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COMPILED BY:PRIYANKA SAHA [PGPM0 8]
ENROLMENT NO.010108084
GLOBSYN BUSINESS SCHOOL
KOLKATA REAL ESTATE
MARKET
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y Introduction
y About Kolkata as RealEstate Destination
y Kolkatas emerging ITdestinations
y Past, Present & Futureof Real EstateDevelopments
y Residential Overview
y Retail Overview
y Office MarketOverview
y Conclusion & Contact
Contents
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K O L K A T A S R E A L E S T A T E M A R K E T I S S E T F O R A H I G H
G R O W T H P H A S E F U E L L E D B Y T H E I T / I T E S S E C T O R K O L K A T A S R E A L E S T A T E M A R K E T I S S E T F O R
T R A N S F O R M A T I O N, A N D P R O P E R T Y W I L L P L A Y A P I V O T A L
R O L E I N T H E C I T Y S C O N T I N U E D R E N A I S S A N C E . T H E
G R O W I N G I T / I T E S S E C T O R W I L L U N D E R P I N S T R O N G
E X P A N S I O N O F T H E O F F I C E S E C T O R ; K O L K A T A I S A H I G H
P R I O R I T Y D E S T I N A T I O N F O R R E T A I L E R S A T T R A C T E D B Y
I T S L A R G E P O P U L A T I O N A N D R I S I N G D I S P O S A B L E
I N C O M E S ; T H E R E S I D E N T I A L M A R K E T I S E X P A N D I N G O N
T H E B A C K O F A G R O W I N G I T / I T E S W O R K F O R C E A N D H O T E LD E M A N D I S B E I N G B O O S T E D B Y C O R P O R A T E B U S I N E S S A N D
T O U R I S M . T H E K O L K A T A R E A L E S T A T E M A R K E T I S N O W O N
T H E R A D A R O F L E A D I N G N A T I O N A L A N D I N T E R N A T I O N A L
D E V E L O P E R S , A L L K E E N T O P A R T I C I P A T E I N K O L K A T A S
I N C R E A S I N G L Y D Y N A M I C R E A L E S T A T E M A R K E T .
INTRODUCTION
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yKolkata Fact
Sheety Location : 2.82 N 88.20 Ey City Population : 15 milliony State : West Bengaly
Area : 1350 Sq.km.y Language spoken :
Bengali,Hindi and Englishy Literacy Rate (city) :
81.31%
y Net State Domestic
Product : Rs. 1435 Billiony Temperature : Winter
(12-27c)y andy Summer (24-38c)
y Average rainfall : 160cm.y Altitude : 6 metersy Time Zone : IST (UTC +
5 : 30)
About Kolkata as Real EstateDestination
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The City Spread Out
y Garia-Narendrapur in the southeast
y Behala-Joka in the south west
y Rajarhat in the northeast
y BT Road in the northwest
y Howrah in the west
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About Kolkata as Real Estate Destination
y The City Spread Out
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About Kolkata as Real Estate Destination
y Advantage Kolkata
y Improved urban infrastructure with strengthenedroad networks.
y Excellent social infrastructure to attract senior/middle management talent.
y Living cost in Kolkata is the lowest among all majorIndian cities.
y Buoyant economy,flourishing IT/ITes sector,banking and financial, retail sector etc.
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About Kolkata as Real Estate Destination
y Kolkata Contributes to GDP
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About Kolkata as Real Estate Destination
y SEZs in Kolkata
y Manikanchan (Gem and Jewellery), Salt Lake
y Salt Lake Electronics City
y Unitech IT SEZ
y Falta SEZ
y Wipro SEZ
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SEZs Knowhow
y Owing to refusal of the state land and land reformsdeptt.(LRRD) to record the change in status from thefarmland to one eligible for industrial use, the IT
park adjoining the Calcutta Leather Complex inBantala has become a dumping ground forpollutants.
y The IT sector SEZ and Biotech Sector at Panagarh,
Bardhaman district is stuck because of slump indemand
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About Kolkata as Real Estate Destination
y Construction Investment in Kolkata
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About Kolkata as Real Estate Destination
y Average Real Estate investment in Kolkata
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About Kolkata as Real Estate Destination
Market Potential Value
0
5
10
15
20
MPV Share %
State wise market Potential Value Share
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Advantage Kolkata
Cost of Living &Market Potential Value
y Kolkata has the highest market potential value share
among the states of India
y Living cost in Kolkata is the lowest among all themajor cities in India
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Past, Present & Future of Real EstateDevelopments
y Transformation in the last five years
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y Several sizzling malls with multiplexes- City Centrein both Salt Lake and Newtown, Mani Square at EMBypass, South Citymall, Forum at Elgin Road.
y Salt Lakes Sector V has emerged as a happeningIT/ITes destination.
y More than 8 Flyovers have been added for reducingtraffic congestion at key junctions.
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y Property values in Kolkata have risen at thefastest pace among Indian metros since2007, according to the National Housing Banks(NHB) Residexan index of property prices.Property values in Kolkata rose by an average of16.8% while those in Bangalore fell by 15.6% in theperiod. Fewer speculative deals and lower base pricessaw the eastern Indian metropolis outpace hotter
property markets such as Mumbai and Delhi, whereproperty values rose at a comparatively sedateaverage of 7.5% and 7.3%, respectively.
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Present status
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Past, Present & Future of Real EstateDevelopments
y Development for the next five yearsy A boom in real estate sector across the country has not left
Kolkata behind as a number of upcoming townships in citysuburbs are attracting investors and mass housing complexesto some untapped suburbs.
According to estimates by the Confederation of Real EstateDevelopers of India, in the next five years 250 million sqfeet will be added to greater Kolkata, requiring aninvestment Rs 37,500 crore. Rajarhat in the north-east, Dankuni in north-west, Howrah in the west, Diamond
Harbour road beyond Joka and Batanagar in the south-westand the Garia-Narendrapur stretch in south-east are areaswhich will see more than 50 per cent price rise in the next oneyear, said real estate sector sources.
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Past, Present & Future of Real EstateDevelopments
y Up Coming new townships
PROJECT SIZE
Kolkata west int.city
390 acres
Batanagar 262 acres.
Dankuni 5000 acres.
Unitech 150 acres.
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Past, Present & Future of Real EstateDevelopments
y Mega Projects
y A consortium of Salim and Ciputra groups is now
building an integrated satellite township, Kolkata West
International city, across 390 acres with 6,100
bungalows, four residential towers, three IT parks, a13-
acre club, a 200-bed hospital, two schools, shoppingmalls and entertainment zones in Howrah ataninvestment of $330 million.
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y Mega Projects
y A new satellite township is coming up at Dankuni(about15 km. From Kolkata) and the project willstart in theyear 2007 covering 5,000 acres of landand expected tobe completed by 2011.
y A township in Batanagar on a 262 acres of land willbedeveloped by River Bank Holdings at the cost ofRs 1,500crore. Apart from various residential
formats thetownship will be slatted for a 300-500bed hospital, aschool an industrial park, hotel, golfcourse and retailzone.
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y An IT-cum housing project,named Uniworld City
promoted by Bengal Unitech Universal, collaboration
between real estate major Unitech Ltd. and Universal
Infrastructure Ltd. of Indonesia is coming up on 150
acres of land at Rajarhat New town
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Kolkatas emerging IT destinations
y Salt Lake & New Town
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Kolkatas emerging IT destinations
y Technopolis, a huge IT park has come up in Kolkata's Salt Lake's Sector Vregion with an area of 6.75 lakh sq ft. It will be the world's first real estateproject to be registered under the United Nations Framework Convention(UNFC) on Climate Change as a clean development mechanism project
y Royal Indian Raj International Corporation (RIRIC), an NRI group, is going to
invest $1 billion in Indian real estate, which is going to be the biggest FDI inIndian real estate aimed to develop large scale commercial and residentialtownship in Kolkata along with other metropolises.
y
Unitech, world's one of the top 50 real estate developer is developing a 100-acre residential project called "Uniworld City" which is only 10 minutes toDumdum Airport. Unitech is also developing a 50-acre IT project.
y The state government announced plans earmarking 500 acre for an IT-cum-Biotech park near the city airport as part of a Rs.5, 000-crore program toupgrade industrial infrastructure
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Kolkatas emerging IT destinations
y Salt lake & Rajarhat :y Rajarhat project, the new IT hub of Kolkata will have retail stores and
entertainment facilities and a 5, 00,000 sq. ft open-air landscapedpodium, Touted to be the largest IT Park in Kolkata, Rajarhat spans an areaof 1.3 million sq. ft and can accommodate 20,000 executives.
y Wipro, which set up a sprawling 17 acre campus in Kolkata's Salt Lake isnow planning to get another 50 acre plot in Rajarhat, the proposed IT hubin east Kolkata.
y Major IT companies such as Satyam Computers, ITC InfoTech, HSBCElectronic Data Processing India (HDPI), ICICI One Source and GECIS willset up their centers in the city shortly.
y Major Real estate developer DLF has developed an IT park in Kolkata inRajarhat area with a super area of 1.3 million sq. ft. and is now largelyoperational.
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Kolkatas emerging IT destinations
y Major Developments - IT / ITeS Sector
PROJECT SIZE (million sq ft)
Unitech 5
DLF 3.5Videocon-Salarpuria 3
Ascendas 2
Godrej Waterside 1.8
KeAppal land 1
Ambuja RMZ 1
Bengal Inteligent Park 0.75
Infinity Waterside 0.7
Technopolics 0.67
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Residential Overview
y Residential Values (Rates are given in Rs per Sq. ft)
EAST
Name of the area Rate(Rs Per sq ft)
Salt Lake 1800-2200
Beleghata 1500-2000
EM Bypass (Cent) 2000-3000
New Town 1300-2500
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Residential Values (Rates are given in Rs perSq. ft)
y SOUTH WEST
Name of the area Rate(Rs Per sq ft)
Alipore 3500-6000
Behala 1100-1300
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Residential Values (Rates are given in Rs perSq. ft)
y SOUTH CENTRAL
Name of the area Rate(Rs Per sq ft)
Queens Park 4000-6000
Sunny Park 4000-6000
Gurusaday Road 4000-6000
Ballygunge Cir.Rd. 4000-6000
May Fair Road 3500-5000
Ballygunge Place 2200-3000
Gol Park 2300-3500
Gariahat 2500-4000
Rashbehari 2200-3000
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Residential Values (Rates are given in Rs perSq. ft)
CENTRAL
Name of the area Rate(Rs Per sq ft)
Park Street 3500-5000
Loudon Street 3000-5000
Theatre Road 3000-5000
Camac Street 3500-5000
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Residential Values (Rates are given in Rs perSq. ft)
NORTH
Name of the area Rate(Rs Per sq ft)
Jessore Road 1300-1700
VIP Road 1200-1600
Madhyamgram 950-1200
Shyambazar 1500-1900
B.T.Road 1200-1800
Kankurgachi 2200-2800
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Residential Values (Rates are given in Rs perSq. ft)
SOUTH-EASTERN
Name of the area Rate(Rs Per sq ft)
Garia 1000-1500
Narendrapur 1100-1400
R.B.Connector 1500-2000
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Residential Overview
y Key Players in Residential Developments
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Residential Overview
y Impact on residential prices post recessiony Sharp decline in interest rates i.e. to 9% from 12% on
home loans upto Rs. 30 lakh has improved theaffordability factor of house buyers.
y
Prices of residential units have also fallen by up to 30%since the last year.y In 2009, the top 9 listed real estate firms posted a 76%
dip in profit and 57% fall in sales in the June quarter,prompting the revival in demand could improve things,especially in light of a government subsidy for loanstaken for affordable housing, but warned that a possibleprice war between players sitting on huge inventoriescould spoil the scene.
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y DLF reported a 79% decline in profit and 57% slide in sales for theJune quarter.2009. According to DLF vice chairman Mr. RajivSinghThere has been a reasonable revival in demand for homes notjust in low-cost or mid-income,but also for high-end ,.
y Unitech, reported 63% decline in profit with sales down by half.
Property prices have come down and so has the interest rate. Thatswhy home buyers are again looking at the property market , said RNagraju, head of corporate planning at Unitech. The firm istargeting to sell a total of 30 million sqft of space this fiscal.
y Other realty players Indiabulls Real Estate, Parsvnath, Omaxe,HDIL, Akruti, Sobha and Purvankara too have reported decline inprofits up to 95% for the June quarter. Parsvnath chairman Pradeep
Jain said the worst was over for the sector and demand had startedpicking up.
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Residential Overview
y Upcoming Residential
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Residential Overview
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Retail Overview
y Retail Overview
y Kolkata is a key hub for commerce of EasternandNorth Eastern states of India. Kolkata
startedcatching up with the rest of the country on theretailand restaurant, mall and multiplex count. Withthesuccess of malls like Forum, 22 Camac Street,MetroPolis, City Center, mall mania has suddenly
gripedthe city. Big chains dropped anchor andbiggerchains scrambled to draw up city plans.McDonaldsrecce confirming big Kolkata plans.
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Retail Overview
y Kolkata Retail RE Zonal Segmentation
y Park Street, Camac Street, Elgin Road zone
y Gariahat, Rashbehari Avenue zone
y
EM Bypass, Ultadanga,VIP Road, Salt lake zone
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Retail Overview
y Major developments Mall
NAME OF THE MALLS AREA (Lakh SFT)
South City Mall 7
RPG Godreg 4.5City Centre 2 4
Mani Square 4
Avani Reverside 4
Avani Renaissance 3
Lake Mall 2.5
Aster Mall 1.5
Block by Block 1.8
Home Land 1.2
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Indian Retail Mall Overview
y Current and Future Major Retail Mall Development
y Mall supply in 2009 fell short by 60%, as only 5.7 millionsq. ft of space was delivered across major cities in India,according to the annual retail reportby real estate
consultant Cushman and Wakefield Inc.y Around 9 million sq. ft of expected mall supply for the
year was deferred to the future, due to poor demand fromretailers, says the report. Of the proposed 44 malls at the
beginning of the first quarter (January-March), about 18were delivered by the year-end. The overall vacancy ratesfor the major cities as of December was 17% compared
with a 16.7% vacancy rate in December last year.
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Retail Overview
y The retail sector in Kolkata demonstrated signs of revival in 2Q 2008y with the mall development exhibiting significant activity since they beginning of 2008. This quarter saw an addition of 370,000 sq.ft. of newy mall supply with Mani Square becoming operational on the EM Bypass.y South City Mall, which became operational in the last quarter in Southy
Kolkata, registered rental appreciation of about 6% over 1Q 08. They presence of major retail brands and high operational occupancy hasy triggered this northward rental movement.y Rajarhat witnessed more than 50% escalation in mall rentals over the lasty quarter. A major determinant of the attractiveness of Rajarhat is they relatively lower price points as compared to other malls in the city, in
y addition to the potential catchments from both the residential andy commercial establishments in the offing. Of all the major mall projectsy nearing completion in Kolkata, about 80% of developments arey concentrated in the Rajarhat micro-market alone.
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Retail Overview
y Impact on retail leasing prices post recessionsLocation Rentals Rs/sqft//month
Camac Street 100-120
Theatre Road 100-120
Loudon Street 80-100
Middleton Street 80-100
Park Street 80-90
Chowringee 100-125
Sarat Basu Road 110-130Elgin Road 100-120
Gariahat Road 100-140
Rashbehari Avn. 90-110
Kakurgachi 80-90
Salt Lake Sec v 90-100
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Office Market Overview
CBDy Kolkata office market largely comprises the CBD of
DalhousieSquare, Park Street, Shakespeare Sarani,Camac Street, AJCBose Road and the suburban business
districts (SBD) of SaltL
ake Sector V.y Park Street, Shakespeare Sarani, Camac Street area are
nowemerging as the new CBD with a number of newoffices
y L&T Chambers, Duck back House, FMC Fortuna,
Jasmine Tower,L
ansdowne Tower, Park Plaza, KrishnaBuilding at ShakespeareSarani, Camac Street, ParkStreet, AJC Bose Road are Kolkatasprime office
buildings
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Office Market Overview
y SBD
y Sector V is Kolkatas SBD, which has emerged asafavoured destination for IT & ITES companies.NewtownRajarhat is a developing SBD. All major
national andinternational IT & ITES companies like,TCS, IBM, PWC,Cognizant, Computer Associates,
WIPRO, NIIT havestarted their operations here.
y During 2001-04, Kolkata was the fastest growingSTPcenter within India, with exports from the citySTPclimbing 70 % within this period. Exports fromKolkatasSTP increased to Rs. 1,837 crore in 2004-05, arise ofover 50 % compared to 2003-04.
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Office Market Overview
y Rentals in High Street Location
y PRIME MAIN STREET RENTS 2Q08
y Park Street 268 6.30 4.02 0% 15%
y Camac Street 268 6.30 4.02 0% 15%
y Elgin Road 233 5.50 3.50 0% 27%
y Theatre Road 233 5.50 3.50 0% 27%
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Office Market Overview
Key Office Space Occupiersy The prominent main streets of Park Street, Camac Street, Elgin
Road andy Theatre Road witnessed stabilization in rental values over the last
three
y quarters. Lack of new supply and attainment of high price pointswere they decisive factors in this case. Leasing activities, however, continued
with ay few prominent brands showing keenness to be present on the mainy streets to leverage the signage opportunity and reinforce their brandy presence. The entry of brands like Dockers and Planet M, seekingy presence in the high street stands testimony to the confidence of they retailers in the city and in the eastern region.
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Most of the prominent real estate developers said demandfor commercial property in Kolkata was rising and thefuture looked better than what it was six months ago.Santosh Rungta, president, Confederation of Real Estate
Developers Associations of India (CREDAI), said, Weexpect the commercial real estate sector to revive in six toeight months. IT companies are reviving and demand foroffice spaces will gradually pick up. The overall industryhas started recovering from the economic slowdown and
is preparing to resume operations on a larger scale.Therefore, it seems likely that demand for office spaceswill rise according to requirements.
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Office Market Overview
y Impact on office leasing prices post recessions
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Conclusion
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Contact
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