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Infrastructure Development and its impact on Realty MarketUpdated on: June 28, 2016
CASE STUDY SERIES
Prosperity in any real estate market is directly proportional to its infrastructural development
Roads and highways are the most important infrastructure which lay foundation to the entire development process
The Delhi/ NCR market, post economic slowdown of year 2008, witnessed announcement of many such expressways
Through this case study, we aim to analyse the impact in the market with a focus on the online search trends
Major Expressways Announced in Delhi NCR
1998: Faridabad-Noida-Ghaziabad Corridor (FNG)
2003: Kundli-Manesar-Palwal Expressway (KMP)
2003: Yamuna Expressway
2007: Dwarka Expressway
Faridabad-Noida-Ghaziabad Corridor (FNG)4-lane 56 km long connecting Faridabad and Ghaziabad via Noida and Greater Noida
1998: Announced
but stuck due to political
unwillingness
2014:Construction finally started on 19.9 km stretch in Noida-Greater Noida
2015:In July, construction
on Noida section almost complete
2015:In November, tender
for two bridges on Yamuna initiated;
process is expected to complete by mid-2016
2016:In June, NHAI passed proposal to convert
non-operational 43 km stretch of FNG corridor into NH. Work to start
by January 2017
Property Search Trends factoring FNG Corridor
Silence till year 2008 Surged in year 2009 Constant surges from
year 2010 onwards Spikes on a regular
intervals indicate a diversion of buyers and investors towards FNG
The trends clearly show that any development on the corridor has reflected in surge in searches
Kundli – Manesar – Palwal Expressway (KMP)135.6 km long divided into three sections of 45 km each connecting Kundli and Palwal via Manesar
2003: 1st
proposal
2009:Layout, DPR & land acquisition
procedures completed. The contract awarded to KMP
Expressway Ltd. Deadline – June 2012
2012:1st deadline missed. New
deadline set to May 2013
2015:Multiple deadlines missed. Contract scrapped. Fresh
bids invited
2015:January-July, the project converted
into 6-lane. Contract awarded to Essel Infra projects for 83.32 km
between Kundli-Manesar. Deadline-August 2018
2016:In April, 53 km stretch
between Manesar-Palwal opened for public
Property Search Trends factoring KMP
Searches in Kundli & Manesar surged in 2010-11
Stabilised post 2012 Manesar saw surge in 2016 Searches in Palwal started
rising from year 2012 and still showing upper trends
Impact of delayed construction suppressed property searches. Whereas, opening of Manesar – Palwal created positive impact for Palwal
Kundali
Manesar
Palwal
Yamuna ExpresswayIndia’s longest 165 km long, 6-lane controlled-access expressway connects Greater Noida with Agra
2003: Yamuna
Expressway proposed
2007:Stuck due to Government
change & financial infeasibility
2007:In December, development
started. Deadline - 2014
2012:In August, project completed ahead
of schedule. Inaugurated by CM
Akhilesh Yadav
Property Search Trends factoring Yamuna Expressway
Property search surged with spike in year 2009.
Remained constant till year 2013 with periodic surges
Searches rose again in 2013-14 It then slowed down afterwards
and remains so till date
Significant surge immediately after commencement of construction and completion thereby, indicating direct impact
Dwarka Expressway (NPR)18 km long and 150 m wide, a high-speed link runs in a smooth parabola from Kherki Daula on NH8 to Dwarka
2007: Project
Announced
2010:Only 80% of land
acquired to develop
2011:In April,
development started for 14 km
2012:Deadline missed to
complete 14 km phase. Litigations over land
acquisitions
2016:Till January litigations continued. In March,
the project got National Highway status, renamed NH-8A
Deadline - June, 2017
Property Search Trends factoring Dwarka Expressway
Demand for the property around Dwarka Expressway started picking from year 2011
Continued till year 2013 Dipped in 2013 and
continues so till date
It is evident that commencement of construction impacted in surge of property searches. However, litigations killed the momentum
Though the Real estate as a sector depends upon many internal and external factors, but infrastructure is one such which determines the future of a particular location and the basics of any infrastructural development start with roads and connectivity. It is thus, said that roads bring life to a location
Unfortunately, roads and highways in our country are themselves struggling to stay alive. As of April 2015, out of all the highway projects around 40% totalling 14,000 km and costing around Rs 94,000 crore were delayed; 70% of these were managed by NHAI and the total cost was close to Rs 80,500 crore
This research report clearly indicates that property markets in and around these highways got instant attention of investors and buyers
However, litigation, roadblock and construction hurdles acted as speed-breakers. Nonetheless, with NHAI's intervention in these highways, things appear to be on right track
As per Mr. Nitin Gadkari, Road Transport & Highway Minister, Government of India, “Road construction in India has accelerated to an all-time high pace of 20 km per day & should reach to 30 km per day in next 5-6 month”. It shows some acceleration in the times to follow
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