micro- market analysis – past, current & future trends - Indian ...

GURGAON INVESTMENT REPORT : MICRO-

MARKET ANALYSIS – PAST, CURRENT &

FUTURE TRENDS

GURGAON REALTY MARKETS : AN OVERVIEW

I. Realty markets in Gurgaon have shown considerable growth over few years post recession

II. Fundamentals driving growth –

A. Strong demand from Corporates& MNC’s for larger offi e spa es followed y residential

Properties for their employees.

B. Good connectivity from New Delhi through MG Road & NH-8

C. Great private participation in development by all tier 1 category developers in the country

D. Infrastructure Developments-

1. Gwal-Pahari connecting Gurgaon to South Delhi

2. SPR(Southern Peripheral Road) linking MG Road & Golf Course Extension Road to NH-8

3. NPR(Northern Peripheral Road) connects New Gurgaon &Dwarka Expressway to Delhi

and IGIA

4. Existing metro connectivity from Delhi, Noida to MG Road & Huda City Centre,

Gurgaon

5. Measures are being taken to ease the traffic by regulating the flow & by planning new

Intra/inter city roads, metro & rapid-metro rail systems – works of which are under

Various stages of development

MICRO – MARKET ANALYSIS

GOLF COURSE ROAD

The present condition of infrastructure (Basic & Social) is at advanced level & is further

expanding at rapid speeds with projects like Rapid Metro, Widening of existing 4-Lane roads to 8-Lanes

& 4-Lane underpasses all along.

The Joint collaboration ambitious project of DLF & HUDA worth Rs. 550 Crorewhich will

include 8 underpasses & a flyover enabling commuters to reach the Golf Course Road from the Gurgaon

Toll Plaza through 18.3kms signal free stretch.

CAGR levels of above 19% have been witnessed along the stretch of this region of Gurgaon & we

predict this trend going upward in future keeping in view the above mentioned infrastructure upgrades

& more ambitious projects in pipe by DLF along the Golf Club patch (350Acres of land parcel is held by

DLF for future expansion of Golf Course & more super high end luxurious apartments like Magnolias &

Camellias).

5500 5500

1800

4500

6000

3000

15500

22000

13500 13500

30000

20000 19000

13500

15700

22000

0

5000

10000

15000

20000

25000

30000

35000

DLF Park Place

(2006-2014)

DLF Belaire

(2006-2014)

DLF Aralias

(2001-2014)

DLF Magnolias

(2004-2014)

Emaar MGF Palm

Springs

(2006-2014)

Parsavnath

Exotica

(2003-2014)

DLF The Crest

(2013-2014)

DLF Camellias

(2013-2014)

Ra

te p

er

Sq

.Ft.

Condominium Complexes

Price Trend Analysis

LAUNCH PRICE CURRENT PRICE

16% 16%

26%

21%

17% 17%

1.50% 0% 0%

5%

10%

15%

20%

25%

30%

DLF Park Place

(2006)

DLF Belaire

(2006)

DLF Aralias

(2001)

DLF Magnolias

(2004)

Emaar MGF

Palm Springs

(2006)

Parsavnath

Exotica

(2003)

DLF The Crest

(2013)

DLF Camellias

(2013)

%a

ge

In

cre

ase

pe

r a

nn

um


CAGR Overview

With entry barrier along this stretch being above 3Cr makes the community character remains

very high end.

The level of occupancy due to the presence of high levels of infrastructure, basic amenities also

remains on a higher side with respect to other micro-markets, making this stretch almost 70%

occupied spreading all along various condominium societies.

GOLF COURSE EXTENSION ROAD

One of the most prime sectors of Gurgaon where ultra luxury condominium complexes by

various A Grade developers are under various stages of advanced construction levels offering world

class luxury specifications & amenities.

With the Phase-2 of metro expanding to this region would further add boost to this sector.

8

10

7

6

Golf Course Road

Level of Infrastructure

Community Character

Occupancy Status

Scope For Future

Development of Infra

4600

6500 6000

3800

5500 6000 6000

22000

11500

9500 9500 8500 8500

7100

9000

30000

0

5000

10000

15000

20000

25000

30000

35000

Ireo Grand Arch

(2009-2014)

Ireo Skyon (2011-

2014)

M3M Golf Estate

(2010-2014)

Ireo Uptown

(2009-2014)

Ireo Victory

Valley (2010-

2014)

M3M Merlin

(2012-2014)

Tata Raheja

Raisina (2010-

2014)

Ireo Grand Hyatt

(2013-2014)

Ra

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er

Sq

.Ft.




Average median CAGR of 22% have been currently observed on this road in just a short span of

about 3-4years approx. since most projects have been launched majorly in the year 2009-2010 which is

bound to go northward in times to come as major infra projects are awaited on this stretch which will

provide residents with better connectivity to nearby upcoming locations like Sohna, Gwal-Pahari& NH-

8.

The investment horizon on this road is Mid-Long term(3-5)years to maximize returns of

investment & one should exit thereafter, topped with a medium/low risk profile of products here as

rates have been established at current levels.

The entry barrier restrictions along this stretch being on a relatively medium side of 1.5Cr,

assures a Medium-High End community character to relish living with & networking.

Through wide internal sector roads, access to NH-8 via SPR, connectivity to Sohna&Gwal-Pahari

via wide 8-Lane roads is bound to give this area a further boost in terms of pricing.

With most developments currently at various stages of construction the level of occupancy

observed on this location is about 30%.

20% 21%

17%

23%

16%

20% 22%

36%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Ireo Grand

Arch

Ireo Skyon M3M Golf

Estate

Ireo Uptown Ireo Victory

Valley

M3M Merlin Tata Raheja

Raisina

Ireo Grand

Hyatt

%A

ge

In

cre

ase

Pe

r A

nn

um


CAGR Overview

6

8 3

9

Golf Course Extension


Community Character

Occupancy Status

Scope For Future


SOHNA ROAD

Mid-market development region of Gurgaon with access to easy connectivity to Golf Course

Extension Road via wide arterials roads & NH-8, premium office & retail complexes.

Mixed use development can be seen on this road due to presence of Commercial Office

developments, High End luxury residences, Retail Complexes & Medium End residential apartment

complexes.

Average CAGR of 20% can be expected from this location keeping in mind past & current trends

as observed, which will be maintained in future times to come as it is strategically located amidst of the

main Gurgaon region.

Community character is not very upscale due to lower entry level ticket sizes – 1Cr& hence is a

community under affordable segment presenting a huge upside from present prices mainly on account

of pent up demand by canaille.

Highoccupancy levels of around 70% are observed on this road mainly due to presence of basic

amenities & infrastructure levels, along with several features presented by condominium complexes in

Gurgaon, which is a major cause of concern in some parts of Delhi from where residents have moved to

such locations.

6450

2800

3500

2500

1600

4500

6650

8500

9500

6000

10000 9500

0

2000

4000

6000

8000

10000

12000

CHD The Vann Unitech Uniworld

Residency

Vatika City CHD Avenue 71 Parsavnath

Greenville

Shweta

Developers

Central Park-2

Ra

te P

er

Sq

.Ft.




3%

21% 19%

34%

26%

14%

0%

5%

10%

15%

20%

25%

30%

35%

40%

CHD The Vann Unitech

Uniworld

Residency

Vatika City CHD Avenue

71

Parsavnath

Greenville

Shweta

Developers

Central Park-2

%A

ge

In

cre

ase

Pe

r A

nn

um


CAGR Overview

SOUTHERN PERIPHERAL ROAD (SPR) Mixed use development region of Medium & High-End Residential Complexes comprising of

Villas, Floors & exclusive residences by prominent developers like Unitech, Tata, DLF& BPTP.

With direct connectivity to NH-8 & metro expansion in Phase-2 covering this area, will prove to

be beneficial in driving both prices & occupancy levels in this part of Gurgaon.

CAGR levels as high as 27% on an annualized basis are currently felt by this sector merely on account of

rapid pace of construction activity by private developers & active involvement by local government

authorities to further provide this area a infrastructural boost, creating comfort zone for investors & end-

users both.

7

6

7

4

Sohna Road


Community Character

Occupancy Status

Scope For Future


2600 2200

2600

5000

6000

7000

5200

6800 6800

5800 5500

8400

10000

5400

0

2000

4000

6000

8000

10000

12000

Tulip White Tulip Orange Unitech Vista Unitech South

Park

Tata Primanti Unitech The

One

Unitech

Crestview

Ra

te P

er

Sq

.Ft.




38%

33%

38%

6%

20%

43%

7%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Tulip White Tulip

Orange

Unitech

Vista

Unitech

South Park

Tata

Primanti

Unitech The

One

Unitech

Crestview

%A

ge

In

cre

as

e P

er

An

nu

m


CAGR Overview

On a scale to 10 SPR enjoys decent levels of community character which is established by developers

like Unitech, Tata & DLF launching medium high end golf condominium complexes & plotted

developments with average ticket sizes rounding to about 1.5Cr for a medium upscale residence

community.

Scope for future development remains an attractive proposition for investors to back for good levels of ROI’s due to proposed connectivity of this location through 6-Lane carriageways with NH-8, Golf

Course Extn&Gwal-Pahari.

NEW GURGAON (SECTORS 82-95) Affordable Mid-Market development community providing great access & connectivity to NH-8, IMT Manesar& other industrial hubs & SEZ’s of Gurgaon region. Main occupiers seen here are the canaille working in industrial houses of IMT, Info City, Reliance SEZ &

Gurgaon.

Development along this region is mainly seen as High-Rise Medium end complex apartments providing

access to basic amenities & infrastructure, & will soon be followed by Commercial Developments.

Average CAGR of 20% has been registered by this micro-market, which our analysts predict could

go even higher subsiding the economic slowdown of 2013 as it enjoys presence of decent levels of

infrastructure, good connectivity to NH-8, IMT Manesar&Dwarka Expressway.

4

5

3

8

Southern Peripheral Road


Community Character

Occupancy Status

Scope For Future


3000

4400

3900

2250

2800

2500 2700

2000

5500

5200 5400

4600

4900

4000

3600

4800

0

1000

2000

3000

4000

5000

6000

Vatika

Lifestyle

Homes

Vatika Seven

Lamps

Bestech

Ananda

DLF New

Town Heights

3C's

Greenopolis

Anant Raj

Maceo

Spaze Privy

The Address

Orris

Carnation

Ra

te P

er

Sq

.Ft.




Current status of occupancy remains low/negligible due to major development being in

advanced stages of construction.

Entry level ticket size of less than 1Cr makes the community character not very upscale & hence

presents a medium end residential living environment.

Commercial activity is witnessed picking up pace in this location with presence of HDFC Bank, Safal

(the day-to-day grocery store) & eating joints more people await handover of their residences to

move in.

DWARKA EXPRESSWAY

One of the most ambitious project of 150 meter wide 18kms stretch on which only 4kms

remain under-developed is bound to shape Gurgaon’s future in Long-Term providing direct

connectivity under 5mins drive to Indira Gandhi International Airport(IGIA), Delhi via

Dwarka& NH-8 through New Gurgaon.

Current focus is rapid construction of the Main Road & delivery of residential projects all

along which remains a cause of concern to investors as huge chunks of money is under bet by

Foreign Equity Investors & Fund Raisers.

This region is poised to become one of the well-planned regions of India & will be a

benchmark for future developments.

16%

9%

20% 20%

30%

14% 13%

34%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Vatika

Lifestyle

Homes

Vatika Seven

Lamps

Bestech

Ananda

DLF New

Town Heights

3C's

Greenopolis

Anant Raj

Maceo

Spaze Privy

The Address

Orris

Carnation

%A

ge

In

cre

ase

Pe

r A

nn

um


CAGR Overview

2

5

1

9

New Gurgaon


Community Character

Occupancy Status

Scope For Future


Currently this micro-market has witnessed a CAGR of 18% spreading over various locations & projects

under scanner.

This area is sure to give very good levels of ROI’s over the long-term(4-5)years as demand is sure to

supersede supply.

Community Character for this location will be Medium High-End as major development carries decent

levels of ticket size thereby restricting the entry by the masses.

Future development of infrastructure is the backbone for capital appreciation on Dwarka

Expressway as the scope still remains vast & a lot is proposed for this development region.

3150

4650

6000

2275

4800

3275

2800

4000

5500

8000

5500 5200

5600

4600

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

Satya The

Hermitage

Heritage Max Puri

Constructions

Diplomatic

Greens

Mahindra Aura ATS Kocoon Chintel

Paradiso

Indiabulls

Centrum Park

Ra

te P

er

Sq

.Ft.




14%

20%

15%

25%

5%

30%

18%

0%

5%

10%

15%

20%

25%

30%

35%

Satya The

Hermitage

Heritage Max Puri

Constructions

Diplomatic

Greens

Mahindra Aura ATS Kocoon Chintel

Paradiso

Indiabulls

Centrum Park

%A

ge

In

cre

ase

Pe

r A

nn

um


CAGR Overview

GWAL-PAHARI

Exclusive Ultra High-End Signature residential condominium complex apartments are under various

stages of construction for this location.

The USP’s – Peaceful green environment, distant from the hustle-bustle of the city & the traffic noise levels, amidst the aravalli’s is strategically located this part of Gurgaon & connectivity - remains an

attraction for major investors/end-users picking up spaces.

Mean CAGR levels of 15% are observed currently for this micro-market taking into consideration

developments not kicking off basic levels of construction which will further boost ROI’s once decent levels of construction would have been obtained.

2

7

0

10

Dwarka Expressway


Community Character

Occupancy Status

Scope For Future


5500

10000

7950 7600

8500

10500

9500

8400

0

2000

4000

6000

8000

10000

12000

Krrish Provence

Estate

Krrish Monde De

Provence

Ireo Gurgaon Hills Paras Quartier

Ra

te P

er

Sq

.Ft.




24%

5%

20%

12%

0%

5%

10%

15%

20%

25%

30%

Krrish Provence

Estate

Krrish Monde De

Provence

Ireo Gurgaon Hills Paras Quartier

%A

ge

In

cre

ase

Pe

r A

nn

um


CAGR Overview

The community character remains Ultra-High End as minimum entry ticket size of 5Cr restricts

entry to select few.

With development of the Mandi Road connecting Gwal-Pahari to South Delhi within 7minutes

drive demand & prices are sure to surge.

Decent level of occupancy is currently observed at 30% as residents feel at peace & calm with

being close to nature & serenity.

RISK PROFILE V/S INVESTMENT HORIZON

MICRO-MARKET RISK PROFILE INVESTMENT HORIZON

Golf Course Road Low Risk; Medium Return 1-3 Years

Golf Course Extension Low Risk; Medium Return 2-4 Years

Southern Peripheral Road(SPR) Low/Medium; Medium Return 3-4 Years

Sohna Road Low Risk; Medium Return 3-4 Years

New Gurgaon Low/Medium; Medium-High

Return

3-5 Years

DwarkaExpressway(NPR) High Risk; High Return 4-5 Years

Gwal-Pahari High Risk; High Return 2-3 Years

4

8

3

8

Gwal-Pahari


Community Character

Occupancy Status

Scope For Future


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