A Review of The PCMC Property Market in 2016

– Anil Pharande, Chairman – Pharande Spaces
 
As the new year dawns, India’s real estate market has begun navigating the potentially choppy seas of 2017 with a lot of uncertainty. When it comes to the past year, it is safe to say that nothing went as anticipated for the property market. The hoped- for recovery in the residential sector did not happen, and the Government’s unexpected demonetisation move in early November put paid to any chances for a last-minute turnaround.
 
Robust economy: Through the entire gamut of churn and setbacks in 2016, only one city’s real estate market managed to hold its own and even achieve some modest growth. West Pune, with its dominant market PCMC (Pimpri-Chinchwad Municipal Corporation), has always been a unique as it rides on an unbeatable trinity of residential demand drivers – manufacturing, Information Technology and the services sector. This equation has perennially acted like a healthily diversified investment portfolio, with the inherent strength of one or two of these sectors compensating for the occasional de-growth in the others. As always, this factor came to the rescue of the PCMC residential market.
 
Employment still drives housing demand: While the manufacturing sector in PCMC has always been robust thanks to the MIDC belt, continued growth in IT and the various services streams additionally ensured that the employment graph remained strong. With job creation continuing to drive the demand for homes, Pimpri-Chinchwad Municipal Corporation crossed the finish line of 2016 ahead of the other major cities – with room to spare. Though the demand for prime and luxury housing has remained somewhat subdued, budget and mid-income housing saved the day. If anything, 2016 amply illustrated that the middle class in Pune and PCMC has become extremely choosy about its home purchases.
 
Unsold inventory: Many of Pune’s peripheral areas – the hot investment favourites of 2014-15 – saw a depressing build-up of unsold supply even in completed projects. The lack of support infrastructure and known deficiencies such as inadequate or non-existent water supply put paid to many a developer’s hopes of selling his stock solely on the basis of enticingly low rates and freebies.

Of course, every large city in the country has its share of unsold inventory today, either because of muted market sentiment, the fact that a lot of supply is still in the early stages of construction, supply in the wrong locations, or unrealistic pricing of certain projects by developers. In the case of West Pune, most of the non-selling oversupply has been in locations lacking infrastructure. In PCMC, the supply overhang is largely from smaller developers without a good track record and credibility on the market.
 
Evolving buyer preferences: Diwali, the traditional period for increased home purchases in Pune, saw very few takers for inferior projects in inferior locations. Even the prospect of acquiring larger homes than their current ones did not draw mid-income buyers to lagging locations. On the other hand, there was a distinct uptick for smaller but ‘high-performance’ homes in properly connected areas. The accent was on a high degree of facilitation within such projects.
 
Price corrections: With 2016 bringing a slow but steady erosion of property pricing in most of its markets, some of the previously unaffordable locations in West Pune / PCMC have once again become attainable to homebuyers. If Budget 2017-18 brings the hoped-for benefits for first-time property buyers and the RBI rolls out lower interest rates, there is every reason to expect a major revival in home buying sentiment – and it is the superior locations which will see the highest demand.
 
Outlook for 2017
 
The trend of the real estate market in Pune and PCMC performing against the larger odds will definitely continue. Not only do the twin cities have all the right economic and demand drivers firmly in place, but their inclusion in the 100 Smart Cities program will only increase the interest from multinational companies to set up and expand operations here. This will, in turn, increase inward migration and fuel greater demand from investors, even as local end-user demand continues unabated.
 
While the bulk of demand today comes from end-users, investors are still very much a force on Pune’s property market. The city offers several budget bandwidths and property typologies into which one can invest. Well-timed and properly researched real estate purchases can reap very satisfactory returns.
 
However, it should be borne in mind that not every kind of investment pays off equally in Pune – one needs to know precisely how each sub-market works, what it responds to and where the demand is headed. A poorly-judged property investment can be a disappointing proposition. Particularly, investors need to be wary of the cheap, potentially illegal ‘gray market’ residential constructions happening on the outskirts.
 
About The Author:
 
Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in West Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

Pimpri-Chinchwad Among Most Popular Cities On The Internet

– Anil Pharande, Chairman – Pharande Spaces

In a recent discussion with the Times of India group, some interesting trends came to light. With 121 million Indians currently logged in on the internet, and this number is growing at the rate of 25% per annum. More and more Indians are logging in and relying on the Internet to meet their needs for information, help them access goods and services, scout for jobs and look for homes and investment opportunities.

The internet has revolutionized the way Indians perceive their world and consume news and information about it, and the rapid growth of smart phone use in the country has only boosted this trend. According to a recent report by HSBC Global Research, India – India’s smartphone penetration stood at just 30% last year, will by 2019 account for 12% of the global smartphone market with a whopping penetration rate of 65%.

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Obviously, media houses like the Times Group have not lost any time in harnessing India’s promising online market. Times Internet, the Times Group’s flagship internet brand, is also India’s largest Indian online group. Naturally, it draws a massive amount of online traffic, and lays claim to over 6.5 billion page views per month. Indiatimes.com alone accounts for 5 million visitors every single month.

Considering that the internet has become the fastest and most trusted medium to reach consumers of real estate, developers will take such statistics very seriously. Over and above other information which is of great interest, real estate developers want to know the demographics of online visitors, and which areas job seekers – who are of course potential real estate buyers – are investigating online.

According to sources at Times Internet, 85% of the monthly visitors to their sites are graduates and 40% of these are post-graduates. 19% of these visitors have an annual income of over Rs. 7 lakh per year. But more interesting than this are the online traffic details for India’s leading cities, because these details reveal which cities potential home buyers are most interested in.

Also, according to the latest statistics available from the Times Group’s indiatimes.com, the Pimpri-Chinchwad draws a mind-boggling monthly traffic of 658273 visitors on. In fact, PCMC ranks among the top 10 cities in terms of search rankings on the Internet. On TOI.com, Pimpri-Chinchwad ranks 4th after Mumbai, Bangalore and Delhi, with 21.7 million views per month. In comparison, Pune ranks 9th with only 5.26 million viewers per month.

Online visitors are interested in the PCMC for various reasons, the first of course being job opportunities. This stands to reason, because in terms of job creation, PCMC is significantly ahead of Pune and most other cities in Maharashtra with the exception of Mumbai. The combined employment generated by the Hinjewadi IT Park and the MIDC manufacturing belt has made PCMC a focus area for fresh graduates seeking to build their careers.

PCMC is also among the most prominent search terms for online home hunters. Buyers are attracted by the prospects of living close to their workplaces, the superior infrastructure in PCMC, and the more attractive property prices when compared to most regions in the Pune Municipal Corporation.

The highest number of online searches for real estate within the region are for properties in Puneville, Moshi, Ravet and Chakan, as these areas offer fast access to PCMC’s primary employment centres and also offer superlative returns on investment. Another key terms which features prominently in online home searches are for integrated townships, for which PCMC has extremely famous.

About The Author:

Anil PharandeAnil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings.

Why Roads Boost Real Estate Growth

Anil-Pharande– Anil Pharande, Chairman – Pharande Spaces

It is no secret that improved road connectivity is very important for real estate growth. Most property brokers will make a big case out of an area’s excellent road network and how this improves the appreciation value of a proposed property. But how exactly does this phenomenon work? What is the real ‘connection’ between better roads and better real estate values?

  • The History Of ‘Road Power’

Infrastructure is the key to growth for real estate – and the cornerstone of infrastructure is roads. The importance of roads to human being is vouchsafed by how long they have been around. The oldest paved road in recorded history was made sometime between 2600-2200 BC in Egypt; but it was the Roman Empire which brought out the fullest potential of roads traversable by wheeled, horse-powered carriages.

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Circa 312 BC, the Roman Empire built stone roads throughout Europe and North Africa to aid its military campaigns. At the height of their power, the Romans had built 78,000 kilometers of roads that led to and from Rome. History is witness to what the Roman Empire achieved by connecting the parts of the world that were important to them to their seat of power.

However, it was only much later that ‘road power’ could begin to be fully exploited. It was, in fact, only in 1768 that the French inventor Nicolas-Joseph Cugnot built the first steam-powered automobile capable of human transportation. Ever since then, roads have emerged as the master key that unlocks all urban potential in the modern world.

  • Fast Forward To Today

It is safe to say that real estate development as we know it is impossible without adequate road networks. In the first place, they are required to transport construction materials and manpower to sites. Thereafter, people need roads to be able to travel to the newly developed locations. However, the basic roads that are initially used to ‘open up’ and area usually fall short of the task of really making it prosper. High volumes of traffic require larger, better-planned roads to accommodate it, and it often emerges that existing distances between locations can be significantly reduced by laying new roads altogether.

In the city of Pune, one recent example of the introduction of a new major road can cut down the distance that needs to be travelled between destinations was the Spine Road in the Pimpri-Chinchwad Municipal Corporation (PCMC). The launch of this important piece of infrastructure had a direct and very beneficial effect on residents in all the areas it influences. It connects two major highways, provides access focus for various residential, commercial and industrial centres and is the longest stand-alone road in the region. Spine Road has significantly relieved traffic congestion on internal roads – it has six lanes with cycle tracks, service roads and even parking facilities.

  • How Roads Improve Urban Life

Time Saved = Improved Lifestyle: With the shorter distances achieved by well-planned and strategically laid new roads, people can choose to not use their fuel-guzzling cars and travel to and from work by public transport or two wheelers instead. Apart from improving the quality of lives, this also decreases noise and air pollution in residential areas. Improved road connectivity also improves the overall safety of a neighbourhood, because emergency services like law enforcement and fire brigades can reach there faster. Residents also have quicker access to hospitals, which often makes the difference between life and death.

Obviously, infrastructure initiatives like the Spine Road in PCMC are a major advantage to employees working in the area’s numerous manufacturing and service industries. In Indian cities, the amount of time it takes to get to and from one’s workplace literally makes or breaks residential locations. Also, because residents of well-connected localities can reach and return from their workplaces faster, they have more time to spend with their families. The same fundamental works for school-going children, as well.

Considerable Savings On FuelEver-increasing fuel prices were once a concern only to the middle class, but they are today even the more affluent classes are feeling the heat. In India, electric cars that can meet the travel requirements of a normal-sized family are still a distant dream. Like it or not, we continue to depend on fossil fuel-driven vehicles.

A normal middle class family can save quite a lot on its monthly fuel expenses when a new road improves overall connectivity in their locality. Communities which live in areas without good road connectivity often spend between 10-15% of their monthly income on transportation alone. The figure rises proportionately to the number of vehicles the family operates.

The Health ‘Connection’Reduced travel time also equals a lower chance of commuting-related physical ailments and stress levels. When people have to travel over longer distances daily, the time in which they are exposed to traffic pollution and extreme climate increases proportionately. Several serious health problems such as deep vein thrombosis and lung infections have been directly linked to regular, long automobile travel.

By the same coin, road rage and reckless driving also often the direct by-product of traffic congestion caused by insufficient road linkages. Also, improved road connectivity leading to significantly shorter travel distances makes it possible for people to opt for health-positive travel modes such as bicycles.

The Real Estate ‘Connection’For all the above reasons, improved road connectivity has a massive impact on real estate prices of a location. There is always higher demand for homes in well-connected areas, because they are more accessible, safer, healthier and cheaper to live in.

About The Author:

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings.

PCMC – India’s Best-Planned Real Estate Market

Anil-Pharande

 

 

 

Anil Pharande, Chairman – Pharande Spaces

Planning In Real Estate

Planning is an inalienable component of real estate development. This is why buildings are engineered, not built randomly. While developing a project, this means that the builder follows a pre-determined design provided by an architect, who has based his or her design on proven engineering principles.

This planning ensures that the building’s structure has a prescribed foundation depth and distributes weight uniformly so that it can withstand internal and external stresses. The engineering aspect of project design also ensures that living units are proportionate and that the available space within them is optimally used.

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In a residential complex, the planning aspect is extrapolated beyond individual buildings. The architect’s job is to engineer the project in such a manner than the buildings are distributed according to plan across the plot, and that open spaces, parking spaces, internal roads and common utilities are exactly where they are supposed to be. In larger townships, the planning aspect becomes even more involved because of the larger area.

Planned Cities

All these are expected factors when it comes to real estate projects. But when such detailed planning is applied to an entire city, its benefits are vastly magnified. Architects, engineers, town planners, government agencies and builders approach the development of the whole city as though it were one large integrated complex.

This takes a huge amount of planning, coordination, investment and effort, but the results are obviously worth it. This is how the Pimpri-Chinchwad Municipal Corporation came into being. This is what sets it apart from other cities and into the same bracket as other planned municipalities like Chandigarh.

Today, the PCMC is a model city which is the result of careful planning of economic, social and real estate development. Unlike in the other regions in Pune, PCMC’s town planning authorities have scrupulously shielded the city from the ad-hoc development that has paralyzed the rest of Pune. The futuristic thinking and high vigilance that has been employed in developing this region has resulted in an avant-garde satellite city which adds a whole new dimension to the Pune’s real estate market.

Planned Cities Which Began Well And Ended In Chaos

From the start, planning authorities of the PCMC were determined not to repeat the mistakes committed in other cities which were originally meant to be immaculately planned municipalities. They started off on the right note, but the planning aspect soon decayed and gave way to the kind of unregulated growth that has destroyed the urban fabric of most Indian cities today. Some of the examples of failed attempts to produce planned municipalities in India are:

  • West India: Navi Mumbai and the Kalyan-Dombivili and Virar-Vasai belts
  • North India: The Ghaziabad-Gurgaon-Faridabad-Greater Noida corridor
  • South India: Bangalore’s Devanhalli-Yelahanka and Chennai’s Siruseri-Sriperumbadur belts
  • East India: Kolkata’s Rajarhat-Batanagar-Kalyani belt.

In each of the above cases, what had begun as a regulated real estate development process soon turned to a commercial expansion. PCMC on the other hand, adopted a smarter blueprint from the start. No scope had been given to nearsighted development. PCMC was always meant to be the city of the future where residents could enjoy the benefits of 100% infrastructure-based, community-oriented real estate planning and development.

Real Estate Demand Drivers In PCMC

Demand for residential real estate in a successful satellite city is created when there is a right balance of infrastructure, a stress-free lifestyle and employment opportunities. Additionally, there has to be good connectivity to the parent city. In context of PCMC, these are:

  • Road and rail connectivity to Pune
  • Its highly-planned business and industrial zones create countless new jobs every year
  • Infrastructure is vastly superior when compared to Central Pune
  • Real estate development is strictly dictated by a pre-planned urbanization model that ensures high living standards for all

PCMC is a perfect example of how satellite cities can surpass the central city. Here, the retail, commercial and residential markets work together symbiotically to create a winning proposition for end users and investors alike. When compared to Pune, PCMC has a much higher availability of green spaces, superior social fabric and vastly better infrastructure. Thanks to better land availability, PCMC also provides the most opportunities for real estate developers to create large integrated townships, which have are nothing short of a blessing for Pune’s residents.

About The Author:

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings.

Six Reasons Why People Buy Luxury Homes

Anil-Pharande

Anil Pharande, Chairman – Pharande Spaces

At given point in time, and regardless of economic conditions and other market variables, there will always be people who are not content with just any kind of home. As a result, the demand for luxury homes in India may rise and fall – but it never goes entirely away.

It is driven by the rising standard of living and increasing disposable income among successful entrepreneurs, high-flying corporate executives and software professionals, and the wealthy scions of traditionally wealthy families. They want more than just four walls and a parking slot.

What lies beneath? Is it just the thirst for the good life, or perhaps nothing more than the play of people who have too much money in their hands? Not quite. Indian luxury home buyers have sound reasons for why they want to live in premium rather than ‘normal’ homes:

  • Status Aspiration

Buying a luxury home is a matter of prestige – and why not? After all, most luxury home owners have bought their pride and joy with hard-earned money. They want to live in homes that announce their arrival, and offer a higher lifestyle rather than just a postal address.

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  • Comfort

The very latest of today’s luxury homes provide all the modern comforts – and an ideal environment for living and raising a happy family. These homes are built to take care of the needs of a comfortable lifestyle. Features like swimming pools, themed, landscaped gardens, gyms, meditation centers, manicured lawns, electronic security, touch-button responsive fixtures, and entertainment and shopping available at close hand all contribute towards making the living experience more comfortable and enjoyable.

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  • Security

One important feature of luxury homes is that they have very high security. They have top-of-the-line security, both in terms of trained security personnel and security installation that guarantee safety. Further, accidents and medical emergencies can be quickly taken care of with immediate response triggered by technology, and the availability of hospitals and emergency rooms close at hand.

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  • Technological Enablement

Technology and IT innovation have gone a long way to make the living experience in high-end luxury homes extraordinary. From solar generators to remote controlled window shutters, everything is directed towards meeting the demands of homebuyers looking for an ultra-modern lifestyle.

 

  • Better Neighbors

The benefits of housing one’s family in a luxury apartment do not only extend to conveniences. Luxury housing projects are also seen as the perfect environment for one’s children to grow up in and the adults to socialize in. After all, such projects basically form a society with a certain degree of culture, education and beliefs – in short, better neighbours.

  • Investment Value

The increasing demand for properties in India rivals that of gold. Real estate and gold are the most traditional forms of wealth investment in India. However, properties present the advantage of being an asset that rises in value at every instance – and it is also a ‘performing asset’, meaning that it serves a practical purpose even as it gains in value. Given the fact that luxury homes are always in demand even on the secondary market, HNIs correctly see them as the perfect investment opportunity that guarantees multiplied returns in the future.

About The Author:

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. 

Anil Pharande In Interview With The Realty Paper

therealtypaper

Anil Pharande, Chairman – Pharande Spaces in interview with The Realty Paper

  • How is the current scenario in the Pune real estate market?

Pune is a powerhouse of potential when it comes to real estate. It is a city of learning and entrepreneurship, and there is a distinctly progressive flavour to everything that happens there. Thanks to the fact that it has become a magnet for IT/ITES and manufacturing companies, the real estate market in Pune is not likely to lose its forward momentum. That said, I always had misgivings about the opportunistic manner in which property development was taking place within the PMC limits, and was far more interested in the holistic approach being adopted in Pimpri-Chinchwad.

  • What are your focal points of a real estate development firm?

In terms of locations, we have so far concentrated on the PCMC area and West Pune. My passion for real estate in PCMC has its reasons – the idea of being involved in the raising of a planned city on the lines of Chandigarh, so close to Pune, excited me. My primary objective has been to help steer the path of this planned development, which is why I got involved with CREDAI. Getting into the creation of township properties that would take the best advantage of the benefits that the PCMC offered in terms of superior infrastructure and phased real estate growth was the next logical step.

  • When was Pharande Spaces established?

Pharande Spaces was started in 1994 with negative capital. We launched purely on bank borrowings and goodwill.

  • Where are you most involved in the development of projects?

Since I come from a technical background, I have always placed great emphasis on employing the latest construction techniques in our projects. Our primary focus is on high-quality, visually aesthetic and lifestyle-oriented township projects that are environmentally sustainable and add to the grandeur of Pune’s real estate landscape.

  • Is Pharande Spaces involved in any other business verticals?

Apart from residential real estate, we are already into the manufacture of non-conventional energy equipment as well as distribution and power transformers. We have also forayed into the construction of malls and multiplexes. As already mentioned, we have so far concentrated on PCMC and West Pune, but are now firming up plans to expand into Goa as well.

  • Were you impacted by the slowdown in the real estate market?

Along with all other real estate development firms, Pharande Spaces faced all the ups and downs of the real estate market. We did not incur losses during the downturn, but we certainly did not experience much growth during the phase. Thankfully, the slowdown is now over and demand for quality housing is back with in force.

  • How many residential townships have you built till date?

We have built more than 25 residential projects to date, which include large integrated residential projects and two fully integrated townships.

  • L-Axis was Pharande Spaces’ first ultra-luxury township. Could you tell us more about the latest township you announced?

L-Axis is definitely one of the largest luxury projects we have launched. More recently, Pharande Spaces launched Puneville, a one-of-its-kind ultra-luxury township at Punavale in West Pune. The project is being developed on the 50-acre plot of a de-notified SEZ. The location in the heart of West Pune is literally perfect, being one kilometre from Wakad and with ready access to Aundh and Hinjewadi and further on to Lonavala and Mumbai via the Pune-Mumbai Expressway.

Puneville is a top-of-line luxury residential project designed on the lines of a luxury resort by Aedas, the global award-winning architects who have master-minded Venetian style hotels in Las Vegas and Macau as well as the Financial Centre in Shanghai and Marina Bay Sands at Singapore. Aedas ranks second among the world’s top architectural firms and will bring its full expertise to bear on Puneville. This project is by far the best in the country and incorporates every conceivable luxury feature, and outshines anything so far seen in residential real estate in Pune.

  • How do you view the real estate business at a personal level?

I am passionate about what I do, but have to admit that this business literally leaves no spare time at all. Relaxation is not even a factor.

  • Do you family members complain about your constant non-availability for them? This is a known syndrome among successful developers…

Quite possible, but I haven’t heard the complaints because I’m constantly on the phone.

  • Where do you and your family go for vacations? Do you have any favourite destination?

We have explored the world, mostly in context with my constant search for architectural inspiration for our projects. During these trips, my family members certainly enjoy themselves. We are particularly fond of Turkey, Singapore, Malaysia, Greece and China.

(As featured in: The Realty Paper)