Month: December 2023

Glossy entrance lobby with waiting lounge for guests. Outdoor areas with large patios. Bar zones and fire pits. Rooftop gardens, private pools and water walls. Top-of-the-line gym, high-speed elevators, clubhouse with tennis and billiards. Tick for all, because luxe is in.

Demand for premium homes has shot through the roof during the first eight months of this year, with luxury properties registering a staggering 130% growth and developers scrambling to cater to this significant surge, according to industry experts. They feel the combination of a buoyant economy, political stability, increased interest from HNIs and NRIs and a tilt towards aspirational investments is fueling this growth.

A look at the factors driving growth in luxury segment

# Buoyant economy: India’s robust economic growth and the emergence of diverse business models, have led to a burgeoning affluent population and large-scale urbanization, triggering more investments and subsequently, a soaring demand for premium homes.

# Lifestyle investment: With the increase in buying power, the aspiration levels have also gone up and investing in a better lifestyle has become more important. A prime want is a large home with premium features, sometimes even a second home. Post-Covid, the demand for larger living spaces has organically soared because people are spending more time at home with the WFH or hybrid work models.

# Traction from HNIs and UHNIs: For high-net-worth individuals (HNIs) and ultra-high-net-worth individuals (UHNIs), the real estate market is always a trusted safeguard against the vagaries of inflation. Post-pandemic, more than ever before, they are keen to park their money in luxury real estate.

# Demand from NRIs: The strengthening of the US dollar against the Indian rupee has stoked the interest of NRIs and there is an increased demand for high-end units from that segment. Also, with the rise in raw material prices like cement and steel, property prices are set to move northwards only. So, this is a great time to invest, concur market watchers.

# Cap on capital gains: Another factor going in favour of this trend of going for luxury homes is the government move to cap capital gains at Rs 10 crore in the Union Budget.

According to market sources, premium properties priced at Rs 1.5 crore and above accounted for nearly 20% of all residential units transacted in the leading cities of India over the past 18 months, as opposed to only 6.8% luxury homes sold during 2019. The continued traction in the premium segment after the pandemic has enabled developers to clear large portions of their inventories.

This positive sentiment in favour of luxury homes with a plethora of built-in amenities is expected to become more pronounced in the near-to-medium term, with the demand surge breaking new barriers. This is elixir for real estate developers after the slump during the pandemic period and the leading players are all ready to roll out high-end residential projects packed with the latest lavish features as they ride the premium crest.

The Christmas-New Year festive season is almost upon us. It’s that time of the year when Kolkata decks up for the yearend carnival and endless partying. There’s a sense of bonhomie and bonding all around. This is also the time when we make our New Year promises. This time, why don’t we vow to appreciate our amazing architectural legacy a little more?

Kolkata’s rich literary, artistic and cinematic heritage is universally acknowledged and celebrated, but our built heritage rarely features in our daily discourse. Isn’t it kind of strange, considering that the city’s part-European, part-Bengali architectural mélange is so distinctive, it has fascinated eminent architects and urban planners around the world for decades? Is it a case of ‘familiarity breeds contempt’?

The intricate cornices, high ceilings, wrought-iron grilles, crescent-shaped verandahs and slatted windows are all a vibrant reminder of our colonial-style built heritage, seamlessly intertwined with an aristocratic Bengali design vocabulary. Elegant and profound, yet charming and beautiful. As Nobel Laureate Amartya Sen describes Kolkata’s historic built environment: “Calcutta’s eccentric but exciting old buildings.”

A walk around the BBD Bag business precincts reinforces the belief that Kolkata had the trappings to become one of the world’s most magnificent cities. Maybe somewhere down the line, we lost our way. Most of the splendid edifices are in various stages of decay and disrepair and crumbling even as we speak. So, are those priceless structures like St. James’ Church or the GPO with its majestic dome, the Writers’ Buildings, et all beyond salvage?

While the Currency Building is the only concrete example of a prominent heritage structure restoration in the CBD till date, there seem to be a clutch of piecemeal plans like restoration of St. James’ Church, beautifying a stretch in front of the GPO, an extension of the Millennium Park, etc. The beautifully conceived Palladian Lounge in the BCCI building was meant to be an oasis, attracting people back to the office para after dark through its myriad events and expos and fine-dining spread.

However, it needed greater traction to engineer a more widespread urban renewal wave in the Dalhousie Square area. While so much could be done along the riverfront, linking it like a ‘T’ with BBD Bag, there were some setbacks that have stymied efforts to steer a holistic regeneration. First, the planned adaptive retail-and-entertainment reuse of the revamped 16 Strand Road (Mackinnon & Mackenzie House) didn’t come off, then the pilot beautification project between the two bridges is yet to take concrete shape. And of course, there was the devastating fire in one of the Strand warehouses of the Port Trust.

So, can’t we put up a united front of various stakeholders and expert groups to create a collective bandwidth to protect Kolkata’s unique built heritage? Let’s not talk about political will only, this requires healthy doses of public will as well. Citizens’ consensus is the biggest enabler in any urban renewal initiative and this can be one of the most significant inner-city rejuvenation programmes in the country. What cities like New York, London, Birmingham, Istanbul or Marrakesh have achieved through such interventions, we can replicate in our beloved Kolkata as well.

Many iconic European cities like Berlin, Vienna, Milan and Prague have shown the world how centuries-old buildings can be restored and put to intelligent adaptive reuse, including art galleries, museums (think Tate Modern) and even modern retail. All it needs is intent and a collaborative approach.

Of course, there are countless other architectural gems elsewhere in the city, like the splendid North Kolkata brick building quarters or the grand Art Deco buildings like Roxy and Metro cinemas in the Esplanade area and also Purna cinema in Bhowanipore, not to mention the beautiful, elegant and stylised old houses of South Kolkata.

However, a systematically restored and rejuvenated BBD Bag can do wonders for the image of our city and create a tourism magnet to draw people from across the country and around the world. A vibrant heritage retail and entertainment pedestrian zone can also be a massive economic energizer, which should generate captive revenue for the maintenance of the entire precincts. It sends out a strong positive signal to the outside world and goes a long way in bringing back the lost glory of Asia’s first cosmopolitan metropolis.

In India itself, Mumbai has already attempted something similar, engineering an afterhours reverse traffic flow to its CBDs in the Fort area, Cuffe Parade, Colaba and BKC, among others, creating retail and fine-dining destinations anchored by aspirational brands and elite F&B outlets. It’s a great way to keep the office districts hip and happening even after swipe-out time, while creating a whole new attraction, drawing friends and families in their hordes, giving them enough reason to spend and blow their workday blues away.

No reason why we can’t replicate a similar, why not better, experience in our own CBD. It’s a project waiting to be signed, sealed and delivered – a value-add that can have a magical ripple effect.

The demand for affordable housing in and around Kolkata remains strong post-pandemic, even as the entire gamut of real estate products experience a bounce-back. In fact, along with Ahmedabad and Pune, Kolkata is one of the most affordable housing markets in the country according to a recent study, with average EMI outgo accounting for 23-26 per cent of a household’s monthly income.

There are several factors responsible for the perennial affordability in the city’s realty market. Kolkata is not only a stable market, it is also largely driven by end-users, not speculators, unlike a Mumbai or a Gurgaon. Besides, a host of new growth corridors have opened up for the property market thanks to growing investment in better infrastructure and connectivity.

Some of these new affordable pockets include the Southern Bypass corridor/Sonarpur-Narendrapur, Rajarhat, New Town, BT Road, Madhyamgram, Diamond Harbour Road/Joka, while new growth areas are sprouting all across. The augmented Metro connectivity and new roads with support infrastructure have been driving this growth of affordable housing on the city’s fringes.

The government has also helped to create traction in the affordable housing segment by launching a clutch of consumer-friendly schemes in its ‘Housing for All’ initiative. Certain steps like raising the tax deduction limit for interest payment on home loans, whittling down GST rates and giving industry status to affordable housing have all added energy to this market and of late, with more and more home seekers taking the plunge. Another report points to the fact that average property prices in Kolkata have gone up by nearly 46 per cent over the past decade, a clear indication of a stable market where frequent fluctuations don’t send shivers down your spine. While there has been a perceptible rise in demand for premium projects after the pandemic, maximum sales are still recorded in the Rs 40 lakh-to-80 lakh segment.

While NRIs have traditionally looked at the Indian real estate market as a good investment option, they are now looking at the affordable property segment seriously. For one, they can leverage the government’s schemes on investing in affordable housing and reap the benefits of tax cuts and interest subsidies. Besides, with demand remaining strong, investment in this segment holds out the prospects of a steady rental income and capital appreciation. Also, this market is less prone to fluctuations and hence, offers greater peace of mind.

So, in terms of both risk reduction and profit maximization, the affordable housing segment offers a wonderful avenue for diversification of their investment portfolios to the NRIs. With more stocks being added to the inventory of most developers, the options are opening up even more.

Buying your dream home is one of the most critical decisions of your life and for many, a once-in-a-lifetime move. There are many factors to be considered before taking the plunge, one of those being whether to go in for a ready-to-move-in (RTMI) home or invest in an under-construction (UC) property.

A sizeable proportion of home-seekers are nowadays prepared to wait for their dream home even if it is under construction. One of the reasons for this preference is that UC properties in India usually come at a lower cost and has great potential to appreciate. Investors in particular, can reap the benefits of this price differential between a UC and an RTMI property, while also being able to leverage the flexi payment options realtors offer.

There are a clutch of advantages working in favour of UC homes, like the flexibility to choose from a plethora of preferred locations, your favourite floor/level and amenities, etc, which all add up to propel your property value. You can also get your apartment customized to suit your specific needs and ideas, which is difficult and sometimes not possible at all to do in an RTMI home. Besides, with RERA compliance now absolutely mandatory, there are very little chances of construction delay.

So, what are the advantages of investing in a UC property?

# Lower prices: The price differential between an RTMI property and a UC one can vary within a band of 10 to 30% if the location, developer, size, etc are the same. Hence, waiting a few months or a year doesn’t really hurt, with the price gap making the wait worth the while. No wonder more and more house-hunters are opting for UC properties.

# Greater appreciation: The construction stage is always the best time to buy into a property, because of the guaranteed appreciation in valuation. As the project nears completion, the ambient infrastructure also organically improves, thus raising the value of your UC home. RTMI properties usually don’t see such a level of value appreciation.

# Flexi payment options: For an under-construction property, you can only pay a token amount as down payment and the rest across comfortably spaced-out instalments till the construction is completed. However, in the case of a ready property, you won’t have that flexibility and will be asked to fork out the whole amount at one go or within a short interval from the signing of the deal.

# Brand-new home: Investing in a UC property means you can move into a brand-new home once the construction is complete and you get the keys. A shiny new property has its own allure and advantages, as opposed to an RTMI home which could be old construction and hence subject to wear and tear. If you have to invest in and carry out repairs immediately after you have moved into your new home, that sheer joy of owning a brand-new entity is somewhat lost.

# Exciting offers: Developers usually offer a variety of lucrative schemes for UC properties, including layered payment plans, freebies and add-ons. However, once the flat/house is complete and ready to move in, these offers are not on the table, more often than not.

# Secure against delays: Earlier, home buyers deemed it safer to buy an RTMI property to guard against possession delays. Now, with the RERA Act in place, customers are insulated against any time overrun, with clearly spelt-out time penalties in the legislation. Of course, you must check if the developer has a RERA number. Most reputed realtors have this. Customers can approach the RERA-established Appellate Tribunal for a prompt resolution of their grievances.

The demand for office spaces has started moving firmly northwards again. Gross leasing across the leading cities of the country in the second quarter of this year almost touched 13 million sq ft, according to market experts, clearly defying international trends and once again underlining the resilience of India’s commercial real estate sector.

With such high absorption rate, the momentum is expected to sustain itself over the rest of the year as well, and Kolkata has been one of the pace-setters in this surge along with Bengaluru and Pune. While average office rents in the city rose by almost 2.8% year-on-year, the spike in the first six months of this year itself has almost touched double digits.

Combined occupancy at the twin tech hubs of Kolkata – Sector V and Rajarhat – has been holding steady over 80% post-pandemic, figures unheard of in the past decade, say property agents. Such is the bullishness in the commercial real estate segment following a clutch of tech biggies making a beeline for these two hubs that some developers fear demand could soon outstrip supply.

While Infosys and ITC Infotech are both building their new campuses in Rajarhat, they have already taken up interim office space and others like Mindtree, Zensar, Calsoft, ArcelorMittal are all checking in, one after another. This buoyancy has pushed up rentals to above Rs 42 per sq ft for just the shell and to nearly Rs 60 per sq ft for furnished and fitted office space lease, as large floorplates are increasingly hard to come by.

In fact, the near-10% jump in rent for office space in Kolkata is the highest among the eight leading office markets in the country, driven by high demand in Sector V and Rajarhat. Interestingly, the traditional office districts of BBD Bag, Chowringhee, Park Street, Camac Street, etc have been left behind in this rent revolution, clearly underlining the slant towards Sector V and Rajarhat.

Experts feel a strong economy, rapid expansion in the IT/ITeS sector, flourishing of Global Capability Centres and a healthy growth in the start-up ecosystem have all combined to propel this demand. Add to that the back-to-office wave and the call for more workstations keeps getting louder.

Also, gleaning out lessons from the pandemic, most employers are now looking to decongest work spaces, budgeting for extra legroom keeping in mind employee health and wellness as they scramble to manage the return-to-work flow. This itself has pushed up demand for new office spaces by up to 30%. Quite a few realtors are even prepared to walk the extra mile in terms of creating healthy and sustainable work spaces by opting for LEED and WELL certification.

Interesting to note, Kolkata has the highest ratio for transaction of smaller office spaces, with over 70% demand for spaces below 50,000 sq ft, followed by Chennai and Mumbai. Small or large, with the country’s GDP projected to grow at 7-8%, this resurgence in demand for office space is expected to sustain itself in the coming years.