Monthly Archives: July 2018

Where to invest in Chennai

A slew of infrastructure projects and the growing IT sector have led to a strong residential market

 

Ambattur

The industrial growth of the area has led to large-scale residential activity in this region.

The micro market is now one of the prominent IT-ITeS and industrial hubs of Chennai. With around 3,000 units launched since 2013, the micro market is witnessing a significant traction in ₹40-80 lakh budget segment. Average property prices range between ₹4,000-4,400 per sq.ft.

 

Oragadam

Located along NH 4, Oragadam is one of the attractive suburbs of Chennai due to the presence of various Fortune 500 companies in the city’s largest Oragadam-Sriperumbudur industrial belt. Around 4,000 units hit the residential market during the past 5 years and the current quoted average capital values are around ₹3,300 to 3,600 per sq.ft. New launches were predominantly in the mid-segment.

 

OMR

The 45 km Old Mahabalipuram Road (OMR) stretch, termed as the IT corridor, is witnessing heightened real estate activity in the ₹40-80 lakh price bracket due to the establishment of various IT business parks and dedicated SEZs in this region.

OMR Road continues to thrive among home buyer’s attention with around 35,000 units launched over the past 5 years. The average capital values of OMR are between ₹3,500-5,900 per sq.ft.

 

Gudavanchery

It’s one of the promising affordable residential hotspots of Chennai. Presence of IT parks and industrial parks coupled with excellent connectivity and well-established infrastructure drives the residential growth.

Over 4,500 residential units have been launched since 2013 and the current prices are around ₹3,200 and 3,600 per sq.ft.

 

Pallikaranai

It lies very close to the IT/ITeS and industrial clusters of the city. The merging of the micro market under the Corporation of Chennai offers good scope for residential developments and infrastructure facilities. Around 3,300 units were launched since 2013 and the current property prices range between ₹4,500 and 4,900 per sq.ft.

 

Growth factors

 

Chennai has grown significantly in the last few years. Education prospects and employment opportunities, along with a decent lifestyle, are the key drivers that attract people to the city. With increasing population, the city’s real estate landscape has also grown and is now spread across various zones.

 

While realty development in Chennai paused momentarily due to massive floods of 2015, the fundamental demand drivers remain intact and the city is likely to continue on its growth trajectory in the future periods, reinforced by:

 

Diversified economic base: It’s anchored by the automobile, software services, hardware manufacturing, healthcare and financial services industries. This diverse economic base is ably supported by the Chennai port, which is the second largest in India and a key facilitator for import-export of goods. Presence of a vibrant economy creates ample job opportunities and leads to massive real estate development in the city.

 

Thrust on infrastructure: Its expansion across various regions, was ably supported by the growth of physical infrastructure with major initiatives such as Outer Ring Road (ORR), Inner Ring Road (IRR), East Coast Road (ECR) and the development of MRTS. The government’s focus on infrastructure development is evident with major projects such as Chennai-Bengaluru Industrial Corridor, ORR Phase II, metro and monorail corridors being planned to improve connectivity and accessibility to various parts of the city. With improved connectivity, any region’s real estate development obviously picks up pace.

 

Expanding zones: The city is restricted only on one side by the Bay of Bengal whilst the city is free for development on all other sides. This provides a latent advantage for widespread development of new zones and in-turn drives realty growth.

 

Reputed developers: The segment has transformed from the dominance of local players a few years ago to the entry of large reputed developers such as Godrej Properties, Purvankara, Mahindra Lifespaces, Pacifica, PBEL, among others.

 

Source:  The Hindu

Tamil Nadu govt gives nod to 4 million sq ft Tidel park in Avadi

Chief minister Edappadi K Palaniswami has approved allocation of 10 acres belonging to Southern Structural Solutions, a defunct state government PSU, for the park in the first phase, said a source in the government.

 

The state government on Saturday cleared the proposal to set up a new Tidel Park at Avadi in the western suburbs of the city. The facility is expected to include 4 million sqft building for software companies, state-of-the-art auditorium, food court, and banks and ATM facilities.


Chief minister Edappadi K Palaniswami has approved allocation of 10 acres belonging to Southern Structural Solutions, a defunct state government PSU, for the park in the first phase, said a source in the government.


Southern Structural has 48 acres at Pattabiram. The government would unlock more land for the expansion of the park in future, said the source. This will be the second Tidel Park in Chennai. The first one, measuring 1.5million sqft, was set up at Taramani in 2000. IT companies located in the park employs more than 12,000 people at present. It charges a rental of 54 per sqft and is almost fully occupied.


The Tamil NaduIndustrial Development Corporation (TIDCO), which developed and managed the Taramani park, will be the managing the Avadi park too, sources said.

 

Source: The Economic Times

Over 1,500 land registration fraud recorded in eight months in Chennai region

These complaints were pertaining to property registrations done in different decades, though the respective owners had lodged complaints only in the past eight months

 

CHENNAI: Nearly 1,700 complaints of fraudulent land registrations have been recorded across Tamil Nadu in the past eight months with sub-registrar offices in Chennai and peripheral districts topping the list of Property registrations using forged documents. In a few cases, the involvement of registration officials has come to light.

 

These complaints were pertaining to property registrations done in different decades, though the respective owners had lodged complaints only in the past eight months.

 

Data accessed by TOI found that a total of 572 complaints of fraudulent registrations have been filed between November 2017 and July 2018 in the Chennai zone – comprising the city, Kancheepuarm and Tiruvallur districts – accounting for about 34% of total complaints in the state. There are 63 sub-registrar offices in these three districts. While Madurai zone stands second with 283 complaints of property registrations with fake documents, Trichy zone is third in the list with 162 complaints. Departmental action has been initiated against 14 sub-registrars all over Tamil Nadu for the fraudulent registrations and FIRs have also been registered in this regard.

 

Official sources said that majority of the complaints were pertaining to sale of property by impersonating landlords. “Most of the complaints were regarding registration of land documents by impersonating the original land owner. The other cases involved furnishing fake revenue records like ‘patta’, besides parent document,” a senior registration department official said. The sources said that sub-registrar offices in South Chennai district had the maximum number of fraudulent registrations. However, the official did not reveal the number of forged property registrations in 17 sub-registrar offices functioning under the South Chennai district registrar.

 

The development comes after the registration department stripped district registrars of their sweeping powers to annul fraudulent property registrations that allegedly led to irregularities last November. This was followed by the department seeking the number of registratioin complaints filed on fraudulent grounds, which are under inquiry in various districts.

Inspector general of registration J Kumaragurubaran said that action is being initiated to dispose of the complaints swiftly. “This would help the victims to get quick relief from the courts, which are only authorized to cancel registration of fraudulent documents,” he added.

 

Source: Economic Times

Amazon leases 4.5 lakh sq ft of office space in Chennai

Amazon India had recently leased 600,000 sq ft of office space in Hyderabad, the second-largest office space deal in the country so far this year

 

The Indian unit of US retail giant Amazon has leased 450,000 sq ft of office space in Chennai, according to two people aware of the company’s plan, marking its second such deal this year.

 

Amazon India had recently leased 600,000 sq ft of office space in Hyderabad, the second-largest office space deal in the country so far this year.

 

“In the first phase, Amazon will occupy 200,000 sq ft, with an option to expand it to 450,000 sq ft over the next one-and-a-half years,” the persons cited earlier said, adding that JLL was banker for the transaction which was closed in Q3 2017.

 

The new campus will come up at Ramanujan IT City, which is being executed by TRIL Infopark, a special purpose vehicle (SPV). The 4.6 million-sq ft commercial property is a joint venture between TRIL, IHCL and TIDCO.

 

Source: Economic Times

Evolution of NRI investor

Mumbai, NCR, Bangalore, Hyderabad, Chennai and Pune are currently the hottest cities for investments into Grade A commercial space

 

The fact that Indian developers had, in the past, launched and marketed projects with an almost exclusive eye on NRI customers is certainly no secret. There were many reasons for this, but the primary one was that NRIs — especially those based in the Gulf and the US — were cash-heavy and invested blindly.

 

Time has proved this theory erroneous. NRIs are among the savviest property investors in the Indian market today.

 

This is amply demonstrated by how adroitly they have gauged new investment trends.

 

For a long time, the returns on investments that they could get on residential assets were extremely rewarding, considering the significant capital appreciation whilst the rental yields have always been low.

 

However, during the last couple of years, the market slowdown resulted in capital appreciation on residential assets no longer being as per NRI investors’ expectations. In the current market conditions, they are now showing a greater preference for investing in commercial properties, which offer good rental yields as well as capital appreciation.

 

This is because there is a continuous rise in demand for commercial spaces in the wake of large-scale requirements and the probability of REITs formation, especially for grade-A offices, IT parks and logistics centres.

 

Top picks

 

Mumbai, NCR, Bangalore, Hyderabad, Chennai and Pune are currently the hottest cities for investments in Grade A offices, co-working office spaces and IT parks. The business being generated in these cities induces a constant upward trajectory on the demand for quality office spaces, while supply is not keeping up with this demand. That means that all available high-quality offices spaces are assured of tenancy. Meanwhile, the strong start-up culture now unleashing in India is driving up the demand for shared office spaces, also known as co-working spaces.

 

Such spaces are snapped up by start-ups which cannot afford the high cost of conventional high-quality office real estate.

 

Pre-conditions

 

Of course, it is only the more experienced NRIs who have been able to gauge the market here. Every year gives rise to new NRIs who still need some basic guidance on what they can or cannot do in Indian real estate. Individuals with a valid Indian passport can invest in the Indian realty market, though there are a few pre-conditions:

 

Citizenship: NRIs with a valid Indian passport need no prior approval unless they are citizens of a few neighbouring countries — specifically Pakistan, Bangladesh, Sri Lanka, Iran, Nepal, Bhutan, Afghanistan and China.

 

Property type: They as can buy as many properties (residential or commercial) as they want but are not allowed to buy agricultural land, plantation properties and farmhouses. However, such properties can be gifted to or inherited by NRIs.

 

Transactions: Transactions must be done in Indian rupee (INR) through regular banking channels via an existing NRI account. Just like Indian citizens, NRIs are also eligible to avail of loans to purchase a property in India. The maximum loan amount is generally 80% of the property value. The RBI does not have any rule for immovable property which is inherited or gifted. NRIs can lease or rent such properties without any restrictions.

 

Legal aspects

 

A few tips:

 

– Hire a reputed lawyer to vet property documents

 

– Verify the original title deed documents; ensure that the property title is in the name of the seller

 

– Do a thorough check to ensure that the seller has cleared all the dues related to the property

 

– Verify that the seller has not diluted the right to transfer the property to a buyer

 

– Ensure that the property is not built on agricultural land without requisite government permissions

 

– In case of under-construction property, give the power of attorney to the developer or a trusted associate.

 

Source: The Hindu