Category: Real Estate

Budget 2024: Pradhan Mantri Awas Yojana Urban 2.0 unveiled

No Comments

Finance Minister Nirmala Sitharaman on Tuesday announced the second phase of the Pradhan Mantri Awas Yojana (PMAY) Urban – a housing-for-all scheme – covering one crore middle and lower–middle class segments in cities. The scheme, PMAY Urban 2.0, has a proposed investment of ₹10 lakh crore and a “central assistance” — credit-linked interest subsidy of ₹2.2 lakh crore.

The housing needs of one crore urban poor and middle-class families will be addressed with an investment of ₹10 lakh crore.

“Under the PM Awas Yojana Urban 2.0, the housing needs of 1 crore urban poor and middle-class families will be addressed with an investment of ₹10 lakh crore. This will include a central assistance of ₹2.2 lakh crore in the next five years. A provision for interest subsidy to facilitate loans at affordable rates is also envisaged,” the Budget document reads.

Launched in 2015, the PMAY aims to set up homes in both rural and urban areas, with a credit-linked interest subsidy component supporting the middle and lower-middle class. The financial assistance scheme was divided into two components – one targeting the urban populace, and the second targeting the rural.

“….enabling policies and regulations for efficient and transparent rental housing markets with enhanced availability will also be put in place,” FM Sitharaman said in her Budget speech.

One of the first Cabinet decisions that the Modi 3.0 government took after coming to power was announce the construction of 3 crore additional houses under the PMAY scheme. Of this, 2 crore homes would be under the PMAY (Grameen) scheme in the rural areas.

The interim Budget tabled in February allocated ₹80,671 crore for the PMAY.

In 2023-24, the Budget Estimates under PMAY (Urban) were pegged at ₹25,103.03 crore, against actual spending of ₹22,103.03 crore. The allocation for FY25, Budget Estimate is pegged at ₹30,170 crore, up 20 per cent over last year’s BE.

In case of the PMAY (Rural), the BE for FY24 was ₹54,487 crore, against actuals at ₹32,000 crore and an additional ₹12,000 crore transferred from the Agriculture Infrastructure and Development Fund. The BE for FY25 was ₹54,500 crore – at similar levels as last year’s BE.

According to Dhruv Dhruv Agarwala, Group CEO, Housing.com & PropTiger.com, there is a distinct push towards promoting homeownership by encouraging states to reduce stamp duty rates, particularly for women.

“This could significantly reduce the cost of property acquisition in India where stamp duty rates are one of the highest in the world,” he said, adding that an increase in standard deduction under the New Tax Regime and rationalisation of the tax structure could leave India’s salaried class with more disposable income, consequently boosting housing demand.

CapitaLand India Trust buys office building in Navi Mumbai for ₹676 crore

No Comments

CapitaLand India Trust (CLINT) has acquired a 8.2-lakh-sq-ft multi-tenanted IT non-SEZ office building at a business park in Navi Mumbai for ₹676 crore.

Building Q2 in Aurum Q Parc Business Park was completed in 2021 and has tenants such as Mizuho Bank, DP World, ICICI Bank, Axis Securities, John Cockerill, ideaForge Technology and Shriram Finance.

In addition to the purchase consideration another ₹30 crore will be paid as deferred consideration, subject to the achievement of pre-agreed business milestones by Aurum Ventures, the seller.

With the acquisition of Building Q2, CLINT’s entire portfolio has increased about 4 per cent to reach 2.2 crore sq ft. In Mumbai, CLINT now has one business park (comprising two buildings — Building Q1 and Building Q2), one logistics park (Arshiya Panvel comprising seven operating warehouses), and one data centre under development (CapitaLand Data Centre Navi Mumbai 1).

Purchase agreement

Building Q2 is the second of two buildings that CLINT has acquired through a forward purchase agreement with Aurum Ventures, announced in 2018. The acquisition of Building Q1, an IT SEZ building, was completed in 2021 and has a committed occupancy of 94 per cent. Collectively, Building Q1 and Building Q2 add a total of 14.7 lakh sq ft to CLINT’s portfolio.

“We have seen strong leasing interest and rental growth in Building Q2 due to demand from multinational companies seeking a convenient base, as Aurum Q Parc is in close proximity to transport networks such as Ghansoli railway station and the upcoming international airport in Navi Mumbai,” said Sanjeev Dasgupta, Chief Executive Officer of CapitaLand India Trust.

Singapore-listed CLINT’s principal objective is to own income-producing real estate used primarily as business space in India.

Tamil Nadu launches instant online approval for building permits

No Comments

The Tamil Nadu government on Monday introduced a new scheme offering instant online approval for building permits for houses built on plots up to 2,500 sq ft, with a maximum construction area of 3,500 sq ft. Applications can be submitted online.

The real estate industry welcomed the State government’s initiative noting that it would help the middle class and promote increased house construction. However, its success will depend on effective implementation.

Under the scheme, scrutiny, infrastructure and amenities fees are fully waived and a completion certificate is not required after construction, the government said.

A government release says that currently 72 per cent of building permission applications come from the village panchayats; 77 from town panchayats and 79 from municipalities and corporations.

These are processed by the concerned Local Bodies through Single Window System, the release added.

Anuj Puri, Chairman of ANAROCK Group said the Tamil Nadu government’s latest announcement of instant online approvals for building permits is a one-of-its-kind move and will pave the way for faster real estate approvals, thereby eliminating project delays and any malpractices.

Getting the necessary government approvals has always been one of the many challenges for builders and a major cause for project delays. By removing this major obstacle, the Tamil Nadu government is making it more convenient and conducive for the developers to operate. Moreover, project delays often lead to price escalations which are ultimately passed on to the homebuyers. Thus, this move will help prevent such price appreciation caused by delays and benefit the homebuyers, he told businessline.

New launches

The new launches in Chennai dropped by 29 per cent in Q2 2024 compared with Q1 2024 and saw a mere 3 per cent increase y-o-y, as per ANAROCK Research.

“With easier approvals we may see developers launching more new projects, thereby assisting in increasing new supply into the market. Currently, Chennai saw total of 10,530 units launched in H1 2024 – the second lowest among the top 7 cities after Kolkata,” he said.

Hanto Workspaces enters Pune and Hyderabad markets with major expansion

No Comments

Hanto Workspaces, a leading provider of managed commercial real estate solutions, has announced the launch of 200,000 square feet of workspace in Pune and Hyderabad. This significant move marks the company’s entry into these new markets, driven by organic demand from its existing customer base in Bangalore.

In addition to expanding  into Pune and Hyderabad, Hanto Workspaces is also broadening its footprint in Bangalore. The company is adding 100,000 square feet of premium workspace in response to the high demand for its meticulously designed spaces. With this addition, Hanto now manages a total of 200,000 square feet of premium workspaces in Bangalore alone.

“ The company’s growth has been fueled by a successful seed funding round in November 2023, where Hanto raised Rs 15 crore. This round was led by Anurag Jain, Founder of KredX, along with other angel investors, in a mix of equity and debt. These funds are being utilised to accelerate Hanto’s expansion into major cities across India, with a revenue target of over ₹700 crore by 2028,” the press statement by Hanto Workspaces added.

According to the company, despite its rapid expansion, it has maintained an impressive 90 per cent occupancy rate, even for its newly launched properties. The company’s ability to secure advance bookings for upcoming properties highlights the strong market trust and demand for its offerings. Hanto’s success is attributed to its close collaboration with clients, creating tailored solutions that simplify planning and establish Hanto as the preferred workspace partner.

Speaking about the expansion, Aashit Verma, Founder of Hanto Workspaces, said, “The organic demand for the managed workspace market is driven by customers seeking high-quality workspaces at value pricing. We provide customisation and flexibility in interior and services unmatched in the industry. This makes it easy for clients to easily shift from their traditional workspace solution to one that is managed by Hanto.”

ASK Property Fund invests ₹190 crore in Kalpataru’s Mumbai project

No Comments

ASK Property Fund, the real estate private equity arm of Blackstone-backed ASK Asset & Wealth Management Group, has invested ₹190 crore in a project being developed by Kalpataru in Mumbai. This is the fund’s second investment in the builder.

The upper mid-segment project comprises 310 units and is spread across 6 acres with a total saleable area of about 6.5 lakh square feet. The funds will be used for acquisition and working capital requirements of the project.

  • Also read: ASK Property Fund exits QVC Realty projects with 20% returns

“The redevelopment project is an exceptional investment opportunity, given its location within an established catchment area. Our growth capital is aimed at providing acquisition and necessary working capital funding,” said Chief Investment Officer Bhavin Jain.

“The catchment is primarily an end-user market and benefits from infrastructure augmentation in the last few years. The inventory overhang is low and strong demand in the micro market will help to achieve healthy and sustained sales velocity for the residential project being redeveloped,” he added.

As per ASK Property Fund Research, Borivali real estate offers substantial potential for property value appreciation. The market has experienced a significant increase in absorption over the past two years, with an 18-20 per cent increase in sales in 2023.

$3 billion of PE investments flow into real estate in H1 2024

No Comments

Private equity investments of $3 billion have been made in Indian real estate in the first half of 2024, an increase of 15 per cent on year from $2.6 billion year ago, a report by Knight Frank India said.

Warehousing sector accounted for largest share at 52 per cent of total PE investments in the period under review, followed by residential (29 per cent) and office (20 per cent). PE investments in the residential sector also saw a significant increase of over 3 times to $854 million.

There was shift in investor dynamics and sectoral preferences for private equity investments in Indian real estate sector, the report pointed out. The office sector, which has received the highest share of PE investments since 2018, was surpassed by the warehousing sector, which has become the most popular now, attracting more investments than the combined totals of the office, retail, and residential sectors.

On an overall basis Mumbai received the most investments at $1.7 billion from $1.24 billion year ago. Flows to the residential segment in the city was to the tune of $201 million.

Bengaluru received around a fifth of the total investments, at $581 million. Around 69 per cent of these investments were dedicated towards the residential sector. The remaining 31 per cent were invested in office sector.

“Indian commercial real estate continues to thrive due to factors like return to work, rising office absorption and strengthening rental values,” Knight Frank India CMD Shishir Baijal. “Similarly, a year on year strengthening of residential market and continued consumer activities in retail further bolstered by economic growth has incentivised funds to adopt a long-term perspective towards investment in real estate.”

Warehousing

Investments in the warehousing segment showed a significant upward trajectory in H1 2024, reaching $1.53 billion, a steep rise of 176 per cent on year, driven by a single deal that accounted for the bulk of it. Mumbai and Chennai were the primary beneficiaries, attracting $1.5 billion and $32.3 million respectively in the warehousing segment.

According to the report PE investors are actively engaged in the warehousing market, particularly targeting subsectors such as e-commerce, logistics, and third-party logistics facilities. “Warehousing sector is experiencing robust growth due to the burgeoning e-commerce industry and an increasing focus of the companies on supply chain optimisation,” Knight Frank said.

The inherent demand for warehousing due to growing consumerism and manufacturing coupled with supportive government policies and growing demand from various industries, make it a compelling proposition for PE investors, it added.

Altern Capital launches ₹250 crore real estate fund JIREF I

No Comments

Altern Capital has launched its maiden SEBI-approved Category II Alternative Investment Fund (AIF), JIRAAF AU INDIA REAL ESTATE FUND — I (JIREF I). The target size of this fund is ₹250 crore initially, with an additional greenshoe option of ₹100 crore.  

The strategic focus of JIREF I revolves around plotted development and last-mile funding in the real estate sector. It distinguishes itself by emphasizing reduced approval and execution risks, a departure from industry norms. The fund’s tenor is 4 years, shorter than the typical 6-year horizon, emphasizing early project completion, enhanced visibility, and dependable principal and returns for investors. 

Navin Dhanuka, Founder & CEO of Altern Capital, said, “ Our goal is to redefine real estate investment by ensuring tech-based stringent investment and post-investment monitoring and delivering exceptional risk-adjusted returns for our investors, and we believe our innovative approach will set new benchmarks in the industry,” said, Navin Dhanuka, Founder & CEO of Altern Capital. “ 

The fund is sponsored by AI Growth Private Limited, through its brands “JIRAAF & ALTGRAAF”.

 

Gigamon expands operations in Chennai with new office

No Comments

Gigamon, the US-based leader in deep observability, has opened a 76,767 sq ft office in the new Olympia Cyber Space building in Chennai. The new facility will become the second largest Gigamon office outside the company’s Santa Clara headquarters.

The new facility will serve as its second headquarters to meet the growing global demand for its Deep Observability Pipeline solution that delivers network-derived intelligence to cloud, security, and observability tools.

The new office is designed to serve up to 1,000 employees, says a release.

Since setting up a small R&D focussed office in Chennai in 2015, Gigamon has expanded its operations in the city to include engineering, sales, customer support, and HR functions.

The Gigamon Deep Observability Pipeline delivers network-derived intelligence to cloud, security, and observability tools, helping organisations eliminate security blind spots, optimise network traffic, and reduce tool costs to more efficiently and effectively secure and manage hybrid cloud infrastructure.

Shane Buckley, president and CEO, Gigamon, said with the fastest growing economy in the G20, the Chennai office would help the company capitalise on the growing demand for Deep Observability Pipeline solution in India, across the broader APAC region, and around the world, he said in a release.

Gigamon serves over 4,000 customers worldwide, including over 80 per cent of Fortune 100 enterprises, 9 of the 10 largest mobile network providers, and hundreds of government and educational organisations worldwide, the release said.

CBRE-CII Report: Realty boom in south with leasing increasing in Chennai, Bengaluru, Kochi, Hyderabad

No Comments

The real estate market in the South is geared for substantial growth, driven by increasing leasing activities in Chennai, Bengaluru, Kochi, and Hyderabad. Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said he attributed this growth to advancements across education, infrastructure, cost of living, and rental rates.

The first half of 2024 saw leasing in the southern region touch an estimated 57.3 per cent, significantly surpassing the 43.6 percent observed in the northern region, added Chandnani.

Bengaluru gears up

Further. CBRE along with the Confederation of Indian Industry (CII), released the ‘Karnataka Horizon: Navigating Real Estate Excellence in the South’ report which highlighted Bengaluru’s burgeoning office and retail sectors. By 2030, the office spaces in the city are expected to expand to 330-340 million sq. ft., which is assumed to be the largest in India.

The city has the highest office absorption rate with 15-16 million sq. ft, compared with other Indian cities. Technology, engineering & manufacturing, and BFSI sectors are expected to be the main demand drivers of office space. The retail space is also experiencing growth, having doubled since 2013, and now spans more than 16 million sq. ft., with projections for 20-30 million sq. ft. by 2030.

Fashion, entertainment, and food & beverage industries are driving the retail growth, supported by new malls, rising consumer awareness, and increased disposable income.

Infrastructural development

This boom is supported by a set of infrastructural developments, including ease of traffic congestion by introducing metro new lines — purple, blue, yellow, and pink — and improving airport access. Development efforts have also focused on the north, specifically the Hebbal-Bellary Road area. Additionally, initiatives to enhance regional connectivity such as the Bengaluru Business Corridor (BBC) and the Satellite Town Ring Road (STRR) were also discussed.

Beyond Bengaluru

The success of Bengaluru will trickle down to nearby emerging cities including Belagavi, Hubli-Dharwad, Mangaluru, Mysuru, Shivamogga, and Tumakuru, aided by initiatives such as the ‘Beyond Bengaluru’ programme, added Chandnani.

Cement volume growth expected to remain muted at 3% in Q1: ICRA

No Comments

Rating agency ICRA expects cement volume growth in the June quarter to remain muted at 2-3 per cent year-on-year due to a slowdown in construction activities because of the General Elections.

However, it is expected to bounce back and rise by a healthy 7-8 per cent in FY25, driven by healthy demand from the infrastructure and housing sectors.

The Government’s focus on infrastructure projects, the sanction of additional houses under the Pradhan Mantri Awas Yojana and industrial capex are expected to meaningfully improve cement volume offtake in the second half of this fiscal year.

  • Read: Goldman Sachs unveils new ratings for cement stocks: Ultratech, Shree, Ambuja, Dalmia, and ACC

Anupama Reddy, Vice President, ICRA said the operating income of companies analysed by ICRA is expected to increase 7-8 per cent YoY in FY25, primarily driven by volume growth.

While cement prices are projected to largely sustain at previous-year levels, some softening of cost-side pressures – primarily power and fuel costs along with an increasing focus on green power is likely to result in an about 3 per cent increase in OPBITDA to ₹975-1,000 per tonne.

The green power to account for 40-42 per cent of the total power mix by the end of this fiscal compared to about 35 per cent as of FY23. The major cement players in the country aim to reduce their emissions by 15-17 per cent over the next 8-10 years by increasing the share of blended cement, which uses less clinker and consequently less fuel, boosting the share of green power consumption through a mix of solar, wind and waste heat recovery system (WHRS) capacities.

  • Read:India’s cement industry goes ahead with expansion plans amidst elections

Of the overall capacity addition of 63-70 million tonne by FY26, about 33-35 million tonne will be added in this fiscal. The eastern and southern regions are forecast to lead the expansion. The capacity utilisation is expected to rise to 71 per cent in FY25 from 70 per cent in FY24, backed by higher cement volumes.

However, the utilisation remains moderate on an expanded base.

The market share of the top five cement companies witnessed a steep rise to 59 per cent as of March 2026 from 45 per cent as of March 2015.