RMZ Corp forays into residential market

Leading corporate real estate developer, RMZ Corp, is charting a new course by foraying into the residential realty space.

The Bangalore-based firm is looking at residential realty market as a new thrust area to propel growth for the company. In tandem with its plans, the firm is looking to have a 60% residential and 40% commercial and retail portfolio in the next two years.

"We are focusing on residential segment as the market is reviving faster. We plan to build 10 mn sft in five years and expect 20% of total turnover to come from residential segment," says Raj Menda, managing director RMZ Corp.

RMZ plans to build 470 units residential projects comprising of high end villas and condomium ranging between Rs 70 lakh and Rs 5.8 crore in Bangalore. The projects are expected to be completed by 2014.

"We will invest Rs 900 crore across our three bangalore projects but will look at raising equity once we plan to ramp our business by mid this year," he added.

To double its commercial portfolio in the next two years, RMZ Corp is shopping for distressed assets in Chennai, Hyderabad and Bangalore. The firm is in talk to buy 15,00,000 sft of Grade A distressed office space in Chennai and Bangalore.

"We plan to expand our commercial portfolio by purchasing distressed properties, as it is cheaper to buy," said Menda. However, he refused to share details on the same. RMZ currently has 3.4 mn sft of commercial property under construction.

RMZ has recently bought 25 acres of land in the outer ring road, Bangalore from Adarsh Developers to increase its footprint in the city. The transaction is valued at Rs 1000 crore.

The company, has so far, acquired and developed over 13 million sq ft and manages a property portfolio in excess of $2 billio

Brigade Group targets Rs 3,000 crore revenue from integrated development

Bangalore-based property developer, Brigade Group, targets total revenue of Rs 3,000 crore from its integrated development, Brigade Orchards, in Bangalore.

"The project is estimated to cost around Rs 2,000 crore, including the land cost of Rs 350 crore. We have fully paid up for the land, and the project would come up in phases," says Kailash Advani, Chief Executive Officer, BCV Developers.

BCV is a special purpose vehicle between Brigade and Classic Valmart.

The SPV is developing a 120 acre mixed used project, expected to be completed in the next five years. "The project will be funded through internal accruals, construction finance and equity infusion from private equity funds. Each party can dilute up to 24% in it," said Advani.

The project will comprise of luxury villas, value homes, premium apartments starting from sub Rs 10 lakh to Rs 3 crore totalling to 3,500 and 4,500 residential units.

Brigade, currently has 2 enclaves, 12 residential and 2 hospitality properties totalling to 13.84 million sft under development across South. It has total land bank of 400 acres spread across seven cities. Out of the total land, 58% is in Bangalore, Mysore and Chikmagalur account for 18% and 12%, respectively

The company's stock closed down by 4.24% on BSE on Friday.

No mixed land use in residential areas

The Karnataka High Court on Wednesday directed the authorities to stop issuing permission forthwith for mixed land use (including commercial) as per the Revised Master Plan (RMP) 2015 for Bangalore city in areas that were classified as ‘residential zones' in the Comprehensive Development Plan (CDP) 1995.

A Division Bench comprising Chief Justice Vikramajit Sen and Justice B.V. Nagarathna passed the interim order while hearing a public interest litigation (PIL) petition filed by Citizens' Action Forum (CAF) in 2008 challenging the RMP 2015.

“We direct that in the following areas of the city — Malleshwaram, Richmond Town, Vasanthnagar, Jayanagar, Vijayanagar, V.V. Puram, Rajajinagar, R.T Nagar, etc., — wherein purely residential use was permitted as per the CDP, no further permission shall be granted for redevelopment or reconstruction, except for residential use,” the Bench said.

“This order shall not be construed in any manner as conveying the approval of the court for other uses,” the Bench said, adding that it would pass orders on the next date of hearing (February 3) on permission already granted for non-residential uses in residential areas as per the RMP 2015.

The CAF, in its application before the court in July last year, pointed out that granting permission to use residential buildings for commercial purposes as per “mixed residential area classification” of the RMP 2015 must be stopped immediately because the State Government itself had “doubts on the credibility and implementation of the RMP 2015”.

The application said that the Government had appointed a committee headed by the former Chief Secretary A. Ravindra in December 2009 to scrutinise the negative aspects of zoning regulations with specific reference to the impact of the RMP 2015 on residential areas.

Modifications

Pointing out that the Ravindra Committee, in its recommendations, had discussed modification of the RMP, the CAF had claimed that zonal regulation, if not stayed, would have an adverse impact on residential areas since the authorities were permitting commercial activities as per the RMP, which came into force in mid-2007.

The Bench took note of an observation in the Ravindra Committee report, which states, “Change of land use has been curtailed for small properties on small roads. The notion of ancillary use of a property has also been done away with. These two provisions have caused much pain to communities by mixing commercial development in what should be residential areas only.”

Bangalore Q4 2011 Office Space Report

RESILIENT DEMAND

Bangalore’s commercial market exhibited resilience with comparatively high demand levels despite the discomfort in the market on account of global uncertainties. Demand for commercial office space reached approximately 3.55 million square feet (sf) during the fourth quarter of 2011 taking the year’s total to approximately 14.78 msf. Quite a few significant big ticket deals were observed to have been closed during the quarter. However, demand for space in the range of 3,000 sf to 20,000 sf was dominant and comprising almost 60% of the number of deals closed during the quarter.The developers/landlords refrained from escalating the rentals in spite of the decreasing vacancy levels across the city in order to retain and capitalize on the enquiries. This further accentuated the pace of deal closures thereby ensuring better absorptions. A marginal escalation in the rentals in the Outer Ring Road (ORR) micro market was observed in view of the low space availabilities corresponding to the strong demand.

SUPPLY SYNCHRONIZING VACANCIES

The supply infusion which remained subdued during the first half of 2011; recuperated during the last two quarters, with supply recording its highest at approximately 2.33 msf during the fourth quarter. The overall supply in 2011 totalled approximately 4.18 msf. The subdued amount during the first two quarters of 2011 coupled with high absorption levels substantially domesticated the vacancy levels in the city (bringing it down from 16.6% in the fourth quarter of 2010 to 12.0% by the fourth quarter of 2011).In spite of the infusion of supply in the SEZ segment during the quarter, the overall vacancy in SEZ developments remained considerably low at about 2.3%. The ORR micro market was characterized by low space availabilities and as a consequence most of the transactions recorded were of comparatively smaller dimensions barring the take up in a pre-committed space. Suburban markets witnessed most of the transactions in the range of 10,000 sf to 40,000 sf. The Whitefield micro market thereby gained leading to increased take-ups and a subsequent reduction in the vacancy level.Moreover, in view of the availability of a larger space in the micro market, most of the large sized transactions were recorded in Whitefield.

OUTLOOK

During the first two quarters of 2012, on account of the spill over of deal closures from end of 2011, the absorption levels will remain on the higher side. Vacancy too is expected to come down marginally or remain stable. Marginal scarcity of space options will prevail in early 2012; however, the situation is likely to improve as approximately11 msf of new supply is expected to enter the market in 2012

Devanahalli sees spurt in property action

Devanahallis realty landscape is beginning to change.From a quiet,far-flung area,its turning into a hubof realestate activity thanks to the airport,the under-construction expressway and the proposed highspeed rail link to the airport.
The airport had generated excitement in the property market when it was opened in 2008.That excitement wore down during the slump.But its reviving again,particularly with the infrastructure commitments.
The focus is currently on villas,and developers launching villas and row houses in Devanahalli are pricing it between Rs 5,000 and 8,000 per sft.Prestige Estates & Projects is developing 225 villas on the foothills of Nandi Hills priced over Rs 5 crore each.Brigade Orchards,an integrated township across 120 acres,is selling villas at around Rs 2.90 crore each.Sobha Developers has launched a 10-acre plotted layout near the airport.
Hiranandani Upscale is selling apartments at Rs 3,000 per sft and Hoysala Corpus s 2-BHK apartment is priced at 2,800 per sft.
Devanahalli will witness growth similar to Gurgaon.The Hebbal-Devanahalli road has reduced the commute time drastically.Infrastructure developments will positively impact residential development, said Ravindra Pai,MD,Century Real Estate.
The government has planned a 6-lane carriageway that will form a ring between the Outer Ring Road and the Satellite Town ring road in Devanahalli.The closest node to this site will be at Kogilu junction on NH-7.This will improve connectivity between NH-7 and the non-CBD commercial areas like Whitefield and Hosur, said Avinash Rao,regional director-south at real estate consultancy Knight Frank India.
Unlike Hebbal,where commercial activity is beginning to catalyse residential development,Devanahalli still remains an investor-led market due to lack of social infrastructure.Devanahalli is now a market for second homes.I dont see it emerging as an end user market in the short term, said Karun Varma,MD for Bangalore and Kochi at real estate consultancy Jones Lang LaSalle India.
Real estate activity in Devanahalli will gather further momentum only when commercial activity in the area increases.
Currently its restricted to the airport and its associated activities.The workplace remains predominantly in the south and east of Bangalore.Workplaces make an area vibrant.Though Devanahalli is a good market to enter,one can expect good capital value appreciation in 5-7 years, said Irfan Razack,CMD of Prestige Group.
The water table beyond Yelahanka is a major concern,and it is not clear when the government would provide water to private layouts.

Sharp rise in property prices in Bangalore, Q4-11 report says

Country’s biggest real estate portal 99acrres.com have revealed that the property price trends for the Bangalore region have seen an escalation if we compare per square feet prices (PSF) of Q4-11 over Q1-11.Therefore, although the real estate market seems to have been under stormy conditions, yet Bangalore has seen some price movement.
Commenting on the same Vineet Singh, Business Head, 99acres.com said“Bangalore has seen the high number of new project launches as compared to other cities. Localities in Bangalore North, South South East have seen a large number of new project launches at various price points and prices being pushed higher over the last 6 – 8 months due to end user buying. The successful launch of the first reach of Namma metro has enabled a higher price push in Indiranagar and has created increased demand in localities around Kanakapura Road Jalahalli which will soon be connected in the next reach. There is also the new lines of the 2nd phase announced recently for the metro, and the next 3 – 4 years will hopefully see a lot of the infrastructure and commuting ache in Bangalore being reduced and new investment localities have emerged across the city.”
A look at the property prices of areas in East Bangalore shows that all localities have seen price appreciation in Q4-11 when compared to Q1-11. Kaggadasapura and Banaswadi have seen 15% and 17% price appreciation in PSQF prices when we compare Q4-11 prices over Q1-11. The prevailing rates of these localities are at Rs 3000psf (per square feet) for Kaggadasapura and Rs 3400psf for Banaswadi. Indiranagar saw highest action with prices moving up by 21% in Q4-11 over Q1-11.
Barring localities of Hennur Road and Yelahanka which witnessed 5% and 2% dips in property prices, all the other localities in North Bangalore saw price appreciation. Thanisandra and Jalahalli witnessed maximum movement with prices moving up by 28% respectively in Q4-11 over Q1-11.
Prices remained flat in South Bangalore localities of Bannerghatta Road, Electronic City and JP Nagar. Jayanagar, Kanakpura Road and Hosur Road on the other hand witnessed prices rise within the range of 15% and 19% in Q4-11 when compared to Q1-11. BTM layout saw maximum price dip with PSQF prices dipping from Rs. 4072 in Q1-11 to Rs 3728 in Q4-11

Think Yeshwanthpur, dream connectivity

With another rail route soon to pass by the neighbourhood, Yeshwanthpur is a suburb that is far yet near

Excellent public transport and the happy pandemonium of the wholesale markets make Yeshwanthpur an integral part of the city despite its distance

One of the most striking features about Yeshwanthpur is its excellent connectivity through public transport.

The area is well-linked by bus and the Yeshwanthpur Railway Station is one of the major hubs of rail traffic in Bangalore. Howrah-Yeshwanthpur, Kannur-Yeshwanthpur, Ahmedabad-Yeshwanthpur — these rail routes are some of the first results that spring up when you do an online search of this suburb in the north-west of Bangalore.

Yearning for metro

Since the past couple of months, one section of the city has been fortunate enough to enjoy that popular public transport, the Namma Metro. Residents of Yeshwanthpur are biding their time for the completion of the ongoing metro project passing Yeshwanthpur. They tolerate the dust and traffic congestion caused by the metro construction in the hope that one day the pink and silver train will pull into the Yeshwanthpur Metro Station.

The soaring prices of residential properties stand testimony to the tremendous growth Yeshwanthpur has witnessed over the last few years. What was once considered an unlikely choice of residence for the young migrant population, mostly comprising working professionals, now has residential apartments coming up with them as the target market.

The industrial hub which was once considered a distant suburb is now home to many big real estate and infrastructure projects.

Evolution

Madhusudan R. who has been living in Yeshwanthpur for close to 35 years has witnessed the evolution of the locality over the decades.

“During my childhood, Yeshwanthpur had just two good restaurants — Hotel Gayathri and Hotel Rajani.

Occasional trips to these places were the highlights back then,” he says. Today, Gayathri and Rajani have paved the way for star hotels like Taj Vivanta that have opened in Yeshwanthpur.

Far and near

Yeshwanpur continues to be more famous for industries and commercial establishments than for its educational institutions and other facilities. Its old market and the new wholesale gaint METRO Cash & Carry co-exist in harmony. The vibrant vegetable market that is decades-old has its own share of regular customers who come from far and near.

The APMC Yard is a major hub for farmers from Nelamangala and nearby areas. Wholesale traders make a beeline to the yard to garner the best produce. The yard is easily the biggest procurement centre for vegetables in the city.

The Gen-Y

What troubles the younger generation living in Yeshwanthpur is the lack of good malls and hangouts in the area.

Bincy Francis, a 22-year-old resident of the area says, “There are no hangouts for youngsters here. I have to go all the way to Malleswaram to buy even a birthday cake.” However all that set to change in 2012 as three malls Under Construction are set to open doors (Brigade Group's Orion Mall ,Vaishnavi's Saffire and Golden Gate's Golden Square Mall).

With few options available to them, they prefer to visit Commercial Street or the relatively closer Malleswaram for some fun.

HUL puts Whitefield plot on the block

Hindustan Unilever (HUL) has put prime land in Whitefield on the block.An independent plot measuring 9 acres and 12 guntas located near Hindustan Unilever Research Centre (HULRC) on Whitefield Main Road is for sale along with the factory shed and office building on it,totaling a built-up area of over 70,000 sft.
As part of normal business process,we continuously review our assets including real estate to unlock business value from idle assets, said an HUL spokesperson.
Real estate consultants Cushman & Wakefield has won the mandate for the deal and has set a minimum bid price of Rs 9 crore per acre or Rs 2,066 per sft,which translates to a total value of Rs 84 crore for the land,said sources privy to the development.
Attempts to contact Cushman & Wakefield to confirm this proved futile.More than 40 companies are said to have made enquiries about the property on Tuesday.
Capital values in Whitefield rose significantly in the years immediately preceding 2008,but has since been moderate.The capital value appreciation in Whitefield has been 10%-12 % in the last one year,in line with the inflationary trend.There is good absorption of Grade A office space in the area, said Avinash Rao,regional director-south at real state consultancy Knight Frank India.
Sanjay Dutt,CEO-business at real estate consultancy Jones Lang LaSalle India,said that 5-6 years ago,HUL identified a portfolio of surplus assets that were not a strategic fit.They are now unlocking value by offloading such assets and ploughing money back into the business, he said.
HUL has also been planning to redevelop its landmark Brookefields property in Whitefield.The plan has been to co-develop the 26.5-acre property into an IT SEZ,and it had called for bids.We have received SEZ approval for this site and are now evaluating alternative options to proceed further, said the HUL spokesperson.


UNLOCKING VALUE

The independent plot measures 9 acres and 12 guntas on Whitefield Main Road.It also has a total built-up area of over 70,000 sft Over 40 companies are said to have made enquiries about the property Cushman & Wakefield has won the mandate for the deal and has set a minimum bid price of Rs 9 crore per acre

Amada plans tech centre in Bangalore

Japan-based machine tool maker Amada Group is planning to set up technical centre in Bangalore with an investment of $13 million. It would be operational by 2014.

The state government has allotted 8 acre land at Aerospace SEZ  for the centre which would be used to upgrade the group’s global solutions centre and also house high class vocational training facility for its employees and customers in India.

According to Amada Co Ltd Senior Managing Director Toshio Takagi, the centre will support other aerospace companies coming up at the SEZ. It will have about 100 engineers and have a parts centre to cater to the growing requirements of its customers in India.

Swiss consulate in B'lore to issue visas by mid-2012

Owing to increase in the number of tourists to Switzerland, the European country's second consulate in India is expected to commence issue of visas by mid-2012, according to a Switzerland Tourism official.
 

"The consulate was set up in Bangalore last year. Hopefully, it should start issuing of the Schengen Visa in the middle of this year," Switzerland Tourism Deputy Director Ritu Sharma, told reporters.

The Schengen Visa is helpful to those who wish to visit several European countries on the same trip. It allows the visa holder to travel across various European countries under a single visa. Sharma said the consulate in Mumbai was the only gateway to Switzerland as many would need to get their visas from this office. However, with the opening of a new consulate in Bangalore, she hoped many tourists from South India would visit the new office.

"This will actually split the work of Mumbai consulate. Many south Indian tourists were finding it difficult to visit Mumbai for an interview," she said. Before obtaining a Schengen Visa, it is necessary for a tourist to undertake an interview at the Consulate, she said.

Noting that India ranks third in the number of tourists visiting Switzerland after the United States and United Kingdom, she said this year the number of visitors from India was set to cross the five lakh mark. "The target growth for India on the number of tourists is again 20 per cent this year and we are expecting it to be beyond 500,000 (tourists)", she said. Last year 460,000 Indian tourists visited Switzerland, she said.

The International theme of this year for Switzerland was 'Year of Water,' she said and added many areas linked with water like water tourism, would be explored. "Last year was celebrated as Year of Hygiene. This year will be celebrated as Year of Water," she said.

Brindavan Hotel to make way for posh house

Rajesh Exports buys property on MG Road for Rs 82 crore

It’s official. The landmark Brindavan Hotel on Mahatma Gandhi Road has been sold to Rajesh Exports for Rs 82 crore approximately, excluding the registration fee.

Constructed in the 1960s, the hotel land admeasuring 46,000 sqft was acquired by the Rao family for just over Rs 25,000. The hotel will officially close down in the next couple of days.

After serving delicious delicacies, apart from providing lodging to travellers over the past four decades, the iconic hotel is now making way for a palatial private property.

The market value of the property has been placed at close to over Rs 130-Rs 140 crore, but it has been sold at a lesser price because of its narrow approach road, claim realty experts.

Industry sources say that while the property may be in a prime location, most investors, including Vijay Mallya, had backed out of the deal due to its very minimal floor space ratio (FSR).

However, Rajesh Mehta, an elated chief managing director (CMD) of Rajesh Exports and owner of Shubh Jewellers, said the FSR did not matter to him and his family. “We are looking for a quiet private residence in the heart of the City. The FSR does not matter to us,” he said.

The Mehta family will utilise the space to build a “small and cosy” house for themselves, sources said. “The Mehta family struck the deal just about 10 days ago and are expected to build a villa for themselves and their relatives in the massive space,” said an employee of Brindavan. The Mehtas are likely to take possession of the land in the next three months.

Meanwhile, 100-odd employees would lose their livelihood with the closure of the hotel. “We have been working in the hotel for over 25 years. Serving people is the only thing we know. Now, with the hotel sold, we will be on the streets,” said a waiter. Bell boys, cooks, cleaners and room service staff will now have to look for other employment opportunities.

The employees, most of them from Udupi and Mangalore, were told nearly eight months ago about the hotel’s closure. While the hotel management has settled the payments of most employees, those in the restaurant have been asked to wait till January 16.

In India, B’lore best for realty investment

Bangalore has emerged the top destination for investmet in India – ahead of New Delhi and Mumbai -- according to a survey jointly published by Urban Land Institute and consultancy firm Price water house Coopers.Mumbai and New Delhi slid down to 15th and 12th position respectively on the list of foremost real state investment markets due to rising economic and inflationary pressures. Bangalore ranks at number at 10, a similar rating like last year.

“Bangalore’s organic, growth driven market and ability to buck mega trends has helped it retain its credentials as a stable play and maintain its position on the list,” the report, titled Emerging trends in Real Estate Asia Pacific 2012, said.Last year PwC had ranked Mumbai at the third and New Delhi at the fifth place. The report says that the vacancy rates in Mumbai are likely to remain stable through the close of 2011 and into 2012 and the absorption will again be positive next year, but rental values will remain questionable as economic and inflationary issues continue to linger.

“In New Delhi , inflation continued to spike costs, and it may not be economically

feasible to build there. Ongoing funding problems do provide investment opportunities for private equity investors,” the report said.The report is based on the opinions of more than 360 in internationally renowned real estate professionals, including investors, developers,property company representatives, lenders, brokers and consultants.

“In the medium term there is a secular steady state trend given India’s favorable demographies. Even post 2009,when the real estate markets were bottoming out in India,there were bursts of demand at every price correction. This clearly demonstrates latent demand,” PwC Leader Infrastructure and Real Estate Jai Mavani said in a statement issued here.He, however, said that short term pain may stay until the regulatory processes get streamlined, approvals resume,interest rates improve and more liquidity gets introduced.

“Long-term solution can only come through reforms both regulatory and financial.The real estate regulation bill is a step in the right direction although the content needs some tweaking to prevent over regulation,” Mavani said, adding re-introduction of Real Estate Investment Trust (REIT) regulation was necessary.The report maintains that India’s consumption driven economy makes it a safe destination for real estate investment.The report maintains that India’s consumption driven economy makes it a safe destination for real estate investment.

Bangalore realty retains10th rank for investment

Bangalore has retained its tenth rank among the most favored real estate investment destinations in the Asia Pacific region. A study on emerging real estate trends in the region by Price water house Coopers (PwC) and Urban Land Institute had ranked the city tenth last year also.

Bangalore’s organic, growth-driven market and ability to buck mega trends has helped it retain its credentials as a stable play and maintain its position on the list, the report said.

The survey is based on the views of over 360 internationally known real estate professionals, including investors, developers, property company representatives, lenders, brokers and consultants.

MUMBAI, DELHI SLIP

Rising economic and inflationary pressures saw Mumbai and New Delhi fall from third and fifth place in last year’s list for investment opportunities to 15th and 12th position respectively in 2012.

Vacancy rates in Mumbai are likely to remain stable through the close of 2011 and into 2012. Absorption will be positive next year, but rental values remain questionable as economic and inflationary issues continue to linger.

In New Delhi, inflation has continued to spike costs, and it may not be economically feasible to build there. Ongoing funding problems do provide investment opportunities for private equity investors, the researchers said.

LATENT DEMAND

On the current scenario in India, Mr Jai Mavani, Leader – Infrastructure and Real Estate, PwC India, said, “In the medium term there is a secular steady state trend given India’s favourable demographies. Even post 2009, when the real estate markets were bottoming out in India, there were bursts of demand at every price correction. This clearly demonstrates latent demand. However short-term pain is here to stay until the regulatory processes get streamlined, approvals resume, interest rates improve and more liquidity gets introduced.”

However, the long-term solution can only come through reforms – both regulatory and financial. The real estate regulation Bill is a step in the right direction although the content needs some tweaking to prevent over regulation.

Further, it is time for the Real Estate Investment Trust (REIT) regulation. Only then long term retail money can flow in and enable circulation of capital. Besides Pension funds and insurance companies (as it is done globally) should also be allowed to invest in long term income yielding assets with quality tenants, he said.

ATTRACTIVE OPTION

With the market expecting to bottom out sometime in the last quarter of this fiscal, debt funding drying up and recession expected to cut inflationary pressures on commodities, it will translate into attractive investment option for private equity players looking to get India back on their agenda.

With sales volumes stagnant and rising labour and commodity prices also squeezing finances, developers also are now expected to turn to private equity funds as a last resort. Incoming capital is expected to rise in the following year. If it does, it will represent a significant turnaround for a market that foreign private equity investors have largely shunned since the onset of the global financial crisis.

Synergy Property bags Rs 1,239-cr realty order

Project management and consulting firm Synergy Property Development Services today said it has bagged two residential projects from the Bangalore-based Embassy Group worth Rs 1,239 crore on turnkey basis.

Under contract, Synergy will manage the entire development the projects including design, procurement, construction management, co-ordination, engineering and will be responsible for time, cost, quality and environmental health and safety standards, the company said in a statement here.

The two projects are Embassy Boulevard and Embassy Lake Terraces coming in Bangalore, it said.

“We have taken up the challenge to deliver the projects through international standards. We have even mobilised resources, local and international to ensure high standards,” chairman and managing director Sankey Prasad said.

Blackstone Real Estate Partners, an affiliate of Blackstone Group LP, had invested USD 18 million for a minority stake in Synergy in 2008. The current order book of Synergy stands at over 125 million sq ft or Rs 2,000 crore.

Exedy Corporation, Japan receives approval for new project in Kolar

Exedy Corporation, Japan one of the promoter of Exedy India Ltd has announced that one of its wholly owned subsidiary, Exedy Clutch India Private Limite, in India which is in similar line of business as that of Exedy India Limited has received Government Order according in-principle approval to a project proposal for establishing a manufacturing unit for multi-pate clutch, continuance variable transmission (CVT), clutch disc and clutch cover assembly and its components for both 2 and 4 wheelers at Narasapur Industrial Area, Kolar District, Karnataka and has extended infrastructure facilities (like land, supply of water and power) and other incentives and concessions as per industrial policy of the State of Karnataka. The above mentioned Government order is valid for a period of 2 years from the date of issue.

The Exedy India Limited stock closed the day at Rs.215, down by Rs.1.70 or 0.78%. The stock hit an intraday high of Rs.223.70 and low of Rs.211.

The total traded quantity was 175 compared to 2 week average of 215.

2012: India gets set to adopt IPv6

HP partners with Government of Karnataka and IIIT-B to help enterprises adopt the new Internet address standard

With the reservoir of available IP addresses fast depleting, governments around the world are putting the finishing touches to their plans to migrate their country’s Internet infrastructure to the new Internet Protocol version 6 (IPv6) protocol, that offers billions of new addresses. The Government of India has set a deadline of March 31, 2012 for all service providers to transition to IPv6. The Government of Karnataka (GoK) has taken a major initiative to help enterprises make the transition, through a public-private project. It today signed a partnership agreement with the International Institute of Information Technology, Bangalore (IIIT-B) and technology vendor HP to conduct a pilot project that will help organizations in Karnataka through a smooth transition to IPv6.

The current IPv4 protocol is a 32-bit addressing system and has a theoretical limit of four billion IP addresses -- the last of which have just been distributed to the five Regional Internet Registries (RIRs). Migrating to the 128-bit IPv6 means billions of new IP addresses will become available. The new Internet Protocol is also more secure and offers the promise of speed; it is 10 times faster. This makes it ideal for high-bandwidth applications like multi-casting.

The demand for IP addresses is fast increasing as more consumer devices such as smartphones, tablets and now, Internet-enabled TVs, connect directly to the Internet. Users are also bringing their mobile devices into the enterprise and connecting these to corporate networks.

For enterprises in India, transitioning to IPv6 is essential to keep up with the current Internet growth, as well to develop new Internet applications, new markets and to serve citizens in new ways. But the transition to IPv6 has been slow, because the fundamental Internet infrastructure has not adapted to the new Internet protocol, even though it was introduced in 1999. The migration to IPv6 is also a mammoth task as it involves multiple stakeholders like service providers, system integrators, organizations, and numerous departments and authorities at the central and state level.

However, the IPv6 Task Force, which officially oversees the country's transition from the old IPv4 protocol to the new one, said almost all major ISPs are now providing enterprise IPv6 services.

This three way partnership will set off a pilot project through an innovation lab set up by HP at IIIT-B. The lab is called HP Network University and the objectives of the pilot project are to:

Identify major the challenges for organizations in adopting IPv6
Develop solutions for these challenges through education, technology and process improvements
Provide advice and resource for enterprises and government bodies in Karnataka
Actively promote the adoption of IPv6 in other Indian states

RMZ Corp forays into residential segment

RMZ Corp, which has so far been only into commercial space development, announced its entry into the residential segment. The company has launched three premium residential projects in Bangalore.

All the projects would be located in north Bangalore, and Mr Raj Menda, Co-owner and Managing Director, RMZ Corp, said that with that region getting infrastructural improvements such as a 12-lane road, “I believe this growth corridor is where the future is”. Going forward, he expected the residential segment to contribute to 35 per cent of the company's revenues.

The company also plans to launch two villa projects in the second half of this calendar year in the city. One of these would be located in Whitefield, while the other would be in north Bangalore. The focus would also be on east Bangalore, said Mr Menda.

Of the three projects launched, RMZ Galleria would be a 12-lakh sq ft integrated project, of which five lakh sq ft would be residential. The Rs 315-crore residential segment of the project would see development of 322 units — two- and three-bedroom apartments. While two-bedroom units would be priced at Rs 70 lakh, three-bedroom units come with a price tag of about Rs 1 crore.

“We have already sold 20 per cent flats without any advertisements,” said Mr Menda. He added that the company hopes 40 per cent of the customer base to come from the employees of corporates occupying his commercial developments.

The Rs 450-crore RMZ Latitude would offer 122 apartments comprising of four-bedroom units — about 3,900 sq ft, and glamour suits — about 5,600 sq ft at an average price of Rs 3.25 crore and Rs 5.8 crore respectively. The project, which was soft launched a month ago, has already seen nine units being sold. “Bigger units are selling faster,” said Mr Menda.

The RS 105-crore RMZ Sawaan would see development of 34 villas with unit sizes ranging between 4,200 sq ft and 4,900 sq ft, and prices start from Rs 3.85 crore.

Except the villa project in Whitefield, all other projects would be joint development with the land-owners.

Plans to enter Chennai, Hyderabad

With the entry into residential segment, real estate developer RMZ Corp plans to launch residential projects at Chennai and Hyderabad soon.

The company plans to develop 10 million sq ft in Bangalore, Chennai and Hyderabad, said Mr Raj Menda, Co-owner and Managing Director, RMZ Corp. “We have lined up lands. But we are in the early stages of discussion,” he said. The company proposes to develop two million sq ft on the East Coast Road in Chennai and two small projects in the city centre, while in Hyderabad it would three million sq ft development spread over two projects.

On funding for the residential projects, Mr Menda said that the company had no fund raising plans for now.

“We will need equity partners at the SPV level to ramp up residential projects post-June this year,” he added. The company has a “committed line of private equity funds of Rs 1,100 crore”, he pointed out. The company also announced its entry into the serviced apartments segments with a tie-up with Ascott Group. It plans to start work on four serviced apartment projects this year. The first property, with 150 keys, would come up at RMZ Galleria, said Mr Menda.

On the commercial segment, he said that the company has 1.6 per cent vacancy levels.

At an industry level, he expected sluggishness till June due to indecisiveness on the part of corporates owing to the economic crisis.

“Past experiences show that the effects post-slowdown have been a lot more beneficial to India. But it takes up to a year to see these benefits,” he added.

RMZ Corp has 2.9 million sq ft space under construction at Outer Ring Road, and 2.2 million sq ft in the newly launched integrated projects in Bangalore.

Mr Menda pointed out that the company has also pre-leased 3.5 lakh sq ft at RMZ Galleria, which was announced on Thursday.

Huawei starts plant; to invest $150m in R&D

As part of its localisation strategy in India, Chinese telecom company Huawei commenced manufacturing in Chennai and announced a fresh $150 million investment to set up a R&D campus in Bangalore.

The company has invested $400 million over the last 10 years in India and is planning to invest an additional $150 million in a new R&D campus in Bangalore, Huawei said in a statement.

The company has commenced production of components of network equipment gear in both its facilities in Chennai, it said.

"Both the manufacturing facilities in Chennai will cater to the growing demand of telecom network equipment supplied by Huawei India to Indian telecom service providers in the domain of 2G expansion, 3G and LTE networks," the company said.

It added that in line with a vision to support the development of the local Indian industry, Huawei is committed towards investing further in India in the future.

The company has a fully-owned manufacturing facility in Sriperumbudur in Chennai and also does contract manufacturing with Flextronics India.

The facilities employ 1,800 technical and managerial staff.

Recently Huawei, as part of its global strategy, announced its future engines of growth and expansion into areas like devices, enterprise solutions and its traditional "bread and butter" focus on supplying network equipment gear.

Huawei has more than 6,000 employees in India, over 90 per cent of which are local Indian professionals. In addition, Huawei views India as a strategic global hub for R&D and network operation services.

Huawei offers end-to-end telecommunication solutions as well as hand-held devices. The company has supplied equipment to both private and state-owned firms, including RCom, Aircel, Airtel, Tatas and BSNL.

In keeping with its India commitment, Huawei has also a very large CSR footprint and claims to have contributed a programme to supply computers and laptops to economically backward children in various parts of the country.

Medium sector IT/ITeS in Hyderabad and Bangalore may shift to Philippines

Many medium enterprises in IT/ITeS sector from Hyderabad and Bangalore are shifting or expanding their bases in the Philippines owing to concerns pertaining to infrastructure, cost of doing business and availability of skilled labour, an ASSOCHAM survey said.

In a statement, ASSOCHAM referred to current developments taking place in the southern part that it said clearly indicate that India's prominence as an Information Technology/Information Technology Enabled Services (IT/ITeS) hub is fast fading away.

"The driving forces are multitude, ranging from ease of doing business, availability of abundant English speaking workforce at lower wages, better infrastructure to government incentives", said D S Rawat, Associated Chambers of Commerce and Industry of India.

"It is imperative for Governments at the Centre and States to quickly initiate remedial measures on war-footing to stem the loss as the capital flight will not only severely affect the growth and employment but threaten India's leadership in the knowledge industry,” he said.

According to the just concluded ASSOCHAM Eco Pulse (AEP) Study titled “Sustaining India’s IT/ITeS Leadership”, the prevailing macroeconomic and sectoral conditions have been resulting in a shifting of ITeS/BPO industry away from India to the Philippines, especially from Hyderabad and Bangalore.

Such a trend is yet not being noticed in the National Capital Region and Pune.

The chamber study said as a proportion of national GDP, the IT/ITeS sector revenues in India have grown from 1.2 per cent in 1997-1998 to an estimated 6.4 per cent in 2010-2011.
 

Its share of total Indian exports (merchandise plus services) has increased from less than four per cent in 1997-1998 to 26 per cent in 2010-2011.

India is presently a premier destination for the global off-shoring market of IT/ITeS, accounting for almost 55 per cent in 2010 as compared to 49 per cent in 2005.

The country has emerged a dominant player in global IT services outsourcing with increase in its share to 70 per cent in 2010 from 52 per cent in 2005. On the other hand, India’s share in BPO sourcing market has declined from 45 per cent in 2005 to 34 per cent in 2010, albeit it continues to be the leader in this space, ASSOCHAM said.

Rawat said the country’s prominence as an IT/ITeS hub is declining owing to factors such as diminishing employable talent pool, high cost of doing business due to inefficiencies of power, transport, security and concentration in metros due to inadequate infrastructure in other towns.

Currently, over 90 per cent of total revenues of the sector are generated from Tier I locations, which are nearing peak capacities in terms of infrastructure support. Therefore, there exists a pressing need to fast-track the development of alternate delivery locations in Tier II and III cities.

Indian IT/ITeS sector has invested and developed world class facilities, extensive talent development initiatives, disaster recovery and business continuity,high transport cost, enhanced security, captive power generation, UPS and other equipment which have overall created a cost disadvantage of 10–15 per cent as compared to other emerging markets.

Hence, India is hard pressed to manage its competitiveness following rising costs and increasing competition.

Israel to open consulate in Bangalore

In a big boost to Indo-Israel cooperation in hi-tech sector, New Delhi has granted Jerusalem permission to open a consulate in Bangalore.

Welcoming the move, Israel's foreign minister, Avigdor Lieberman, expressed his gratitude to his Indian counterpart, S M Krishna, here on a two day visit, emphasising that the move will give a big push to the burgeoning Indo-Israel trade ties.

"It is a wonderful news coming at a time when the two countries are celebrating 20 years of establishment of diplomatic relations", Lieberman said.

Senior representatives from the Israeli hi-tech sector, many with offices in Bangalore, also welcomed the move saying that it will help cut down a lot of costs and time required to travel to other places for bureaucratic purposes.

Israel already has a consulate in Mumbai and its embassy is located in New Delhi.

A Disneyland is unfolding along KANAKAPURA ROAD

Let's looks beyond Jayanagar and J P Nagar of Bangalore South to feature Kanakapura Road which is emerging as the hub of growth in the area 

Vaikunta Hill,off Kanakapura Road,gives a birds-eye view of the future of Bangalore South.The hillock provides not only a 360-degree view of all of Bangalore but also the trajectory the development of the city will take in the coming years.

The 28-acre hillock,on Kanakapura Road and very close to Konanakunte Cross,will be at the heart of the path-breaking changes the city will witness.

Iskcon,which bought the 28-acre hillock for Rs 23 crore at a public auction,is building what it says is a Disneyland-like 4D technology driven Krishna Lila Park and will transform the tourist potential of Bangalore,Karnataka and India.

The construction work on the theme park is expected to begin mid-2012 and get completed by 2016-17.The estimated cost is around Rs 350 crore.

Apart from the intrinsic attraction of the theme park,its spin-offs for Bangalore are numerous: a 600-unit Gokulam Apartments has been built right next to the hill and sold off to citizens,while a second block of 1,400 apartments is being built by Mantri Group also adjacent to the hill.

A massive block of 1,000 apartments already exists next to the hillock.Gokulam apartment resident K A Shenoy told media: We purchased the flat not only because JP Nagar,Banashankari and Jayanagar are accessible,but because we will be right next to a world-class social theme park.The neighbourhood will be hi-tech and socially alive and engaging. 

Vaikunta Hill is expected to spur massive residential apartment projects and villas in the range of 3-10 km.

Kanakapura Road is set to become the hot destination from 2012 onwards as development is still now concentrated in the Yelahanka,Whitefield,Sarjapura regions.Kanakapura Road and beyond is virgin area in a sense and will see far more residential development than office space development,followed by retail and commercial development, says Farooq Mahmood of Silverline Realty.Owing to the arrival of a massive tourist hub,property prices in and around Kanakapura Road area are bound to shoot up in the next five years.The prices for a square foot of site hover around Rs 3,150 to Rs 3,850,according to magicbricks.com,a property site.While a two-bedroom flat may cost Rs 30-35 lakh,three-bedroom ones will begin around Rs 50-55 lakh.

An acre of land in the area is running at Rs 9-10 crore.Expect a 10% to 15% rise in these prices in the next five years.

The location of Metro Cash and Carry on Kanakapura Road is attributed to the presence of wealthy families in the area and the vastly spread small retail network in the area.

Housing activity along Kanakapura Road is expected to rapidly expand with the arrival of Metro Rail network.

The line will reach Konanakunte,which will be connected to Majestic,which,in turn,is connected to M G Road.

The co-ordinates

Kanakapura Road originates in the city at Krishna Rao Park in Basavanagudi.Is close to J P Nagar,Banashankari,Jayanagar Is 16-18 kms from M G Road,Vidhana Soudha Metro rail is being built on Kanakapura Road till Konankunte Cross The road cuts through Vasanthapura and Konanakunte ward

 

Nano Park to come up in Bangalore

•  State-of-the-art Business Incubation Facility
• Ample conference room facility for meetings and seminars
• Training Center
• Exhibition Center
• Fully equipped biochemical and physical research laboratories
• Modern working condition
• Spacious, fully furnished and IT equipped office suites
• Professional business facilities

Financial city coming up near airport

IFCI Financial City, a project of IFCI Infrastructure Development Ltd. (IIDL), will come up near the Bengaluru International Airport here. Union Minister for Finance Pranab Mukherjee will lay the foundation stone for the project on Sunday.

Addressing presspersons here on Friday, IIDL Managing Director P.V. Srinivas said that the Rs. 1,000-crore project is expected to be completed in three years and will house over 20 banks and financial institutions. “IIDL, in association with participating banks and institutions, is developing first-rate urban infrastructure at the proposed site and expects to complete the project in three years,” he said.

Chief Minister D.V. Sadananda Gowda and Union Minister for Corporate Affairs M. Veerappa Moily will take part in the event.

IRR OPENS UP RESIDENTIAL CATCHMENTS ALONGSIDE INDUSTRIAL BELTS

When this project is implemented,there will be many residential catchments along its way.

The Bangalore Metropolitan Regional Development Authority (BMRDA) has plans to take up the development of two Intermediate Ring Roads (IRRs).This is going by the statement given by Chief Minister D V Sadananda Gowda to the legislative assembly recently.
Though these projects were planned in 2006,the BMRDA had trouble initiating the development works,as the compensation to be given to farmers involved a huge sum.The government now plans to take it up on a public-private partnership basis and take the development works forward to ease the traffic congestion around the city.

Satellite Township Ring Road (STRR)

The BMRDA already has plans to develop a STRR that will connect all the proposed townships.According to sources in BMRDA,this will have to take off from Bidadi and the status quo remains on this project.
The government had revoked the freeze imposed in 2006 on land owners of Sathanur,Ramanagaram,Solur and Nandagudi,enabling them to go ahead with development and construction activities.
Now with plans afoot to strengthen the Outer Ring Road (ORR),and initiate land acquisitions for the IRRs,the residential catchments in the area of the proposed route will definitely get a boost.


The plans to strengthen the ORR,and IRR,will be taken up in four stages:



Dabaspet to Devanahalli

The plan is to construct an 89-km IRR starting from Dabaspet up to Devanahalli at a cost of Rs 1,110 crores.When this comes through,the road will traverse through Doddaballapur,which is fast-gaining pace as a major residential catchment.The road to Nandi Hills which is in the vicinity too is a hot spot for upscale residential development.
The Dabaspet area is an emerging industrial town,with the Karnataka Industrial Areas Development Board (KIADB) planning industrial areas in four phases.Spread over 2,957 acres,there are more than 500 units operating here.A road connecting this industrial hub with a majority of industries being export-oriented,to the international airport,will give a fillip to both growth and connectivity.
A mixed residential catchment comprising affordable units,villas,and apartments will be available along the road.

Highlights:

Dabaspet to Devanahalli: 89 km Cost of project: Rs 1,110 crores Benefits industrial areas around the stretch Good connectivity to international airport

Devanahalli to Attibele

A plan is on to construct an 80-km stretch of the IRR from Devanahalli to Attibele at a cost of Rs 1,000 crores.It will serve as a vital link between the international airport and Electronic City,and its vicinity.It will pass through Hoskote and the already-developed Whitefield.The area is a thriving micro-market with social infrastructure and IT SEZs,and huge malls and hypermarkets abound here.The road to Hoskote has many options in residential units.

Highlights:

Devanahalli to Attibele: 80 km Cost of project: Rs 1,000 crores Connects international airport to IT hub Benefit for mix of industries - manufacturing,IT

Attibele to Ramanagar

The longest stretch of 128 km will connect Attibele with Ramanagar at a cost of Rs 1,600 crores.Passing Kanakapura,Anekal,Jakkasandra,and other hubs,this road will serve as a link between Electronic City and Mysore Road.Ramanagar is a textile hub and has investments of over Rs 1,500 crores.The KIADB has recently notified 1,000 acres in Harohalli Phase III near Kanakapura after the recent move to free farmland in these areas.The residential catchments in the vicinity will be along Kanakapura Road,Uttarahalli,and Bidadi.

Highlights:

Attibele to Ramanagar: 128 km Cost of project: Rs 1,600 crores Industrial areas in Kanakapura,Mysore Road stand to gain Will augment connectivity between satellite towns and NICE corridor

Ramanagar to Dabaspet

The last phase of the IRR will be around 70 km from Ramanagar to Dabaspet at Rs 1,078 crores.The textile hub will be well-connected to the industrial area of Dabaspet,and to the international airport beyond.This will serve the industry as well as the residential units along the route.

Highlights:

Ramanagar to Dabaspet: 70 km Cost of project: Rs 1,078 crores Will connect textile and manufacturing hubs

Office space leasing rises 8% in 2011: Cushman report

 Supply is falling: Bangalore retains its top position in the commercial space absorption list at 11.53 million sq.ft along with additional pre-commitments of 5 million sq. ft for next year.

The commercial space absorption in India rose eight per cent in 2011 to about 36 million sq. ft. Real estate consultant Cushman & Wakefield, however, cautioned that the vacancy level continues to be high at 18 per cent, despite a reduced supply flowing into the market now.

There was a drop of 20 per cent in the total supply entering the market as compared to the previous year, the report by Cushman & Wakefield said.

Bangalore continued to top the charts with highest absorption in the country at 11.53 million sq.ft along with additional pre commitments of 5 million sq. ft for next year.

Chennai and NCR also witnessed a considerable growth in the space usage during the year accounting for 32 per cent and 15 per cent, respectively, compared to the previous year, it said.

Mr Anurag Mathur, Managing Director of Cushman & Wakefield India, said that while the first half of 2011 had witnessed dynamic leasing activities, the second half was more subdued. “…The absorption could have been higher had several corporations not deferred their expansion plans in the second half of the year, in the light of weak economic sentiments in the Western markets,” he said.

IT, BPO and BFSI sectors, which are the key demand drivers and have the significant share of the absorption, have seen a clear slowdown in expansion plans, thereby affecting the demand, he pointed out. The non-IT absorption, on the other hand, registered a 30 per cent growth adding to the positive demand.

“Despite the impending uncertainty on the back of weak global cues, the growth in emerging economies is still expected to be seven per cent or more, which continues to drive the absorption in difficult times,” he said.

The total offices space supply was recorded at 34.63 million sq.ft, most of which was delivered in the first two quarters of the year. Cushman & Wakefield further said that the decline in supply could be attributed to a large pipeline of projects under construction coupled with lower pre-commitments in the latter part of the year on account of the uncertain economic scenario.

“The projected supply of 51 million sq.ft in the next year is likely to be controlled by the developers, who may alter the pace of construction to align with demand fluctuations. This may keep rentals under pressure leading to flat trend through most of the year,” Mr Mathur added.