The Manchester of south India looks set to become a preferred destination for IT, ITeS and biotech companies Over the next five years, new firms setting up offices in Coimbatore are likely to add close to 100,000 jobs tion for real estate investment in

WHEN property prices across the country shot up sharply, several tier II and tier III cities clocked a higher rate of growth than even the metros. Once the market sentiments turned negative, the downward spiral in prices were faster in these second and thirdrung cities, as investors dropped them from their portfolio. While the market has more or less stopped even thinking about these cities, Jones Lang LaSalle Meghraj (JLLM), a global property advisory company, has identified Coimbatore as an exception and has called it a city that offers a lot of potential for growth in the future. The company has recently brought out a white paper, ‘Coimbatore – An Emerging Real Estate Destination,’ which traces the evolution of the city’s real estate market, identifies its numerous market drivers and showcases its prospects as the perfect south Indian real estate investment destination.

“It is time to sit up and take notice of Coimbatore’s status as a highly-promising, alternative IT/ITeS and biotech destination,” Ramesh Nair, managing director, Chennai and Hyderabad, JLLM, said. “This city has everything, including telecom, power, a highlyskilled workforce, a rapid pace of infrastructure development and a proactive government that is aggressively promoting the city,” he said.

The study mentions Coimbatore’s high literacy rate, the pace at which top multinationals are migrating to the city and the manner in which the retail, hospitality, entertainment and residential sectors are growing as promising. The study confidently concludes that Coimbatore, the second fastest growing city in Tamil Nadu after Chennai, is indeed a boom story.

“Our findings in this study indicate that Coimbatore will emerge as a favoured destination for real estate investment in the long run,” said Abhishek Kiran Gupta, head of research, JLLM. “There is a huge potential for local, national as well as international developers in the real estate sector in Coimbatore. We are of the opinion that there is no better time than now for developers, investors, tenants and homeowners to strategise and collaborate to reap the longterm benefits of right investments in the right place,” he said.

Coimbatore, which has a high literacy rate, looks all set to scale new heights as a preferred destination for corporate firms to expand their business presence. Over the next four-five years, Coimbatore is likely to add close to 100,000 jobs, which will in turn contribute to the growth in the per capita income of the city, the white paper said.

The report says the global meltdown, which has exerted severe macro-economic pressure on the industry, has not left Coimbatore untouched. However, the city’s entrepreneurial spirit, combined with all its unique advantages, when compared with other neighbouring tier III cities, would act as growth drivers. While the effects of the economic crisis are only a short-term challenge for all stakeholders of the real estate industry, Coimbatore is likely to emerge as a hot destination for real estate investments in the long run, the paper concluded

Courtesy : Financial Chronicle 09/07/2009

CHENNAI: The Chennai Metropolitan Development Authority (CMDA), in a recent order, has sought to hasten the building plan approval process in the city by making it mandatory for builders to apply for plan sanction through the green channel if their projects are eligible for such consideration.

The green channel guarantees that applications that fulfil all basic requirements are cleared within 30 days of receipt. Also, CMDA officials do not conduct site inspection before issuing the planning permission. Green channel is not new in CMDA. It has been there for quite some time, but builders hardly use it. Hereafter, projects eligible for green channel clearance will not be entertained under the ordinary category, said reliable sources.

Buildings up to four floors which do not exceed 50 dwelling units or 16,140 sq ft (1,500 sq metres) of commercial built-up area are eligible for consideration. But multi-storeyed buildings are not eligible. Other conditions: the piece of land should be a CMDA-approved plot or it should be in existence without any sub-division August 4, 1975 onwards. In case of sub-division, it should have been approved by the competent authority. All such applications should be certified by a qualified architect or engineer, registered with Chennai corporation as a Class 1 licenced surveyor.

Applicants who do not receive communication from the regulatory agency within 21 days of submitting applications can either approach the member secretary or the senior planner to represent cases. The time limit is 21 days to facilitate final clearance or rejection of the file before 30 days of admittance. While the green channel ensures speedy sanction for projects, it also entails strict action against the promoter as well as the architect in case of misrepresentation of facts. In such cases, the CMDA will cancel the planning permission and initiate steps for demolition. Also, the licence of the surveyor will be cancelled. Since the CMDA provides a 20-point check-list along with the application, there is hardly any chance for the promoter to overlook facts.

Confederation of Real Estate Developers’ Association of India (CREDAI) Tamil Nadu chapter secretary T Chitty Babu, reacting to the CMDA’s order, said, “It will help a lot of small projects, especially those coming up within the city. It will be good if multi-storeyed buildings are also covered under the scheme.” Suresh Kumar Jain, MD, Vijay Shanthi Builders, said, “The checklist makes it easy for promoters to keep their applications foolproof.”

Courtesy : Times of India 23/06/2009

Firm to build superstructure and associated facilities, besides handling the electrical and plumbing works at the complex The Rs 250cr residential project, spread across 12 acres, will offer 572 housing units

WW HEN THE going is W good, companies W seem to focus on their independent business plans. But when the market turns tough, some of them look around and see value in what others can contribute towards their cause.

VGN Developers, a leading Chennai-based layout promoter that had forayed into residential housing projects more than a year ago, has now joined hands with construction major Consolidated Construction Consortium (CCCL). VGN has now awarded a Rs 70-crore construction contract for its upcoming Minerva residential apartment project to CCCL.

The project is coming up at Mogapair near Anna Nagar, a prime residential locality.

VGN Minerva is a Rs 250crore residential project spread across 12 acres. It offers 572 housing units, covering a total built up area of about 732 sq ft. The project, launched towards the end of September 2008, is slated for completion by December 2010.

“Through this strategic partnership, we are confident that the project will turn out to be a best-in-class quality offering to customers and create a unique identity for us as well as for them,” says VGN Developers managing director Pratish Devadoss.

“Minerva is a premium apartment project for which we had already done the pile foundation and other basic infrastructure such as compound.

With the construction contract now awarded to CCCL, we are confident about completing the project at least a couple of months ahead of the original schedule,” Devadoss adds.

As a completely homegrown company, VGN’s track record has been fantastic and we are confident that Minerva will redefine the dynamics of a happy home, says CCCL managing director S Sivaramakrishnan. “In fact, we have been in talks with VGN for quite sometime as they have a large landbank.

Finally, both the companies have come together for Minerva,” he adds.

CCCL will construct the super structure and associated facilities such as a club house, besides handling electrical and plumbing works.

CCCL, which had made a name for itself by executing large scale IT parks, industrial sheds and housing projects for developers, is now working on the Rs 1,200-crore Chennai airport expansion project.

Minerva will offer 572 residential apartments, comprising both 2BHK and 3BHK units. The size of the apartments would range from 1,000 sq ft to 1,200 sq ft for 2BHK units and from 1,400sq ft to 1,800 sq ft for 3BHK units.

“While the inaugural offer price was Rs 2,975 per sq ft, the price has since increased to Rs 3,175 per sq ft. But we are able to sell our apartments because the price is still comparatively lower than other projects that are quoting around Rs 3,900 per sq ft,” Devadoss says.

Courtesy : Financial Chronicle 14/05/2009

CHENNAI: Taking advantage of the reduced land prices, some builders have started to seek permission for new residential projects in the city.

“As I have recently purchased land at a price 30 per cent lower, I am planning to start projects there,” says A. K. Alaudeen, Director of Salma Constructions.

About 50 per cent of the builders who purchased land after 2006 are reluctant to start work even though many of them have got permission from the authorities concerned, say builders.

According to CMDA vice-chairman Susan Mathew, the planning body had given permission for 877 housing units of special buildings category in the first four months of 2009 in the Chennai Metropolitan Area as against 1,499 units in the corresponding period the previous year.

A total of 1,700 apartments in multi-storey building category have been permitted this year by the CMDA, said Ms. Mathew. According to stakeholders in the industry, the blend of comparatively low land prices on the outskirts, less realty transactions within the city, reluctant buyers and calculating builders are expected to create a skewed distribution of new residential apartments in Chennai.

Secretary of Chennai Real Estate Agents Association M. R. Nazeer says, “The number of new residential projects in many localities within Chennai Corporation limits has come down because the builders are waiting for the market to boom.”

Builders who have purchased land for development in many residential localities off Poonamallee High Road before slowdown have not started work even after demolition of the old structures, says Mr.Nazeer.

Many builders, ready with necessary government permission, are reluctant to start work as they are unable to gauge the market and the optimum price for viability of the residential project, he says. According to builders, a chunk of the housing stock now available on OMR and GST Road were built on land purchased before 2006 at relatively affordable prices.

More than 20 per cent of the builders who have made land transactions in many areas of the city Corporation limits after 2008 at an inflated price are yet to start work even after obtaining permissions from authorities concerned.

Some builders have decided to wait for the market to stabilise, adds L. Dayanidhi, vice-president of the Chennai Real Estate Agents Association.

In such a scenario, buyers in real need of a residential apartment in good localities within the city limits do not have too many options to choose from. “There is relatively small number of new apartments to choose for buyers in some localities while there is a problem of plenty in certain localities,” says Mr. Dayanidhi.

In contrast, the number of residential projects beyond the Chennai Corporation limits seems to be increasing. But even in those areas, builders say it is not easy. According to them, many land-owners are not willing to negotiate the price. In these times of less number of transactions, only a few of the buyers have been able to buy at 30 per cent less than the first quoted price.

The Tamil Nadu Housing Board has not been able to initiate new projects because of the restrictions imposed by the code of conduct for elections, said one of its senior officials.

Courtesy : The Hindu 12/05/2009

The Rs 200-crore project, near Sipcot IT park, to offer 934 1, 2 and 3BHK residential units ranging from 580 sq ft to 2,362 sq ft -the-art minute drive fr Project to offer eco-friendly living with a state-of-the-art sewage treatment plant

THOUGH the real estate market has been going downhill for quite some time, there seems no let-up in the launch of new resi- dential projects in and around Chennai. The latest to join the list is the Sabari Group, which has diversified business interests, including hospitality and retail.

The company has launched Sabari’s Serenity, off OMR (Old Mahabalipuram Road), Chennai’s IT corridor, close to Siruseri Sipcot IT Park. The Rs 200-crore project will offer 934 residential apartments ranging from 580 sq ft to 2,362 sq ft 1BHK, 2BHK and 3BHK units.

According to the company, the project would offer customers ecofriendly living with a state-of-the-art sewage treatment plant for a pollutionfree environment, 24×7 power back-up for common area lighting, two elevators in each of the 13 blocks, security intercom facility, an exclusive club house with landscaped garden, multi-purpose hall, a well-equipped gymnasium, reserved car park, swimming pool, a patio coffee terrace, squash court, children’s play area and an indoor games floor.

A commercial complex in the premises would house a shopping centre, convenience store, an ATM and bank extension counter, a polyclinic and a unisex saloon, among others.

“We are determined to help customers realise their dreams and, in the process, create a valuable asset for them,” said KRV Ramani, chairman and managing director, Sabari Group.

“Serenity comes at a reasonable price, with the promise of comfort and convenience, vital ingredients for a spacious home,” he said.

Pointing out that Serenity would offer high-quality lifestyle at affordable rates, Ramani said the apartment prices begin at Rs 11.86 lakh and increases according to the size.

Spread over nine acres, the project is a 25minute drive from Tidel Park and a 45minute drive from the airport.

The project would be executed in three phases. About 324 apartments would be built in the first phase and are expected to be ready by December 2010.

The entire project is expected to be completed by March 2011.

Courtesy : Financial Chronicle 07/05/2009

Gardens@Orchid Springs in Chennai to offer 225 units with a mix of 1BHK & 2BHK apartments Gardens apartments offer a carefree lifestyle for senior citizens, who can avail services various helps

PROPERTY develop- ers seem to be channellising all their energies in creating an oppor- tunity in the otherwise dull market condition. With low cost housing and affordable housing having been tried already by many, the Bengaluru-based Alliance Group has launched an exclusive senior citizen-friendly residential project.

The project, called Gardens@Orchid Springs, offers 225 senior citizenfriendly lifestyle apartments. It incorporates a host of safe and convenient features ranging from anti-skid floors to grab bars in bathrooms and panic alarm buttons to wider passages. This is the first of its kind project in the country, claims the group.

“Gardens apartments will offer a carefree lifestyle for senior citizens, who can also avail the services of a resident manager, service coordinator and various helps provided there,” says Alliance Group CMD Manoj Namburu. The apartments have been designed by Surbana, an international consultancy and township development company based in Singapore, keeping in mind the special requirements of the elderly.

For instance, the toilets have been designed to accommodate wheelchairs, Namburu added.

The unit sizes vary from 650 sq ft 1BHK apartments to 890 sq ft 2BHK apartments. With an inaugural price of Rs 2,999 per sq ft, they would cost Rs 19.49 lakh and Rs 26.69 lakh, respectively.

The project forms part of a well-secured gated community launched near Anna Nagar by the group sometime ago.

Orchid Springs in Anna Nagar extension, has already sold 262 units.

According to the company, Gardens@Orchid Springs apartments will be housed in a 14-storeyed building and be part of the gated community project with a community centre, parks, library, yoga facilities, spiritual discourses and video conferencing facility through Skype.

A 24×7 nursing centre, connected through intercom with a doctor’s consultation room and an ambulance service in collaboration with wellequipped hospitals in the vicinity, will take care of the medical needs of the residents.

Common dining halls will offer multi-cuisine and nutritional meals at a reasonable cost to residents as and when they don’t feel like cooking at home, the company has promised.

The complex will have in its vicinity, grocery and departmental stores, an ATM and a chemist shop.

Maintenance and housekeeping services, common pool of chauffer driven cars and guest rooms will also be available for the residents on payment.

Alliance Group is one of the fastest growing real estate companies in the country with projects worth Rs 5,000 crore in hand, including premium residential projects in Bangalore, Chennai, Hyderabad and Mysore.

Courtesy : Financial Chronicle 30/04/2009

Focus on value engineering for reduction of prices

“Customers should stay in places away from the city to benefit from the reduced price”

CHENNAI: The increase in the number of residential projects in recent months at relatively less cost has not only generated considerable interest among the prospective buyers but also made many others curious on how the builders are able to do that. Particularly, given that most developers promise that the reduced cost does not mean a cut in the amenities.

Builders, however, say that affordable housing is the byword and made possible due to a combination of strategies. “Construction industry is going through a change in terms of how the project is executed,” said Pratish Devadoss, Managing Director of VGN.

One of the key drivers is the increasing competition, making many of the builders do an exhaustive comparative study on the prices announced by others in the neighbourhood.

President of Sabari Realtors V.A.Ramash said the company was able to peg the price of the housing units at its project off Rajiv Gandhi Salai at a considerably low level because of various initiatives. “Our rate per sq.ft compared to other projects nearby was brought down by 15 per cent,” he said.

The company also focussed on reducing the land cost as it was the most important factor in the pricing of the apartments. Instead of an outright purchase, it opted for a joint venture with the land owner.

Landowners have an important role in making the housing units affordable, agreed Mr.Devadoss. However, with many landowners reluctant to reduce the price builders have started paying more attention on alternative methods of reducing construction cost.

“We have focussed on value engineering for reduction of prices,” said Nakshatra Roy, Director (Corporate Operations) True Value Homes. The common area and electrical wiring has been optimised in order to reduce the prices, he said. Normally common area is around 20 per cent. We have to optimise the area of corridor, lobby and other super built-up area, he adds.

“Every square inch counts,” says Mr.Roy, adding that better space management has helped in reducing the price of the apartments by 15 per cent.

Technology has also helped in reducing the construction cost. Builders have planned to manufacture the inputs needed for construction. “We are sourcing fly ash and silica for manufacture of concrete blocks,” said Mr.Roy. Bulk order to steel plants is another measure, he added.

Many builders are evaluating new technologies available abroad for reducing costs. Prefabricated walls are found to be effective in reducing the costs. However the construction has to be large scale for use of such walls, said Mr.Devadoss. He added many builders were unable to use technology available in other countries as the infrastructure in India was not adequate for using the technology.

Focussing on minute aspects also helps, explains Padam Dugar, Managing Director of Dugar Properties. The infrastructure levies of multi-storied buildings are Rs.100 per sq.ft. But it is Rs.50 for low-rise buildings, he said. The construction charges also go up as the height of the building increases. The use of more lifts and power consumption also contributes to a rise in the construction cost. Optimisation of common amenities, painting materials and tiles are other important components of the cost-reduction strategy, he added.

Many construction companies accept they have reduced the number of employees as a cost cutting measure and to that extent limited their expenditure. According to Mr. Devadoss, customers should be ready to stay in places away from the city to benefit from the reduced price. He added that the specifications of the amenities in some cases may vary, he added. Valuers said a chunk of the amount reduced was the speculative component of the price increase in the past few years.

Courtesy : The Hindu 28/04/2009

Metro Gold Nest to offer 915 budget residential apartment units, priced between Rs 15 lakh and Rs 28 lakh

SRIPERUMBUDUR, whichhas become a manufactur-ing hub for automobiles,float glass, electronics hardware and telecom, seems to have caught the attention of property developers. Proximity to Chennai’s greenfield airport that’s set to come over the next five years, has only added to the attraction of Sriperumbudur.

A number of project launches have been announced or plans are underway for more residential projects, including townships and gated communities. Given its distance from the city and also the large workforce, realtors are keen to build affordable and budget homes in the region. Chennai-based True Value Homes (TVH), which has several commercial and residential buildings in the city to its credit, is set to launch Metro Golden Nest, its first budget home project. Being developed over 13 acres near Sriperumbudur, behind Rajiv Gandhi Memorial, the complex would offer about 915 1BHK, 2BHK and 3BHK residential units.

“Instead of cutting down on facilities, we are going to use technology to cut cost and time of construction,” Nakshatra Roy, director of corporate operations at TVH, said. The company has decided not to take any construction loan and would promote the entire project based on a self-sustained model.

“By budget homes, we do not mean cheap housing. Since it is a lifetime acquisition for most home buyers in this segment, we are focusing more on adopting the right technology from the right players to drive down costs,” Roy said. TVH sent teams to the Philippines, Japan and even Spain to study mass-housing and quality construction at lower costs to implement the same in the Sriperumbudur project.

While 1BHK unit would come in the 585 sq ft, 625 sq ft and 630 sq ft sizes, the size of mid-segment 2BHK units would range between 790 sq ft and 900 sq ft.

The 3BHK units will be around 1,084 sq ft. “We have not wasted a single sq ft and have strived hard to create maximum living space,” Roy pointed out.

Despite being promoted as a budget home project, Metro Golden Nest would offer the facilities of a gated community complete with a swimming pool, gym, water bodies, community hall, children play area, jogging track, badminton court and even an open air theatre.

Instead of selling the residential units on a per sq ft basis, TVH is offering them as a package deal, which includes registration charges. The package rates for apartments starts from Rs 15 lakh and goes up to Rs 28 lakh. While car park is optional, the project would have about 60 per cent of total areas as open space.

The entire 915-odd apartment complex would be spread over 34 blocks, mostly as ground-plusfloors, while some would be stiltplus-four-floor structures. “Our target buyers would be those in the Rs 5 lakh per annum salary bracket and we expect most midmanagement executives working in companies in the Sriperumbudur belt to opt for this,” Roy said. The project is slated for completion by the end of 2010.

Courtesy : Financial Chronicle 23/04/2009

CHENNAI: As a number of licensed surveyors and builders are complaining of a delay in the new online building approval system of the Chennai Corporation, the civic body is planning to impart training to licensed surveyors and architects to handle the new facility.

Y.S. Kannan, a Chartered Engineer, said he was not able to submit drawings online. “We have made a representation to the Corporation.”

45 plans approved

According to officials, the Corporation received more than 550 applications for building approval after the introduction of the new online building approval system a few weeks ago.

“We approved 45 plans and the rest were rejected,” said a Corporation official.

Plans were rejected because the licensed surveyors did not upload the drawings according to the norms, said a Corporation official. The drawings that were not in layers and closed polygon were rejected.

Corporation Commissioner Rajesh Lakhoni said licensed surveyors would have to undergo compulsory training for renewal of their licence.

There were around 1,200 licensed surveyors in the city. The training programme for them would start on Friday, said the official.

Any person interested in knowing about the new online system can attend the training programme.

According to officials, one of the factors contributing to the trouble was the problem in the conversion to metric system. The software required metric system and the licensed surveyors did not show interest in training, said Mr. Lakhoni.

The online system of plan approval was in operation only in Zone 10 and building approval for other zones could be obtained through the old system, according to Mr. Lakhoni.

Courtesy : The Hindu 01/04/2009

“A green building uses less energy, water and natural resources, creates less waste”

CHENNAI: Even as the global economic slowdown is affecting construction industry, the green building movement is continuing to gain momentum. The impact of the slowdown has made various stakeholders think of different options to reduce operating costs. The movement has started to create interest in the minds of stakeholders of the housing sector in Chennai.

“The green home concept is picking up in the city. The number of clients who want to opt for green homes is continuing to increase,” said Deepa Sathiaram, Executive Director, EN3 Sustainability Solutions.

Last year all 28 registered green projects in Chennai were commercial buildings. Of the six green building projects registered so far this year three are housing projects, M.Raghu, Deputy Director, Confederation of Indian Industry.

The concept of green buildings has become a marketing tool for builders in this period of economic slowdown, said Ms. Sathiaram.

According to the definition provided by the Indian Green Building Council, “A green building uses less energy, water and natural resources, creates less waste and is healthier for the people living inside compared to a standard building.”

The design of green buildings helps reduce the overall impact of the built environment on human wellbeing and the natural environment by efficiently using resources such as energy and water, protecting the health of the dweller and improving productivity of employees, reducing waste, pollution and ecological degradation.

Some of the commercial green building projects being developed in the city include Royal Bank of Scotland in Ambattur, Shell in Perungudi, ABN Amro Bank in Chetpet, Great Lakes Institute of Management and Standard Chartered Bank.

However, Chennai was lagging behind other cities in India in the construction of green residential projects, said Ashish Rakheja, National President of Indian Society of Heating, Refrigerating and Air-Conditioning Engineers (ISHRAE) and Chief Operating Officer, Spectral Services Consultants.

The Leadership in Energy and Environmental Design (LEED) green building rating system provides the set of standards governing green building certification. Total number of LEED projects certified in Chennai is 12 and the number of projects registered for LEED certification is 33, said Mr. Raghu.

The cost of design and construction of green buildings has been decreasing tremendously in the recent months and the cost is expected to become lesser than normal buildings, said Mr. Rakheja.

For example, the cost of a waterless urinal has decreased from Rs.25,000 a few years ago to Rs.2,500. The consistent reduction of the price because of better technology will make green buildings affordable soon, said Pankaj Dharkar, PDA-MEP Consultants. The cost of construction of green buildings was 30 per cent higher some years ago. Now the cost has come down and green buildings require around 10 per cent more money, said S.Arul, a green building consultant. The money saved by the reduction in operating costs of green buildings will be higher than the additional investment of around 10 per cent, said Mr. Rakheja.

Courtesy : The Hindu 31/03/2009