Suratwwala Business Group is the first Real Estate company of Pune to be listed on BSE SME platform under the flagship of Mr. Jatin Suratwala. He has led the foundation of the company being the Promoter, Chairman and Managing Director since incorporation. Under his leadership and vigilance, the company is going towards achieving a goal of making Suratwwala Business Group a renowned name in Real Estate Development of the country.
Pandemic or slowdowns don’t affect markets like India beyond a point. With an increase in disposable income because of good growth in GDP this year (RBI says it will be close to 10%). All these point towards recover taking place
There are a few things that are forming a trend as far as realty in India is concerned. We mention some below:
- Commercial sector! In the commercial sector, the most trending event is the start-up culture. Everyone coming out of college does not want a job anymore. They want to start their own startup with their own offices. If they have the money, they buy commercial spaces outright. If they cannot afford CAPEX, they go for OPEX in the form of rentals. In this space also, the biggest increase has been in the shared spaces who give a variety of options for start-ups from table space to entire office set-up at competitive prices.
As far as trends go, a recent report from very established sources mentions that just the start-ups will be buying about 10% of new office space that comes into the market! At 10%, it would mean office space of 30 million sq ft- a clear increase of 1.5 milion sq ft over the 2019-2021 period.
Be it a Byju or Zomato which are established names, or other not-so-establishes names, start-ups are where the market is indicating. In Pune, places like Hinjewadi, Aundh, Baner, Sus Road, Manjri, Nagar road and surrounding areas are seeing a sustained growth in realty in the commercial space with large office spaces coming up at prominent locations. The difference today is that office space is no more a cluster of rooms with common facilities like pantries and toilets. Today every start-up space has to look like an office in Singapore or the US. And thankfully, there are people providing such type of facility.
- Affordable housing space! The immediate budget’s main highlight was affordable housing with Rs 48000 crores marked for it. This means small home category is hot. How this finally takes place on the ground is still not known. This is part of the central government’s priority in affording housing and may have a two-fold effect. One, it would get more home for those with limited budgets. Two, it would get money into realty projects that are stuck for finance. For builders and realtors, this could be a reason to smile if not rejoice.
- Sustained interest rates on home loans! When a lot is happening in this space, thankfully, the RBI and the government have held fast with home loan interest rates. Both repo and reverse repo rates remain stable and unchanged as of now. And could stay like that for some time, given that things like a general election is not far away. Besides the economy, which gets affected every time home-loan interest rates go up, people’s sentiments also take a hit. Taking both these factors, the government has held interest rates stable which is a good thing for the industry overall as it makes people come out any buy realty. In a few years, this development is likely to bring about good value appreciation and ROI- approx. 12-14% in residential, and about 18-20% in the commercial space. Now is the right time to take advantage of loans to make the killing.
- Capital appreciation in the housing sector! With people everywhere in the country expecting good times, the current trends indicate an average 5% capital appreciation in the current year in the home and residential sector. With the pandemic slowing down, people’s sentiments are towards buying bigger and even bigger spaces. Most people want to buy in city centres and close to offices because work-from-home times are slowly fading and people may be called back to office. Rentals as such should remain stable and overall profitability will return to the sector. Also, there is a distinct preference towards commercial properties which give returns 2-3 times of residential. This is helped further by loan structures that make commercial property more profitable than residential. If it continues in just a few years commercial property may fetch good ROIs for prospective buyers.
- People looking for bigger spaces! If realty advertisements are to be believed, the sentiments are towards bigger home spaces including villas, duplex etc. The other trend is that reconstructions are looking up. When city centres are full, the only space available are old homes that need to be demolished and built all over again. And in cities like Pune it is seeing a revival after the pandemic as people want to stay close to their earliest memories and not move to urban centres.
- Good times are here! As per reports from Niti Aayog, Indian realty shall be worth approx. USD 1 trillion (Approx INR 76 trillion or 76000 cr!) by 2030. In a few years’ time, realty in India would contribute to about 13% of our GDP which means it should be close to the iron and steel, and just as important. Overall, the trend means that realty is on the upward movement! Expect good times!
- Logistics and infrastructure space! FY 2020 saw warehouses occupying 265 million sq ft likely to go up to 483 million square feet by 2026 in cities including Ahmedabad, Bangalore, Chennai, Mumbai, Delhi and Pune. What this means is that with more world-class roads, high-speed high-capacity rails and airports, and increased buying power, we shall need more storage and processing space! Again, a sign of ache din!
- Heavy investment in infrastructure to continue! India shall be the 3rd largest construction market in 2022 which may see an investment of USD 750 billion plus in infrastructure to sustain our long- term development. With a CAGR of approximately 7% and projects like Housing for all’ and ‘Smart Cities Mission’, it can be expected that industry continue to grow at a steady pace while also helping sister core-sectors like steel, cement, petroleum and manpower. The budget itself has provisioned for 20000 kms of road. Add to that grants and assistance form multilateral agencies. Together, this is one sector that shall drive growth of all others. This does not include the existing and planned expenditure on railways networks and road. Cities like Pune are also getting their share with metro networks and a ring road.
From the above it is clear that “acche din” is not simply a slogan. It has meaning to it, and if it turns real will make a lot of Indians very happy.