DELHI: Delhi NCR’s property market is all set to regain its lost momentum with the revival in the economy. Private and public sectors are leaving no stone unturned to capitalise on the inherent capabilities of the real estate and infrastructure sector to drive growth and to deliver. Recently, three new cities were included in the NCR: Bhiwani and Mahendragarh of Haryana district and Bharatpur from Rajasthan.
In this regard, the private public partnership (PPP) model is increasingly being supported by the government to boost the infrastructural activities in the NCR. This cumulative growth strategy involving contributions from public and private sector are expected to revamp the city’s environs. It took the country’s best realty players to shape up the NCR. Ansal Housing, DLF, Jaypee, Supertech, Amrapali Groups, Ajnara India, Emaar MGF are amongst the elite players that have shaped up the entire NCR with their multiple projects.
The impact of the subdued economic sentiment, the rising inflation rate in the realty market and the attractiveness of a city’s business environment can largely be gauged by evaluating the health of commercial realty in that city. The popularity of NCR as an investment destination can be determined by the emergence of Connaught Place as the fourth costliest commercial office market in the world.
Rental values in Central Business District (CBD) rose by over 20 per cent in one year primarily due to lack of availability of quality space and no new supply with prevailing demand. Commercial activity, apart from Delhi CBD, is mainly concentrated in the prominent locations of Gurgaon and Noida. Gurgaon enjoys precedence as a choice of business destination above the cheaper market of Noida.
The total supply of Grade A commercial spaces in the NCR last year was approximately 5.5 million square feet (msf), while supply was recorded at 1.28 msf in the first quarter of 2013. Though the vacancy levels have increased to 24.3 per cent, there is an increase in the average rental values by 8-10 per cent. Rental values are expected to remain stable this year due to increased vacancy.
Ashok Gupta, MD, Ajnara India Ltd, a major developer based in NCR says,”it is advised to invest in office or commercial spaces as the rental value is higher than in the residential real estate market. Even the capital appreciation is better. The only thing to be kept in mind is the time of investment. Properties in the construction phase are the safest deals as there is no tenant tension.”
The new and upcoming growth corridors along Gurgaon and Noida such as Yamuna Expressway, Noida Expressway and Dwarka Expressway have recorded increase in the commercial and residential activity in the past few months and will continue to drive the commercial market activity.
Faridabad-Noida-Gurgaon (FNG) Expressway, Southern Peripheral Road and the Kundli-Manesar-Palwal Expressway are other major corridors that are witnessing commercial development and their popularity is likely to accelerate with time. Amenities, travel time to commercial districts, connectivity to various parts of the city and quality of public transport and infrastructure are the decisive factors affecting capital values of the residential realty market.
The residential markets of South-East Delhi, South-Central Delhi and Gurgaon have witnessed capital appreciation in the range of 14-29 per cent in a year. The rent is mostly stable across all markets as compared to the last quarter. Though the residential sector has witnessed a cautious buyer sentiment in the last year, the situation is expected to improve this year with the suburban markets seeing good activity.