Phoenix Mills to Is Sohna the new realty hotspot? more than dou­ble its of­fice port­fo­lio

HUB Sohna has be­come pop­u­lar due to its prox­im­ity to in­dus­trial clus­ters and busi­ness cen­tres as well as low prices

HT Estates - - FRONT PAGE - Prashant Thakur ht­es­tates@hin­dus­tan­ The au­thor is Head – Re­search, ANAROCK Prop­erty Con­sul­tants Bidya Sa­pam

Nes­tled in the foothills of Aravalli - one of the old­est range of folded moun­tains in In­dia - Sohna was for long a ma­jor tourist at­trac­tion due to its lakes, hot springs, tem­ples and many places of his­tor­i­cal im­por­tance. Lo­cated in the south­ern part of Gu­ru­gram, Sohna is also pop­u­larly known as ‘South Gu­ru­gram’.

In the last few decades, Gu­ru­gram’s un­prece­dented eco­nomic growth has led to ac­cel­er­ated ur­ban­iza­tion and rapid growth in mi­grant pop­u­la­tion flock­ing the city for em­ploy­ment.

Over time, the fast- paced growth in key ar­eas such as MG Road, Udyog Vi­har and Cy­ber City has cre­ated a rip­ple ef­fect and pushed de­vel­op­ments to­wards the western and south­ern parts of the city.

This led to the emer­gence of new ar­eas such as Golf Course Road, Golf Course Ex­ten­sion Road, South­ern Pe­riph­eral Road (SPR) and Sohna Road - lead­ing right up to Sohna town.

With prox­im­ity to var­i­ous busi­ness cen­tres and in­dus­trial clus­ters, good over­all ac­ces­si­bil­ity, af­ford­able prices and planned i nfras­truc­ture up­grades, Sohna is evolv­ing as a key real es­tate des­ti­na­tion for the work­ing pop­u­la­tion of Gu­ru­garam and sur­round­ing re­gions. En­vis­ag­ing the growth po­ten­tial on the ba­sis of its strate­gic lo­ca­tion, ur­ban­iza­tion and af­ford­able prices, Sohna Mas­ter Plan - in­tro­duced in 2012 - cov­ers var­i­ous re­quired as­pects of fu­ture de­vel­op­ments, phys­i­cal as well as so­cial.


Sohna is eas­ily ac­ces­si­ble from the key cities of NCR via an ex­ist­ing grid of roads:

· NH-248A: A four-lane road that con­nects Sohna to Gu­ru­gram via Sohna Road in the North, ex­tend­ing up to Al­war in the South. It also touches the Kundli-Mane­sar-Pal­wal (KMP) Ex­press­way and NH- 8 ( now known as NH-48).

· KMP Ex­press­way: Sohna is lo­cated close (ap­prox. 6-8 km) to the 135-km KMP Ex­press­way that starts fromKundli (Soni­pat) and­con­nects Pal­wal (Farid­abad) via Mane­sar (Gu­ru­gram). How­ever, this ex­press­way is still un­der de­vel­op­ment and only par­tially op­er­a­tional between Mane­sar and Pal­wal.

· South­ern Pe­riph­eral Road (SPR): Soon to be com­pleted, this 16-km long road pro­vides seam­less con­nec­tiv­ity between Golf Course Road, Golf Course Ex­ten­sion Road and NH-8.

This en­hanced con­nec­tiv­ity will ben­e­fit Sohna by in­ter­link­ing NH-248A to these roads.

· North­ern Pe­riph­eral Road (NPR): Also known as Dwarka Ex­press­way, this 28 km 8-lane high­way con­nects Dwarka in Delhi to Kherki Daula in Gu­ru­gram.

Due to land ac­qui­si­tion is­sues and sev­eral lit­i­ga­tions, the de­vel­op­ment of this road has been de­layed sig­nif­i­cantly and missed sev­eral dead­lines.

In June 2016, the project was ac­quired by Na­tional High­way Author­ity of In­dia (NHAI) and re­named as NH 248-BB. Also, the author­ity has in­cluded the pro­posed Cen­tral Pe­riph­eral Road (CPR) along with the ex­press­way, which will even­tu­ally con­nect North­ern Pe­riph­eral Road to South­ern Pe­riph­eral Road.

Rail: Gu­ru­gram rail­way sta­tion is the near­est to Sohna, at a dis­tance of ap­prox. 28 km.

Air­port: Indira Gandhi In­ter­na­tional Air­port (IGI) is ap­prox. 40 km from Sohna.

Metro rail: HUDA city cen­tre is the near­est ex­ist­ing metro sta­tion, lo­cated 26 km from Sohna. The Gur­gaon Mane­sar Ur­ban Com­plex Mas­ter Plan 2031 has pro­posed a new metro route that will pass through Golf Course Ex­ten­sion and SPR un­til Mane­sar.


Cur­rently, Gu­ru­gram’s core ar­eas along with the ini­tial stretch of Gu­ru­gram-Sohna con­nect­ing road (from Ra­jiv Chowk to Bad­shah­pur) have suf­fi­cient so­cial in­fra­struc­ture in the form of hos­pi­tals, malls, ho­tels, of­fices and sev­eral busi­ness cen­tres. While the core vicini­ties within a 10 km ra­dial dis­tance of Sohna town are still un­der­de­vel­oped, Sohna has al­ready be­come an ed­u­ca­tional hub due to the pres­ence of many prom­i­nent schools and in­sti­tu­tions such as GD Goenka World School, Ryan In­ter­na­tional School, SCJ World School, DPS, St. Xavier’s High School and many more.

In ad­di­tion, be­ing a tourist des­ti­na­tion, Sohna has sev­eral prom­i­nent ho­tels and re­sorts such as The Taj Gate­way, Botanix Gate­way, The Westin Sohna Re­sort and Spa, etc. With in­creas­ing in­flux of work­ing pop­u­la­tion and bur­geon­ing real es­tate de­vel­op­ment, Sohna’s so­cial in­fra­struc­ture is likely to im­prove in the fu­ture and the town will soon be­come self-sus­tain­ing.


Sohna’s real es­tate mar­ket is led by af­ford­able and mid-seg­ment hous­ing. With mas­sive de­mand from end-users in the low and mid-in­come groups, Sohna has at­tracted sev­eral de­vel­op­ers in­clud­ing Ashi­ana Hous­ing, Ra­heja, ILD, Ireo, Su­pertech, Tata Hous­ing and many more. The re­gion has wit­nessed a sup­ply ad­di­tion of around 20,000 hous­ing units which are sched­uled to be de­liv­ered in next 3 to 4 years.

Units with an av­er­age ticket size of less than INR 40 lakh con­sti­tute around 49% of the over­all sup­ply. The gov­ern­ment’s re­cent schemes and ini­tia­tives have given a fur­ther im­pe­tus to the de­vel­op­ment of af­ford­able units.

As Sohna is in a nascent stage of de­vel­op­ment, most of the projects are in the un­der-con­struc­tion stage and likely to be de­liv­ered within 1 – 4 years. In the next 2 years, a large por­tion of pre­vi­ously-launched units is likely to be de­liv­ered.

The cur­rent av­er­age res­i­den­tial prop­erty prices in Sohna range between INR 4000 – 4300/ sqft. Due to the im­pact of re­cent re­forms such as de­mon­e­ti­za­tion, RERA and GST, prices marginally cor­rected dur­ing the past few quar­ters. How­ever, the av­er­age prices in the re­gion have marginally risen by around 3% between Q1 2015 and Q3 2017.

With its in­her­ent ad­van­tages in­clud­ing prox­im­ity to the Mil­len­nium City of Gu­ru­gram, easy ac­ces­si­bil­ity to other parts of NCR, its well-knit net­work of ex­ist­ing roads and planned up­grades, scope for es­tab­lish­ment of in­dus­trial and com­mer­cial hubs – and, most im­por­tantly, af­ford­able real es­tate prices, Sohna has con­sid­er­able po­ten­tial to emerge as a prom­i­nent satel­lite town in the fu­ture. The in­creas­ing em­pha­sis on af­ford­able hous­ing un­der the Gov­ern­ment’s ‘Hous­ing for All by 2022’ scheme will pro­vide fur­ther im­pe­tus to the de­vel­op­ment of this re­gion. MUM­BAI: Phoenix Mills Ltd, which mostly builds malls, is plan­ning to more than dou­ble its of­fice port­fo­lio to 3.5 mil­lion sq.ft in four years, joint man­ag­ing di­rec­tor Shishir Shri­vas­tava said.

The com­pany owns around 6.5 mil­lion sq.ft re­tail space in seven cities, in­clud­ing Mum­bai, Pune, Ben­galuru and Chen­nai. Most of them are malls, built as part of mixed-use de­vel­op­ment.

It also owns around 1.5 mil­lion sq.ft of of­fice space at Kurla in Mum­bai.

“We want to ex­pand our of­fice port­fo­lio to about 3.5 mil­lion sq.ft. It will take about four years to build that kind of space. The of­fice build­ings would be built in the ex­ist­ing mixed-use de­vel­op­ments,” Shri­vas­tava said in an in­ter­view.

A mixed- use de­vel­op­ment may house re­tail, of­fice and res­i­den­tial spa­ces within the same project. With this, Phoenix Mills joins large de­vel­op­ers such as Lodha Group and Oberoi Realty Ltd which are build­ing of­fice tow­ers to cater to ris­ing de­mand, even as the res­i­den­tial prop­erty mar­ket stag­nates.

In the nine months ended De­cem­ber, the BSE-listed firm gen­er­ated around 67% of its rev­enue from re­tail busi­ness while com­mer­cial of­fice ac­counted just around 4%. Around 30% of its over­all rev­enue came from its hospi­tal­ity and res­i­den­tial seg­ments.

The new com­mer­cial of­fices would be built across all its ex­ist­ing “re­tail-led mixed used de­vel­op­ments” in Pune, Ben­galuru and Chen­nai.

Phoenix plans to add an of­fice tower at the com­mer­cial area at Mum­bai’s Lower Parel, where it op­er­ates High Street Phoenix mall and St Regis Ho­tel, Shri­vas­tava said.

He did not say how much the com­pany will in­vest to build these as­sets, but said it would be funded mostly through in­ter­nal ac­cru­als.

De­mand for pre­mium of­fice space is cross­ing sup­ply in ma­jor cities.

Ac­cord­ing to a 19 Fe­bru­ary re­port by bro­ker­age firm ICICI Se­cu­ri­ties, net ab­sorp­tion of prime of­fice space in 2017 across seven cities in­clud­ing Mum­bai, Delhi-Na­tional Cap­i­tal Re­gion (NCR) and Ben­galuru stood at around 24 mil­lion sq. ft against a sup­ply of around 23.5 mil­lion sq. ft dur­ing the year.

This year, net ab­sorp­tion of of­fice space is likely to touch 28 mil­lion sq. ft, the re­port said.

Be­sides, the com­pany is also on ex­pan­sion mode to ramp up its re­tail busi­ness. Last year, Canada Pen­sion Plan In­vest­ment Board ( CPPIB) said it would in­vest around Rs1,600 crore in Is­land Star Mall De­vel­op­ers Pvt. Ltd, a unit of Phoenix Mills.

Most of the funds would be de­ployed be­fore the end of this year in pur­chas­ing land to de­velop malls or ac­quir­ing ex­ist­ing re­tail as­sets.

“Our rental in­come in the last fi­nan­cial year was around Rs 770 crore. Go­ing by the indicators in the last nine months, this year’s rental in­come would grow at l east by around 11-12%,” Shri­vas­tava said.


Gu­ru­gram’s un­prece­dented eco­nomic growth has led to ac­cel­er­ated ur­ban­iza­tion

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