Prime Pune

(Part 2)

Accommodation Times - - Project Update - By Nikita Parekh

Pune is de­vel­op­ing rapidly and still it has huge po­ten­tial to at­tract more de­vel­op­ments and it will wit­ness the progress in the com­ing months. In the first part of Prime Pune we have stud­ied the cities over­view, de­mo­graph­ics and sce­nario over land use and hous­ing. In the sec­ond part we will learn about the de­vel­op­ments and cur­rent progress, de­mand and mar­ket view of the city, along with the de­vel­op­ments of other sec­tors which con­trib­utes in the growth of Pune’s realty mar­ket.

Mar­ket view as

per 2013

Wakad, Baner, Aundh and Pashan in the Western re­gion con­tin­ued to re­main pri­or­ity hous­ing des­ti­na­tions due to their close prox­im­ity to the in­dus­trial zone of Hin­je­w­adi, easy ac­ces­si­bil­ity to the Mum­bai- Pune Ex­press­way, and the pres­ence of a large IT sec­tor work­force. Fur­ther­more, de­mand re­mained high in the East­ern re­gions of Wagholi, Kharadi and Hadap­sar ow­ing to avail­abil­ity of de­vel­oped phys­i­cal and so­cial in­fra­struc­ture, es­tab­lished or­ga­nized re­tail, and prox­im­ity to the city air­port. Ad­di­tion­ally, close prox­im­ity to the EON SEZ, Kharadi and Ma­garpatta con­tin­ued to pro­mote Ke­shav Na­gar (East­ern Pune) as a pri­or­ity hous­ing mar­ket. Cap­i­tal val­ues rose dur­ing 2013.

Hous­ing De­mand

Hous­ing de­mand in Pune is likely to im­prove fur­ther by the sec­ond half of 2014. The East­ern and Western Sub­urbs of Baner, Bale­wadi, Vi­manNa­gar, Kharadi and Had­sapar, lo­cated in close prox­im­ity to IT and in­dus­trial hubs, are likely to at­tract ma­jor trans­ac­tion ac­tiv­ity.

Ad­di­tion­ally, the pro­posed in­fra­struc­ture de­vel­op­ment of the Pune Metro Rail, the Bus Rapid Tran­sit Sys­tem (BRTS), and up­com­ing SEZ de­vel­op­ments are all ex­pected to pro­vide im­pe­tus to res­i­den­tial de­vel­op­ments in the North­ern re­gion of Chakan, Tavet and Tale­gaon.

De­vel­op­ments in Pune

Pune is rapidly de­vel­op­ing as a IT/ITeS city and au­tomo- of real es­tate and in­fra­struc­ture sec­tor. IT and au­to­mo­bile sec­tor is sup­port­ing the city for its de­vel­op­ment in to a met­ro­pol­i­tan city. The State Govern­ment of Ma­ha­rash­tra is im­ple­ment­ing mea­sures to pro­mote Pune as an IT/ ITES des­ti­na­tion; and pro­mot­ing the Ra­jiv Gandhi IT Park as an IT/ITeS knowl­edge cen­ter by ac­quir­ing large tracks of land and invit­ing large In­dian MNCs such as Wipro, In­fosys, and TCS, in the early 2000s set the tone for the city. Pune has many ma­jor IT parks like Ma­garpatta Cy­ber City, EON Free Zone, Com­mer­zone, Em­bassy Tech Park,Marisoft IT Park (Kalyan­i­na­gar), Panchshil Tech Park and MIDC Soft­ware Tech­nol­ogy Park (Talawade).

Ed­u­ca­tion in Pune

The city’s pre­mier ed­u­ca­tion in­sti­tutes have en­sured that there is al­ways a great talent pool avail­able for var­i­ous in­dus­tries. With over six Uni­ver­si­ties and more than 500 col­leges, the city boasts of leading in­sti­tutes like the Armed Forces Med­i­cal Col­lege Pune, the Col­lege of En­gi­neer­ing Pune, the Sym­bio­sis In­sti­tutes, and the Film and Tele­vi­sion In­sti­tute of In­dia. An­other fac­tor help­ing to po­si­tion Pune strate­gi­cally for businesses in In­dia has been its ex­cel­lent con­nec­tiv­ity to Mum­bai, and the in­fra­struc­ture avail­able due to the Mum­bai-Pune Ex­press­way.

Hos­pi­tal­ity in Pune

Pune has wit­nessed huge growth in hos­pi­tal­ity sec­tor since 6-7 years, sev­eral ven­tures of hosip­i­tal­ity and ser­viced apart­ment are build. Cur­rently, the city has nearly seven five-star prop­er­ties, in­clud­ing the JW Mar­riot, the Hy­att Re­gency, and the Le Meri­dien.

Additional sup­ply of star­rated prop­er­ties is un­der con­struc­tion, and ex­pected to en­ter the mar­ket by 2015.

Commercial De­vel­op­ments

Pune is emerg­ing in to an IT hub and the de­mand and sup­ply of commercial space is high in Pune.

There is around 4.1 mil­lion sq. ft. of Grade A of­fice space was trans­acted in 2013, of which around 2.4 mil­lion sq. ft. was ab­sorbed in thecity’s Off CBD mi­cro-mar­ket—largely led by IT/ITeS oc­cu­piers. On the sup­ply front too, of the ap­prox­i­mately 4.4 mil­lion sq. ft. of Grade A of­fice space that came on stream dur­ing 2013, around 2.16 mil­lion sq. ft. was re­leased in the Off CBD mar­ket.

The city also saw sig­nif­i­cant SEZ sup­ply ad­di­tion, with the com­ple­tion of EON SEZ AatKharadi. Ow­ing to en­hanced de­mand lev­els, rentals ap­pre­ci­ated across most mi­cro-mar­kets to­wards the end of the year.

De­mand- Dur­ing the year Pune mar­ket can see an in­crease in its commercial leas­ing ac­tiv­ity ffolow­ing the de­mand The large an­tic­i­pated sup­ply ad­di­tion, along with the con­sol­i­da­tion and ex­pan­sion of ex­ist­ing and new cor­po­rate oc­cu­piers is likely to gen­er­ate de­mand for Grade A of­fice space across all mi­cro- mar­kets in the medium term. The IT/ITeS,and BFSI seg­ments will con­tinue to drive de­mand for of­fice space in the Off CBD and PBD lo­ca­tions.

Re­tail Mar­ket of Pune

The re­tails mar­ket is sig­nif­i­cantly in­creas­ing in the city, the high-streets of JM Road, Aundh, Kore­gaon Park and MG Road con­tin­ued to be the pre­ferred lo­ca­tion for re­tail­ers, es­pe­cially from the F&B and fash­ion seg­ments. In terms of fresh or­ga­nized re­tail space sup­ply, Sea­sons Mall (0.65 mil­lion sq. ft.) at Ma­garpatta City be­came op­er­a­tional dur­ing H22013.

Rental val­ues re­mained un­der pres­sure, as re­tail­ers adopted a cau­tious ap­proach amid con­tin­ued slug­gish mar­ket sen­ti­ments and con­sumer con­fi­dence.

The city will soon wit­ness new re­tail out­lets dur­ing the year, some of the exclusive projects are Wes­t­end Mall at Aundh, the ICC Mall on SB Road, and the Royal Her­itage Mall at NIBM. These projects will make an ad­di­tion to city’s re­tail space of 1.5 mil­lion.

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