The first quarter of the new financial year has begun and stakeholders in the housing sector are looking for better days ahead.
Property seekers want prices to stabilise, and developers have been waiting longer for prices of construction material to drop. The salaried class and lower-income groups want the government to give greater thrust to affordable housing.
There have already been positive signs for the year, and realtors have been calling 2015 the ‘year of recovery’.
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Multi-crore property transactions of prime property have been completed and consultants and builder are busy scouting for new land for developing both residential and office space, sources in the construction industry say.
When it comes to the office space market in Chennai, supply is limited and narrowing while the demand is high. On an average, the demand is for about four million sq. ft. every year. The vacancy level, which was around 25 per cent, is now 16 per cent.
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Interestingly, this 16 per cent is in ‘wrong locations’ where companies want their property to come up. “There are some vacancies on Rajiv Gandhi Salai (Old Mahabalipuram Road) in Sholiganallur and also beyond Navalur. But not many seem to be opting for those spaces. On Rajiv Gandhi Salai, on the pre-toll stretch, there is only a marginal amount of space available,” says a real estate consultant.
Residential projects “Commercial space is at its peak. There is no space in grade A or B locations,” says T. Chitty Babu, chairman and chief executive officer of Akshaya Homes.
On the residential front, Chitty Babu says the home segment has steady absorption. Suburbs — be it Padi (Uni5, S and S Foundations), Medavakkam–Perumbakkam (Wow and Superb, respectively), Tambaram or Pallavaram (Winchester) — continue to witness the launch of new residential projects in an accelerated pace.
Some of the key indicators revealed in the monthly study by Jones Lang LaSalle are on predictable lines, with Adyar region topping rental values, which are on the rise in suburban pockets.
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INFOBOX:
REALTY TRENDS
Here are some key indicators of trends in real estate development in the past month
OFFICE SPACE
Key areas Rental Value (In Rs. per sq. ft. per month)
ANNA SALAI 60 to 85
R.K. SALAI 65 to 85
PRE-TOLL OMR 40 to 70
POST-TOLL OMR 25 to 35
GUINDY 45 to 65
Major office space transactions: Arunatech, OMR; Pintron, Mount-Poonamallee Road
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RETAIL SPACE
Key areas Rental Value (In Rs. per sq. ft. per month)
T. NAGAR 120 to 180
NUNGAMBAKKAM 130 to 150
VELACHERY 80 to 120
PRE-TOLL OMR 80 to 100
ANNA NAGAR 120 to 150
L.B. ROAD, ADYAR 100 to 140
Major retail space transactions: Menchis Frozen Yoghurt, Khader Nawaz Khan Road; Focus Art Gallery, T.T.K. Road; Aasife and Brothers Biriyani Centre, Anna Salai
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RESIDENTIAL SPACE
Key areas Rental Value (per month)
ADYAR 20,000 to 30,000
ANNA NAGAR 15,000 to 25,000
SHOLINGANALLUR 9,000 to 12,000
TAMBARAM 6,000 to 12,000
MEDAVAKKAM 7,000 to 14,000
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Source: Jones Lang LaSalle