Residential space: Coimbatore spins a growth story

The textile city of Coimbatore is witnessing initial signs of surge in demand for residential space. The pleasant climate and sweet Siruvani water had turned this centrally-located industrial city in Tamil Nadu into a retirement haven. But today the culture is changing and more people are buying homes here as an investment option.

Renowned for its cosmopolitan outlook due to influx of north Indians generations ago, the people in the city were mainly dependent on manufacturing industries. But with the development of infrastructure in IT space and enormous growth in retail, a huge flow of population is expected to come into Coimbatore in the next few years.

“The Tidel Park, which will be ready in 2010, is expected to bring in direct employment for 12,000 people and at least half of them will require residential space,” said Builders’ Association of India (BAI) Coimbatore chapter’s vice-chairman C T Narayanan.

He expects demand for residential space to improve drastically in the coming years. “By January 2011, the industry will be back to its good days,” he said.

Sankar Foundation, MD, Omkar Sankar, too painted a positive picture “The sector is slowly getting better as investor confidence has come back. We are seeing a lot of confirmations unlike a few months ago,” he said, adding that the builders were quoting 10% less on the price front compared to last year.

“The land rates are still high but we are trying to move ahead in business by reducing our profit margin,” said Mr Narayanan. He added that the prices never dropped in Coimbatore on the realty front even during the recessionary phase.

“Coimbatore’s property market is showing signs of recovery with several companies seeking a presence in the city. However, the word of caution is that prices should remain reasonable due to sustained demand and more investments,” said Jones Lang LaSalle Meghraj MD Ramesh Nair. He told SundayET that the year 2010 definitely looks better than 2008 and 2009. “Compared to other cities in the tier II and III arena, prices were realistic in Coimbatore and there wasn’t any major downward trend seen during recession,” he added.

Sreevatsa Real Estates MD C S Ramaswamy said, enquiries have increased and conversions are happening now. Even big players in the realty segment like Sahara, which announced projects long back in Coimbatore, have expedited construction activity, he added. Recently, Rakindo too announced the starting of Kovai Hills project in the city. The residential projects are mainly taking place in the outskirts of the city like Saravanampatti, Vadavalli and Mettupalayam Road as the main areas such as Race Course cannot support anymore projects.

“The increasing enquiry in the last three months doesn’t mean that the industry has recovered from recession. The enquiries will have to be converted into sales or occupancy,” Mr Nair cautioned. He, however, credited the city for its adaptability to changing market conditions. “The builders reduced the sizes of apartments and cut down on amenities to make sure apartments are more affordable,” he said.

BAI Coimbatore chapter chairman D R Sekar added, the houses in the Rs 20-40 lakh range are moving well. “It is only the higher budget ones that are seeing sluggish movement,” he added. The enquiries on the commercial front are yet to pick up, added Mr Nair. “Most of the SEZ projects planned in Coimbatore haven’t taken off. But we expect demand for office space to grow in the coming months,” he sai

Tier II and Tier III cities witnessing real estate boom

The coming of affordable housing has meant a booster shot for many of the Tier II and Tier III cities. While earlier Tier I cities and theirsuburbs were looked upon as the best bet in real estate, large scale development in affordable constructions is now translating into high interest levels for Tier II cities as well.A number of these cities such as Bhubaneshwar, Coimbatore, Vadodara, Ghaziabad, Indore and Jaipur have witnessed remarkable development over the last few years.

Ashutosh Limaye, associate director, strategic consulting, Jones Lang LaSalle Meghraj, says that the common features of affordable housing — low-priced land, larger unit numbers to achieve economy of scale, smaller product sizes and reduction of aspiration-driven features are applicable in smaller cities, as well. “Affordable housing is easier in Tier II cities because the land rates are relatively low and the distance of city centres from such projectsis generally manageable. Earlier, developers in Tier II cities also aspired to deliver products that reflected Tier I lifestyles. Now, they have adapted their formats to dovetail with Tier II city requirements.

Tier III cities continue to display a preference for self-built properties, and organized developer penetration is relatively low,” he says.

Realty development has indeed meant a push for many of these cities. A number of developers, including the big names such as DLF, Unitech and Omaxe have upcoming projects in these cities. Rohtas Goel, CMD, Omaxe feels the growth has been tremendous in Tier II cities owing to the real estate industry. The developer is looking at a number of mid-segment and affordable projects in the residential segment in these cities.

“Indore, Lucknow, Sonepat, Jaipur, Rohtak and Allahabad have witnessed quite a push. Right now, it is 20% investors and 80% end users in these markets,” says Goel. Similarly, Unitech also has residential projects coming up in Mohali, Lucknow, Rewari and Bhopal among others.Going forward, these cities will be hubs of development and growth, feel experts. Cities worthy of consideration for serious long-term investors would include Nasik, Nagpur, Vadodara, Ahmedabad, Pune and Coimbatore, according to JLLM

Rakindo builds Kovai Hill township !!

Rakindo Developers Pvt Ltd, a property development and master planning company involved in designing and developing properties and resorts in the Middle East, China, India and Europe, has appointed Mudra and Grey Worldwide as creative agencies for two of its upcoming projects.While Mudra will handle the integrated township project that is coming up at Kovai Hill, Coimbatore, Grey Worldwide will look after the creative duties of Orchid, a residential project consisting of apartments and row houses.

Confirming the development, a Rakindo Developers spokesperson said that after going through the presentations of the agencies that had taken part in a pitch, the company decided to appoint Mudra and Grey. “Mudra and Grey understood exactly what we need to communicate,” he added.JWT and Lowe are the two other agencies that had taken part in the pitch.

Joydeep Dasgupta, Head of Mudra Chennai said, “Initially, the communication will focus more on BTL activities. ATL activities will be undertaken some time later.”Rakindo Developers is a joint venture company formed by Rakeen, a global business company promoted by the Government of Ras Al Khaimah, UAE, and Chennai-based mineral conglomerate Trimex Group. The project – Kovai Hills – will be developed over 1,000 acres with an 18-hole golf course as the centrepiece. The project involves setting up of luxurious golf course villas with scenic mountains and lush greenery in the background. Rakindo will offer these exclusive villas on ‘Own by Invitation Only’, a first in Tamil Nadu. The project is located southwest on the Coimbatore-Palakkad route and will have about 22 million sq ft of constructed space.

Guideline value revision

The Registration Department will check for anomalies in guideline values and revise the values in two select areas in the district, according to an official of the department.

The official said that the guideline values were usually fixed for a site based on classification of the land and location. Some of the classifications were residential, commercial or industrial. A site located in the municipal or corporation area might be used for agricultural purpose. If it was surrounded by houses, it would attract the residential guideline value.Under the Section 47 AA of the Act, such anomalies would be rectified.

As a trial project, a locality in Thondamuthur and another in Joint II in the city were identified.Such anomalies would be identified in these two places and the guideline values would be revised accordingly. Every site would be verified in these two places.

The exercise was already on and it would be completed in six months, the official said.

Provogue ventures into real estate !

Sources tell that Provogue, the retail player is looking to foray in its residential development sector. 20-40% of the land from Prozone, which is into mixed use development projects, will be converted and used for housing development.

Liberty International, which is Provouge’s partner for these mall destinations, will continue to remain the partner even for the housing development part of it, now in the Prozone project it could probably be the first one to see residential development to take place, one of the reasons is that retailers have downsized their rental space demand in these malls. So the company has a lot of property which can be developed for other users and plus residential projects always deliver on a faster turnaround basis. The company says that it is indeed working on a residential development plan although nothing concrete has been decided yet.

The first Prozone is expected to become operational by May 2010 in Aurangabad. There are other projects which have been developed for companies like Indore, Coimbatore, Nagpur and interestingly Jaipur and Lucknow which are two main projects for Provouge. So Prozone Mall destinations have been shelved for a while and the company is exploring other options as to how it can use this land further.

Smart Rooms 2009 Exhibition

Smart Rooms 2009, an exhibition of decoration materials for kitchen, bedroom and bathroom, is organised at Padmavathi Ammal Cultural Centre on Avanashi Road from August 7 to 10. According to a release from the organisers, Interface Trade Fair Private Limited, this will be the 17th edition of Smart Rooms. With people opting for new ideas to decorate each room in their homes, the decoration materials are gaining popularity.

The exhibition will focus on kitchen, bedroom and bathroom accessories, fittings and furniture, home linen, camping products, home appliances, kitchen cabinets, modern furniture, tiles, curtains, glass products and sanitary ware. With 90 stalls, the fair will showcase some of the best known brands and also imported products all under one roof. The exhibition will be inaugurated on Friday by N. Kannan, Superintendent of Police, Coimbatore District, the release adds.

Coimbatore – An Emerging Real Estate Destination

When property prices across the country shot up sharply, several tier II and tier III cities clocked a higher rate of growth than even the metros. Once the market sentiments turned negative, the downward spiral in prices were faster in these second and third-rung cities, as investors dropped them from their portfolio.

While the market has more or less stopped even thinking about these cities, Jones Lang LaSalle Meghraj (JLLM), a global property advisory company, has identified Coimbatore as an exception and has called it a city that offers a lot of potential for growth in the future. The company has recently brought out a white paper, ‘Coimbatore – An Emerging Real Estate Destination,’ which traces the evolution of the city’s real estate market, identifies its numerous market drivers and showcases its prospects as the perfect south Indian real estate investment destination.“It is time to sit up and take notice of Coimbatore’s status as a highly-promising, alternative IT/ITeS and biotech destination,” Ramesh Nair, managing director, Chennai and Hyderabad, JLLM, said. “This city has everything, including telecom, power, a highly-skilled workforce, a rapid pace of infrastructure development and a proactive government that is aggressively promoting the city,” he said.

The study mentions Coimbatore’s high literacy rate, the pace at which top multinationals are migrating to the city and the manner in which the retail, hospitality, entertainment and residential sectors are growing as promising. The study confidently concludes that Coimbatore, the second fastest growing city in Tamil Nadu after Chennai, is indeed a boom story.“Our findings in this study indicate that Coimbatore will emerge as a favoured destination for real estate investment in the long run,” said Abhishek Kiran Gupta, head of research, JLLM. “There is a huge potential for local, national as well as international developers in the real estate sector in Coimbatore. We are of the opinion that there is no better time than now for developers, investors, tenants and homeowners to strategise and collaborate to reap the long-term benefits of right investments in the right place,” he said.

Coimbatore, which has a high literacy rate, looks all set to scale new heights as a preferred destination for corporate firms to expand their business presence. Over the next four-five years, Coimbatore is likely to add close to 100,000 jobs, which will in turn contribute to the growth in the per capita income of the city, the white paper said.

The report says the global meltdown, which has exerted severe macro-economic pressure on the industry, has not left Coimbatore untouched. However, the city’s entrepreneurial spirit, combined with all its unique advantages, when compared with other neighbouring tier III cities, would act as growth drivers. While the effects of the economic crisis are only a short-term challenge for all stakeholders of the real estate industry, Coimbatore is likely to emerge as a hot destination for real estate investments in the long run, the paper concluded.

Beware during buying Sites !!

The Coimbatore Corporation has asked people to verify the genuineness of layout documents before buying house sites, lest they end up buying sites on unapproved layouts. The caution comes in the wake of a case registered against two persons forging layout documents to sell unapproved sites as approved ones.

When a group of residents in a colony applied to the Corporation for water connections, the layout documents were found to be forged. It was found that they had been allegedly cheated by the persons who sold the sites and claimed to have developed a layout and got it approved by the Local Planning Authority (LPA).The Corporation wants the people in the city to be cautious enough not to become victims of such malpractice.

Commissioner Anshul Mishra says people can check with him or the Town Planning Officer at the main office whether a layout is approved or unapproved. This can be checked with the Assistant Commissioners and Assistant Town Planning Officers in the four zone offices also.

(The Corporation is regularising house sites in unapproved layouts, purchased till July 25, 2006, under a scheme for regularisation of unapproved layouts introduced by the Government. The scheme does not apply to layouts formed after this cut-off date. So, people will land themselves in trouble if they buy sites on such layouts. They will not get any basic amenity such as drinking water connection, road, drainage and street light.)

The present case relates to Bagavathi Nagar, a layout of 23 sites formed without approval after July 25, 2007, in the West Zone of the Corporation. Apart from showing forged layout documents, those who sold the sites also produced fake receipts of the Corporation to claim that they had paid the development charges for the layouts. A check by the Corporation revealed that no such payment had been received on the date mentioned in the fake receipts.

Mr. Mishra says the civic body plans to put all plan details on its website so that people can know of the norms. People must be wary of the problems that they can land in when they buy such sites. “We can punish the sellers. But, what can we do to the buyers who become inadvertent culprits. So, prevention is the best option,” he explains. Registration Coimbatore Consumer Cause secretary K. Kathirmathiyon says this problem can be checked when registration of land in unapproved layouts is banned again. An Act to ban the registration came into force in 2000, but was withdrawn in 2007 to make some amendments to it. The amended Act is expected to come into force soon. When registration of sites is not possible, the purchase/sale cannot be effected. So, the solution is provided at the earliest stage itself.

But, till the Act comes into force, people should ask the promoter to furnish the original approved plan of the layout and check the original signature of the competent authority, namely the Director of Town and Country Planning (if the layout is above five acres) or the Joint Director/Deputy Director of the Local Planning Authority (if the layout is below five acres).

Real Estate scenario Postive in Coimbatore !!

Coimbatore, is still brimming with a lot of positive energy as far as the real estate scenario is concerned. The city, with a population of 1.8 million people, has a few pan-India players in the real estate market but the 35-40 odd local developers are confident of staying in business despite the economic slowdown.

Though many are in the wait-and-watch mode, buyers are looking at this growing city as the place for long-term investment, especially on the residential front. Industry experts say majority of the buyers are from nearby cities like Chennai and Bangalore and non-resident Coimbatoreans and NRIs, who want to settle here post retirement.

The latest Jones Lang LaSalle India 30 Real Estate Opportunities in Tier III cities identifies Coimbatore as one of the top 10 growing consumer markets. “Though Coimbatore stands low on current office market activity, the growing engineering and IT potential is sure to throw up opportunities for the real estate market in the next few years,” said experts.

“The prices are marginally down by 5-10% in Coimbatore but the situation will not worsen any further. Land prices are going up and construction costs have increased. We don’t see any downslide on price aspect,” said Omkar Mohan Sankar, a real estate developer in the city.
According to him, the city has perfect attributes such as excellent locale, ideally set in the footsteps of Nilgiris, pleasant climate and sweet Siruvani water. Further, it is an education and healthcare hub and the two industries are recession proof.

Though textile industry is going through tough times, work options are increasing as nearby districts such as Tirupur, Erode and Karur are fast catching the attention of world markets with their fashion products.

Also, with the entry of big players such as L&T and Suzlon in the engineering industry, more investment is expected in real estate market. “Once the companies look at increasing their work force, the requirement for housing would increase and the residential value in the city will go up,” said market sources.

State-owned Electronics Corporation of India’s Tidel Park in IT-SEZ is expected to be ready by January and is likely to provide employment to nearly 12,000 people, which means more residential space will be needed. The Wipro development centre inside the IT-SEZ is also nearing completion and more IT companies like TCS and HCL have plans here.
The city already has the presence of global engineering and IT giants like Robert Bosch and Cognizant and big IT & ITES players like Perot Systems and Spheris. “The city is looking at employing 20,000 more and even if 20% opt for new homes, there would be a demand for 4,000-5000 houses soon,” said Mr Rajesh B Lund, VP, Confederation of Real Estate Developer’s Associations of India.

Today the focus of realty players has moved towards Saravanampatti and Kalapatti, apart from the traditional residential hubs like Race Course, Bharati Park and RS Puram. “The huge activity and development of IT companies in the private IT space in Saravanampatti and also its easy connectivity to airport has attracted developers to construct houses there,” Mr Omkar said.
According to the LaSalle report, the city stands sixth in the connectivity index and fourth among the higher education institutes in top 30 tier-III cities and it gives lot of credibility and potential for the growth of real estate here.

“The city is centrally located and close to Chennai, Bangalore and Kochi by road and also is well-connected to all major metros. Therefore, the prospects of people preferring Coimbatore as a place to invest in real estate in Tamil Nadu rather than already saturated Chennai city is very high,” added Mr Omkar.

BuildMat 2009 Exhibition Inaugurated

Union Minister of State for Finance S.S.Palanimanickam visiting a stall at the BuildMat exhibition inaugurated on Vijaya Fair Grounds in the city on Friday. Indian economy is built with all insulations and the country has the resilience and adequate reserve to withstand the economic meltdown, said S.S. Palanimanickam, Union Minister of State for Finance, here on Friday.

He was speaking after inaugurating the BuildMat 2009 exhibition of the construction industry organised by the Coimbatore Centres of the Association of Consulting Civil Engineers (ACCE), Builders’ Association of India (BAI) and the Indian Institute of Architecture (IIA). Mr. Palanimanickam said any rapidly growing economy was bound to face challenges and the present crisis was one such. To make the industry immune, additional allocation was being made. The Minister said that the plea for enhancing the ceiling for housing loans at the lowest interest rate from Rs. 20 lakh to Rs. 30 lakh could be considered.

However, he replied in the negative to an appeal for further cut in the interest rate. On revamping the taxation pattern for the industries involved in construction materials, he asked the industry to come forward with any proposal that could help it perform better. Chairman of Bharatiya Vidya Bhavan, B.K. Krishnaraj Vanavarayar said that Coimbatore was the fourth most favoured destination in the country by being investor-friendly. P.R. Ramasubrahmaneya Raja, Chairman, Ramco Group of Companies, Chennai, said that the Forum of Architects, Engineers and Builders should seriously commit to promoting green buildings. By 2010, India would have only 160 green buildings with 70 million sq ft. The industry should resolve to construct only green buildings in future.

The stakeholders should keep themselves updated on the latest trends in green building concept. The industry should have more Leadership in Energy and Environmental Design professionals to plan, design and execute green buildings. Of the total 42 million tonnes cement produced by Madras Cements over the last 10 years, 36 million tonnes were blended cement. This had helped prevent 40 million tonnes of carbon dioxide being let into the atmospheric air besides preventing 10 million tonnes of fly ash and slag from being dumped.

Mr.Raja expressed concern over the demand of the industry and the government for Ordinary Portland Cement. OPC led to exhausting of precious natural resources such as limestone for every tonne besides letting 1.5 tonnes of carbon dioxide into the atmospheric air. The industry should go in for blended cement. He wanted the industry to provide international standard houses at affordable prices to the domestic market. S. Balasubramanian, Chairman, CT. Narayanan, Secretary of BuildMat, V.P. Ponnuswami, Chairman of ACCE, G. Srinivasan, Chairman of BAI, M. Arivudai Nambi, Chairman of IIA and O.Lakshmanan, Treasurer of BuildMat spoke.

Training & Skill Certification Stressed For Construction Industry

With public organisations and urban infrastructure and housing projects insisting on at least five per cent of workers being certified to bid for their projects, the construction industry in India feels the need to expand training and skill certification. G Srinivasan, chairman of the local chapter of Builders Association of India said more than three lakh large and medium construction enterprises are involved in the industry in India and that Rs 17 lakh crore is expected to be spent on infrastructure work in the 11th five year plan.

"Considering the boom in other segments of the industry like housing, the Indian construction industry may require around five crore labourers in 2010-2011," he told. Though the prerequisite was for a major portion of labour apart from materials, the industry did not have artisans trained through institutions, affecting quality of construction, he said. With the present asset creating potential of construction industry at Rs 3,10,000 crore, the share to GDP worked out to 12 per cent. In terms of employment generation, construction provided employment to 14 per cent of working citizens, he said. Stating that construction of houses and roads involved about 75 and 60 per cent of civil construction activities, Srinivasan said that building of airports and ports has construction activity in the range of 40 to 50 per cent.

However, Indian construction companies suffered from lack of trained manpower, which led to slow progress of work, rampant time and cost overruns, low productivity and quality, he said.
Considering the demand for skilled manpower, the BAI has taken the initiative and started a School of construction Artisans in collaboration with Sri Ramakrishna Mission Vidyalaya at Periyanaickenpalayam on the outskirts, he said. The school, the first of its kind in the sector in India, would initially offer three courses in Masonry, formwork and carpenter and barbending fitter, with intake of 25 students each, Srinivasan said.

The students would be trained free of cost for three months and paid a stipend for 12 months in work sites. They would then be absorbed by member companies of the association, who would sponsor them, Srinivasan said. On employment generation, Srinivasan said the organised construction sector required 1.2 million hands every year and the unorganised sector, over 30 million. There was a need for about 2.5 lakh professionals like engineers, technicians and foremen, over 3.5 lakh skilled workers and about 25 lakh unskilled hands, he said. With several ambitious projects on the anvil in the 11th plan, demand would grow at a consistent pace of at least eight to nine per cent, requiring an incremental growth of at least 25 lakh skilled persons per year in addition to the existing numbers, Srinivasan said.

Quoting the National Sample Survey report of 2005,he said that only two per cent of the population in the age group of 15-29 years received formal vocational training and another eight per cent non-formal vocational training. Skills and knowledge being the driving forces of economic growth and social development, 90 per cent of the country's workforce was in the unorganised setor, marked largely by low skills, low productivity and poor incomes, he pointed out. Skill level and education of the workforce also determined productivity and income levels, he said, adding that one of the important causes of poverty was the lower percentage of skilled persons in the work force.

Considering all these aspects,BAI would offer more courses like that of tile layer and construction equipment operators so that uneducated workers could be well trained and enhance productivity, thereby increasing the industrys' contribution of 8.5 per cent to the GDP, Srinivasan said.

Sahara Chosen Construction Company For Prime City

Sahara Prime City, the real estate company of Sahara India Pariwar, has appointed construction companies for construction of residential blocks at Sahara City Homes. The projects are the part of Sahara City Homes chain of 217 townships to be developed across India. Sricon Infrastructure has been appointed for the construction of high rise apartment blocks of Sahara City Homes, Nagpur. For the Sahara City Homes Coimbatore and Ahmedabad Township, Nithya Associates and Ramky Infrastructure have been chosen respectively. Each township is spread over 100 to 300 acres. Development of the townships is taking place in a phase wise manner and in the first phase 102 cities have been chosen.

Influence Lifestyle Store Eyes Coimbatore

Influence Lifestyle Store in collaboration with India’s leading designer Manish Malhotra announced the launch of the first of its kind fine dining restaurant in the city – “Influence”. Spread across 5000 sq ft with a ceiling height of 18 ft the restaurant, which can seat 125 diners; offering them an unparallel international vegetarian cuisine with an ambience resonating extravagance and glamour.

Vikram Padke, popular interior designer in the city has worked on the interiors and décor of the restaurant. The styling and hues has been master minded by Manish Malhotra. The restaurant will have three custom made private dinning suites giving the diner a retreat to an international experience. Hand picked customized chinaware and glassware has been flown in from across the world to create an exotic atmosphere.

Commenting on the city and the project Mr. Manish Malhotra, India’s leading fashion designer, said “The Influence avant-garde restaurant will have my signature design and great amount of detailing as I have also styled the uniforms of the staff. I have extensively used gold, beige and wood to create an opulent ambience. Chennai consumers can now be proud of having a first of its kind designer hi-end restaurant.”

Speaking on the occasion Mr. Sumanth Cuppala, Chief Operating Officer commented, “Chennai is an untapped market, where there aren’t many luxury retail and service offerings today. The city has a lot of potential with the Chennai consumer carrying a lot of spending power and wealth. Chennai is maturing and it’s the right time to enter and give the consumers what they have been searching for elsewhere. We have invested Rs. 2..5 crore on just the interiors of the restaurant to create an lavishness for fine living; our collaboration with Manish Malhotra further emphasizes our commitment to bring Chennai the best.”

The restaurant will open to Chennai by the 2nd week of January 2009. The investment for Influence brand has been 8 crores, and the expected turnover for the first year would be 15 crores. The company is anticipating multiple locations in Chennai, as well as expansion plans in South of India, specifically Hyderabad, and Coimbatore and also in cities like Delhi and Mumbai. Influence expects to be present in 4 other locations in the city by 2011. The store will also house a luxury spa and a boutique retailing designer wear from a gamut of India’s leading designers.

ITC Footprints Into Property Development

Diversified business group ITC is planning to develop properties across the country depending on the demand and land availability, the Group's Hotels Division Senior Executive Vice-President Pawan Verma said. "ITC (hotels division) is keen in development of properties across the country, depending on the demand and the availability of land (on its own)," Verma told reporters on Monday here. In association with its wholly-owned subsidiary Fortune Park Hotels, ITC had already taken up the property development work at Bangalore and Coimbatore, he said.

Verma revealed that ITC is also considering few more hotel properties to be developed in tier II towns in Andhra Pradesh like Vijayawada, Tirupati etc. "Fortune Park will invest in all these properties, while ITC will provide land," he said. Commenting on the impact of economic downturn and Mumbai blasts, Verma said the industry lost its occupancy levels drastically and the situation will continue for some more time. Verma is in Hyderabad to announce the property management agreement with city-based Shri Shakti Resorts & Hotels Ltd, which opened 'Fortune Select Manohar' from Monday.

Ungal Illam 2008 Housing Loan Expo

Customers making enquiries at ‘Ungal Illam 2008’, a housing loan expo at the Suguna Kalyana Mandapam in the city on Friday. LIC Housing Finance has organised a home loan expo at Suguna Kalyana Mandapam here. According to a release, ‘Ungall Illam 2008’, which was inaugurated on Friday by the Southern Regional Manager of the company, Vincent Saldanha, will go on till December 14.

Applicants will get special offers in interest rate, monthly instalment, repaying facility, concession in processing fee and on the spot sanction at the expo. A large number of builders and developers, including Sahara City Homes, Marutham Developers, Priyadarshini Builders, Aiswaryam Builders and True Value Homes, have displayed their projects. LIC Housing Finance had been conducting the event in Chennai annually and this is the first one in Coimbatore.

Shriram Group Entering Lowbudget Homes In Coimbatore

The real estate arm of the Chennaibased Shriram Group has finalised plans to enter the market for lowbudget homes aimed at middle-income groups, the latest property developer to try and tap into the socalled affordable housing segment as demand for real estate slumps in a slowing economy. Bangalore-headquartered Shriram Properties will invest Rs 500 crore over three years to build some 4,000 apartments in Bangalore, Chennai, Kolkata, Coimbatore and Visakhapatnam, cities where the company already has a significant presence, managing director M Murali said. New-Delhi based Omaxe and Bangalorebased Golden Gate, Provident Housing & Infrastructure, Mantri Developers, Ozone Group and Vakil Housing have all outlined plans in recent months to develop affordable housing projects.

“Our projects will offer value-formoney homes, with prices starting at Rs 13.5 lakh for homes measuring between 650 sq ft and 1,400 sq ft,” Mr Murali said. “The company hopes to drive down costs by acquiring land on the outskirts of cities and using modern construction techniques. It also expects to benefit from discounts on bulk purchases of construction materials,” executive director SS Asokan said. Advertising and marketing costs will be kept to the barest minimum: the company does not plan to spend on advertising or creating glossy brochures. Instead, it will rely on personal recommendations by the more than 25,000 employees of the Shriram Group and its existing customers.

“We already have bookings for about 200 apartments from existing customers and through personal recommendations; the sales team has set itself a target of selling 800 apartments by March. The central bank allowing the classification of home loans up to Rs 20 lakh as part of priority sector lending will definitely help us,” Mr Murali observed. The Reserve Bank announced on Saturday that banks could classify housing loans of up to Rs 20 lakh as “priority sector” advances, part of a slew of measures announced to increase the flow of funds to the real estate sector.

About 90% of the funds required for Shriram’s masshousing projects will come via sales advances, the company said. The rest will be invested by equity partners Walton St Capital and Starwood, who together own a 20% stake in Shriram Properties. “Funding is not a problem. The land for the projects has been acquired and fully paid for. Our equity partners will meet the working capital requirement, which is about Rs 50 crore. Further, we also have the option of diluting equity in the entities that implement these projects,” Mr Asokan said.

Ultratech Cement Opened 5 Retail Building Solution Outlets

Ultratech Cement, part of Aditya Birla Group, has opened five retail exclusive building solution outlets at Coimbatore.The showrooms will sell high-quality construction materials and offer endto-end home building solutions right from planning to completion, and also allied valued added-services under a single roof at affordable costs. “By these exclusive showrooms, we hope to redefine the shopping of construction materials in the region,” said B Venugopal, senior vice-president - marketing, UltraTech Cement, after inaugurating the showroom at Ramanuja Nagar.

Total solutions including access to brands of all construction materials such as cement, aggregates, bricks, tiles, sanitary fittings, paints, water proofing compounds and white cement would be available at the showrooms, he added. The company has 76 outlets and plans to open 400 outlets across India in fiscal 2009. The building solutions showrooms would offer all materials required for constructions, said T Siva Shanmukam, senior manager - marketing, UltraTech Cement. They would also offer free construction related guidance on ‘how to plan and build dream houses’ and consultancy services on legal opinion and for plan approvals.

TCS Plans To Expand In Coimbatore

India’s largest computer services firm by revenue, Tata Consultancy Services Ltd, or TCS, plans to cut land and rental costs by expanding centres in smaller cities such as Bhubaneswar and Coimbatore and consolidating its real estate holdings in major cities.

The bulk of the TCS workforce in India is concentrated in five large cities—Mumbai, Chennai, Bangalore, Hyderabad and Pune—where its employees work from multiple centres that are either owned or leased by the firm. “We are taking a hard look (at real estate costs),” Vish Iyer, chief financial officer of global business for TCS, said in a phone interview. IT firms could save 20-40% on salary and real estate costs by expanding in tier II cities. TCS did not quantify the savings targeted from the measures to be implemented over two years. The company has a global workforce of 121,610, of which 15,787 are based overseas.

Indian information technology (IT) firms are engaged in a drive to reduce costs as the US, their largest market, battles recession. They are postponing replacement of IT equipment, trying to reduce electricity bills, and cutting air travel and hotel stays by employees. For TCS, such short-term measures could reduce sales, general and administrative (SG&A) expenses by as much as 10%, said Iyer. TCS’ operational expenses, which include SG&A costs, in the first six months of the current fiscal year reached Rs5,205.84 crore on total income of Rs13,239.07 crore.

Analysts say high real estate and salary costs in large cities have already made Indian technology firms look at setting up development centres in tier II cities, which host a number of engineering colleges they could tap as a source of employees. “Quality of people may be an issue, but with training, hopefully, it could be addressed,” said Harit Shah, equity analyst tracking the technology sector at Mumbai-based Angel Broking Ltd. The difference in salary and real estate costs in small cities, compared with larger metros, could be between 20% and 40%, he said. Governments in states such as Karnataka and Tamil Nadu are also encouraging technology firms to expand in smaller cities to decongest their capitals and create jobs.

Building Promoters Eyeing Agricultural & Industrial Lands

With hardly any residential sites available in the city and suburbs, realtors and building promoters here are eyeing agricultural and industrial lands for constructing apartments and multi storey buildings. In November alone the Coimbatore Corporation has received several applications for approval to convert around 25 acres of agricultural and industrial lands into residential and mixed residential area.

A major chunk of lands falls in Ganapathi, linking Sathy main road, Thelungupalayam, linking Thondamuthur-Coimbatore main road and R S Puram and belong to private industries. During January this year, nearly 40 acres of agri and industrial lands, mostly in Singanallur and Ramanathapuram areas linking Trichy National Highway and also areas linking Mettupalayam main road, were approved for constructing multi-storey buildings. Agricultural lands in Thudiyalur, Narasimanaickanpalayam, Periyanaickanpalayam and Karamadai and Saravanampatti are the hot favourites for the realtors and developers.

Construction is going on very fast in every nook and corner of the city. Most of the structures are unauthorised. It is not the fault of the owners but the Corporation is to be blamed for delaying the approval of building plan, P Rajkumar, AIADMK Coimbatore councillor said. Normally, builders apply to the corporation for construction , and wait for sometime but the corporatione town planning wing would not respond. The vexed citizens would go ahead with the construction.

To sort out the issue, the Corporation should form a joint committee and set a deadline, minimum 30 days, for approval, he added. He also expressed the fear that as the officials were not checking the safety measures in mega commercial complexes and departmental stores, the fate of Chennai Saravana Stores, where a fire broke out, charring to death its employees, may befall the Coimbatore tall buildings.

Court Direction In acquisition Of 2,000 Acres In Kalapatti Village

The Madras High Court has directed the Chief Secretary to convene a meeting on or before December 18 to resolve the issue relating to the acquisition of 2,000 acres in Kalapatti village in Coimbatore north taluk.

Originally, the Tamil Nadu Housing Board sought to acquire the land for construction of houses. But it could not acquire the entire land as the acquisition proceedings were challenged and they were at different stages. In the meanwhile, a substantial portion of the area had been occupied by subsequent purchasers and they had also put up pucca houses. There were also stay on acquisition or stay on dispossession. In such a contingency, even if this court decided the batch of writ petitions on the merits of each case, it might not bring any relief either to the present land owners or to the TN Housing Board, Justice K Chandru pointed out.

Also since the acquisition involved a vast area and the board did not have resources to pay huge compensation for the land owners and considering the permanent structures that had come up in the area, the issues could not be resolved by mere disposal of the writ petitions, the judge said. He directed the Chief Secretary to convene a meeting of the secretaries of the Housing and Urban Development, Revenue, chairman of TNHB and the Coimbatore District Collector to discuss the entire issue.

If a decision was taken by the government based on the field situation, the issue could be resolved by this court, the judge said. If the government decided to give up the acquisition, that could also be mentioned in the report. Alternatively, the land the Board wants to acquire along with the survey numbers might be furnished in the report, the judge added.