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The Plotline of Investment

December 3, 2012 Leave a comment

Invest in Plots Chennai

 

Many people are looking at plots in the peripheries of the city as a means of short and medium-term investment.Arjun Narayanan finds out more

Land is undoubtedly emerging as a much sought after asset for investments.While purchasing a plot by end users is common,there are many who look for plots as a short to medium term investment.Since availability of plots within the city limits seems beyond question,the obvious choice is the outskirts,where a lot of manufacturing companies have set up shop.
Buying a plot calls for lower finances and allures many investors for this very reason.”I personally feel that property requires more money and the appreciation that happens in case of an apartment is not as high as in case of a plot,”says Mahipat Bhandari,a city-based businessman,who has purchased a plot in Kayarambedu.
It is areas like these that are up for grabs on the investment map today.”The area towards GST,Oragadam,Sriperumbudur and the stretch along the ECR,after Muttukaadu,are attracting investors and developers today.The connectivity is improving in these areas and many educational institutions and hospitals are being proposed here.These aspects work like a trigger for developers and investors,who are looking for plots in the suburbs of the city.It works well as a long-term investment,”says Wilson Mathews,Director,Sales and Marketing,TVH.

With increased economic activities and growing income,space for residential property has become an issue in Chennai.Employees of multinationals and manufacturing enterprises (that are set up on the outskirts) are also planning for a permanent residence in these areas and as that happens,what was once a suburb has now become a part of the city.”Even a few years ago,Tambaram was seen as a suburb.But today,it has become a part of the city.There are many IT professionals residing in the area there and facilities are increasing there,”says Rakesh Jain,a city-based entrepreneur,who has invested in a plot near Guduvanchery and has plans not to sell the plot for at least the next three years.”After seeing some appreciation,I am planning to get into a joint development with a builder,”says Rakesh,who holds the plot jointly with another investor.
“Most real estate developments being proposed in recent times follow the joint development route.In such a case,a developer doesn’t invest money in land;both partners join hands to develop property,”says Wilson.Rakesh also sees a lot of merit in investing in a plot over a house.”Apartments require a lot of maintenance and that becomes cumbersome if you are living in another city.Besides,you can do a lot with a plot.Selling it becomes easier,”he says.

So how does a person clearly decide between investing in a plot and a house Wilson feels that one needs to prioritise his/her needs and keep the budget in mind,which means that the purpose of investment,the time in hand to remain invested,the source of funding and the desired cash flow are the key factors while making a decision.”Don’t bite off more than you can chew,”he says,with a note of caution.”If a person already has a house,then its ideal to invest in a plot in one of the locations in the suburbs.Growth is happening in the periphery of the city,”he says.A planned decision will then help a person invest in plots as a short term or medium term investment.

As published in Times of India, Times Property – December 2, 2012

Profiling GST, OMR and Oragadam

September 18, 2010 Leave a comment
HOLISTIC LIVING

With rising population,integrated townships are poised to be the next big thing in Chennai,even as suburbs in the city play host to a number of such projects.RADHIKA RAMASWAMY visits three important corridors in the city to find out more

GRAND SOUTHERN TRUNK (GST)

The 20-kilometre stretch from Tambaram to Maraimalai Nagar on GST Road could well be mistaken to be within city limits.Such is the development here. GST Road has been touted as a premium industrial corridor and connects all the Southern districts of the State to Chennai via both road and rail. Home to manufacturing giants, IT majors, schools and colleges, the road, over the past three years, has turned into a commercial hub of sorts. One of the first companies to set up its unit on GST Road was Team (Team co Hitech Enginering Ltd) in Vandalur (20 years ago). This was followed by a series of developments in and around Maraimalai Nagar. Mahindra World City,an integrated township,spread across 1,500 acres,developed in the year 2000 transformed the landscape of GST and triggered the growth of integrated townships in this area.Arun Excello’s Estancia and Shriram Properties’ The Gateway are upcoming integrated projects here.”While OMR is IT-centric, GST is a mix of IT, telecom, automobile and ancillary units,”says P Suresh,MD,Arun Excello.”The city has reached a saturation point in terms of significant residential development.With Chennai expanding and peripheral areas playing host to large-scale industrial boom,self-contained townships have become the order of the day.”

OLD MAHABALIPURAM ROAD (OMR)

The OMR phenomenon occurred in the late 90s. What was once a stretch with green patches and large land parcels on either side of the road has evolved into a premier IT corridor.Tidel Park was the first IT establishment to foray into OMR,which is now called Rajiv Gandhi Salai. This was followed by the mushrooming of several other IT parks.Today,over 2.7 lakh people work out of here. “The IT boom led to an unprecedented residential demand along the stretch and several residential projects have come up since 2000,”says K K Raman,Vice-President,DLF Homes “Nobody has the time or the energy to go to far-away places for entertainment and recreation. People prefer everything right from education to healthcare centres in the vicinity of their homes. This is where integrated townships come into play. An integrated township is not just about a home. It is about creating a lifestyle that takes care of every single need of the resident.”DLF Homes is coming up with a 58-acre integrated township project called Garden City in Shollinganalur. Over the next two years,the number of people working in OMR is expected to cross four lakhs. With this,the demand for gated communities will only increase. There are currently over five full-fledged integrated townships on OMR.

ORAGADAM AND SRIPERUMBUDUR

Oragadam,centrally located between Grand Southern Trunk and NH4,has been touted as Chennai’s largest and the most developed industrial belt. With over 22 Fortune 500 companies (of which six are global car manufacturers),the Sriperumbudur-Oragadam belt has seen tremendous industrial growth in less than four years. The area is well-connected via road and rail and according to industry experts,the presence of automobile giants like Renault and Nissan and Ford has triggered growth around Oragadam. Several manufacturing giants such as Motorola, Dell, Flextronics, Samsung, Nokia, Apollo Tyres,and TVS Electronics,have set up their respective units in the industrial belt stretching from Sriperumbudur to Oragadam. Three integrated townships – Arun Excello’s Temple Green,Hiranandani (Hirco Group)’s Palace Garden and Inno Geo City are being developed in Oragadam. Aniruddha Joshi,Executive Director,Hirco Group,Says, “Today,owning a home in the city has become cumbersome and costly. The only solution to the spiralling price and increasing interest rates on home loans is to own a property in an integrated township coming up in the outskirts of the city. The new industrial corridor foraying into places like Oragadam will generate new jobs and will attract people to relocate out of Chennai. Our township will provide them with homes that are located conveniently close by. We are building the whole infrastructure from the ground up – roads,electrical power,telecommunications backbone,water and sanitation. By doing so,we reduce our townships dependence on the public infrastructure and make them self-sustaining – a key differentiator in a country where the public infrastructure is under considerable pressure.”That apart,today’s buyer profile consists mainly of young people,who want to fulfil their aspirations at the earliest.Moreover,these buyers want all this,within the constraints of a certain level of pricing. Townships are an ideal option for such buyers,due to the inherent advantages of economies of scale – they offer various amenities,at relatively lower price points.

 

Times Property, Times of India, 18 September 2010

Costs drive home dreams to Suburbs

 

Aspiring homeowners are now looking to relocate beyond the city suburbs, with private builders offering dream homes in affordable townships in these areas, complete with entertainment, schooling and hospital facilities.

With land becoming sparse and costlier within city limits, the only option for the builder is to amass at least 3,000 acres of land in rustic corridors off OMR, ECR or GST, says C. Devadasa Sundaram, chairman and MD, CeeDeeYes, whose upcoming township Chennai Pattinam, on OMR near Thiruporur has flats ranging from Rs 22 lakh to 45 lakh.

“A township is economically viable for both the builder and the consumer, only if we are planning to accommodate 3,000 families in comfortable two or three BHK homes, and provide schools for the kids, a mall, multiplex,” he says.

Even as private builders are catering to a large middle class segment that is ignored by government projects, they do seek participation from the state. “While we have taken care of other infrastructure like sewage, electricity and water, we have recently written to the government to improve the road facilities,” Mr Sundaram says.

Apart from smoothening unmotorable road tracts, the government must take a keen interest in reducing construction costs, says Nakshatra Roy, True Value Homes. “Material like doors, windows and tiles are much cheaper to import, but when faced with the levy of 30-40 per cent on such items, the builder will have no choice but to pass it on to the buyer, who is already burdened with EMIs,” explains Mr Roy.

Deccan Chronicle, 2 Aug 2010

Poised for growth – Oragadam

 

Oragadam,the industrial hub on the outskirts,is growing rapidly. However,are there enough residential projects in the area to accommodate the rising population RADHIKA RAMASWAMY and HARINI SRIRAM find out Real estate development in the city has been witness to several transformations over the past four to five years.While in certain areas residential development was a defining factor for industrial growth,in others,commercial and industrial growth have paved the way for improved infrastructure and connectivity.

Landscape of Oragadam

Oragadam,centrally located between Grand Southern Trunk and NH4,has been touted as Chennai’s largest and most developed industrial belt.With over 22 Fortune 500 companies (of which six are global car manufacturers ),the Sriperumbudur-Oragadam belt has seen tremendous industrial growth,in less than four years.The area is well-connected via road and rail and according to industrial experts,the presence of automobile giants like Renault-Nissan and Ford has triggered growth in and around Oragadam.In addition,JCBL Ltd,Essar Steel,BPCL,Delphi TVS Diesel Systems Ltd,GE Bayer and Silicons (India) Pvt Ltd have set up offices at SIPCOT Industrial Park.

Industrial impact

Has this industrial expansion paved the way for residential development in and around Oragadam Are there enough projects in the pipeline to cater to the large working population The State Industries Promotion Corporation of Tamil Nadu (SIPCOT) is spread over 347 acres in Oragadam and houses a number of industrial units and intends to expand in order to accommodate more industries and residential complexes.MRJ Premnath,General Manager,SIPCOT,says,”We have more than 10,000 employees,most of who commute to and from their homes in the city by company buses.It is high time that there are apartments or villas built in Oragadam,so that people do not have to spend two hours traveling.” Devendar Singh,Deputy Manager,Motherson Group of Companies,GST Road,is quick to agree.”For me, he says,traveling from GST Road to the city is a nightmare.I recently bought an apartment in Oragadam (in Temple Green,an Arun Excello project).In fact,nearly half the project is occupied by employees from my company.Living so close to work will cut down on travel time and reduce additional expenditure incurred by companies when providing transportation.We want more such projects in this part of the city,as it will benefit thousands of employees working in and around Oragadam.”

The flip side of the customers perspective is that sometimes,regardless of the facilities offered,moving to a new home outside the city is a less than appealing perspective. Kiran Chandan,Deputy Manager,Renault-Nissan,says,Despite working at Renault-Nissan,whose offices are in the Oragadam area,my wife and I moved from Tambaram to Kodambakkam.We did so,largely,because my wife works in Nungambakkam and commuting,for her,would have been difficult. Kiran adds that commuting,for him,is quite a problem now.He continues,We have been looking,for some time,for an opportunity to move closer to Oragadam.Our budget,currently,is about Rs35 lakhs.So far,we havent really found anything. Oragadam used to be a sleepy little village even about three years ago.However,when SIPCOT was set up in 2007,the area underwent a sea change.The resultant flood of working professionals and their family,complete with residential and shopping demands had,and still has,the potential to wake the sleeping giant of urban development in the area.

Times Property, Times of India, 19 June 2010