Property News in Delhi NCR | Investment hotspots in Delhi are alive & robust
Historically, real estate has been amongst the preferred asset classes for investors in India. In recent years, the attractiveness of real estate as an asset class has been further augmented by the increasing demand for more and betterquality housing, additional office space requirement owing to expansion and consolidation by several corporates, and last but not the least, advent of modern retail formats, a report by real estate consultancy firm DTZ said.
It is no secret that investments in real estate have been one of the greatest wealth builders in history. With growth across major smaller cities slowly picking up, the report said there are yet emerging investment ‘hotspots’ in traditionally favourite real estate markets like the Delhi NCR. We would like to highlights the strengths and weaknesses of these destinations for our readers.
Over the years, a few micro markets in the Delhi NCR have emerged as destinations for future investments, which not only provide relative affordability but have also transformed majorly owing to infrastructural development and improving connectivity, with the potential to attract real estate demand across segments—residential, office and retail. Such destinations are likely to give better return on investments than those areas, which are already fully developed.
The satellite towns of Delhi like Gurgaon, commonly known as Millennium City and Noida-Greater Noida, are the growth engines of real estate development in the Delhi NCR and have given good returns in the last 20 years.
Gurgaon is home to 300 companies from the Fortune 500 list; consequently, it has thousands of white collared workers living here. In Gurgaon, the sub-micromarkets of Sohna Road, Dwarka Expressway, and the new sectors (Sector 76 to 95 along NH-8) are on track to become the future real estate hubs of the city, the report said.
A slew of forthcoming infrastructural projects, large availability of developable land, and comparatively lower property prices are some of the key attributes that make these locations potential investment destinations.
Sohna Road has developed into a self sustained ecosystem with a good mix of commercial, residential, and retail segments, DTZ said in its report. The area is well connected with NH-8 and Golf Course Extension Road. The alternative route to NH-8 via Southern Peripheral Road (SPR), under construction, will further boost its connectivity.
Sohna Road has upscale schools like GD Goenka World School and Pathways World School, and high-end healthcare facilities like Medanta Medicity and Artemis. This area has transformed from a low-profile suburb into a much sought after real estate investment hotspot, the report said.
The competitive advantage of Sohna Road is primarily fourfold:
– Demand for a wide range of residential and commercial premises at comparatively lower rates than established sectors of Gurgaon
– Proximity to established real estate hubs of the city
– Good connectivity and infrastructural development
– Lucrative financial returns in last four years, which exceed benchmarks of several established real estate hubs in the metropolis
According to the report, the area is good for end users. However, because of the good availability of residential units, one needs to remain invested for a longer period to reap handsome returns.
In the long run, several forthcoming universities and institutions in the area may bring in high rental income, thereby infusing capital appreciation, the report said. New residential projects are coming up in the adjoining areas of Sectors 33, 34, 48, and the sectors along Southern Peripheral Road and are a good investment option, as most of them are under construction offering potential for capital appreciation.
Also, this location has a huge opportunity for individuals to become landlords. There is an abundance of income-generating commercial assets, which can be bought at 6-8% yield, depending upon the quality of the lease and the building quality. However, the report cautioned that immense care needs to be taken during the documentation, so that a buyer does not end up with the wrong asset and putting his hard-earned reserves to risk.
Dwarka Expressway, also known as Northern Peripheral Road, is a new link connecting Dwarka with Gurgaon through an eight-lane (150-metre-wide) expressway starting from Dwarka in Delhi and connecting Palam Vihar, Gurgaon to join the NH-8.
It is one of the latest hotspots for home seekers and potential investors, the report said. Its proximity to the capital city and the IGI airport gives it an edge over other forthcoming real estate destinations like Dharuhera, Bhiwadi, Yamuna Expressway, and Noida-Greater Noida Expressway, the DTZ report said.
The competitive advantage of Dwarka Expressway is primarily fourfold:
– Good connectivity with Gurgaon and Delhi
– Proximity to the IGI airport
– Better infrastructural development expected
– Better-quality residential units at lesser cost. A similar quality residential unit in Gurgaon or Palam Vihar will cost at least two to three times more and, in some cases, in spite of the high cost the quality of construction and amenities provided might not even match up.
Identifying the competitive advantage: Since Dwarka Expressway is still an emerging real estate destination with much potential for growth, the location scores, on average, as much as Gurgaon on financial returns. Similarly, due to its proximity to New Delhi Railway Station, the IGI airport, and other established commercial hubs of south Delhi and Gurgaon, the location scores, on average, over Gurgaon on connectivity as well.
In the last five years, Dwarka Expressway has registered around 200% increase in average residential capital values—from Rs 2,400 per sq ft in 2009 to Rs 7,000 per sq ft in 2013. Between 2009 and 2013, the location has recorded the second highest number of project launches, next only to the new sectors in Gurgaon, in terms of number of units. Nearly 18,000 residential units have been launched here in the last five years, across 44 projects, ranging from mid to premium category.
Dwarka Expressway is expected to receive the second highest number of residential units (nearly 24,160) between 2013 and 2018, the DTZ report said. Almost all the prominent developers-BPTP, Puri Constructions, Raheja, Mahindra Lifespaces, Sobha Developers, Ansal Housing, Assotech Limited, Paras, ATS, and Ramprastha Builders—have launched more than 50 projects on Dwarka Expressway, which are in various stages of construction. These projects range from mid-end to premium segments. The expressway is still under construction; once it is operational, it is expected that the travel time from Gurgaon to west Delhi during peak hours would be reduced from 90 minutes to 45 minutes. This area is being developed with better infrastructure and roads are expected to be 60-75 metres wide paving for smooth traffic flow.
The sewage and electricity distribution systems are also likely to be better and more advanced. The nearby locations of Palam Vihar, Gurgaon, and Dwarka already have decent infrastructure in place. However, the snail’s pace at which work on the expressway is progressing, along with litigation issues with respect to land acquisition on a 4km-stretch of the expressway, is stymieing the growth of the corridor, the report says.
We will cover other hotspots like NH-8 in Gurgaon and Noida-Greater Noida Expressway in Noida, Noida Extension in Greater Noida, Greater Noida, and Yamuna Expressway in the next issue.
Source: Times Property, The Times of India, Delhi/NCR
Posted on November 7, 2013, in Real Estate and tagged Flats in Delhi NCR, Flats in Noida, Greater Noida (WEST), Real Estate Company in India, Real Estate India, Sanjay Rastogi, Sanjay Rastogi Builder, Sanjay Rastogi Builders. Bookmark the permalink. Leave a comment.