Pune market 2014 real estate heroes v2

Real Estate Market Report

PUNE 2014

Contact: BM Poonacha

Real Estate Heroes 287, 1st main, Defence Colony, Indiranagar, BANGALORE

560 008 INDIA

+91 9449073566 [email protected]

4/12/2014

REAL ESTATE HEROES

PUNE 2014 Real Estate Market Report

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CONTENTS

1. Preface ...................................................................................................................................... 2

2. Pune City ................................................................................................................................... 3

Overview ........................................................................................................................................... 3

SWOT Analysis: Pune ....................................................................................................................... 4

Upcoming Infrastructure Developments ............................................................................................. 5

Pune Positioning ............................................................................................................................... 6

3. Pune Urbanisation ..................................................................................................................... 7

3.1. Urban Transformation ................................................................................................................ 7

3.2. Urban Prognosis ........................................................................................................................ 8

3.3. Spatial Growth ........................................................................................................................... 9

4. Real Estate Micromarkets ........................................................................................................ 10

4.1. Residential ............................................................................................................................... 10

4.2. Commercial ............................................................................................................................. 11

4.3. Integrated Townships ............................................................................................................... 12

5. Market Outlook 2014 ................................................................................................................ 13


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1. PREFACE This Information Memorandum on Pune has been prepared after research from various sources, urban development plans, historical data, market news and expert analysis. The document has been prepared to cover the following aspects:

Knowledge of Competition

Historical Transformation

Reviewing Market Trends

Market Outlook and Forecasts

Market Insight on Valuations

Distribution of Asset Classes across Micromarkets

Asset Class Product Positioning

Infrastructural Focus

Growth Corridors

Economic Factors Most of all this report intends to aid in an “Informed” Decision Making


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2. PUNE CITY

OVERVIEW Pune is a plateau city situated near the Western margin of the Deccan plateau and a city of historical

eminence. Ranked as Gamma Global City, it is an important economic center, second to Mumbai in

Western India and currently an expanding metropolis which makes it one of the most emergent

among all cities of India.

The temporal evolution of Pune originated from a tiny agriculture settlement called ‘Punnaka’ in the

8th century. Pune noticed significant growth under the rule of Peshwas, after which it became a

municipality in 1858 and a municipal corporation in 1950.

The Pune Urban Agglomeration (PUA) has an estimated population of 6 million brought about by

large influx of population due to 3 Significant Sectors.

IT & ITeS

Automobile & Engineering

Education


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SWOT ANALYSIS: PUNE

Strengths Weaknesses

Op

po

rtu

nit

ies

• Second Significant Urban Center after Mumbai in the West

• Excellent Connectivity to other cities: Rail & Road • Established Engineering, Education and ITeS Hub • Pune comes in the DMIC influence zone

• Spatial Growth opportunities exist • Emerging Market which is incubator for various

Businesses & Services Sector

• Enormous Strain on Urban Infrastructure

Th

reats

• Fully Independent Aviation Operation still

underway

• Competition from neighboring Urban Centers especially

Indore, Nashik and Hyderabad • Rapid urbanization poses threat to environment and

overpopulation unless If counter magnets are not

developed simultaneously


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UPCOMING INFRASTRUCTURE DEVELOPMENTS Pune Food Cluster development project at various locations of Pune, funded by the World

Bank with the help of SIDBI.

Pune Metro

Pune International Exhibition and Convention Centre (PIECC) on an area of 239 hectares

expected to be completed in 2017 developed by the Pimpri-Chinchwad New Town

Development Authority.

170-kilometre Ring Road which encompasses Pune City and Pimpri Chinchwad.

The 4 laning of the Pune Solapur section of NH 9


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PUNE POSITIONING Pune is strategically located and is well accessible from a number of cities in West, Central and South

India most of which are well connected by Rail, Road and Air.

Following three National Highways pass through Pune District:

NH4

(Mumbai-Bangalore): The NH-4, passes through the following places in the district: Khandala, Lonavala, Talegaon, Chinchwad, Pune and Khed-Shivapur. It enters the district from Khopoli

(Dist. Raigad) at Khandala (Tal. Maval) and exits from Sarole (Tal. Bhor) in Pune disrtict and continues further towards the Satara district. The total length of NH-4 in the district is around 120 km.

NH9

(Pune-Hyderabad) The NH-9 starts at Pune and passes through Loni, Bhigwan and Indapur. NH-9 ends in the district at Hingangaon (Tal. Indapur) and continues towards the Solapur district. The total length of NH-9 in the district is around 152 km.

NH50

(Pune-Nashik) The NH-50 originates at Pune and passes through Chakan, Rajgurunagar, Manchar, Narayangaon and Alephata, which ends at Alekhind (Tal. Junnar) and continues

further towards Sangamner in the Nashik district. The total length of NH-50 in the district is around 95 km.

Pune Urban Agglomeration

Mumbai Indore Nashik

Bangalore

Nagpur

Hyderabad

Pune Intercity Distance (Kms)

Mumbai 163

Indore 624

Nashik 202

Bangalore 841

Nagpur 705

Hyderabad 558


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3. PUNE URBANISATION

3.1. URBAN TRANSFORMATION

The urban area of Pune was hardly 5 sq. km. in 1818 and now it stands at about 700 sq. km., with the

total area of the Pune metropolitan region currently covering 1605 sq. Km. Provisional data of the

Census 2011 shows that 5.7 million people live in Pune metropolitan area. Industrialization in Pune

began in the early 1960’s with the establishment of industrial estates in Pimpri – Chinchwad and was

further boosted with the arrival of IT and multinational companies in the last decade.

Figure: Chronological Development of Pune 1820 -2011, Source: Town Planning Department, Pune- 2011


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3.2. URBAN PROGNOSIS The probability map of urban growth of Pune by 2030 shows that the chances of Pune’s expansion towards the North and East direction may be higher than the other directions. This may be due to the presence of the Western Ghats in the South and West direction. Road influenced growth may be much higher along the NH-9 and SH-27 than the NH-4 towards the Bangalore.

Figure: Probability map1 of urban growth of Pune by 2030

Rural areas in Urli Knanchan, Wagoli, Rahu and Talegoan Dhandhere revenue areas might be the main centers of attraction for Pune urbanization in the future; this may be due to presence of Pune-Ahmednagar State Highway (SH-27), Pune-Hyderabad National Highway (NH-9) and greater availability of flat ground compared to the West and South sides of Pune. Non built-up land in the rural areas of Hadapsar, Kothurud and Thergaon revenue areas might be converted in to builtup areas by 2030.

1 Source: International Journal of Geomatics and Geosciences, Volume 2 Issue 2, 2011


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3.3. SPATIAL GROWTH Pune has been able to expand spatially by way of inclusion and urbanisation of its peripheral villages.

This has served to decrease pressure on the core city by way of a radial urbanization pattern. The

City has already witnessed massive growth towards Pimpri-Chinchwad areas where the Development

Plas are in place. Eastwards on Solapur Road up to Loni Kalbhor will also see major development.

The growth direction of PMC is envisaged towards the present growth along Hinjewadi, PCMC and Hadapsar. The growths are triggered mainly by IT industry in Hinjewadi, automobile industry in PCMC and BPO, IT and manufacturing industry in Hadapsar. The growth corridors mainly pass through North, West and East direction. Southern side of PMC contains hilly area where growth is not favorable. There is restriction of growth in the Northeast due to the presence of Airport funnel area. Pune city also has its own limitation for growth; having Pimpri-chinchwad on its north-west direction with some part of the boundary almost touching each other restricts spatial growth of city in this direction.


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4. REAL ESTATE MICROMARKETS

4.1. RESIDENTIAL

Eversince, major expressways and highways rather growth corridors shaped Pune’s geographical

territory. Areas like Baner, Pimple Saudagar, Wakad, Kharadi, Warje etc. emerged as the new gold

mines on Pune’s realty scene.

Major Micromarkets

North Pimpri, Nigdi, Moshi, Dighi. Chinchwad, Akurdi, Pradhikaran, Talegaon, Chakan, and Ravet

Central Bund Garden Road, Koregaon Park, Deccan, Kothrud, Swargate, Bhosale Nagar, Deccan, Model Colony,

Prabhat Road, and Shivaji Nagar

South Warje, Katraj, Kondhwa, NIBM Road, Undri, Ambegaon, Katraj, Kondhwa, Parvati, Salisbury Park, Sinhagad Road, Mohammadwadi, and Warje

East Kalyani Nagar, Yerwada, Viman Nagar, Kharadi, Wagholi, Hadapsar, Koregaon Park, Boat Club

West Aundh, Baner, Bavdhan, Wakad, Ravet, Balewadi, Hinjewadi, Kothrud, Pashan, Pimple-Saudagar, and Wakad.

Focus Micromarkets

Baner Aundh Sample

Emergence After Aundh started saturating, Baner emerged as a natural

growth area. Additionally it is located at the entry point to Pune

close to Mumbai-Pune Expressway Baner is also located along the

Mumbai-Bangalore highway

Due to its proximity with Hinjewadi IT Park it became

significant

Typical Asset Classes Baner quite remarkably developed a Hi-End social

profile and is the preferred location for Hi End Residential properties

Mixed Class Housing

Access Easy access to the city via Ganeshkhind Road

Market Characteristics Highest appreciation for high-

end properties


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4.2. COMMERCIAL As is with most Indian Cities Pune developed with a radial profile with Government offices (Pune Municipal Corporation,Passport Office, Registrar of Companies, Town Planning and Valuations Department to name a few), District court and hospitals all are located centrally in the old city area. Accessing any residential catchment area is very easy as it is centrally located and well connected.

Districts Micromarkets

CBD Laxmi Road, Camp, Bund Garden Road, Boat Club, Koregaon Park, Wakdewadi, Shivaji Nagar and Senapati Bapat Marg

SBD – I Karve Road, Deccan Gymkhana, FC Road, Jungli Maharaj Road, Ganeshkhind Road, SB Road, Wakdewadi SBD – II Yerwada, Kalyani Nagar, Airport Road SBD – III Kondhwa, NIBM, Wanowrie, Hadapsar

SBD – IV Mundhwa, Viman Nagar, Kharadi, Nagar Road SBD – IV Aundh, Baner, Pimpale Nilakh, Pashan, Sus, Bavdhan, Pimpri PBD – I Hinjewadi, Wakad, Talegaon

PBD – II Saswad Road, Sholapur Road, Phursungi

New Commercial Micromarkets which are emerging are split between two choices primarily:

Preference Factor

East Pune Airport West Mumbai expressway.


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4.3. INTEGRATED TOWNSHIPS As per the Special Township Policy Act of the Maharashtra government, a minimum area of 100 acre, investment in public infrastructure, such as roads, water, and sewage is required for development of townships. Following is the list of significant Township Projects in and around Pune at various stages of their existence.

Township Developer Land Area Gross Development

Value (as at inception)

Location Project Status

Magarpatta City Magarpatta Township Development and Construction Company

Limited

400 Acres INR 4000 Crores Hadapsar Existing

Lavasa HCC 25000 Acres INR 50,000 Crores

Pune District Partially Operational

Oxford Knowledge City Oxford Pvt Ltd. NA NA Lavle Partially Operational

Defence City Defence City Developers 226 Acres NA Wagholi Ongoing Amanora Park Town City Development Corporation 400 Acres INR 10,000

Crores

Hadapsar Ongoing

Forest Trails Paranjape Schemes 138 Acres INR 3,200 Crores Bhugoan Ongoing Blue Ridge Pegasus Properties (ABIL) 150 Acres INR 1,500 Crores Hinjewadi Ongoing KUL Ecoloch Kumar Builders 124 Acres NA Baner Ongoing KUL Nation Kumar Builders 110 Acres NA Kharadi Ongoing Life Republic Kolte Patil & ICICI Ventures 450 Acres NA Hinjewadi Ongoing Nanded City Magarpatta Township

Development and Construction Company Limited

700 Acres INR 9000 Crores Nanded Ongoing

Palace Gardens HIRCO NA NA NA Upcoming


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5. MARKET OUTLOOK 2014 IT and ITeS to be the dominant driver

Occupier Interest among all asset classes follows

Peripheral Micromarkets and Exurban areas to witness most growth

Activity Areas will be the East and West due to land availability, intra-city connectivity and Infrastructural facilitation

Lot of anticipations from this market compared to all metros

Pune market 2014 real estate heroes v2

Real Estate

urban growth

urban prognosis

urban transformation

market outlook

total length

asset classes

viman nagar

koregaon park