CHENNAI: The residential real estate sector in Chennai is expected to see a completion of more than 16,000 residential units across all categories in 2014, as against 13,000 units launched during 2013.
The high-end properties would see a revival in demand during the year, according to Cushman and Wakefield (C&W).
Currently, more than 16,000 residential units across all categories are expected to be see completion in 2014 which will infuse more ready-to-occupy stock in the market, it said.
In 2013, Chennai witnessed more than 13,000 new residential unit launches, which is a decline of 38 per cent compared with 2012 and this was due to availability of ready-to-occupy residential products in many micro markets like Rajiv Gandhi Salai, Grand Southern Trunk Road and some parts of North Chennai, it said.
"The residential property market would witness a revival in demand for high-end properties, as changing customer preferences for customised houses with better amenities is a new trend being witnessed in the market," it said.
In 2013, there was approximately 60 per cent year-over-year dip in the number of luxury launches.
Nearly 300 units in the high-end or luxury category are currently in the soft launch stages and are expected to be launched this year in locations like Nungambakkam, Kotturpuram, RA Puram, Poes Garden and Mylapore.
Nearly 900 units in the mid-end category are in a pre-launch stage and would be launched this year in locations like Rajiv Gandhi Salai-II, RA Puram and Sriperumbudur.
In terms of challenges, it added the changing regulatory scenario and political upheaval due to the upcoming general elections may lead to demand slowdown in the short term.
However the situation is expected to improve after the first quarter of 2014.
Meanwhile, on the commercial space, in 2014, nearly 2.2 million sft new office supply is expected to be infused in some of the sub-urban parts of the city among others.
Almost 1 million sft of this upcoming supply would be dedicated to IT and ITeS sector, followed by 5 lakh sft commercial spaces and the remainder in special economic zones for IT and ITeS.
However, the asking rentals may increase in the above locations due to buoyant demand from occupiers for these locations, said Cushman and Wakefield.
In 2013, the overall net absorption of office space decreased 25 per cent on a yearly basis. IT companies have relocated and consolidated from Central Business District to Peripheral and suburban submarkets with more leasing activity in those locations. This has resulted in decline in net absorption levels, which were recorded at 3.1 million sft for the ye
A total of 3.4 million sf new office space became available in the market during 2013, down 27 per cent on a yearly basis, it added.