De­vel­op­ment de­coded

Ar­eas like Mane­sar, Dharuhera, Bhi­wadi and Neem­rana pro­vide good con­nec­tiv­ity and also serve as cor­ri­dors of growth

HT Estates - - FRONT PAGE - Rohan Sharma

The 250-kilo­me­tre stretch be­tween Delhi and Jaipur has be­come a hot­bed for real es­tate de­vel­op­ment, with ar­eas l i ke Mane­sar, Dharuhera, Bhi­wadi, Neem­rana, Kot­putli and Al­war be­com­ing at­trac­tive in­vest­ment des­ti­na­tions.

High­ways con­nect­ing var­i­ous towns and cities serve a dual pur­pose. Not only do they pro­vide good con­nec­tiv­ity and ac­ces­si­bil­ity, but they also serve as nodes that spur de­vel­op­ment. Typ­i­cally, the por­tions of the high­ways with cities ly­ing on these routes wit­ness hec­tic de­vel­op­ment ac­tiv­ity right from the time the projects are first an­nounced. The NH-8 con­nect­ing Delhi to Jaipur has seen a sim­i­lar growth tra­jec­tory.

Gur­gaon, be­ing closer to Delhi, has seen rapid growth in real es­tate de­vel­op­ment. The res­i­den­tial real es­tate sec­tor has seen ex­po­nen­tial growth along NH-8, with res­i­den­tial projects un­der­way on the up­com­ing Dwarka-Gur­gaon Ex­press­way which runs nearly par­al­lel to NH-8, meet­ing it near Sec­tor 82.

Prom­i­nent town­ship projects are com­ing up on NH-8 beyond the sec­ond toll plaza. The ma­jor de­vel­op­ers ac­tive there in­clude Vatika ( Vatika City Next), DLF (Gar­den City) and Or­ris In­fra­struc­ture.

Mane­sar, Dharuhera and Bhi­wadi are the satel­lite cities of Gur­gaon and have a t hriv­ing i ndus­trial sec­tor. Mane­sar also has com­mer­cial de­vel­op­ments and res­i­den­tial projects by ABW, DLF, SARE and Sid­haratha, which have seen good de­mand on ac­count of their af­ford­abil­ity quo­tient. Dharuhera has de­vel­op­ers like Parsv­nath, Vipul, Bestech, Vardhman, M2K, Fer rous In­fra­struc­ture and Dwarkad­his, among others.

De­vel­op­ers l i ke Omaxe, Ashi­ana Group, BDI, Star R a i s o n L a n d m a rk , M V L , Cos­mos In­fra, Avalon, Kr­ish i nfras­truc­ture and Piyush Group, to name a few, are com­ing up with projects in Bhi­wadi.

Neem­rana has at­tracted heavy in­dus­trial in­vest­ment from Ja­panese man­u­fac­tur­ing firms. Cur­rently, a 1,200acre Ja­panese zone is 70% op­er­a­tional, with heavy in­vest­ment in man­u­fac­tur­ing fa­cil­i­ties by firms such as Daikin, Mit­sui Chem­i­cals, ls, Nis­san, Nip­pon and NYK YK Lo­gis­tics. The Ja­pan Ex­ter­nal al Trade Or­gan­i­sa­tion and the h Ex­port Pro­mo­tion In­dus­trial Park, spread over 3,500 acres, de­vel­oped by the Ra­jasthan State In­dus­trial De­vel­op­ment and In­vest­ment Cor­po­ra­tion (RIICO) in sev­eral phases, are other in­dus­trial zones that have led to this sub-mar­ket’s emer­gence as a ma­jor in­dus­trial hub. Some res­i­den­tial projects by Ashi­ana, Eldeco and Anant Raj have al­ready been launched. This sub-mar­ket has tremen­dous po­ten­tial for in­te­grated town­ship projects and low-cost, af­ford­able hous­ing.

Kot­putli in Ra­jasthan has de­vel­op­ments by Eklavya Hous­ing and is largely de­fined by plot­ted de­vel­op­ment projects by a host of small, in­di­vid­ual de­vel­op­ers. There are a num­ber of de­vel­op­ments on the out­skirts of Al­war, es­pe­cially on the Bhi­wadi-Al­war By­pass and out­skirts of the city.

An­sals are un­der­tak­ing a res­i­den­tial project, while other projects are by small, in­di­vid­ual de­vel­op­ers.

In­fra­struc­ture

Phys­i­cal in­fra­struc­ture com-com­pris­esi off roads,d power, sewage, san­i­ta­tion and water sup­ply while so­cial in­fra­struc­ture refers to schools, col­leges, malls, en­ter­tain­ment av­enues among others. Cur­rently, Gur­gaon has in­ad­e­quate in­fra­struc­ture in re­spect of proper roads, reg­u­lar power and water sup­ply and city sewage dis­posal mech­a­nism. In the light of this, other cities will need to make in­fra­struc­ture de­vel­op­ment a pri­or­ity and en­sure that ca­pac­ity-build­ing takes place in a proac­tive and pro­gres­sive man­ner, keep­ing in mind the ex­pected de­mand over the next 10-15 years. How­ever, since all in­fra­struc­ture projects have long ges­ta­tion and op­er­a­tion pe­ri­ods, a time pe­riod of 10 to 15 years can be eas­ily taken as ref­er­ence.

Though the in­ter­nal road in­fra­struc­ture is de­vel­op­ing fairly rapidly in Gur­gaon and Mane­sar, other towns are yet to catch up. Most lo­ca­tions closer to these cities’ cen­tres will have pro­vi­sions of ba­sic ameni­ties. How­ever, since de­vel­op­ment work is still be­ing car­ried out here, ameni­tiesi i are yet to be­comeb fully func­tional. Towns like Bhi­wadi and Neem­rana are likely to see faster growth as in the for­mer case.

Prop­erty prices

Prices are a func­tion of de­mand and sup­ply, and cur­rently are at an all-time high in Gur­gaon. With in­fra­struc­ture de­vel­op­ment lag­ging in the emerg­ing res­i­den­tial cor­ri­dors, prices are op­er­at­ing on spec­u­la­tion of fu­ture ap­pre­ci­a­tion and in­vestor sen­ti­ment. Mane­sar, by virtue of its lo­ca­tional ad­van­tages, has also seen healthy ap­pre­ci­a­tion in res­i­den­tial projects lo­cated there. It is a well-es­tab­lished in­dus­trial town and is slowly emerg­ing as an of­fice des­ti­na­tion. Since it is con­sid­ered a part of Gur­gaon, there have been sig­nif­i­cant price in­cre­ments in hous­ing projects lo­cated here. Prices in Dharuhera and Bhi­wadi, which largely cater to af­ford­able hous­ing in terms of ameni­ties, have re­mained more or less sta­ble, show­ing only range-bound growthh iin pro­jectsj nearingi com­ple­tion. Neem­rana has shown ap­pre­cia­ble in­cre­ment in land val­ues and apart­ment prices since the Mas­ter Plan-2031 was no­ti­fied.

Land val­ues

Land val­ues dif­fer based on the ex­pected pric­ing for res­i­den­tial projects and the pro­jected de­mand for projects in each lo­ca­tion. While in Gur­gaon the land val­ues are ` 2500 to ` 3000 per sq ft in the lo­ca­tions on NH-8 which are closer to the sec­ond toll plaza, Mane­sar has land val­ues in the range of ` 2200 to ` 2400 per sq ft. Dharuhera’s land pric­ing is ` 1100 to ` 1400 per sq ft while Bhi­wadi is ` 800 to ` 1000 per sq ft. Neem­rana’s land prices are in the range of ` 800 to ` 900 per sq ft, while land value range in Kot­putli is ` 350 to ` 500 per sq ft with Al­war’s land val­ues be­tween ` 500 and ` 600 per sq ft.

Land val­ues are cur­rently at a pre­mium in Gur­gaon, and hence are adding to the project costs off de­vel­op­ers;d l whichhi h i in turn is lead­ing to de­vel­op­ers pric­ing their projects higher to ser­vice their debt as well as earn a cer­tain profit mar­gin. Sim­i­larly, with land prices ris­ing across all the towns on the NH- 8 cor­ri­dor, project costs are ris­ing. This im­pacts the profit mar­gin of de­vel­op­ers, or im­pacts sales if project pric­ing is higher than what could be con­sid­ered competitive.

The op­por­tu­nity

There is a def­i­nite op­por­tu­nity in the af­ford­able and mid­in­come hous­ing seg­ments for de­vel­op­ers in these ar­eas, as a ma­jor­ity of the de­mand is di­rected to­wards these seg-

The au­thor is se­nior man­ager – re­search and real es­tate in­tell i gence ser­vice, Jones Lang LaSalle In­dia

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