Mumbai: Residential demand increases in eastern suburb
Jul 07, 2014
Source : The Times of India

 

MUMBAI: The hitherto low-profile eastern suburb of Mumbai, starting from Kurla to Thane on the Lal Bahadur Shastri Marg, is fast becoming the next commercial hub of the city with tiny office complexes and new-age retail destinations, giving tough competition to its southern and western counterparts such as Nariman Point, Worli-Lower Parel and Bandra-Kurla Complex, among others.

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Reason, eastern suburbs are enjoying the maximum infrastructure development in the recent years and a few other projects are making the suburbs glitter more and a lot of investors who are keen to investing in the area are going for the investments as they find value propositions in the same.

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Earlier, the area was considered as an unorganised industrial zone but with the rapid infrastructural development, the areas of Bhandup, Kanjurmarg, Ghatkopar, Vidyavihar and Chembur, Mulund, have undergone noticeable changes. A Kalpataru spokesperson talking about the development said, “With the availability of land, these places have become the hotspot for residential markets. Major infrastructural projects like the Eastern Express Highway and the Eastern Freeway, have made it easy to connect with the rest of Mumbai, while the Mumbai metro rail and monorail projects, will further boost connectivity. These fac tors have boosted the residential and commercial market in the eastern suburbs.“

Venkatesh Gopalkrishnan EVP and CIO, Shapoorji Pallonji Real Estate, says, “The construction of the Eastern Freeway has drastically reduced the commuting time between the commercial hub of south Mumbai and central suburbs. The recently opened Santacruz-Chembur Link Road has connected these locations directly to the western suburbs and the monorail has increased the connectivity within the central suburbs. This has definitely led to a spurt in the real estate demand in these areas thereby, leading to a rise in the construction and subsequently, the pricing.“

It was the Mumbai Development Plan of 1991 which was instrumental in bringing about key infrastructure projects for decongesting the city center and promoting a transit-oriented development pattern. Consequently, the city’s eastern suburbs had benefitted immensely from these policy measures. Areas that had once been characterised by unorganised development and industrial zones, underwent a noticeable transformation. It also proposed the creation of commercial centres in micro-markets such as Kanjurmarg along with the Bandra-Kurla Complex and Oshiwara in the western suburbs.

Commenting on the recent residential developments, Hariprakash Pandey , VP-Finance and Investor Relations, HDIL, says, “Infrastructure projects have clearly changed the real estate outlook for the area. Suburbs like Mulund, Nahur and Bhandup have witnessed massive infrastructure growth in the last few years. These stations are well-connected through railways and share easy connectivity to Mumbai, Thane and Navi Mumbai. The region is well-connected to other western and eastern suburbs through major roads such as LBS Marg and the Eastern Express Highway .“

To cater to the requirement of the growing population, these suburbs have witnessed a growth in quality educational institutes, medical care, retail development and other so cial infrastructure. The region also saw an enhanced demand from developers for redevelopment activities but among the various suburbs, according to real estate consultants, Bhandup and Chembur have witnessed rapid increase in demand for housing.

Good connectivity, improved lifestyle and rapidly changing infrastructure with various retail malls, lifestyle shopping centers, multiplexes, private schools, colleges, banks, hospitals, football clubs and parks, make the area a well-equipped living destination. Nahur station has been a catalyst in Bhandup’s development, catering to the needs of those living in Bhandup east, as well as those near the Airoli Link road. The LBS Marg stretch is rapidly developing as a mixeduse real estate destination. As the road is a link to the eastern suburbs, any real estate development along this stretch would also have an impact on Mulund, Kanjurmarg, Vikhroli and Ghatkopar.

Also, it has been seen that real estate development along the Eastern Freeway increased significantly over the last few years. Due to the reduced commuting time to south Mumbai, demand for commercial and residential properties went up and housing prices in locations such as Chembur and Ghatkopar increased by approximately 28-30 per cent over the last two years.

After 2003, the only region that saw rapid growth is the eastern suburbs because of the land availability and cheaper property prices. In 2003, the average property price in the eastern suburbs was less than Rs 2,000 a sq ft, while the western suburbs fetched Rs 3,000 a sq ft.

Manju Yagnik, vicechairperson, Nahar Group, says, “The areas of Bhandup, Kanjurmarg, Vidyavihar, Chembur and Powai, were not considered as residential real estate zones until a few years ago. These areas were considered downmarket areas with limited amenities a decade ago. However, the development alongside the LBS Marg gave the first boost to the real estate development in these areas, resulting into the arrival of prominent developers to create world-class housing stock in these areas.“

Though home prices in this belt have nearly doubled in the last four years, they are still 30 per cent lower than those in their western counterparts, property experts emphasise. Since many suburbs such as Powai, Bhandup, Mulund, Thane and others, have come up very fast, it makes sense for companies to set up offices there.

This belt is also becoming a destination for firms that want to move from BKC and Nariman Point for lower rentals. The housing supply in this area has been growing at an approximate rate of 10 per cent for the last four years, and it now accounts for approximately 18 per cent of Mumbai’s total housing stock. With growing residential activity, retailer interest in the market has understandably increased too, leading to the development of large-scale organised retail in the region.

Saugata Maitra, national director strategic consulting, JLL India comments, “It is an established fact that scheduled infrastructure projects tend to increase the value of properties in the adjoining areas. This occurs because the infrastructure project becomes a part of the USP for the developers or property owners. There have been instances where property prices have increased 50-70 per cent from the announcement of an infrastructure initiative until the operational phase.“

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