Realty sector to touch $50 billion
The domestic real estate sector may emerge a $50 billion industry by 2010 and prove one of the most attractive sectors for foreign investment. A study by financial services firm India Infoline (IIL) said the sector, which was growing at 33 per cent (CAGR—compound annual growth rate), could be a $50 billion industry in the next four years, if institutional participation supported its growth. The study saw strong economic growth, favourable demographic changes, fiscal benefits, lower interest rates and improvements in institutional framework helping the industry’s growth in the last two-three years. “The evaluation reflects that since 2004 most companies have reported astronomical growth in profitability on the back of rising property prices. In 2005, the industry grew at around 30 per cent. Now, companies have lined up projects, which are more than two-three times the size they have completed in the past five years,” the report said. Sachin Neema, research head, IIL, said, “We estimate India to experience a demand-supply gap of 17.9 million housing units by 2010. This apart, commercial real estate demand is expected to be around 350 million sq ft, of which IT/ITeS and organised retailing sectors should contribute around 300 million sq ft.
Final approval for gems special economic zone in Hyderabad
The Centre has okayed given the final approval to the Gitanjali Group promoted Hyderabad Gems Special Economic Zone Ltd (HGSEZ). At an estimated cost of Rs 500 crore, the SEZ is expected to be fully functional by the end of 2008. It will feature a diamond trading bourse, an international trade centre, a convention centre and an exhibition area.
Waterways body may help to decongest Mumbai, Kochi
After rail and sea routes, it is time to use river routes to help ease congestion and save time. And why not, given that a river link from Mumbai to Nagothana on the outskirts of the megapolis helps one reach in only 45 minutes, as against five hours taken by bus. Thanks to its substantial water resources, the Inland Waterways Authority of India is drawing up ambitious plans to decongest Mumbai and Kochi using river assets. Including the Kochi and Mumbai port projects, 15 projects have been identified under the National Maritime Development Programme, which will need a total investment of Rs 10,500 crore (Rs 105 billion), of which Rs 2,300 crore (Rs 23 billion) will be sourced from private players. IWAI is envisaging an alternative water route for cargo evacuation and passenger transportation from Mumbai to Nagothana, Bassein, Thane, Vashi, Belapur, Panvel and Kalyan. “Inland waterways ensure better fuel efficiency, with lesser damage to the environment. A 1,000-tonne barge movement will mean taking 100 trucks off road. This system is working efficiently in Europe,” said analysts.
Malls flex muscle, hike rentals
Big retailers are losing hold over malls owners, who are no longer in awe or dire need of brand halos to drive occupancy or consumer footfalls to their glass-boxed shopping havens. With malls becoming an accepted, even sought-after marketplace for both consumers and marketers alike, an increasing number of mall developers are now realising that it makes little sense in giving out prime mall space to anchor tenants, essentially big brand retailers, at throwaway rentals. “Low rental offers by anchor stores have also forced developers to try their luck through revenue share agreements where they may earn more,” says Abhijit Das, head, Ansal Plaza Mall Management Company. “What will be more important is the kind of brands one is bringing in as the anchor. For instance, in any tier-2 or tier-3 market, a Koutons will be a much better anchor than Esprit,” says Technopak chief executive officer Arvind Singhal.
Gujarat’s first pharma SEZ
The Ministry of Commerce and Industry has cleared Pharmez, Gujarat’s first pharmaceutical SEZ. Zydus Infrastructure will complete the first phase of the SEZ by mid-2007. Around Rs 1,000 crore will be invested in this SEZ, which will provide direct employment to around a thousand people. The SEZ is to have a museum on the evolution of pharmaceutical science spread over an area of 500,000 sq ft.