Surge in demand for commercial real estate: Builders hurry to finish the stalled projects
Post elections there is a Modinomics wave and there is a sudden pickup in demand for offices and commercial projects. Builders are rushing to complete the delayed commercial projects to cater to a sudden surge in demands. Since there is a stable government at the Centre, several funds are planning to invest in India. It is expected that the business confidence is likely to improve, and many developers like DLF, Unitech, Godrej Properties and others want to get a share of the pie.
These developers are speeding up projects that were put on the backburner for several quarters, and are also in the process of developing new ones. For instance, two blocks of DLF Park in Chennai, which had been delayed for over two years, are now expected to be ready by the first quarter of 2016. Mantri Developer’s Cosmos project in Hyderabad will be ready by the third of quarter of 2014 after a delay of a year. The builder had put this 8 lakh square feet Mantri Cosmos project on the backburner due to lower demand from corporates.
Sanjay Dutt the executive managing director for South Asia at property consultant Cushman & Wakefield (C & W) stated that the increase in office absorption has increased in the first half of the year and is expected to be higher in the second half.
About 21 million square feet of commercial space got delayed by over two-three years with developers slowing down construction across cities like Mumbai, the National Capital Territory of Delhi, Pune, Chennai and Hyderabad. These projects are expected to come to the market over 2015-2016.
Due to the lack of demand in the commercial property sector, real estate giants like DLF and Mantri Developers were concentrating on residential real estate. Now they are gearing up the plans to launch projects in commercial space and pace up the existing ones. Mantri has appointed Aditya Sikri as chief executive of Propcare mall management and commercial leasing to drive retail and commercial real-estate business.
Sushil Mantri the chairman and managing director of Bangalore-based Mantri Developers mentioned that in the past two years the company was focused on generating liquidity by selling residential assets. Now the company plans to have 10 million square feet under its commercial portfolio in the next five years across Bangalore, Hyderabad and Pune, from 2 million square feet now.
Source- The Economic Times
Cushman & Wakefield, demand for commercial property, Housing demand had increased, Mantri Cosmos project, Post Election
