Smart cities: wait be­fore you in­vest

Spec­u­la­tors should be in no rush to in­vest in cities tagged smart. A hike in prop­erty prices is not ex­pected in the short term as im­pact will take some time to be felt

HT Estates - - NEWS - Van­dana Ram­nani

Will the se­lec­tion of Farid­abad, Kar­nal, Ghazi­abad and the NDMC ar­eas as smart cities lead to spec­u­la­tive pur­chase of prop­er­ties in these ar­eas and push up prices? The an­swer is no. The ‘Buy the ru­mour, sell the flat’ may not work in this case, at least for the short term.

While real es­tate ex­perts agree that queries for prop­er­ties have in­creased ever since these cities made it to the smart list, a run- up in prices will have to wait. “There will not be any rise in prices in the short-term. It’s not that if an in­vestor is not getting any re­turns in Delhi, he will go to in­vest in Kar­nal be­cause it has been de­clared a smart city. It will take some years – at least three to five years af­ter some work has been done on the ground and im­pact of the mis­sion is felt,” says Anckur Sri­vast­tava of GenReal Ad­vis­ers.

By and large, Ghazi­abad seemed to have done bet­ter than Farid­abad in terms of in­fra­struc­ture and even val­u­a­tion. While prop­er­ties in Ghazi­abad are val­ued at any- thing be­tween ₹ 4,000 to ₹ 5,000 per sq ft, prices in Farid­abad they start at ₹ 3,000 per sq ft.

Ex­perts also ex­pect mo­men­tum to pick up in the com­mer­cial seg­ment.

“Should there be ac­tual ex­e­cu­tion, cre­ation of world­class fa­cil­i­ties, im­pact of flow of money from overseas mar­kets, there will be mo­men­tum in the mar­ket post the an­nounce­ment. As of now Ghazi­abad is pri­mar­ily an end-user mar­ket and Farid­abad spec­u­la­tive in na­ture with more in­ter­est in plots and in­de­pen­dent houses,” says Shveta Jain, ex­ec­u­tive di­rec­tor, res­i­den­tial ser­vices, Cush­man & Wake­field.

En­gi­neer­ing com­pa­nies like Eicher and Es­corts had given a new lease of life to com­mer­cial realty in Farid­abad in the early 1980s. Post the ex­ten­sion of the metro this month, com­mer­cial real es­tate may get a fil­lip, say ex­perts.

NDMC has also made it to the smart cities list. Ex­perts view this as a bal­anc­ing strat­egy. “This is an at­tempt at an in­clu­sive ap­proach. The fact that the heart and the soul of the Cap­i­tal, the prime mar­ket, has been in­cluded in the list helps build a lot of con­fi­dence in the realty sec­tor. The area’s in­clu­sion in the list will help recre­ate in­ter­est among com­pa­nies whose first choice was Gur­gaon be­cause of avail­abil­ity of large com­mer­cial spa­ces. Smaller set­ups may look at CP (Con­naught Place) as the first al­ter­na­tive to set up their li­aison­ing or in­cu­ba­tion of­fices be­cause of its great con­nec­tiv­ity and avail­abil­ity of bet­ter in­fra­struc­ture in the near fu­ture,” says Jain.


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