Reits: A solution to many problems in Indian real estate

Over the past two decades, the global commercial real estate sector has seen a dramatic shift from private sector to public markets. The Indian real estate industry’s growing demand for additional sources of funds and the success story of global real estate investment trusts (Reits) is compelling enough to encourage the implementation of a similar regime in India with requisite adjustments. Typically, Reits invest in completed, revenue generating commercial properties and distribute a major portion of the earnings among investors. They have proven to be an attractive investment option for retail investors as well as for long-term pools of capital such as pension funds and insurance companies who prefer to have a regular income stream. Historically, global Reits have been able to generate significant market traction. The US Reit industry’s market capital, for example, has grown at an average annual rate of nearly 23% in the past 20 years.

Besides other advantages, Reits bring in increased transparency in the sector by adopting better corporate governance, disclosures and financial transparency practices. Being required to comply with the corporate governance, information disclosure and financial reporting standards laid down by the regulator, Reits will bring in a regular information exchange and availability in the public domain. This will result in higher professionalism with a clear emphasis on issues such as risks attached to titles and transaction costs. To read more please visit - livemint.com

State's new real estate law set to be a game changer.

Presidential nod to the Maharashtra Housing (Regulation and Development) Act 2012 has paved the way for Maharashtra to become the country’s first state to come up with a real estate regulator in the housing sector. The notification is likely to be issued soon, following which rules and regulations would be formulated.
This is the second Act to serve the interests of the flat buyers in 50 years in the state of Maharashtra. Before this, the Maharas-htra Ownership of Flat Act was introduced in the state in 1963 and since then there was a complete vacuum with regard to safeguarding common buyers from builders.
“We are committed to bringing this Act as soon as possible and if everything goes according to the plan, the law would be enacted by May this year,” said Sachin Ahir, minister of state for housing.
According to Mr Ahir, the Act makes it mandatory for every developer to disclose their property title, layout plan and completion plans to buyers at the time of booking. The most important provision is that the project details would be registered with the regulatory authority and the same would be uploaded on its website, so that buyer would be confident about the authenticity about the project and its offers.
As per the provisions made in the Act, developers won’t function like a fly-by night operator and they would be held responsible for repairing major defects in the buildings during the first five years after handing over possession to the society. Even builders may have to refund buyers for delayed projects. The regulator has been given ample scope of power and would work as par with powers of a civil court and can impose fines of up to `1 crore and prison terms up to three years. To read more please visit - asianage.com

Hiranandani real estate heiress fights dad, brother for share of Rs. 3,000 cr fortune

At stake is property worth at least Rs. 3,000 crore (according to some estimates, it could be as high as Rs. 9000 crore). And fighting over it is Niranjan Hiranandani, the real estate tycoon who created the eponymous enclave in Mumbai’s Powai area on the one hand, and his daughter Priya Vandrevala, a self-confessed rebel.The latest salvo was fired by Hiranandani and his son Darshan, who, last month, moved the Bombay High Court to restrain Priya’s company, Hiranandani Living, from using the family name. They even claimed `50 crore as damages for alleged trademark infringement.

But a lawyer, who represents a third party in the dispute, said the case could be a strategy to get Priya, who had earlier filed arbitrations proceedings against her father and brother in London, to the negotiating table. To read more please visit - hindustantimes.com

World's super-rich hold a fifth of their wealth in real estate

The world's super rich people hold a fifth of their wealth in property, estimated at USD 5,328 billion, while Asia's ultra rich have a greater share in real estate, a report says.

According to international real estate advisor Savills, in association with Wealth-X, property accounts for about a fifth of the invested wealth of almost 200,000 ultra high net worth individuals (UHNWIs) in the world.

Of the total private wealth of USD 27,770 billion, 19 per cent is held in real estate assets amounting to USD 5,328 billion, it said.

Europe's super rich hold the biggest share of all privately owned real estate assets, followed by Asians.
To read more please visit -  Zeenews

Bangalore to see 2nd highest office demand in Asia during 2014

IT hub Bangalore is expected to witness the second highest demand for office space in the Asia Pacific region during 2014 in a list topped by Tokyo, according to property consultant Cushman and Wakefield (C&W).

"Bangalore is expected to see the second highest absorption in the APAC region and the highest demand in the country owing to expansion of the IT, ITeS and multi-national companies," C&W said in a statement.
To read more please visit - Zeenews 

'Premium housing prices may fall soon on inventory pile-up'

Mumbai: Investorscan look forward to premium housing units getting cheaper by up to 20 percent and gold prices rising significantly this festive season, says a financial advisory firm.

"We are expecting premium housing projects to get cheaper by up to 20 percent... Potential buyers will not have to negotiate discounts, since realty companies are in all probability going to make such announcements," a Delhi-based financial advisory firm InvestCare said in a statement.

The high inventories can soon impact cash-flow for realtors, adding that depending on the project, a cut up to 20 percent could be possible.

"A cut in prices is definitely possible for premium housing units. If companies can cut prices, it will help bring back buyers to the market despite the weak environment", its Managing Director Ajit Mishra said.
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