When the real estate boom captured the Indian market between 2005 and 2006, expectations of investors from 2007 were even higher. Developers responded with frantic searches for land, announced mega townships and commercial buildings, and scouted for foreign partnerships in construction and funding. The assumption was: everybody’s rich; and properties can sell at any price.

          The Government and the genuine buyers proved the experts wrong, and builders found fewer visitors booking deals. Private equity players were willing to invest, foreign investment in real estate wasn’t a constraint, but the residential properties were not moving.

          Commercial properties, however, sustained the trend set in the preceding years, and retail began to push the demand for luxury malls and value malls. Industrial growth supported the sector, and business fostered visitors who needed hotel accommodation. The severe crunch in the hospitality sector has seen developers rush for foreign collaborations with established global brands in the high-end and the budget range hotels.

          But builders stuck with premium residential properties had to find a way out. Responding quickly to the situation, developers and property consultants concluded that though the demand for the properties was intact, it was the price that did not go down well with buyers.

          Reinventing their strategy, builders are going back to the mid-range property buyer, who can spare between Rs.30 lakh to Rs.60 lakh for a home. Picking up land from agriculturists on the periphery of Tier II and III cities, holy towns and holiday resorts, builders are undoing the damage by optimizing spaces with buyer friendly prices to keep the real estate market firmly on the ground.

• Lucknow – Ansal API will set up a world-class Medicity at Sushant Golf City, which will have a facility for 800 beds, and a medical college, dental college and a nursing college for undergraduate medical courses.

• Nasik – Indiabulls Real Estate and the Maharashtra Industrial Development Corporation are in a joint venture for the multi-product SEZ covering 1,214 hectares.

• Goa - rated the hottest residential and commercial property market by global property specialists David Stanley Redfern Ltd. All major builders from North and South India are pitching for a share of the lucrative property pie in this popular seaside town.

• Chandigarh - Knight Frank rates Chandigarh as the primus inter pares amongst emerging cities, ranking it high on infrastructure and business parameters.

          Nagpur follows, with property prices steadily rising against the tide of sliding prices. Goa and Kochi are third, with Visakhapatnam following close behind. Ahmedabad is in the top 5, graduating from manufacturing and trade to becoming an IT hub.

Spreading the Mall Magic

          Prepared for big-time growth, JLLM has devised a three-pronged formula to extend their services to Ahmedabad, Bhubaneswar, Jaipur, Lucknow, Ludhiana and Kochi, apart from Chandigarh and Coimbatore. The company is entering the mall management arena, and will introduce Jones Lang’s hotel division from the US, and service Jumeirah hotels of Dubai and Dusit Hotels from Thailand.

          US based Simon Global Ltd has been roped in by the Wadia Group to set up 8-10 luxury shopping malls across India in the next decade. A study by Merrill Lynch and Capgemini in 2006 revealed that 83,000 individuals in India have a net worth of a million dollar each, and the luxury market has the potential to grow at 20% per annum.

          Rentals at malls have doubled over the last year, especially in the NCR. 100 malls are expected to come up over the next year in the NCR, with 50 of these in Delhi, 35 in Gurgaon, 16 in Noida, and 20 in Faridabad and Ghaziabad. Malls are being increasingly used by offices in the NCR. Investors in Mumbai malls are getting good returns on their investments as they follow the lease model which gives landlords the opportunity to select their tenants. Pan-Indian players Unitech, Parsvnath and Omaxe are spreading their wings to smaller cities to establish shopping malls.

Savouring Indian Hospitality

          Ansal API has floated a Special Purpose Vehicle with Ambience Hospitality Management to build 30 hotels at various locations at a cost of Rs.2000 crore. The project encompasses golf resorts, clubs, spas and palace hotels apart from the regular business and leisure hotels and serviced apartments. Greater Noida, Mohali, Jaipur, Jodhpur, Amritsar, Lucknow, Ghaziabad figure in the list, as do some cities of south India.

          In another deal, The Metropolitan, Delhi, broke off with Japan’s Nikko Hotels International to tie up with Summit Hotels and Resorts, a division of the Preferred Hotel Group of Chicago. The Metropolitan will be extending its network to Bangalore, Hyderabad, Chennai, Kolkata and Mumbai

          The Marriott chain will entrench itself deeper in the Indian hospitality sector as it seeks to add 3,324 rooms by 2010 through 3 additional JW Marriott hotels and a Ritz-Carlton  in the luxury bracket, a Marriott Hotel and Resort and a Renaissance  in the deluxe  category, 1 Marriott Executive Apartment and 8 Marriott Courtyards in the mid-segment. Bangalore, Gurgaon, Hyderabad, Pune, Noida, Chennai, Mumbai and Kolkata will be the focus of their activity in the months to come.

          The Ascott Group from Singapore has strengthened its presence in India after acquiring its fourth property, the Citadines Chennai OMR Gateway. Emaar has already signed up with Premier Inn for 80 budget hotels. Accor of France is introducing its Formule 1 brand of budget hotels in the next decade. Lemon Tree is also planning a Rs.1000 crore investment in 12 Indian cities to add 1,700 hotel rooms to the market, while Taj Hotels has 7 Ginger hotels, its budget range, and 29 hotel projects in the pipeline.