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      ["id"]=>
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      ["title"]=>
      string(66) "At 7 Years, NCR Saw Longest Project Completion Time in Last Decade"
      ["alias"]=>
      string(65) "at-7-years-ncr-saw-longest-project-completion-time-in-last-decade"
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      string(223) "

    In a significant trend seen in the last decade, homebuyers in NCR had to wait for the longest time to get possession of their flats among the top 7 cities.

    " ["fulltext"]=> string(3896) "

    Anuj Puri, Chairman - ANAROCK Property Consultants says, "Latest ANAROCK data reveals that the average completion time for large residential projects in NCR, launched and completed between 2010-2019, was 7.2 years. For the top 7 cities collectively, the average completion time for large projects stood at 6.5 years in this period."

    The southern cities were markedly ahead of their northern, western and eastern counterparts in project completions. For all large projects launched and completed over the last decade, the average completion time was least in Bangalore and Hyderabad with around 5.5 years each. Chennai came close behind with an average completion time of 5.6 years.

    To calculate the average time for project completions across the top cities, all projects launched and completed between 2010-2019 were analysed. These were further segregated into small-size with 100-500 units/project and large-size having >500 units.

    “The difference of 1.5 years of average completion time between NCR and the southern cities may not seem significant at a macro level,” says Anuj Puri. “However, this period must be measured in the real-time strain it adds on consumer patience and optimism. Among the major reasons for NCR to trail behind are project delays due to land ligation issues, many developers’ lack of professionalism in project delivery, and also the periodic construction bans by both NGT and the apex court due to rising pollution levels.”

    For most projects in NCR, developers had purchased land outright, thereby compromising their overall financial health and delivery capability. Most projects in the main southern cities are joint developments where landowners usually get a certain share of the resulting units. Extreme weather conditions – both hot and cold - in NCR must also be considered as a factor to some extent.

    Small & Large Projects: Completion Trends

    The average time taken to complete smaller projects of 100-500 units each in the top 7 cities was 5.2 years, and 6.5 years for large projects of >500 units each.

    • Individually, residential projects launched and completed between 2010 to 2019 in Delhi-NCR took the longest average time to complete for both small and large size projects – 6 years and 7.2 years respectively.
    • In MMR, it took an average of 5.4 years to complete small projects and around 6.5 years for large projects.
    • In Pune, the average project completion time was 5 years for small projects and 6.2 years for large ones.
    • In Kolkata, homebuyers waited an average of 4.8 years for small projects and 6.3 years for large ones.
    • The southern cities were visibly ahead – in both Bangalore and Hyderabad, the average completion time for small projects was 4.4 years each, and 5.5 years for large projects. In Chennai, it was 4.2 years for small projects and 5.6 years for large ones.

    Source ANAROCK Research

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    At 7 Years, NCR Saw Longest Project Completion Time in Last Decade

    Anuj Puri
  • 2
    object(stdClass)#13443 (59) {
      ["id"]=>
      string(4) "5591"
      ["title"]=>
      string(72) "Pune, Bengaluru and NCR - Epicentres of India's Student Housing Movement"
      ["alias"]=>
      string(69) "pune-bengaluru-and-ncr-epicentres-of-india-s-student-housing-movement"
      ["introtext"]=>
      string(237) "

    A slew of recent Government measures will draw lakhs of students to Indian college campuses for higher studies, and the demand for student housing has never been higher.

    " ["fulltext"]=> string(9928) "

    In the recent Budget, the Finance Minister allocated INR 99,300 crore towards the education sector and INR 3,000 crore for skill development. To boost the ‘Study in India’ initiative declared in the previous Budget, an Ind-SAT program is proposed to be held in Asian and African countries to attract overseas students to Indian universities.

    The Government hopes to attract 200,000 international students to India - more than four times the current number. Currently, the total number of foreign students enrolled in India is 47,427 from 164 different countries. This number has risen by 36% since 2012-13 when the number of international students in India was a little over 34,770.

    The last three years have seen a fairly decent growth of 6.55% in the number of beds in hostels across the top ten states; however, it has not kept pace with the increase in student enrolments. To illustrate - in 2017-18, the total enrolments were estimated at 36.6 million, while the hostel intake was 6.5 million. In 2018-19, the number of enrolments rose to over 37 million, while hostel intake still stood at 6.5 million.

    Need for Purpose-Built Student Accommodation (PBSA)

    Hostels and residential facilities in Indian educational institutes can meet only a fraction of the student housing demand. Purpose-Built Student Accommodation (PBSA) remains a largely untapped real estate category. What are they? Homes away from home, with spacious rooms, top-end security systems, fresh meals, laundry and housekeeping services, gym, and entertainment zones. A serious upgrade from college hostels and paying guest accommodations.

    The student housing ethos aligns perfectly with contemporary students and is now a buzzing watchword in educational hubs around the country. Three major education centres – PuneBengaluru and Delhi-NCR - lead the pack.

    Pune                                                                                                                                             

    A major IT hub and emerging Smart City, Pune's educational offerings have earned it the moniker of ‘Oxford of the East’. Home to almost 3 lakh students, it is one of India's largest education centres which attracts students from across India and beyond. Not surprisingly, Pune has witnessed a spurt in PBSA development with national players like Stanza LivingOxfordcaps and Your Space establishing presence and planning aggressive expansion.

    Anticipating the growing demand in this segment, Kohinoor Group has invested INR 100 crore in the student housing franchise Youthville. The company started with a 150-bed facility in Pune and aims to have 40,000 beds by 2021. Another local player, The Tribe, has set up a 194-bed facility in Viman Nagar offering purpose-built facilities at 6-month and 12-month packages to match university schedules.

    • Major players: Stanza Living, Your Space, Oxfordcaps The Tribe, Youthville
    • Areas of presence: Viman Nagar, Bavdhan, Karve Nagar, Kothrud, Dhankawadi
    • Average rate per bed: Rs 8,000/month

    Bengaluru

    Apart from the IT/Tes industry, education also turbocharges Bengaluru’s real estate market. According to the HRD Ministry’s All India Survey on Higher Education 2018-19, the Bengaluru Urban District tops in the number of colleges with 880. Every year, the city attracts thousands of local, outstation and expatriate students. In fact, with over 10,000 overseas students, Karnataka has had the highest number of students coming from foreign countries.

    Private institutions like M S Ramaiah have now established dedicated student living spaces to cater to the burgeoning demand for student housing here. Manipal Education and Medical Group had earlier launched a chain of branded youth hostels offering 10,000 beds through the independent brand Yoho. Sensing potential in the city’s student housing sector, Wall Street giant Goldman Sachs has acquired a 75% stake in Yoho for INR 350 crore, helping the company to expand its footprint and add another 20,000 rooms. National players like Stanza Living are also betting big on Bengaluru and have plans to provide 5,000 beds to cater to the city’s growing population.

    • Major players: Stanza Living, Oxfordcaps, Campus Students Communities, MSR Living, Yoho, Youthville
    • Areas of presence: Hebbal, Koramangala, Electronic City, Sudhama Nagar, Basvaanagudi, J P Nagar, Bannerghatta Road, Yelahanka, BEL Road, JC Road
    • Average rate per bed: From INR 10,000 - Rs 35,000/month

    Delhi-NCR

    Home to the country’s top colleges at Delhi University and dozens of private educational institutes, Delhi has traditionally attracted students from far and wide. In Kamla Nagar, Vijay Nagar and Hudson Lane in the north campus and Satya Niketan, Anand Niketan in the south campus, scores of PBSAs have come up across the city. The neighbouring pockets of Noida and Gurgaon have also seen a spurt in private colleges, creating demand for student housing. Sectors 121, 63 and 73 in Noida and Sohna Road in Gurgaon are preferred locations for student housing.

    Leading operators Stanza Living and Your Space have been leasing properties from owners and customising them to match student needs. Noida-based Placio offers fully-furnished accommodation in a community-living model, while CoHo dorms has partnered with leading institutions such as Faculty of Management Studies, Indian Institute of Technology and Pearl Academy to provide affordable student accommodation. Singapore-headquartered Oxfordcaps is prominently present in NCR and now plans to develop dormitory spaces to cater to a wider audience.

    • Major Players: Stanza Living, Placio, CoHo, Your Space, Oxfordcaps, Nest Away
    • Areas of presence: Vijay Nagar, Kamla Nagar, Satya Niketan, Hauz Khas, Noida Sector 121, 63 and 73, Sohna Road
    • Average rate per bed: Rs 8,000 -20,000/month           

    New Emerging Centres

    Apart from these leading cities, new student housing opportunities are emerging in tier 2 and 3 cities such as Kota, Pilani, Indore, Nagpur and Mesra, which have premiere educational institutes. These smaller cities provide more lucrative opportunities to student housing investors due to low land costs and scope for expansion and experiment.

    Built-to-suit properties are the future of the student housing segment as they offer the higher yields and returns. With proper optimisation of spaces, such properties can become the norm for future student living projects.

    According to ANAROCK data, about USD 90 million of capital has been infused into the Indian student housing sector since 2017, indicating high investor interest in the segment. The New Education Policy is expected to be announced soon, and the Government plans to introduce External Commercial Borrowings and FDI in the sector to open fresh avenues of funding in the future.

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    Pune, Bengaluru and NCR - Epicentres of India's Student Housing Movement

    Anuj Puri
  • 3
    object(stdClass)#13446 (59) {
      ["id"]=>
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      ["title"]=>
      string(69) "Coliving, Coworking & Student Housing Give 7-11% Higher Rental Yields"
      ["alias"]=>
      string(65) "coliving-coworking-student-housing-give-7-11-higher-rental-yields"
      ["introtext"]=>
      string(206) "

    Changing demographics, proliferating entrepreneurship, digitisation and millennial demand are boosting the demand for various alternate real estate categories.

    " ["fulltext"]=> string(4295) "

    Their significantly higher rental yields attract major investor interest, according to the latest CII-ANAROCK report 'Emerging Asset Classes: The Future Looks Promising' which was released by knowledge partners ANAROCK Property Consultants at the 2nd CII Real Estate Confluence in Mumbai today.

    Anuj Puri, Chairman – 2nd CII Real Estate Confluence & Chairman - ANAROCK Group said, "Coliving, student housing and coworking have rental yields of anywhere between 7-11% - a significant step-up from the 3% national average rental yield of traditional housing formats. Coliving, student housing and senior living are the next evolutionary step in the residential real estate domain, while coworking has evolved from traditional office real estate. The drivers behind this evolution are changing social dynamics, a highly enabled start-up environment, rising interest in higher education by migratory student population, and the need for quality housing solutions for senior citizens."

    The report delves into these highly promising new Indian real estate asset classes and explores their growth drivers as well as the underlying opportunities for investors and other real estate stakeholders.

    "Coliving, student housing and senior living are fundamentally innovative and specialised residential assets, but with varied business models," said Anuj Puri. "The report highlights that a majority of millennials today prefer coliving over traditional rental models. The top 6 players alone now have 1.18 lakh beds, and are drawing investments from both domestic and global institutions. From seed funding to subsequent rounds of financing, private equity players, developers and individual investors have backed this segment. Start-ups have particularly benefitted from the infusion of funds and are scaling up operations in multiple cities. Likewise, ANAROCK is actively tapping the considerable opportunities of alternate asset classes like coliving, student housing and K-12 schools."

    While coworking as a segment has flourished in India, there are interesting differences in how local and global players address it. As of today, domestic coworking operators have restricted their presence to tier I cities, while global players are also penetrating into tier 2 and 3 cities.

    Meanwhile, the government's efforts to make data localization mandatory will ensure a promising future for data centres in the country. The recent budget's proposal to roll out a new policy for building data centre parks underscores the importance and relevance of this promising asset class. Currently, the major data centre companies prefer Mumbai, Pune and Bengaluru.

    Other Report Highlights

    • Senior living has immense potential in India largely because life expectancy here has improved to 68.8 years in 2018. Moreover, the population aged above 60 years has already breached the 100 million mark
    • Apart from holistically dedicated senior citizen spaces, many developers are also launching integrated townships with a proportion of units dedicated to senior living. Most of these projects will thrive in tier 2 & 3 cities.
    • Currently, for over 37 million students there are just over 6.54 million hostel beds which is merely a little over 17.4%.
    • 451 million active internet users, 1,173.75 million mobile subscribers, the rapid rise in digital transactions, Smart Cities Mission and Personal Data Protection Bill will boost demand for data centres.

    Download the report http://bit.ly/2wuIfTu

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    Coliving, Coworking & Student Housing Give 7-11% Higher Rental Yields

    Anuj Puri
  • 4
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      ["title"]=>
      string(55) "Listed Players' Housing Sales Steady in Festive Quarter"
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      ["introtext"]=>
      string(180) "

    Housing sales revenue of the top 9 stock exchange-listed developers continued to grow steadily in the last festive quarter.

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    Despite all headwinds, their collective revenues in Q3 FY20 stood at a little less than INR 5,800 crore, increasing by 4% on a quarterly basis and 2% in a year. Meanwhile, the total area sold by these top developers (excluding DLF) during the festive quarter was nearly 7.1 mn sq. ft. against 7.2 mn. sq. ft. in the preceding quarter, and 7.9 mn. sq. ft. a year ago.

    The top listed developers analysed include DLF Ltd., Sobha Ltd., Puravankara Ltd., Prestige Estates, Brigade Enterprises Ltd., Mahindra Lifespace Developers Ltd., Godrej Properties Ltd., Oberoi Realty Ltd. and Kolte Patil developers.

    The total area sold (in mn sq. ft.) was slightly higher during last year’s festive quarter (Oct-Dec FY 19), while the total revenue was more this year. This indicates that the sale of homes other than affordable housing saw a higher overall sales value.

    The collective data trends of the first three quarters of FY 2020 indicate that the overall revenue of the top 9 developers was close to INR 16,500 crore as against INR 15,730 crore during the corresponding period in FY 2019. The total residential space sold by these top players (excluding DLF) b/w Apr-Dec was approx. 21 mn sq. ft. against a little over 20 mn sq. ft. a year ago.

    Total Housing Sales Value INR Bn

    (Above data is collated from the investor presentation of each of the listed companies)

    Godrej PropertiesPrestige Estates and Sobha Ltd. were the top 3 players with maximum sales revenue during the first nine months of FY 2020. Together, they accounted for a 55% share of the total sales revenue of INR 16,500 crore. Last year too, these 3 players topped the list with collective sales revenue of INR 8,500 crores.

    The trend of developers deliberately restricting new supply continues, as increasing launches at this juncture can lead to more unsold stock and reflect negatively on cash flows. New launches by the top 9 listed developers (excluding DLF) more than halved during the period – from 31 mn sq. ft. area in Apr – Dec FY 2019 to nearly 15.71 mn sq. ft. in the corresponding period of FY 2020.

    New Launches in Mn. sq

    Source: ANAROCK Research

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    Listed Players' Housing Sales Steady in Festive Quarter

    Anuj Puri
  • 5
    object(stdClass)#13450 (59) {
      ["id"]=>
      string(4) "5558"
      ["title"]=>
      string(76) "India: Total Real Estate Loan Equals $93 bn, over 62% Completely Stress-free"
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      string(220) "

    Over 62% of the total loan advances ($93 bn) to Indian real estate by banks and NBFCs/HFCs is currently completely stress-free, reveals a study by ANAROCK Capital.

    " ["fulltext"]=> string(4624) "

    Another 22% (approx. USD 21) bn is under some pressure but can potentially be resolved. In fact, the stress on this segment is largely on recovery of interest and not on principal amount.

    USD 14 bn (or merely 16%) of overall lending to Indian real estate is under ‘severe’ stress, meaning that there has been high leveraging by the concerned developers who have either limited or extremely poor visibility of debt servicing due to a combination of factors.

    Shobhit Agarwal, MD & CEO – ANAROCK Capital says, “The ‘stress’ loan amount in real estate is not as bad as seen in other major sectors like telecom and steel. For instance, the entire ‘severe stressed’ loan value in real estate is spread across more than 50 developers. In the telecom or steel industries, default by a single company alone equals a sizeable portion of the overall stress in the real estate sector. Also, every real estate loan is backed by hard security, which is anywhere between 1.5 times to 2 times. Even if the loan is NPA, there is enough security for the lenders to get a significant portion of their money back. Even if defaulting developers decide to sell their real estate at a discount, there is enough margin for them to pay back.”

    Meanwhile, HFCs accounted for the largest share of total realty loans equalling 38%, followed by banks which comprised nearly 34% share while NBFCs have 28% (including loans given under trusteeships). Of these, banks and HFCs are much better placed with 70% and 65% of their lending book in a comfortable position. However, it also comes as no surprise that nearly 58% of the total NBFC lending is on a watchlist.

    “In retrospect, there has been continuous shrinkage of lending to Indian real estate in recent years by both banks and NBFCs/HFCs amidst non-repayment of some loan dues and NBFC crisis post the IL&FS default,” says Agarwal. “One prime reason was that sluggish residential sales over the last few years completely dried up cash flows for many developers, resulting in unsold inventory pile-up and, thus, their inability to service their loans. Moreover, some developers have even filed for bankruptcy in the backdrop of stricter regulatory norms under RERA.”

    However, with both banks and NBFCs/HFCs now doing their due diligence before giving loans to developers, the situation is gradually getting ironed out. Nearly 84% of the overall loan amount has little or no stress at all. Going forward, residential sales are likely to pick up due to multiple measures being taken up by the government to relieve the sector. This fact itself will help developers to repay their loan dues.

    Realty Loans Breakdown: Builder-Type Wise

    On further analysis of the overall realty loans with respect to builder-type, it emerges that out of the total USD 93 bn realty loans, Grade A builders received over $65 bn loan advances, followed by $27 bn to Grade B players – and a mere $1 bn to Grade C developers.

    This presents a relatively safe outlook because more than 72% of the loans given to Grade A builders is safe and under no stress.

    On the other hand, a high amount of realty loans to Grade B & C developers needs strict monitoring. Nearly 28% of the loans given to Grade B developers is under ‘severe’ stress while for Grade C developers it is over 19%. However, this collectively equals to less than mere USD 8 bn of overall stressed loan.

    * Grade A developers are players that are currently active, with excellent execution track record and having till date developed real estate in excess of 3 mn sq. ft. 

    * Grade B developers include those with an established execution track record having developable area between 1 mn sq. ft. and 3 mn sq. ft. and are currently active. This category also includes players with excellent past execution track record but are currently largely inactive

    * Grade C comprises of players with less than 1 mn sq. ft. developable area.

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    India: Total Real Estate Loan Equals $93 bn, over 62% Completely Stress-free

    Shobhit Agarwal

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