architecture, Delhi, Vidur has taken his creativity to new heights with his dynamic and innovative designs that have brought accolades for him and his team.

Here, he explains how his company has lived up to its motto of “creating, caring and conserving” through their environment friendly creations and has set stringent standards for others in the industry in the process.

Excerpts from the interview: Before the world was hit by the recent recession, the real estate market was booming. In the present market scenario how are you sustaining the growth of your business?

The uniqueness of our operation is our bus iness model to develop ‘Green Buildings’. We are the pioneers in development of green buildings in Delhi-NCR.

When the Indian real estate industry was reeling under the capital crunch and lack of demand for their projects due to economic downturn, we focused on providing our customers value for their money.

Corporate houses, which too were affect ed by the downturn, realized the importance of cutting costs. An efficient energy saving building was just a savoir for them and an opportunity for our business. This kept the momentum of demand for us in the commercial segment.

At the same time, in the residential segment, when most of the developers were focused on launching a slew of projects across the country, we launched only a couple of residential projects and our main focus till date is the completion of our on-going projects. The location and the quality of our projects became their selling points.

What are your new projects in the pipeline that your company is devel oping? l Lotus Boulevard and Lotus Boulevard - Espacia are the current residential proj- r ects that we are working on. Adjacent to each other, spread across 40 acres, col- f lectively these form India’s largest green e residential estate in sector -100, Noida. c We are also nearing completion of d Oxygen Boulevard, which is a green IT 5 SEZ in sec-144, Noida. With 2200 plug & play work stations and over 7 lakh square feet of ready to fit out space avail able, this project is spread across 25 h acres. The team is also gearing to launch i another green residential project in Sec- g 110, Noida. t i As you have already mentioned that k 3C Company specializes in develop- t ing green projects. It is also a well known that in the light of increased e environment consciousness, ‘green’ is the new mantra, can you explain in detail in what ways does your development work cater to this market as well as social needs?

The 3C Company is an environment responsive company which is developing green buildings. Having delivered over 12 million square feet, we are the only team in Asia which has to its credit the “03 Platinum Rated Leed Certified Green Buildings by USGBC (United States Green Building Council)”. These are Green Boulevard and PATNI campus in Noida and WIPRO Campus in Gurgaon. Green Boulevard is world’s largest Platinum Rated Leed Certified Green Building in shell and core category.

Green concept offers numerous benefits. While enhancing air-quality, providing excellent day lighting and saving energy consumption by a minimum of 40%, developing green building involves about 5% extra cost in construction but gives many fold benefit to the users.

Any real estate development work has to go hand in hand with larger infrastructural development by the government (for example, a residential complex gains in value only if it is well connected by roads), what kind of infrastructural requirements, the govt. has to put in place that would boost the growth of real estate. Infrastructure is a key factor for any kind of development. The Expressways are the new growth corridors. Well developed main roads along with good internal roads also add to the value of the project. As a strategic planning, our key offerings are situated at locations that boast of a developed infrastructure. The govt. should try to provide basic infrastructure like roads, public transport, water, clean sewage systems etc. before allowing any development in the region.

What are the challenges you face in land acquisition for real estate development purposes?

We have an in-house division which looks after the land acquisition for the 3C Company. We feel that there are very few strategic land parcels available in and around Noida and as far as operational hurdles are concerned, every business has its own set of challenges. The right quality of research is the way towards hassle free land-acquisition.

How do you differentiate your offering from others in this space?

We have an expertise in green developments and that is what distinguishes us from others developers. We are a team of 350 professionals that are jointly working towards the cause of reducing carbon footprints on earth. Today, when a lot of other major players in construction and development industry are still accumulating their resources to develop environment friendly construction solutions, the 3C Company has already set very high standards and created benchmarks in the concept of green construction.