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Wednesday, Sep 13, 2006

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Delhi witnesses big realty growth: Survey

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60,000 sq ft of space was transacted in Q2

High value
Rental values in Central Business District increased by 10 pc due to restricted supply.
Prices at residential areas such as Prithviraj Road, Greater Kailash and Golf Links rose by 20 pc.
Noida and Gurgaon will continue to see the highest levels of activity in the future.

New Delhi , Sept. 12

Owing to the recent decision by the Securities and Exchange Board of India to approve the guidelines for Real Estate Mutual Funds (REMF), Delhi is experiencing an unprecedented growth in the realty sector, says a survey conducted by Jones Lang LaSalle for Q2 of 2006.

According to the survey, in the commercial area in Q2, approximately 60,000 sq ft of space was transacted in the Delhi NCR region.

The quoted rental values in the Central Business District (CBD) also increased by 10 per cent due to restricted supply, while the rentals in the suburbs have been stable and in the range of Rs 40-50 per sq ft per month.

Big projects

The retail sector too is evolving at a very rapid pace. The appreciation of quoted and transacted rental values witnessed in the first quarter of the year, continued in this quarter as well.

This quarter also witnessed the start of operations such as the 15 lakh sq ft Great India Place by Unitech that will be a part of the Entertainment City. The 1.8 million sq ft Ambi Mall by Ambience Infrastructure is also another big project on the roll.

Though no new projects in the premium residential segment were started in Q2, the rental values of residential areas such as Prithviraj Road, Greater Kailash and Golf Links rose by 20 per cent over the previous quarter that witnessed an appreciation in rental value of 10 per cent.

High Rental values

According to the study, future predictions for the realty sector in Delhi suggest that given low vacancy levels and no scope for expansion, the CBD rental values are expected to continue to rise over the medium term.

Noida and Gurgaon will continue to see the highest levels of activity in the future. The retail sector, which is growing at a rate faster than the country's GDP, is expected to continue the trend in the next five-10 years with rentals also expected to continue to increase.

While, the residential sector will keep witnessing growth owing to the growth in the IT/ITES sector, rental values in the premium areas such as Golf Links will also be on the rise.

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