JOIN USCommercial sector yet to recover fully post-2007
According to Sachin Sandhir, MD & Country Head, RICS India, “The year 2010 saw a tremendous turnaround in fortunes with the residential sector spearheading market recovery. As anticipated, developer focus has shifted back on luxury and premium housing space.
Speculative demand is now as high as 50-60% compared to generally acceptable 30% level, thereby fuelling unprecedented price hikes. This has invariably resulted in oversupply with close to 250 million sq ft of pan India housing inventory pile-up. It is somewhat inevitable that we will see some levels of price rationalisation during the first half of 2011, though corrections may not be as sharp as in the previous downturn.”
He adds, “commercial property on the other hand is yet to fully recover from the slump in market conditions since late 2007.
“However, with a positive macroeconomic outlook for 2011 greater semblance is expected within this segment during 2H 2011. We are already witnessing improvements with oversupply on a pan-India basis pegged at just 6% as compared to the previous 11% and 25% during the earlier parts of 2010 and late 2009.”
Bounces back from slump of 2009
According to CMD, Prestige Group, Irfan Razack, “The year 2010 saw the real estate sector bounce back following the slump in 2009.
This year witnessed an exciting and recovering economy where demand in the luxury market witnessed a distinct come back as well as a significant increase in commercial leasing.
Mall leasing also increased with regular and luxury malls doing steady business along with the hospitality business picking up in a big way.
With the generation of more jobs, residential realty demand is only set to further increase. Within Bangalore, the southern part of the city will continue to grow, especially Jayanagar, Bannerghatta and Kanakapura Road.
Whitefield is fast developing into a satellite hub to the city and will soon become a self-sustained area, especially now, with an elaborate social infrastructure in place with prominent malls in the area.
North Bangalore will take some time to gather momentum and keep pace with other parts of the city that are witnessing rapid growth.
On the infrastructure front, I don’t think Bangalore saw any significant change in 2010.”
DHNS