2019: Devanahalli: An emerging upcoming suburb expected to change the game for builders such as hira

2019: Devanahalli: An emerging upcoming suburb expected to change the game for builders such as hiranandani group

Introduction • India’s real estate market has grown at a slow rate over the past decade.

• The 2017-18 saw signs of gradual comeback.

• The impact from RERA towards affordable housing and smart city missions, GST and the Benami Transactions Act have made India an investor-friendly destination for real estate.

• With various new projects in Chennai and Bangalore, these are the eye-catching cities to look at in 2019.

The Year 2019 • The year 2019 is regarded to be an ideal year to get hold of the desired dream home. • Characterised by abundant supply, crawling demand and rock bottom real estate prices, make this an ideal time fo r home-hunters to look out for upcoming projects by buil ders such as the hiranandani group. • The overall real estate market is facing liquidity crisis, but the commercial real estate space is the rising star asset class.

Trends that are expected to shape the propert y market in 2019 • • • •

Spurt in office demand Co-working culture Market size and absorption Co-living spaces

Spurt in office demand Renewed interest from banking tenants, expansion of technology companies and initiatives such as “Make in India� have created a thriving start-up culture in the country.

Co-working culture • The thriving start-up ecosystem has contributed immensely towards the co-working culture since past few years. • Bangalore is one of the largest markets for flexible space leasing, and this new business model has created demand for new apartments in Bangalore.

Market size and absorption • Emerging Indian cities such as Bangalore, Chennai, Hyderabad and Pune have negligible vacancy rates.

• Emerging suburbs such as Devanahalli has enabled Bangalore to lead the occupancy pack.

• The locality is an upcoming industrial and technology hub, is in close proximity to the International airport and provides a comfortable commute and transport and connectivity.

• These factors have created demand for new houses, flats and apartments in devanahalli.

Co-living spaces • The renting philosophy is based on “sharing the air”.

• The renters share the living spaces, kitchen and balconies along with the rent as a working community.

• Relating to the above point of market size and absorpt ion, this trend has led to announcements being made f or various upcoming new projects in Chennai.

Outlook for 2019 • The commercial real estate asset class is expected to witn ess lower vacancies and higher rental yields in 2019-20. • The liquidity crisis is not likely to show much turnaround until at least the first half of 2019. • With a long-term horizon of at least 5 years, investing in residential real estate projects, such as those from the hiranandani group would provide higher potential returns.

Takeaway In light of the aforementioned trends, one can reasonably e xpect a positive momentum going ahead for the real estate market, whether residential, commercial or an investment point of view.