Nov. 7, 2009 (The Hindu Business Line) --
increase in enquiries for residential property.
Moumita Bakshi Chatterjee
Over the past few months, there has been a marked increase in consumer enquiries for residential property, and builders — quick to recognise this — are wasting no time to cash-in on a buoyant market sentiment. A month ago, in a gap of a week, companies — the likes of Sahara Prime City, Emaar MGF Land, Ambience Ltd, DB Realty and Kumar Urban Development — announced plans for public offerings. Together, these would translate into mobilisation of over Rs 13,000 crore. And that excludes the potential public offers in the pipeline — BPTP, Godrej Properties and Oberoi Construction, among others.
That’s not all. Consumers who had deserted the property market for nearly four quarters are now returning with enquiries largely around affordable housing, and even luxury products in Mumbai and Delhi — if claims of realtors are anything to go by. “There are signs of revival in the luxury housing segment,” real-estate major DLF said while announcing its results for the quarter ended September.
Mr Shailesh Kanani, research analyst (Infrastructure) at Angel Broking, believes that with the global economy coming back on track, there are visible signs of recovery across sectors. “In real-estate particularly, we have seen volumes pick up and the confidence is back. Even though the retail and commercial office realty segments are yet to recover, companies are of the view that FY11 will be a better year,” he says.
Then and now
Last year this time, the consumer response to property market was testing new lows. The demand had completely vanished from the market, loans from banks dried up, and debt-laden builders ended up delaying or deferring projects. In fact, the sudden turn of events in the market had forced Emaar MGF Land to withdraw its Rs 7,072-crore IPO in February 2008.
BPTP too had sensed the nervousness of the markets, and pulled back its IPO plans last year. Now Emaar MGF is seeking SEBI nod for a Rs 3,850-crore public issue, and there is also a buzz around BPTP gearing up for an IPO in the coming months.
True, a fourth of the IPO proceeds that builders hope to raise overall will go towards debt-repayment or prepayment. Nevertheless, companies will use part of the proceeds to kick-start construction of new projects, as well as existing ones that had come to a halt with market downturn.
“A year ago the global markets, fresh from the Lehman crisis, were taking a turn for the worse. Back home, Diwali sales were down and people realised that the India-US decoupling concept was a misnomer.
