The Hindu Business Line : Amrapali’s apartment complex

Delhi-based Amrapali group has launched Amrapali Empire on NH24 at Ghazaibad. Spread over 16,000 sq.mt, the complex offers two- and three-BHK apartments ranging from 1,000 sq.ft to 1,650 sq.ft. Prices start at Rs 22 lakh and go up to Rs 37 lakh. The project is to be completed within 27 months, according to a press release.

Facilities include full power back-up for essential functions, a club membership that includes access to swimming pool, gym, play school, community hall and round-the-clock water supply, security, fire-fighting facilities and lifts. Amrapali Group has launched four projects and sold more than 3,000 flats over the last four months in Delhi-NCR.

Apart from Amrapali Empire, the group is also setting up a project at Sector 70, Noida, a developed and well-connected location in NCR. The initial market response has been quite encouraging and the formal launch is eagerly awaited, says the release.

Demand for office space rises

Office space transactions have picked up in the second quarter of 2009 and the drop in rentals have slowed down in the major markets of Mumbai, Pune and Bangalore. But there is little cause for cheer for developers as huge supplies are in the offing and supply is bound to outpace demand. Mumbai’s commercial real estate has shown two positive signs during the quarter:

A slowdown in rental decline (rents are at around Rs 175 a sq.ft a month), and a revival in demand, according to the Asia-Pacific Property Digest brought out by international property consultants Jones Lang LaSalle Meghraj. But with a huge supply of commercial space expected by the year-end, rentals could face downward pressure.

Over a million sq.ft of leasing transactions were recorded and 80 per cent of the buildings under construction and are likely to be completed within six months.

These pre-leases are by “opportunistic occupiers” who are capitalising on lower rentals, as rentals in the third quarter of 2008 had declined by about a third, according to the report.

The net absorption in the city was about 1.70 lakh sq.ft in operational buildings in the central and secondary business districts. The average vacancy in the second quarter was 8 per cent, compared with 9 per cent in the previous quarter. No new projects were completed, but Mumbai city’s prime micro-market has a large supply pipeline of about 3.6 million sq.ft expected to hit the market in end-2009. If pre-leasing continues to be low, vacancy levels are bound to rise.

The property consultant anticipates an increase in vacancy and downward pressure on rentals in two to three quarters. Developers will have to be flexible in pricing to attract occupiers. Some commercial projects could be changed to residential projects.

In Pune, the secondary business districts of Kalyani Nagar, Hadapsar, Kharadi and Nagar Road on the eastern corridor and Aundh and Baner to the west are among the most active markets, says the report. The rental values are around Rs 35 a sq.ft a month.

The second quarter of 2009 has seen a resurgence in demand for office space. These areas accounted for about 2.7 lakh sq.ft of absorption out of the 5.50 lakh sq.ft of grade-A office space transactions.

This again is primarily due to opportunistic occupiers looking to bring down rental outgo, the report says.

Two major projects were completed in the second quarter of 2009, which accounted for about 4.30 lakh sq.ft of office space. There were no new supplies in the central business districts and the suburbs, says the report.

The market sentiment is that the rentals are approaching the bottom of the cycle. But with a supply pipeline of about 4.85 million sq.ft the next two quarters may see vacancies rise, says the report.

In Bangalore, net absorption of office space in the central and secondary business districts has grown to 1.63 million sq.ft in the second quarter of 2009 compared with 1.19 million sq.ft in the first quarter, says the report.

But vacancy rates increased to 11.4 per cent (10.6 per cent) mostly in the suburbs. In the central and secondary business districts, the vacancy was 2.9 per cent (2.4 per cent). The property consultant pegs the monthly rental value of grade-A office space at about Rs 48 a sq.ft.

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