emerging corridors of delhi ncr - jll corridors of...4 emerging corridors of delhi ncr in the...

Emerging corridors of Delhi NCRFuture development amidst economic and regulatory changes

2 Emerging corridors of Delhi NCR

Current macroeconomic scenario

Emerging corridors of Delhi NCR 3

US unemployment rate has gone down significantly, although job creation is slower than anticipated

US housing sector has been showing progressive recovery since 4Q-2011

Source: US Bureau of Labour Statistics, Federal Housing Finance Agency

500 11.0%

300 10.0%

1009.0%

(100)8.0%

(300)7.0%

(500)

6.0%

(700)

5.0%

4.0%

Jan 2005

Jan 2006

Jan 2007

Jan 2008

Jan 2009

Jan 2010

Jan 2011

Jan 2012

Jan 2013

July 2005

July 2006

July 2007

July 2008

July 2009

July 2010

July 2011

Non-farm jobs (‘000s)

Unemployment rate (RHS)

July 2012

July 2013

(900) 3.0%

Jan 2000

Mar 2001

May 2002

July 2003

Sep 2004

Nov 2005

Aug 2007

Oct 2008

Nov 2012

Dec 2009

Jun 2006

Aug 2000

Oct 2001

Dec 2002

Feb 2004

Apr 2005

Jan 2007

Mar 2008

July 20101

FHFA US Housing Price Index (base year - 1980)

May 2009

Jun 2013

Feb 2011

Apr 2012

170

160

150

140

130

120

110

100

90

US economy: Housing market recovers, unemployment falls… but job creation is still slow

Global economy

From the global economy perspective, we now witness diversity in growth rates across three major continents. The world’s largest economy, the United States, has been on a recovery path with its hitherto most distressed sector - the housing sector - recovering sustainably over last 4-5 quarters. A partially improving manufacturing sector along with certain macro-prudent fiscal and

monetary policies have led to unemployment rate falling substantially from over 9.0% as of early-2010 to around 7.0% levels currently, thereby providing policymakers with great comfort. Along with an improving manufacturing sector and prudent fiscal management, the economy posted a healthy growth rate of 2.2% YoY in 2012, as against 1.8% in the previous year.


In the European region, which was worst affected during the crisis period and acted a drag on the world economy; the best that could have happened in recent times is growth stability. After having witnessed several quarters of recessionary growth, recent economic releases indicate a stable outlook for the current fiscal year. Recent quarterly official statistics as well as the IMF estimate for 2013 suggests that the region region may be crawling out of recession. However, it still suffers from high debt and unemployment rates, which need to be addressed carefully through prudent fiscal and monetary management.

Meanwhile, problems seem to have resurfaced for the Asian countries, led by the Chinese economy which is the largest in the region. Growth in China, which is considered a “factory to the World”, has moderated sharply from 10.4% in 2010 to 7.8% as of end-2012. Many Asian economies, including the developed ones to an extent such as

Source: IMF

Australia and Japan, depend on China through trade linkages. Risk of “hard-landing” of the Chinese economy could pose a challenge for these dependent economies.

In the present world of increasing trade and financial integration, the economic woes of the developed world are spilling over to emerging countries through weaker demand for exports, heightened volatility in capital flows and commodity prices. For instance, a loose monetary policy of the US was a source of cheap funding for several emerging economies that are currently reeling under current account imbalances. More so, some problems of emerging countries are also home-grown. After having witnessed high growth rates in the recent past, several of these economies have started to face structural bottlenecks, including funding constraints faced by local governments, or overinvestment leading to excess production capacity in others, as in the case of China.

Euro area continues to suffer from unsustainably high levels of debt and unemployment

30%

25%

20%

15%

10%

5%

20062012

0%Spain Greece Italy USA GermanyFrance UK Japan

Unemployment rate rose sharply since the crisis erupted, particularly in indebted European nations

100.0

90.0

80.0

70.0

60.0

50.0

40.02006

69

2007

66

2008

70

2010

86

2012

93

2009

80

2011

88

2013e

95

Euro area’s rising government debt (% of GDP)


India economy

India has its own set of problems over and above the uncertainties arising from an uncertain global economic outlook. A brief period of rising international commodity prices during 2010 had exposed the supply-bottlenecks inherent in the Indian economy, causing widespread inflation (see inflation chart below). While demand was high due to high consumerism in India, not all demand could be fulfilled due to capacity constraints and other structural issues. Resolving these structural issues requires long-term planning and cannot be solved in the short-term. Thus, the RBI had no alternative but to raise interest rates consistently in the short-term to dampen demand and subsequently arrest a widening demand-supply gap.

Source: Mospi, RBI

Unlike developed world, India and few other emerging nations are experiencing headwinds since 2012

15.0

13.0

11.0

9.0

7.0

5.0

3.0

1.0

(1.0)Mar 2007

Mar 2008

Mar 2009

Mar 2010

Mar 2011

Mar 2012

Mar 2013

Jun 2007

Jun 2008

Jun 2009

Jun 2010

Jun 2011

Jun 2012

Jun 2013

Sep 2007

Sep 2008

Sep 2009

Sep 2010

Sep 2011

Sep 2012

Dec 2007

Dec 2008

Dec 2009

Dec 2010

Dec 2011

Dec 2012

RBI policy: Inflation targetting takes precedence

20.0%

15.0%

10.0%

5.0%

0.0%

-5.0%Jun 2010 Jun 2011 Jun 2012Mar 2011 Mar 2012Sep 2010 Sep 2011 Sep 2011Dec 2010 Dec 2011 Dec 2012 Mar 2013

Investment-led slowdown results in drag on consumption as well (% YoY)

Over a period of 22 months during 2010-11, the RBI increased benchmark interest rates (the repo rate) by a whopping 375 basis points (100 basis points = 1%), consequently affecting investments and to some extent consumption.

The eventual fallout on the broader economy was imminent with quarterly growth consistently slowing since the last peak observed in FY2010-11. As of the latest QE-March 2013, economic growth stood at a paltry 4.8% YoY, resulting in an annual growth rate that stood at 5.0% for FY2012-13. This is the slowest rate of annual growth since almost a decade. As growth deteriorated and liquidity remained tight, all sectors witnessed slack, including the construction and real estate (part of the Finance, Insurance and Real Estate sector – FIRE).

9.0

8.08.5

7.57.06.56.05.5

4.55.0

4.0

WIP inflation (%YoY, LHS)

Real GDP

Repo Rate (%RHS)

Pvt. Consumption Investment


Another major concern for India in recent times has been the widening gap between its imports and exports, which is captured in the current account statement. As of financial year ending Mar-2013, the current account deficit (CAD) stood at 4.8% of GDP, which is much above the comfort zone of Indian policymakers - 2.5-3.0% of GDP. In a tight liquidity scenario such as that presiding in India, this deficit needs to be bridged using external financing. Thus, a burgeoning deficit makes India highly dependent, and therefore vulnerable, to vagaries of external capital flows and consequently, increases risk of an investment downgrade. This CAD financing risk has lately got transmitted into a weaker rupee, which recently touched a historic low of 61.8 as of first week of August 2013. (See chart on INR currency and 10-yr yield)

With limited support coming from global economy and a water-tight situation with the monetary policy authorities, the only alternative that seems feasible is to carry out fiscal reforms that would encourage foreign flows into India. The on-going monsoon session (during the entire month of August) of the Indian legislature is a good time for the government to roll-out certain additional measures to boost growth.

The currently ruling UPA government has not entirely disappointed investors on that front, although more needs to be done in terms of making conditions for investment more market-friendly. The last three quarters has been very active for the real estate sector in terms of policies. Beginning September 2012, when the government brought forward a motion to allow 51% FDI in multi-brand retailing, which got approved in the parliament in the month of Dec-2012, to allowing 100% FDI in single-brand retailing, the policy environment has become somewhat friendly. More recently in June-July 2013, the Indian government has proposed concessions on the FDI norms for retail (amongst certain others sectors) in order to factor-in concerns over operational feasibility of international retailers. The move has excited several international retailers who have been contemplating an entry into Indian market. In the QE-June 2013, the central government had passed the real estate regulatory bill, which was pending for some time and is touted to be the game-changer in the industry particularly for the residential sector.

India GDP Growth versus Construction and FIRE Sector (% YoY)

12.0 14.0

12.010.010.08.08.0

6.06.0

4.0 4.02.0 2.0

0.0 0.01QFY11 1QFY12 1QFY132QFY11 2QFY12 2QFY133QFY11 3QFY12 3QFY134QFY11 4QFY12 4QFY13

8.69.5 9.2 9.9

7.56.0

5.1 5.26.5 5.4

4.84.7

Construction Sector (RHS)Real GDP FIRE Sector (RHS)


Source: MOSPI, RBI, Oanda.com

India’s external vulnerability risk getting transmitted to markets

10-year bond yield % (RHS)INR / USD Values

Capital A/C balanceCurrent A/C balance

40.0

30.0

20.0

10.0

0.0

-10.0

-20.0

-30.0

-40.0

1QFY

09

1QFY

10

1QFY

11

1QFY

12

1QFY

13

2QFY

09

2QFY

10

2QFY

11

2QFY

12

2QFY

13

3QFY

09

3QFY

10

3QFY

11

3QFY

12

3QFY

13

4QFY

09

4QFY

10

4QFY

11

4QFY

12

4QFY

13

India’s growing vulnerability to finance its Current Account Deficit (CAD) (in USD billion)

Interim risk perception of Indian economy has risen(data upto end-July 2013)

45

47

3.0

2.6

2.8

49

2.451

2.253

2.055

57

59

61

63 1.0

1.2

1.4

1.6

1.8

Jan 2012 Sep 2012 May 2013Mar 2012 Nov 2012May 2012 Jan 2013Jul 2012 Mar 2013 Jul 2013


Brazil China India Russia

20.0%

15.0%

10.0%

5.0%

-0.0%

-5.0%

-10.0%

1955

-60

1950

-55

1960

-65

1970

-75

1965

-70

1975

-80

1985

-90

1980

-85

1995

-00

1990

-95

2000

-05

2005

-10

2010

-15

2015

-20

2020

-25

2025

-30

2030

-35

2035

-40

2040

-45

Higher growth of young population to last longer in India(% Growth in working population aged 15-59)

Number of new firms incorporated

Emerging Economies Annual avg growth 2004-11 (%)

Russia 35.4%

India 26.0%

Indonesia 13.3%

Hong Kong, China 12.7%

Singapore 9.7%

Brazil 6.3%

Korea 5.7%

Malaysia 2.5%

Australia 0.9%

Source: World Bank Entrepreneurship indicators 2013

India’s long-term story remains intact

As per the UN population statistics, India’s favourable demographic story (rising workforce population in the age group of 15-59 years) will last for at least another 25-30 years. As against this, other major emerging economies would witness a sharp decline in this demographic dividend in the next 7-12 years, resulting in narrowing of spread between their growth rates with that of advanced countries.

At a time when the world economy has slowed down considerably, affected by the global financial crisis, India’s rising potential for growth, rising per-capita income, high consumerism and relatively low wages is attracting investors and companies to shift their base and start operations in India. As per recently published World Bank’s Entrepreneurship indicators, in a seven year period of new firms incorporated in India witnessed a stellar growth rate of 26% annually in a seven year period until 2011 (latest available data), second only to Russia.


In focus Delhi NCR Real Estate

performance


It is pertinent to observe how the Delhi National Capital Region (Delhi NCR) real estate markets have performed over the past year or so. All three sectors - office, retail and residential - are witnessing growth because of the suburban towns surrounding the prime city. The reasons for this are the large untapped development potential in the suburbs and the substantial financial viability and affordability that are available to both developers and end-users in these locations.

Based on the evidence presented above, it is clear that suburbs are the drivers of real estate growth across Delhi NCR. As such, they are also the drivers of pricing and other financial indicators. The prime city, however, has an appreciable level of office and retail stock, but the lack of potential for future development limits its growth.

We look at the past 18-month period of reflection following the recovery that began in 2010. A qualitative overview of the three sectors - office, retail and residential - with relevance to the Delhi NCR follows.

Office

There was a period of stagnation in 2012, followed by office space occupiers adopting consolidation measures. The global economic signals were sluggish and the impact was most visible on Delhi NCR office market that is driven primarily by the IT/ITeS sector. With the Americas and Europe in the throes of a slowdown, office demand dipped and, as a result, 2012 recorded the lowest absorption volumes in eight years at 3.8 million sq ft. Occupiers of office space were looking at portfolio rationalisation and cost control measures such as relocation and/or consolidation and space enquiries were the dominant aspect of demand in the office markets.

It is pertinent to note that since 2009, the annual new supply of commercial office space has caused the total stock to rise by 70% (from end-2009) to nearly 70 million sq ft at end-2012. Previously, from 2006 to 2009, stock had more than doubled to more than 40 million sq ft by end-2009. This points towards new supply also showing a slight correction, as demand levels remained steady.

Demand levels started showing an improvement over the first half of 2013, with fresh absorption already at 62% of 2012 levels. Gross transaction volumes also showed an increase and were nearly 1.8 million sq ft during 2Q13, compared to 0.98 million sq ft in 1Q13, a substantial 84% q-o-q improvement.

The chart below shows the performance of the combined office

60% 100%

4%0%

80%

Residential (Unsold Units)

Retail (sqft)

20%10%

34% 66%

14% 67% 15%

13% 63% 25%

40%

Office (sqft)

CBD/SBD Gurgaon Noida

CBD/SBD Gurgaon Noida Faridabad GhaziabadDelhi City Suburban

*(The chart above shows the current Delhi NCR stock/supply levels on an overall basis and at the sub-market level that contribute to supply in the appropriate asset classes (2Q13))

Delhi NCR - Office Supply / Absorption and Vacancy rates

4,50,000

4,00,000

3,50,000

3,00,000

2,50,000

2,00,000

1,15,000

1,00,000

50,000

30.0%

25.0%

20.0%

15.0%

10.0%

5.0%

0.0%01Q 2012 3Q 2012 1Q 20132Q 2012 4Q 2012 2Q 2013

New Construction Net Absorption Vacancy Rate

sq ft


markets of Delhi, Gurgaon and Noida. The prime office sub-markets are still the suburbs of Gurgaon and Noida. Within these sub-markets, DLF Cyber City and Sohna Road in Gurgaon and the Noida-Greater Noida Expressway in Noida are the most sought after office destinations. The office markets of Delhi (CBD and SBD) remain marginal players in terms of fresh supply and absorption volumes.

Retail

The Delhi NCR retail sector has a unique character - the market, with its combined per capita incomes being one of the highest in the country provides every retailer with a healthy consumer base. For analysis, we segregate organised retail in this market into the Prime South (South Delhi retail mall developments), Prime Others (mall developments in the north, west, east and the rest of Delhi) and Suburbs (Noida, Greater Noida, Gurgaon, Ghaziabad and Faridabad) sub-markets.

Retailers have over recent quarters been aligning their growth strategy with a focus on their business margins and expanding in previously untapped markets. The focus was to grow selectively in existing prime retail assets or select new and under-construction projects that offered the optimum advantages of location, brand visibility and a pure leasehold ownership model. This led to slow absorption volumes that were the norm across most quarters during the past 18 months. Only 1Q12 and 4Q12 saw moderate absorption, primarily because of new project completions in the suburbs that became operational with moderate pre-commitment levels.

The period under consideration was marked by two major trends. One, retailers were downsizing the number of stores, shutting down those that were recording low business volumes. Large format retailers were also looking at reducing their typical store sizes. Mall management teams, on the other hand, became active in tenant management, undertaking periodic tenant performance reviews and letting go low-performing tenants for better prospects.

Noida-Greater Noida Expressway

Noida City

SBD

CBD

Sohna Road

MG Road

NH-8

Golf Course Road

Gurgaon Office sub-marketsNoida Office sub-marketsDelhi Office sub-markets

GROWTH SLOWING

RENTS FALLING

DECLINE SLOWING

RENTS RISING

Delhi NCR - Retail Supply / Absorption and Vacancy rates

80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

0

25.4%

25.2%

25.0%

24.8%

24.6%

24.4%

24.0%

24.2%

23.8%

23.6%-10,000 1Q 2012 3Q 2012 1Q 20132Q 2012 4Q 2012 2Q 2013


sq ft

Values for 2Q13


Demand in Delhi NCR retail markets came from both domestic and global retailers, especially in the apparel, electronics and food and beverage sectors. The market has the highest number of operational malls (more than 90) compared to any other Indian urban agglomeration and this is indicative of how the organised retail sector has gained ground in this sub-market and altered shopping habits of the urban population.

Most of the future developments are in the Suburbs sub-market, and this retail market is likely to contribute significantly to retail demand going forward. However, the retailers’ plans of selecting only specific projects based on their business growth parameters are likely to add to growing supply and vacancy rate pains in the retail sector. The most sought-after retail projects are those located in the Prime South sub-market, and they command the highest rents.

A lack of vacant space in preferred malls has led to retailers focusing on the prominent high streets of the main city, such as Connaught Place, South Extension, Khan Market and Rajouri Garden.

Residential

The residential sector has not been left untouched by the events that have influenced the domestic economy over the previous 18 months. These events along with the consistent increase in land valuations and input construction costs have led to sustained price increments across all residential markets in Delhi NCR, despite demand momentum being affected by such a price rise.

Like other real estate asset classes, the vibrant nature of residential sector is also attributed to the contribution of suburban cities, which along with Delhi form the Delhi NCR residential market.

Each residential market has its own typical development types, price points and buyer/investor categories. The Delhi NCR residential sector offers a wide range of projects across all categories classified by type (apartments, row houses, villas, plots) and price (affordable, mid, premium and luxury). There is a fair mix of both buyers and investors across all the residential markets, although investor contribution is significantly higher in Gurgaon and Noida residential markets as they offer a wider array of projects and are backed by healthy demand levels.

The prime city of Delhi has been a marginal contributor with select residential projects only and as such may not provide an accurate barometer of the Delhi NCR residential sector

Noida residential market has been the largest contributor to the new supply of private apartment units for the past 17 quarters, barring one. This residential market is home to the Noida Extension residential corridor, which has been a significant contributor to apartment unit supply in the overall Delhi NCR residential market. As a result, Noida residential market has recorded the highest sales volumes over the last 18 months. The Noida-Greater Noida Expressway corridor has been the most vibrant, with projects available at varying price points and its location acting as a major pull factor. The hosting of the Formula 1 event in Greater Noida has also brought about interest in that residential corridor, which was otherwise facing stagnation because of low buyer/investor interest.


Gurgaon residential market has strong fundamentals of controlled supply and good traction from investors and buyers alike. It has scaled its previous market peaks recorded in 2008 and remains in demand. All of the major developers have their eyes set on the residential growth corridors of NH-8 and the Dwarka-Gurgaon Expressway, which account for most of the new supply in this market over the past 18-24 months period. This residential market is also seeing good traction in terms of luxury apartment supply by prominent national developers. These growth corridors have seen a healthy increase in primary market price levels because of the healthy sales volumes in these sub-markets.

The other suburban residential markets of Ghaziabad and Faridabad cater primarily for affordable and mid-segment housing and their lower price points are a reflection of the relatively lower investor interest here. However, with an increased focus on affordable housing, developers are actively looking at the NH-24 stretch in Ghaziabad, which already has a sizeable living population in the developed residential corridors of Vaishali and Indirapuram. The Faridabad residential market has Greater Faridabad (also known as Neharpaar) as a growth corridor, offering projects at relatively affordable price points.

Overall, the Delhi NCR residential market has seen sustained price increases that have contributed to a steady cooling-off of the demand momentum over the past 12-18 months. However, we have not seen a definitive trend of falling sales, although the sales volumes as a percentage of available stock have shown a sluggish decrease, pointing to a creeping stagnancy in the residential markets. The

Delhi NCR - Residential Supply / Absorption and Vacancy rates

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

38.0%

36.0%

34.0%

32.0%

30.0%

28.0%

24.0%

22.0%

26.0%

20.0%1Q 2012 3Q 2012 1Q 20132Q 2012 4Q 2012 2Q 2013


Numb

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apar

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t unit

s

macroeconomic situation has not allowed the Reserve Bank of India to cut the repo rates, which could lead to a reduction in home loan interest rates and has acted as a catalyst for slowing demand. A reduction in apartment supply is also a pointer in this regard.


Recent Policy Changes and its Impact on Delhi NCR Market

less than USD 1 million in plant and machinery. The period for the second provision was not defined. For example, if a small business increased its capital expenditure investment above the limit, would the retailer have to change supplier in order to adhere to the 30% sourcing cap?

Some clarification was provided in June 2013 by the Department of Industrial Policy and Promotion. The infrastructure of existing multi-brand retail chains bought by foreign retailers was not to be counted as part of the mandatory investment criterion. New retailers had to invest in their front-end operations from their own pockets, thus disallowing the franchisee route of growth to global firms. In addition, the sourcing requirement of 30% from Micro, Small and Medium Enterprises (MSMEs) was restricted to processed goods only and agro goods were not included. This sourcing could not be used for their global business, but only for domestic sales through retail chain stores.

On 1 August 2013, the government offered further concessions on investment regulations. The 30% sourcing from MSMEs has been revised to include firms where investment in plant and machinery was USD 2 million. Additionally, the sourcing requirement is applicable only at the beginning of the relationship, i.e. if a firm grows above the USD 2 million limit, the relationship will endure. The investment in back-end infrastructure has been capped at USD 50 million only. The other major concession has been that firms will now be allowed to operate in cities with a population lower than the one million limit introduced earlier, subject to the approval of the state governments.

However, all these changes have to be mandated by parliament before real groundwork is expected to begin from the retailers’ end. The policy is likely to see some traction in Delhi NCR only by 2015. Delhi NCR, however, does offer global retailers the option to set up independent stores in suburban centres. Considering their business margins and store sizes, such retailers may find the traditional high streets and organised retail developments expensive in terms of operating costs.

Real Estate Regulatory Bill and the Land Acquisition, Rehabilitation and Resettlement Bill

The above two bills have the potential to impact the residential sector, particularly private enterprises involved in real estate development.

The Real Estate Regulatory Bill meets a long standing need for providing much-needed transparency and regulating the

Changes in Special Economic Zone (SEZ) Policy

Recent changes in the SEZ policy have removed the land size cap of 25 acres for IT SEZs while also reducing the minimum built-up requirement to 100,000 sqm in the seven major cities, including Delhi NCR. In such a scenario, it is likely that developers of under-construction SEZs who have already achieved the minimum built-up criteria and have surplus land available may not undertake development of future phases and will have to launch residential projects for faster inventory offloading and the cash conversion cycle. This is likely to influence the development of future phases in the SEZs, with developers not retaining the keenness to develop office space unless a potential occupier pre-commits to space take-up. With the residential sector remaining quite robust and attracting both buyers and investors, it is likely that developers will remain focused on residential developments at the expense of their commercial projects. With returns from the residential sector likely to remain high, developers may need a greater financial incentive to create office developments going forward, or they are likely to adopt a go-slow policy. With returns low at current prevailing rents, and project gestation periods being similar for residential and comparable office projects, the possibility of developers increasing quoted rents for vacant space and future office phases in such SEZ projects must be taken into account. It is also likely that with the removal of the land size cap and the development area requirement reduced, occupiers might approach state governments or attempt to source land by themselves to create their captive, campus-styled SEZ developments.

In addition, the twin reasons of reducing vacancy rates in quality projects and the constrained future supply that will be affected by the SEZ policy change might lead developers to seek higher financial incentive to undertake office development, which is likely to result in rents rising over the medium term.

FDI Policy in Retail

The first announcement allowing FDI in multi-brand retail trading was made in September 2012, with the industry acknowledging the proactive approach. Two major provisions of the policy caused concern among retailers. One was retailers having to invest 50% of their total investment in greenfield developments and back-end infrastructure of cold storage and supply chains. The minimum investment in multi-brand retailing ventures had to be USD 100 million. The other was retailers having to source 30% of their material from small businesses that had invested


hitherto largely unregulated housing sector in India. By applying this bill to all projects more than 4,000 sqm in size, the ambit is quite large and seeks to cover all major private residential developments across the country.

The Real Estate Regulatory Bill works both ways. While it aims to hold developers accountable, it also looks to ensure that the allottees do not default in making payments. Thus, by providing penalties for both the promoters and the allottees, the bill seeks to ensure that non-compliance is minimal. On enactment, the bill aims to ensure that real estate transactions are carried out in a just and equitable manner.

The category of real estate brokers has also been brought under the ambit of this bill by making their registration mandatory when the promoter provides the project details to the Regulatory Authority.

The bill also seeks to define the carpet area, which will be a standard definition across the country.

The bill seeks to provide a model Agreement to Sell under which the promoter is liable to furnish the necessary project details to the allottee while also becoming responsible for providing project-level details as demanded by the buyer.

The bill will establish a central Appellate Tribunal, with the individual states responsible for setting up the Regulatory Authority at the state level.

Although the bill will be a boon for property purchasers and consumers, it has received a lot of opposition and criticism from developers for not being inclusive in its approach. The bill in its current form does not provide for any relief to developers in terms of getting through the cumbersome approvals and permissions process in an expeditious manner. It has been a constant complaint by developers in India that they have to experience long and inordinate delays in addition to the difficulty in obtaining approvals for construction from the multi-headed government agencies, and they have stressed the need for a single-window clearance to cut through the red tape. This issue does not find any mention in the bill. In addition, although the list of disclosures to be furnished by the promoter is fairly exhaustive, it could still be benchmarked against the best practices of the developed markets, bringing the real estate markets in India in line with markets where regulations have existed for some time, with relevant lessons to be learnt from their experience.

The Land Acquisition Bill seeks to redress the compensation and resettlement grievances of landowners who have sold their land to private enterprises. It also seeks to reduce the state’s role in acquiring land for private enterprises, while the states will

continue to enjoy the same powers of land acquisition for public policy purposes.

This bill, although noble in its intent to provide a comprehensive resettlement and rehabilitation package to displaced landowners, will likely have, by increasing the compensation burden on private enterprises, the dual impact of an increase in land prices and, as a result, in project pricing. With the clause for acquisition requiring the assent of 80% of affected parties, the process is bound to become more tedious for mid-level real estate players.

This bill was conceived in the aftermath of the land fiasco that engulfed the Noida Extension corridor in Delhi NCR. Here, the government authorities were at fault, having acquired land for industrial purposes from landowners and then altering the land use to residential and selling it to private developers. The result was that the original landowners received compensation at lower rates commensurate to industrial land prices, while the state cornered the proceeds, which were much higher as the land use was changed to residential. The resultant court rulings were in favour of the landowners and a comprehensive resettlement package was arrived at. With the burden also thrust on developers, since their cost of land acquisition went up, they increased the prices of their residential projects, which adversely affected the rights of buyers. One of the reasons for the Bill to come about.

The state of Haryana has a model of land acquisition that seeks to provide annuity payments to landowners who have parted with their land to private enterprises or Public Private Partnership projects.

The need is to arrive at a more realistic model that is not skewed in favour of any stakeholder, but is more just and equitable.

Land Pooling Policy in Delhi

The Delhi Development Authority (DDA) approved this policy in the last week of July 2013. Realising the issues faced by the nodal body in acquiring land in the prime city, in terms of demand or higher compensation in the wake of increased land valuations, this policy has been executed. The DDA has created two categories - one for land pooling above 20 hectares and the other for land pooling between 2 and 20 hectares. Under this policy, the ground coverage has also been increased from 33% to 40%.

Landowners would receive between 40-60% of the developed land back from the DDA in lieu of compensation and they can use that developed land in any way they desire. The DDA would use 60% of the pooled land (53% for residential purposes, 5% for commercial and 2% for public and semi-public use) and 48% (43% for residential, 3% for commercial and 2% for public and


semi-public use) in the two categories, respectively. For housing for economically weaker sections (EWS), 50% of the pooled land would be handed over to the DDA for building EWS units.

This policy is likely to result in residential development projects across the prime city, which has an acute shortage of housing and where most of the housing needs are fulfilled by the DDA. This policy is likely to lead to an increase in private participation in housing development across the city.

The Developer Switch in Asset Development

Post-crisis, many developers switched to the residential sector due to the dual benefits of the sector’s self-liquidating nature as well as the inherent short-supply of housing in India. Another point of interest is how the focus of the major developers of commercial office space has undergone a gradual shift towards residential housing development projects.

The current commercial stock levels of the top developers have low vacancy levels indicating that quality stock is limited. Also, a recovery of sorts is being seen in the commercial office space market. However, there are indications that suggest that focus on future office

development will be limited. This is because, returns from residential sector development has shown a healthy rise for developers, whereas commercial rents have recovered only up to levels seen as of end-2009, staying at merely 53% of the peak values observed in 2007. These factors are likely come together to create a situation where the current occupier-friendly conditions in the office market are likely tour of the landlords.

A comparison of the most vibrant office and residential markets of Gurgaon and Noida clearly bring out the points made above regarding movement of office rents against residential prices.

A point that needs to be highlighted is that from 2009 until today, while total new supply of IT office space in Gurgaon and Noida has been 27 million sq ft, the corresponding launched residential supply totals an extremely high 490 million sq ft across the residential markets of Gurgaon and Noida. This clearly highlights the point that developers across all levels have shown a bias towards residential projects that allow them a quick turnaround in their liquidity cycle while also providing higher returns on average compared to rent returns from commercial office projects.

Office Rents vs Residential Capital Values

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Expanding the Delhi NCR BoundariesDelhi NCR is the largest urban agglomeration in India and the second largest in the world. This sub-market has an independent Delhi NCR Planning Board, which was constituted to channel the flow and direction of economic growth and development along more balanced and spatially orientated paths. The body creates its own functional plans for the various constituent sub-markets of Delhi NCR and ensures implementation at state level, keeping in mind the overall Regional Plan.

As the existing suburban sprawls of Gurgaon, Noida and Ghaziabad are close to exhausting their development potential, we take a look at five hotspots that are likely to emerge as the nerve centres of future growth planning and real estate development.

Sohna

Along with the recent Gurgaon Master Plan 2031, the Haryana Government also notified the 2031 Master Plan for Sohna. The town is located 24 km from Gurgaon and is currently connected by the well-known Sohna Road. Under the new master plan, an area of 6,110 hectares has been earmarked for future development. According to the plan, the population of this town is expected to see an explosive half-decadal growth rate of 70-76% until 2031. Of the development proposed in the 2031 plan, more than 20 new sectors have been planned and more than 28% of the land area has been set aside for residential development. A host of factors is likely to contribute towards this sub-market being a potential investment sub-market. Already, a host of developers has undertaken land consolidation/acquisition and obtained development licences, while a few have already launched projects. This real estate market is likely to emerge

as an affordable housing hub with built-up residential projects likely to be priced at the INR 4,000 to INR 5,500 per sq ft level. Serviced plot prices are nearly one-third of those in Gurgaon. This sub-market is likely to see a host of township projects, with developers holding land parcels under commercial licence also considering a conversion of land usage to residential. Land valuations following notification of the master plan have risen to between INR 3.5 crores and INR 4.5 crores per acre for non-licenced land parcels, a jump of more than 120%. In addition, a host of infrastructure initiatives is likely to enhance the attractiveness of this sub-market and create pull factors for demand. This sub-market is expected to enjoy enhanced connectivity by two cloverleaf junctions on the proposed KMP Expressway. Along with this, the government has planned an Orbital Rail Corridor along the KMP Expressway, while also earmarking 1,500 acres for an Industrial Model Township. The Dedicated Freight Corridor linking Delhi to Mumbai is also likely to be a growth magnet for development.

Neemrana

Neemrana is one of the fastest growing industrial centres in north India. It is located strategically on NH-8 and in proximity to other industrial sub-markets such as Bhiwadi, Bawal, Khushkhera and Tapukhera. Situated in Rajasthan and part of Delhi NCR, this sub-market has attracted heavy industrial investment from Japanese manufacturing firms. Currently, a 1,200-acre Japanese Zone is 70% operational, with heavy investment in manufacturing facilities by firms such as Daikin, Mitsui Chemicals, Nissan, Nippon and NYK Logistics. The Japan External Trade Organization and the Export Promotion Industrial Park, spread over 3,500 acres, developed by the Rajasthan


State Industrial Development and Investment Corporation (RIICO) in several phases, are other industrial zones that have led to this sub-market’s emergence as a major industrial hub. Neemrana is also part of the Delhi Mumbai Industrial Corridor Phase I development and land acquisition for it is already complete. Its strategic location and strong industrial linkages and prospects of employment generation have led to it becoming a real estate investment hotspot. With non-licenced land located on NH-8 currently priced at 1.2 crores per acre, developers have already acquired large land holdings, while others are actively seeking land parcels. Some residential projects by Aashiyana, Eldeco and Anant Raj have already been launched. This sub-market has tremendous potential for integrated township projects and low-cost, affordable housing. There is likely to be inherent demand from the large workforce already working here, with more likely to be added over the course of the next few years. The government of Rajasthan has already notified the 2031 Master Plan for the Shahjahanpur-Neemrana-Behror Urban Complex with a futuristic 2041 Master Plan in the draft stage. Further infrastructural initiatives are also likely to aid the emergence of this town as a major real estate growth node. There are plans to set up a cargo airport, with industrial firms from Korea and Taiwan also showing interest in setting up manufacturing facilities. In fact, a Korean Dedicated Manufacturing Zone has already been proposed to be set up through an agreement between RIICO and the Korean firms’ nodal body, Kotra. Neemrana is also a strategic stopover in the Delhi Mumbai Freight Corridor. There are also plans to set up a Global City spread over 40,000 acres containing smaller cluster cities centred around electronics, education, entertainment and logistics. With industrial growth acting as a pull factor, real estate development across the office, retail and residential asset classes is likely to find greater traction going forward.

Yamuna Expressway

The Yamuna Expressway offers large land parcels, and with it becoming operational it is expected to act as a magnet for real estate development projects. The expressway is 165 km long, and with land availability in Noida becoming limited, this stretch will act as the next node for large-scale developments such as integrated townships and logistics & warehousing hubs. There is now a separate Yamuna Expressway Authority that is responsible for creating and implementing growth plans for this sub-market. More than 33,000 hectares has been notified for development along the expressway, of which the authority has acquired 11,200 hectares up to Agra. Long-term planning for infrastructure development in the form of an independent Yamuna Power Corporation Limited has been established, which will set up a 2,000 MW power plant. According to the 2021 Master Plan, 20% of land has been allocated for residential development and 28% for industrial zones, with a substantial 21% set aside for the green belt.

The proposed Delhi Mumbai Industrial Corridor is expected to pass through Dadri and will boost the development of warehousing and Special Development Zones along both sides of the expressway. With connectivity to Agra, which is a major tourist spot that is being enhanced, and travel time reduced considerably, the Yamuna Expressway has already attracted the interest of major developers, who have announced township and residential projects. With the operational Formula 1 track and upcoming facilities like the Jaypee Sports City project and Night Safari, it will be the source of the next wave of development, which will expand the city boundaries.

Land parcels are available at much lower prices compared to other


parts of the Delhi NCR, with the current price for non-licenced land being from INR 1 crores to INR 5 crores per acre, depending upon location. While built-up apartment prices are in the range of INR 2,200 to INR 3,500 per sq ft, plots are priced at INR 14,000 to INR 32,000 per sq ft, one of the lowest in the sub-market.

A sub-market with low prices and upcoming projects at low price-points provides enough scope for future developments and investment in infrastructure projects to create a well-developed hub, which equals a good investment option. Residential apartment prices have remained largely stagnant since the expressway completion, with projects further down this stretch launched at lower prices. The residential plot prices have remained relatively stable over the past one year, after showing an initial 35-40% appreciation.

For end users, low price points with projects by major developers present an equally viable opportunity. In addition, with ancillary developments such as Jaypee Sports City and Gautam Buddha University coming up along with other social infrastructure projects, this sub-market is expected to turn into a large-scale residential hub with good amenities.

NH-24

Highways are the nodes along which a city spreads and with the proposed upgrade and widening of NH-24, this stretch should offer good infrastructure as well as enhanced connectivity to the main city. This stretch lies close to the existing residential sub-market of Indirapuram, which is quite densely populated and thus has growth potential. The main growth node is the stretch of highway that begins around 10-15 km beyond Indirapuram. This stretch was the first affordable housing hub in the Delhi NCR with the launch of Crossings Republik, where a host of developers offered apartment units at low cost to the buyers.

NH-24 is an important road linkage between Delhi, Ghaziabad and Noida. The proximity to the established residential and industrial corridors of Noida and Ghaziabad and accessibility to Delhi have been the major factors that have led to real estate developers showing interest here. However, currently the interest is focused towards housing projects only. Currently, pricing on the NH-24 stretch, which is of interest to developers, is in the range of INR 4 crores to INR 5 crores per acre for non-licenced land parcels. Developers are keen to look at affordable housing projects or large-scale township projects, which find good demand in the predominantly end-user driven market at attractive price points. This sub-market is expected to be the game changer in terms of affordable housing prices, which are likely to be the lowest amongst all established suburban centres in the Delhi NCR.

The stretch offers affordable housing in the price range of INR 2,600

to INR 3,100 per sq ft. Connectivity along this stretch is likely to improve and with its proximity to Noida, Ghaziabad is expected to see healthy interest from buyers/investors. Projects along NH-24 are currently available at one of the lowest price points in the Delhi NCR residential market. In addition, developers such as SARE and Wave are creating township projects that have a varied range of residential formats at different price points. Other large projects by developers such as Landcraft, SARE and Wave are also witnessing good interest from buyers/investors. The Wave Hi-Tech City township is spread over 4,500 acres and more such projects are expected, with a few prominent developers actively sourcing land options. Other prominent developers who have launched large township projects include Landcraft, SARE, Antriksh and Mahagun. Apartment prices here are among the lowest in the main suburban residential markets of the Delhi NCR.

Proposed infrastructure initiatives have to keep pace with the development of this sub-market to achieve its potential. There are plans to decongest this stretch to enable it to achieve its optimum potential. The Uttar Pradesh Government has proposed adding five underpasses on the 28-km stretch from Dasna to Indirapuram and making this stretch signal-free. Widening of the highway to six lanes is being proposed due to traffic congestion. Widening of the stretch between Ghaziabad and Indirapuram towards the Delhi border to eight lanes is also proposed. There is a proposal for a Metro station at Indirapuram, but no concrete timelines are available. A connecting road from NH-24 to Greater Noida before the Indirapuram Crossing is also proposed and is likely to aid in reducing the traffic pressure on NH-24.

New Zones under the Delhi Master Plan 2021

To find Delhi among the real estate hotspots is doubtful, as the prime city has had every possible square inch of urban land already developed. However, the northern and south-western extremities of the city have for some time now been the subject of discussion as being potential development growth corridors. A large portion of growth in Delhi has been undertaken by the DDA, especially in the housing sector. The shortage of housing notwithstanding, the prohibitive land prices and a lack of available land parcels were factors that limited private sector participation in the growth of the city’s housing sector.

The city of Delhi is the engine that drives the economic and growth story of entire Delhi NCR. Archaic development regulations were in part responsible for not allowing optimum utilisation of the land available within the city. The city has excellent infrastructure in terms of roads, power, water and connectivity through the Metro. The need to create a viable strategy for kick-starting the housing sector


by involving private enterprises was finally realised when the Delhi Master Plan 2021 was proposed and later notified. It was clear that underutilising available land within the city boundaries had led to high property prices and created barriers to fulfilling the housing needs of a larger cross-section of society.

The Delhi Master Plan 2021 has envisaged the creation of five new zones - J, K, L, N and P - spread over 87,000 hectares. These zones, referred to as “urban extensions”, are expected to unlock 60,000 hectares for development and redevelopment projects primarily focused towards the housing sector. The population in Delhi according to the 2021 plan is expected to grow to 2.36 crores over this period. The idea is to create five sub-cities on the lines of Dwarka with influence zones planned based on the mass transport system. To cater to the shortage of housing, the Floor Area Ratio (FAR) has been increased to 200 for group housing projects. The basic area details for the zones follow.

Zone J comprises the sub-markets of Satbari and Mehrauli in south Delhi. This sub-market is likely to see high-end developments and land parcels sold off primarily as farmhouses. Existing farmhouses would be able to undergo redevelopment to form multi-dwelling units. Prices in this zone are in the range of INR 15 crores to INR 30 crores per acre. Zone K is sub-divided into K1 and K2. While K1 comprises the sub-market near the Najafgarh Drain, K2 comprises largely of existing developments in Dwarka. This entire sub-market is located close to the Dwarka sub-city. Few new sectors are likely to be added to Dwarka, where private participation is anticipated. These will be low density residential sub-markets. There is an increased focus on setting up SEZs in this sub-market.

Zone L comprises the sub-market adjoining Dwarka and New Gurgaon, separated by the Najafgarh Drain. This zone has 37 villages, which have been identified to be in the residential zone. More than 11,000 hectares is available for development and already large private developers such as DLF, Emaar MGF and Ireo have acquired substantial land holdings here. This zone has the potential to provide for more than 500,000 residential units and townhouses/farmhouses. Land prices in this sub-market are in the range of INR 4 crores to INR 4.5 crores per acre. At current residential Floor Space Index prices, built-up apartments are likely to be priced between INR 3,500 and INR 5,000 per sq ft, which is likely to provide a good investment opportunity. This zone is also being actively sought for creating townhouses in a gated community format with price expectations of INR 4 crores and more. This sub-market is expected to see its population grow to over three million over the master plan period. Its proximity to Gurgaon and accessibility through the Dwarka-Gurgaon Expressway provides an added advantage. However, actual

infrastructure development in this sub-market would provide an actual barometer of investment potential in this zone.

Zone N is located close to Rohini in north-west Delhi. It comprises over 11,000 hectares, of which nearly 49% is zoned for residential use. According to development norms, this zone should additionally provide for a further five million to six million dwelling units across both apartments and plotted developments. With expectations of no height restrictions in this zone, the FAR is likely to be higher and hence the cost of development is likely to be lower. Land prices are currently in the range of INR 2 crores to INR 4 crores per acre and built-up apartments should be priced anywhere between INR 4,500 and INR 6,000 per sq ft. This zone enjoys proximity to the existing Metro connectivity to Rohini and accessibility through the proposed Urban Extension Roads 1 and 2.

Zone P is sub-divided into P1 and P2 and is located along both sides of the NH-1, comprising the Narela sub-city. More than 7,000 hectares is available for development in this zone. The government aims to create around 20,000 residential units by itself in Phase I. There is also a growing trend of smaller, cooperative housing/welfare societies acquiring smaller land parcels of 2-3 acres for creating group housing under the cooperative housing schemes. Land prices are in the range of INR 2 crores to INR 3 crores per acre. Residential apartment prices are in the range of INR 2,400 to INR 2,500 per sq ft. The chief attraction of this sub-market is the industrial activity, with a major portion already made operational by the Delhi State Industrial Corporation. Other proposed utilities and the proposed development of an Integrated Freight Corridor are likely to aid employment generation and in turn generate demand for housing by the industrial workforce in this sub-market.


Emerging Trends on Urbanisation and Integrated Townshipsperipheries are usually low on infrastructure support, and the development of integrated townships needs such support to flourish. Public infrastructure development usually lags any sub-market’s development. This means that the infrastructure does not keep pace with development and it is usually planned reactively rather than being forward looking.

Integrated townships seek to house a large number of families as well as commercial establishments. Infrastructure is pivotal to making such developments liveable. Most big Indian cities are struggling with issues of power, water and drainage, not to mention the slow upgrade of the road network. In such a scenario, integrated townships are likely to struggle with a lack of support infrastructure. Although the internal infrastructure such as roads, drainage and water connections as well as social infrastructure has to be provided by the developer, the external linkage to the state infrastructure backbone is imperative.

Over the next 2-5 years, most metropolises and satellite cities are likely to see more launches of integrated township projects. Tier II cities and state capitals, which see the population from the interior gravitating towards them, are also likely to see the launch of such projects. It is difficult to give an exact number, but a few hundred such projects are likely to be in different stages of development over the next five-year period. To substantiate further this trend, it is pertinent to note that the Delhi NCR has more than 50 such township projects under construction or in the proposed/planning stage. Although there are no fully operational projects in the Delhi NCR, unlike the

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1(Economic Survey, 2010-2011, pp 283-284), 2(Economic Survey, 2010-2011, pp 283-284)

With a land area one-third the size of the US, India harbours nearly three times the population. Unsurprisingly, Indian cities are not only the most populous but also among the densest urban agglomerations of the world, which pose unique challenges to the development of infrastructure and real estate.

India’s urban population is underestimated, partly because of definitional reasons, and is expected1 to approach some 45% of the population compared to 30% (295 million) in 2009. This is equivalent to building one additional Greater Mumbai or Greater Delhi every year. Growth is taking place in the peripheries of the major agglomerations of Greater Mumbai, Delhi, Kolkata, Chennai, Bangalore and Hyderabad.

Cities may hold the key to our future. India is entering what we term the “Three Great Transformations”: (1) growth of cities; (2) jobs to meet the rising aspirations of a young adult population; and (3) doubling of household incomes. Urbanisation is pulling people out of rural poverty. However, the process is a knife-edge: failure will lead to chaotic cities, unfulfilled aspirations and slower growth2.

New master plans in all major cities seek to expand the boundaries of the urban sprawl. In such a scenario, newer areas would benefit if integrated township developments were undertaken, as they would provide a more holistic living environment and prevent the mushrooming of unplanned urban villages.

Integrated townships, because of their huge land requirements, need to be outside the main urban areas of any city. The city’s


Magarpatta City township in Pune, there are many that are likely to become operational over the next few years.

With the focus of integrated townships on creating affordable housing and infrastructural development, such townships are prime candidates for the granting of infrastructure status. This would provide access to cheaper and more established sources of funds while also providing the tax benefits required for developers to look at this model of development.

The government has already opened the doors for External Commercial Borrowings in integrated township development. This provides access to cheap sources of finance and has had a positive impact on this form of development.

We are observing an increasing trend of developers looking at such large, integrated projects, especially in the growth corridors and emerging development hotspots in the Delhi NCR. Positive trends surrounding integrated townships, a lack of residential density in fast-growing cities (such as Gurgaon) and state governments promoting integrated township projects by proposing the easing of development norms have led to many developers entering the fray of integrated township development. Major players, such as DLF, Unitech, Vatika, Ansal API and IREO, are already in various stages of developing township projects. In Noida, developers such as Logix and the Jaypee Group are developing golf-centric townships, in effect offering a value-added option for customers. Other players, such as Parsvnath, Supertech, Sobha Developers, Emaar MGF, BPTP and the Wave Group, have also announced large and multiple integrated township projects in the Delhi NCR.


AuthorsSuvishesh Valsan Assistant Vice President, Research [email protected] +91 22 3985 1309 Suvishesh joined Jones Lang LaSalle India in 2013 and is responsible for driving Thought Leadership and Research publications, been part of the Research & Real Estate Intelligence Service (REIS) team. Based in Mumbai, he also contributes to bespoke research publications for all sectors of the real estate. In his over 5 years career prior to joining Jones Lang LaSalle, he has served in various financial institutions and consultancy research firms, specialising in macroeconomics, asset allocation strategy and business research. Suvishesh holds a Master’s degree in Economics from the Gokhale Institute of Politics & Economics, Pune.

Rohan Sharma Assistant Vice President, Research and REIS [email protected] +91 124 4605 015 Rohan Sharma manages the Real Estate Intelligence Service (REIS) for Delhi-NCR. Based out of Gurgaon, he is responsible for bespoke research assignments and contributes towards topical whitepapers and property market updates including sector analysis and market forecasts. He also actively contributes towards media articles on local real estate development, city master plans and policy analysis. He joined Jones Lang LaSalle India in December 2010 and has had over four years’ of prior real estate experience across the commercial leasing and investments domains in previous firms. Rohan holds a Bachelor’s degree in Engineering and a Master of Finance and Control degree from Delhi University.

Ashutosh Limaye Head - Research and REIS [email protected] +91 22 3307 1500 Ashutosh Limaye is responsible for overseeing research and REIS business of JLL. He is also responsible foreffective business development, selection, grooming and growth of professionals in the research division. He has 14 years of experience, including one and half years of post graduation in planning with specialization in Urban Planning. His contributions include real estate market intelligence and forecasting, formulations of economic and physical plans, assessments of policies, legislations and regulatory mechanisms for delivery of infrastructure services, study of urban governance initiatives for urban management programmes, identification of appropriate modes of private sector participation in infrastructure delivery for large-scale infrastructure and township projects in the urban context, financial cost-benefit analyses, project formulation and appraisals, and urban land management.

About Jones Lang LaSalleJones Lang LaSalle (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 2.6 billion square feet and completed $63 billion in sales, acquisitions and finance transactions in 2012. Its investment management business, LaSalle Investment Management, has $47.7 billion of real estate assets under management.Jones Lang LaSalle has over 50 years of experience in Asia Pacific, with over 25,400 employees operating in 76 offices in 14 countries across the region. The firm was named ‘Best Property Consultancy’ in nine Asia Pacific countries at the International Property Awards Asia Pacific 2012, in association with HSBC, and was named the number one real estate advisory firm in Asia Pacific in the Euromoney Real Estate Awards 2012.’ For further information, please visit our website, www.ap.joneslanglasalle.com

About Jones Lang LaSalle IndiaJones Lang LaSalle is India’s premier and largest professional services firm specializing in real estate. With an extensive geographic footprint across 11 cities (Ahmedabad, Delhi, Mumbai, Bangalore, Pune, Chennai, Hyderabad, Kolkata, Kochi, Chandigarh and Coimbatore) and staff strength of over 6100, the firm provides investors, developers, local corporates and multinational companies with a comprehensive range of services including research, analytics, consultancy, transactions, project and development services, integrated facility management, property and asset management, sustainability, industrial, capital markets, residential, hotels, health care, senior living, education and retail advisory. The firm was named the Best Property Consultancy in India (5 Star Winner) at the International Property Awards - Asia Pacific for 2012-13. For further information, please visit www.joneslanglasalle.co.in

COPYRIGHT © JONES LANG LASALLE All rights reserved. No part of this publication may be published without prior written permission from Jones Lang LaSalle. The information in this publication should be regarded solely as a general guide. Whilst care has been taken in its preparation no representation is made or responsibility accepted for the accuracy of the whole or any part. We stress that forecasting is a problematical exercise which at best should be regarded as an indicative assessment of possibilities rather than absolute certainties. The process of making forward projections involves assumptions regarding numerous variables which are acutely sensitive to changing conditions, variations in any one of which may significantly affect the outcome, and we draw your attention to this factor.

Real Estate Intelligence Service (REIS) is a subscription based research service designed to provide you with cutting edge insights into diverse and challenging real estate markets through collation, analysis and forecasts of property market indicators and trends across all major markets across various real estate asset classes - office, retail, residential. REIS empowers you with consistent and complete market data and analyses for all real estate indicators by specific micro markets. It is supplemented by value added services including client briefings, presentations and rapid market updates. For more details, contact, Ashutosh Limaye - [email protected]

Indian Chamber of Commerce (ICC) Founded in 1925, Indian Chamber of Commerce (ICC) is the leading and only National Chamber of Commerce operating from Kolkata, and one of the most pro-active and forward-looking Chambers in the country today. Its membership spans some of the most prominent and major industrial groups in India. ICC is the founder member of FICCI, the apex body of business and industry in India. ICC’s forte is its ability to anticipate the needs of the future, respond to challenges, and prepare the stakeholders in the economy to benefit from these changes and opportunities. Set up by a group of pioneering industrialists led by Mr. G D Birla, the Indian Chamber of Commerce was closely associated with the Indian Freedom Movement, as the first organised voice of indigenous Indian Industry. Currently, Mr. Shrivardhan Goenka is leading the Chamber as its President.

ICC’s North-East Initiative has gained a new momentum and dynamism over the last few years, and the Chamber has been hugely successful in spreading awareness about the great economic potential of the North-East at national and international levels. Trade & Investment shows on North-East in countries like Singapore, Thailand and Vietnam have created new vistas of economic co-operation between the North-East of India and South-East Asia.

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