| There is something to cheer about in the commercial property markets. However, a research note from realty consultancy Knight and Frank points out that the stubbornly high inflation is also affecting growth in the realty sector. The Bangalore CBD recorded an increase of 18 per cent while the NCR CBD recorded an increase of about 14 per cent over the previous quarter. Demand for office space still remains relatively sluggish although there has been some uptake in absorption this quarter as compared with previous months. Between the first quarter of fiscal 2010 and the third quarter of fiscal 2012, foreign direct investment in real estate has declined by a drastic 92 per cent. CBDs, supplies of which still remain tight, emerged as the most expensive office market destination in India at the end March quarter. Some key emerging markets of India are still showing growth owing to the sustained demand generated specially from banking and consultancy, automobile, engineering and pharmaceutical sectors. Significantly, expectations of future transactions have improved strongly having a positive impact on capital value expectations as well. The BKC will continue to see sustained supplies and absorption, thanks to the continuing strong trend of relocation from South Mumbai to North Mumbai's BKC (the new CBD). Firming occupier demand is seeing rental expectations turning positive this quarter in contrast to the negative trend during the last three months of 2011. Mr Ravi Ahuja, Executive Director, Office Transactions, Cushman " Mr Farook Mahmood, Chairman and Managing Dircetor, Silverline Group, said. The report also noted a shortfall of quality space in the micro-market ensures that any new supply/vacancy in quality office space in the NCR or the BKC gets absorbed at a premium, thereby pushing the rental values up. The industry body, National Real Estate Development Council, said they hope to see a turnaround soon, adding that the Securities and Exchange Board of India's new alternative-investment-fund regulation may bring in new investors. |
Monday, 4 June 2012
Commercial rentals rise
