3. CITY WISE COMMERCIAL PROPERTY MARKET REPORT CITY NAME QUARTERLY TOTAL GRADE A OFFICE SPACE SUPPLY ( IN MILLION SQ.FT.) MAJOR SUPPLY OF SPACE CATEGORY Q 1 Q 2 Q 3 Q 1 Q 2 Q 3 MUMBAI 7.5 8 9 OFFICE SPACE GRADE A OFFICE SPACE GRADE A OFFICE SPACE GRADE A DELHI & NOIDA 4.5 5.6 5.5 MULTI-TENANTED GRADE A GRADE A IT & OFFICE SPACE GRADE A IT-ITES OFFICE SPACE BANGALORE 4 4.2 4 OFFICE SPACE GRADE A GRADE A IT-ITES, SEZ, OFFICE SPACE IT ITES OFFICE SPACE GRADE A KOLKATA 5 4 4.7 OFFICE SPACE GRADE A OFFICE SPACE GRADE A GRADE A IT & OFFICE SPACE
4. MUMBAI RENTAL VALUES & TRENDS - 2009 CITY NAME SUB-MARKETS AVERAGE QUARTERLY RENTALS ( IN RS. PER SQ.FT. PER MONTH) VIS A VIS VACANCY LEVEL ( IN %AGE) GRADE A RENTAL TRENDS ( YoY) Q1-GRADE A Q1- GRADE B Q2-GRADE A Q2- GRADE B Q3-GRADE A Q3- GRADE B Q1 (Q1. 08- Q1. 09) Q2 (Q2. 08- Q2. 09) Q3 (Q3. 08-Q3. 09) MUMBAI CBD AREAS 325/ 15% 225/ 15% 287/ 17% 170/ 18% 287/ 25% 175/ 25% (-) 32% (-) 39% (-) 37% ANDHERI EAST 148/ 20% 80/ 20% 125/ 15% 77/ 15% 116/ 20% 85/ 20% (-) 28% (-) 38% (-) 39% BANDRA KURLA COMPLEX 275/ 20% 187/ 20% 239/ 10% 182/ 10% 240/ 25% 190/ 25% (-) 39% (-) 47% (-) 41% LOWER PAREL 167/ NA 120/ NA 170/ NA 120/ NA 187/ 22% 122/ 20% (-) 48% (-) 51% (-) 34% MALAD 80/ 30% 70/ 30% 70/ NA 60/ NA 70/ NA 60/ NA (-) 11% (-) 25% (-) 48% NAVI MUMBAI 65/ 30% 33/ 30% 68/ 40% 40/ 40% 66/ NA 45/ NA (-) 24% (-) 25% (-) 14% POWAI 98/ 30% 35/ 30% 115/ NA 83/ NA 115/ NA 86/ NA (-) 24% (-) 8% (-) 16% WORLI 270/ NA 212/ NA 200/ NA 152/ NA 200/ 7% 152/ 7% (-) 30% (-) 47% (-) 47% GOREGAON/ JVLR 140/ NA 90/ NA 110/ NA 83/ NA 110/ NA 82/ NA (-) 30% (-) 27% (-) 41% KALINA 239/ 20% 187/ 20% 186/ 10% 150/ 10% 190/ 25% 150/ 25% (-) 32% (-) 46% (-) 39% CITY’S SUBMARKETS The major business locations in Mumbai are the CBD (Nariman Point, Fort and Ballard Estate), Central Mumbai (Worli, Lower Parel and Parel), Bandra Kurla Complex (BKC) and Andheri Kurla stretch. Powai, Malad and Vashi are the preferred IT/ITES destinations, while Airoli at Navi Mumbai and Lal Bahadur Shastri Marg are emerging as new office and IT/ITES sub-markets.
5. DELHI & NOIDA RENTAL VALUES & TRENDS- 2009 CITY NAME SUB-MARKETS AVERAGE QUARTERLY RENTALS ( IN RS. PER SQ.FT. PER MONTH) VIS A VIS VACANCY LEVEL ( IN %AGE) GRADE A RENTAL TRENDS ( YoY) Q1-GRADE A Q1-GRADE B Q2-GRADE A Q2-GRADE B Q3-GRADE A Q3-GRADE B Q1 (Q1. 08- Q1. 09) Q2 (Q2. 08- Q2. 09) Q3 (Q3. 08- Q3. 09) DELHI & NOIDA NEHRU PLACE 215/ NA 92/ NA 182/ NA 87/ NA 168/ 12% 75/ 14% (-) 23% (-) 41% (-) 44% CONNAUGHT PLACE 330/ 9% 152/ 9% 300/ 7% 130/ 8% 266/ NA 130/ NA (-) 13% (-) 33% (-) 37% NOIDA 66/ 25% 40/ 30% 90/ 25% 62/ 30% 110/ 30% 60/ 30% (-) 39% (-) 28% (-) 5% JASOLA 122/ 35% NA 115/ 0% NA 105/ 50% NA NA (-) 47% (-) 46% SAKET 165/ 30% NA 175/ 35% NA 165/ 27% NA NA (-) 40% (-) 41% CITY’S SUBMARKETS The commercial areas in New Delhi metropolitan area can be broadly classified into the CBD (Connaught Place), SBD Nehru Place, Bhikaji Cama Place Jasola & Saket and the PBD refers to Gurgaon & Noida. Greater Noida is also emerging as a new destination for office space.
6. BANGALORE RENTAL VALUES & TRENDS- 2009 CITY NAME SUB-MARKETS AVERAGE QUARTERLY RENTALS ( IN RS. PER SQ.FT. PER MONTH) VIS A VIS VACANCY LEVEL ( IN %AGE) GRADE A RENTAL TRENDS ( YoY) Q1-GRADE A Q1-GRADE B Q2-GRADE A Q2-GRADE B Q3-GRADE A Q3-GRADE B Q1 (Q1. 08- Q1. 09) Q2 (Q2. 08- Q2. 09) Q3 (Q3. 08- Q3. 09) BANGALORE CBD 85/ 40% 70/ 35% 70/ NA 65/ NA 70/ 82% 65/ 80% 0% (-) 17% (-) 20% HOUSUR ROAD 25/ NA 22/ NA 22/ NA 20/ NA 20/ NA 20/ NA (+) 4% (-) 8% (-) 20% EPIP ZONE/ WHITEFIELD 28/ 30% 25/ 30% 22/ 70% 20/ 70% 22 20/ 90% (-) 4% (-) 24% (-) 27% CITY’S SUBMARKETS Prime office properties in Bangalore are located in the CBD, the SBD and PBD comprising Whitefield, Electronic City & Outer Ring Road (ORR). Currently, North Bangalore is emerging as the city’s new major micro market.
7. KOLKATA RENTAL VALUES & TRENDS- 2009 CITY NAME SUB-MARKETS AVERAGE QUARTERLY RENTALS ( IN RS. PER SQ.FT. PER MONTH) VIS A VIS VACANCY LEVEL ( IN %AGE) GRADE A RENTAL TRENDS ( YoY) Q1-GRADE A Q1-GRADE B Q2-GRADE A Q2-GRADE B Q3-GRADE A Q3-GRADE B Q1 (Q1. 08- Q1. 09) Q2 (Q2. 08- Q2. 09) Q3 (Q3. 08- Q3. 09) KOLKATA PBD 55/ 70% 40/ 70% 35/ 60% NA 32/ 65% NA (-) 22% (-) 26% (-) 27% CBD 120/ 9% 85/ 12% 87/ 10% 74/ 12% 95/ 15% 72/ 15% (-) 14% (-) 38% (-) 29% BALLYGUNGE CIRCULAR ROAD 105/ 30% 80/ 30% 95/ 32% NA 95/ 35% NA (-) 9% (-) 24% (-) 14% CITY’S SUBMARKETS The major business locations in Kolkata are CBD (Park Street, Camac Street, AJC Bose Road), Ballygunge circular Rd, East Kolkata and PBD (New Town & Rajarhat). The area around Park Street, Camac Street and AJC Bose road houses a number of highrises commercial buildings such as Chatterjee International Centre, Tata Centre, Everest House and Industry House among others.
8. Commercial Office Space Growth drivers • The IT/ITES sector registered an 18 per cent growth in 2008–2009 • Significant growth in FDI. Market structure • Dominated by a few large national developers with a pan-India presence. • Regional players are expanding to achieve an all-India presence. • Shift in the type of operations from sale model to lease and maintenance model. Segmentation • Commercial space can be classified broadly into grade A and B. • Business activity shifting from Central Business District (CBD) to Special Business District (SBD) and from tier I to tier II and III. Outlook • Commercial market expected to grow at a Compound Annual Growth Rate (CAGR) of 20 per cent to 22 per cent over the next five years. • IT/ITES sector expected to require 150 million Sq. ft. of commercial office space by 2010.
9. Retail Space Growth drivers • Rising consumerism with doubling of disposable income. • Growth in organized retailing • Entry of international retailers Market structure • Dominated by unorganized retail • Large corporate houses entering the organised retail sector. • International retail brands are tying up with Indian partners. Segmentation • Contribution of organized retail to the retail industry grew from two per cent in 2003 to four to five per cent in 2007. Now, it’s 5-6 percent. • International retailers are present through the franchisee route. Outlook • Government is exploring the possibility of a relaxation in FDI norms. • Organized retail expected to grow at a CAGR of 19 per cent over the next five years • Share of organized retail in terms of sales expected to reach 5.6 per cent by 2010. • By 2010, 220 million sq.ft. of new retail space will be required. • Number of malls in India is expected to increase from 105 in 2006 to 600 in 2010.
10. Demand Pull and Supply Push Factors Demand pull factors Supply push factors Sustained macro-economic growth. Policy and regulatory reforms (100 per cent FDI relaxation). Upsurge in industrial and business activities, especially, new economy sectors. Positive outlook of global investors. Favourable demographic parameters. Fiscal incentives to developers. Significant rise in consumerism. Simplification of urban development guidelines. Rapid urbanization. Infrastructure support and development initiatives by the government. Availability of a range of financing options at affordable interest rates. Impact Impact Increasing occupier base. Significant rise in demand for office/industrial space. Demand for newer avenues for entertainment, leisure and shopping. Creation of demand for new housing. Entry of a number of domestic and foreign players -increasing competition and consumer affordability. Easy access to project financing options. Increases developers‘ risk appetite and allows large scale development. Improved quality of real estate assets. Development of new urban areas and effective utilization of prime land parcels in large cities .
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13. START UP FUNDING TOTAL START-UP EXPENSES ( IN INR) ONE TIME OFFICE SET-UP, LEGAL, LICENCING, PROPERTY ACQUISITION AND OTHERS:- OWN OFFICE SET UP COSTS:- PROPERTY ACQUISITION FOR RENT:- TOTAL START-UP FUNDING :- 1,50,000 10,13,00,000 _ 10,14,50,000 =========== OVERHEAD OPERATIONAL COSTS:- ( P.A.) YEARLY RENT:- CONSIDERING 500 SQ.FT. :- 2,00,000 STAFF SALARY:- SALES MANAGERS- 2,00,000 HR & ADMIN STAFF- 1,50,000 MAINTENANCE STAFF 50,000 4,00,000 OTHER SEMI-FIXED OVERHEAD COSTS:- ELECTRICITY CHARGES:- 1,20,000 TELEPHONE BILL:- 40,000 OFFICE MAINTENANCE:- 50,000 2,10,000 MARKETING COSTS:- ONLINE ADVERTISEMENT:- 35,000 PRINT ADVERTISEMENT:- 1,00,000 TOTAL YEARLY OPERATING COST:- 1,35,000 --------------- 9,45,000 ========