central park final Questions from Realty Supplement

NEW DELHI: Central Park Gurgaon is a billion dollar plus conglomerate, with interests in real estate, hospitality, auto components, and infrastructure. Central Park has been awarded as Asia’s best and fastest growing real estate brand. It has 5.5 million sq. ft. of superbly built luxury residential and 5-star hospitality projects. Central Park projects are not just luxury residences, but premium townships offering world-class amenities and ready-to-move-in spaces.

In an e-mailed interview, Mr. Amarjit Bakshi, Managing Director, Central Park discusses the impact of demonetization and other issues connected with real estate. The following are edited excerpts:

Scope for NRIs

Demonetization drive and implementation of the Real Estate Regulatory Act (RERA) will help improve confidence of non-resident Indians to invest in the Indian residential market, pushing the total investment from this segment to touch Rs 1,150 crore, according to sources. Luxury housing is the growing popularity among NRIs. The kind of lifestyle they are leading in foreign countries does incline them towards properties that are providing high standard of living in India. NRI customers are looking for those developers who are more transparent, financially stable and highly customer centric. Companies are now focusing more on product quality and customer centric approach to gain the confidence of the customer.

The qualities of product delivered by Indian developers are not at par with overseas developers. But few reputed developers are getting into providing high standard quality of life to their customers.

Investment in the sector is becoming safe and investor friendly. Transparency in accounting, increased inflow of cash into bank accounts, and the ongoing demand for residential investments will influence home loan rates, making them friendlier to buyers. Moreover, though approvals for newer projects will be delayed, existing projects that have received approvals will be able to continue smoothly.

The basic reason for NRIs to choose Indian real estate market for investments is the price appreciation which will increase in luxury segment. Demonetization is hardly going to affect the NRI segment whether it is residential or commercial property as they hold minimal or zero cash in hand. Tier-I cities, which were already witnessing higher investments of NRIs compared to other cities, will witness even higher investments both in villas and big apartments and commercial segment. The government also approved a proposal to allow foreign investment in rent-yielding office and retail space in India. This allows NRIs to invest in Indian retail space, without considering it domestic. If the government removes the minimum requirements on capital and built-up area, NRI investments in office space would rise. This sector is vibrant, and India has seen some of the largest office space deals in the recent past.

For NRIs, we offer a transparent work environment with dedicated relationship managers who work round the clock to offer best of services.

Long term outlook

The market will crash further but long term outlook of the Indian Real Estate sector is positive with only transparent and honest developers surviving in the industry. Further, the law of demand does not work in the real estate market. In a normal market, when prices go up, people buy less of that thing. In the real estate market, as prices go up, more and more people enter the market. The trouble is that this is also likely to lead to default of bank loans from real estate companies. As of August 2016, the total lending carried out by banks to real estate companies stood at Rs 1,81,700 crore. If home loan borrowers also start to default, then there will be a bigger problem.

2016 has not been the best of years for the Gurgaon residential real estate market. Sales volumes fell drastically and prices remained stable. Investors have held their investment decision in real estate sector and are looking for other options. End users are looking for those buyers who are more transparent, financially stable and highly customer centric. Companies are now focusing more on product quality and customer centric approach to gain the confidence of the buyer.

USPs of Central Park projects

Central Park is not just a real estate brand but Boutique Concepts of Luxury that fuse warm hospitality and hotel like homes thereby offering luxury and personalized touch to its residents and owners. Currently, we have two ongoing projects in Gurgaon: Central Park Resorts & Central Park Flower Valley.

Central Park Resorts is our flagship asset class that has been attracting the crème de la crème and expats for its unique ready to move in homes in a Resort ambience. Some of the highlights of Central Park Resorts are:

1. ZERO vehicles on ground surface. International Tunnel driveway experience in 5 star drop offs at this fully delivered project that has a fine mix of nationals and expats.
2. Master Planned by HOK (Hellmuth, Obata and Kassabaum) International Ltd., Landscape Designed by Green Architects of Thailand, winner of many an award including Asia’s best brand, experience Resort living for the first time in India.
3. Spread over approx. 47.5 acres with over 85% dedicated to greens with more than 15000 trees beautiful views, water bodies, grand fountain, open chess and also amphitheatre, pet hotel and even a mess and gym for your staff
4. 360 degree recreational facilities – physical, social and more! Walking, jogging track, cycling, skating, racquet sports, golf putting, zumba, yoga, laughter club etc. amphitheatre, grand fountain, 20 acre of central greens and much more including a clubhouse spread across 50000 sq ft
5. Wide variety of F&B delights: Juice bar, Multi cuisine restaurant, specialty Italian, vegetarian gazebos.
6. Superior level 3 tier security. On call hospitality services – launderette, concierge, housekeeping. You think of it and it will be there.
7. 5 Quality certifications at the time of possession by leading 3^rd party firms like JLL &Dema

Central Park Flower Valley is a Premium Global Township with many firsts. Some of the key features of Flower Valley are:

1. 10 World Class Academies – Boxing, Badminton, Lawn Tennis, Cricket, Day & night  Golf Academy, Fitness, Swimming, Yoga, Acting & Dance
2. Fitness Farm-Aquatic Gym, Jogging Tracks, Cycling & more
3. Social Networking hub– Experience Café, Gazebos, Fine dining Restaurants, Clubhouse,  Juice Centre, Reading Room, Banquet hall
4. Wellness Sanctuary-Meditation, Yoga , Gym, Steam, Sauna, Jacuzzi, Aroma Baths, Sun baths, herbal parks, organic farming, nature walk
5. Green Sanctuary – 9000 trees & flower lanes, Flora fountain
6. A world of all Conveniences – Grocery shop, medical facilities, Shuttle service, 24X7 security, 24 hours power & water backup
7. Kid’s World – Children’s amusement park and Nursery school
8. Proposed Helipad

The sector will become more transparent, credible & attractive

Mr. Amarjit Singh Bakshi is the Founder & Managing Director of Central Park, a billion dollar plus conglomerate, with interests in Real Estate, Hospitality, Auto Components, and Infrastructure.

Central Park has been a frontrunner in the NCR for its concept living or boutique concepts of living. He strongly believes that ordinary people are capable of extraordinary things and invests considerable time in developing teams and leaders. Under his leadership, unflinching commitment to values continues to remain at the core.

Mr Bakshi has been recipient of numerous awards and honors. Here he answers some questions on the Indian Real Estate Sector:

What are the major impacts of demonetization on Real Estate?

The market is expecting a correction in the resale properties segment. However, the primary sales market in the larger cities is not going to be affected, especially when it comes to strong, established developers and those who are highly customer centric. Prices have already stabilized in view of the situation prevailing prior to the demonetization move, and there is a minimum chance of further correction – especially in low-end projects.

High-end and luxury projects may see a correction to some extent. Land transactions, which have historically been driven by cash, are taking a major hit and we can expect a correction of 20-30% in land valuations in the unorganized sector. Lower land costs in emerging areas and smaller cities will eventually result in lower cost of budget housing, as developers will assuredly pass on the benefit of these savings to their customers.

Pricing is a critical factor in the current market environment, and no player will lose the chance to offer more benevolent price tags in order to secure business. The full impact of demonetization will be more visible only after the next Union Budget in February 2018. The negative sentiment currently prevailing is likely to be negated to a large extent by some very positive announcements.

What kind of process filtration you expect due to demonetization in the current scenario?

The Indian real estate sector is considered to be the most unorganized. With demonetization, it will now become more transparent, credible and attractive to all kinds of serious investors, especially institutional investors. In the long term, we will see a much more holistic and healthy pattern of growth in the Indian real estate sector. It will make the Indian business environment more attractive for both domestic and foreign investments.

Will property prices go down after demonetization in India? If yes, how?

The real estate industry is already down due to slow sales, which is leading to rising inventory. Due to growing uncertainty and negative impact on demand the sales will go down which would increase inventory levels further. Developers and sellers could be compelled to cut down prices to drive sales. The reputed developers will remain more or less unaffected as the buyers who invest in such projects take the home loan route, and all transactions are carried out through legal channels. Home buyers can look forward to better pricing in the secondary or resale market.

Demonetization brings happy days for residential property buyers?

Residential properties that deliver value for money, and those that have always conducted integral and accountable financial transactions in sales, would not be affected. Demonetization could be a boon for those developers who deal in the high-end or luxury housing segment as long as transactions are done transparently. Transparency in accounting, increased inflow of cash into bank accounts, and the ongoing demand for residential investments will influence home loan rates, making them friendlier to buyers. Moreover, though approvals for newer projects will be delayed, existing projects that have received approvals will be able to continue smoothly.

What should an NRI keep into consideration while investing back home?

Demonetization drive and implementation of the Real Estate Regulatory Act (RERA) will help improve confidence of non-resident Indians to invest in the Indian residential market, pushing the total investment from this segment to touch Rs 1,150 crore, according to sources. Luxury housing is the growing popularity among the NRIs. The kind of lifestyle they are leading in foreign countries does incline them towards properties that are providing high standard of living in India. NRI customers are looking for those developers who are more transparent, financially stable and highly customer centric. Companies are now focusing more on product quality and customer centric approach to gain the confidence of the customer.

Do Indian Developers deliver Realty at par with the quality available oversees?

The qualities of product delivered by Indian developers are not at par with overseas developers. But few reputed developers are getting into providing high standard quality of life to their customers.

How safe is real estate investment in India today after such a big jolt to the industry?

Investment in the sector is becoming safe and investor friendly. Transparency in accounting, increased inflow of cash into bank accounts, and the ongoing demand for residential investments will influence home loan rates, making them friendlier to buyers. Moreover, though approvals for newer projects will be delayed, existing projects that have received approvals will be able to continue smoothly.

India’s Real Estate Market: Time for the bubble to burst! What are your views on this statement?

The market will crash further but long term outlook of the Indian Real Estate sector is positive with only transparent and honest developers surviving in the industry. Further, the law of demand does not work in the real estate market. In a normal market, when prices go up, people buy less of that thing. In the real estate market, as prices go up, more and more people enter the market. The trouble is that this is also likely to lead to default of bank loans from real estate companies. As of August 2016, the total lending carried out by banks to real estate companies stood at Rs 1,81,700 crore. If home loan borrowers also start to default, then there will be a bigger problem.

Scope for NRIs to invest in Commercial Properties in India, what kind of returns they may expect after Market Corrections?

The basic reason for NRIs to choose Indian real estate market for investments is the price appreciation which will increase in luxury segment. Demonetization is hardly going to affect the NRI segment whether it is residential or commercial property as they hold minimal or zero cash in hand because it doesn’t serve as active currency for them. Tier-I cities, which were already witnessing higher investments of NRIs when compared to other cities, will witness even higher investments both in villas and big apartments and commercial segment.The government also approved a proposal to allow foreign investment in rent-yielding office and retail space in India. This allows NRIs to invest in Indian retail space, without considering it domestic. If the government removes the minimum requirements on capital and built-up area, NRI investments in office space would rise. This sector is vibrant, and India has seen some of the largest office space deals in the recent past.

What are the initiatives Government is taking to boost Foreign Investment in Indian Realty Market? What are your suggestions?

RERA and GST is expected to improve transparency and boost NRI interest in Indian real estate market in 2017. In the recent budget, the government had liberalized restrictions on foreign direct investments (FDI) in real estate sector which will give a boost to affordable housing. The minimum capital requirement for FDI in Indian real estate was also lowered from $10 million to $5 million.

What is the current trend in Real estate in your region?

2016 has not been the best of years for the Gurgaon residential real estate market. Sales volumes fell drastically and prices remained stable. Investors have held their investment decision in real estate sector and are looking for other options. End users are looking for those buyers who are more transparent, financially stable and highly customer centric. Companies are now focusing more on product quality and customer centric approach to gain the confidence of the buyer.

What are the major USP’s of your project? Why do you feel that it could be the trend setter in your region?

Central Park is not just a real estate brand but Boutique Concepts of Luxury that fuse warm hospitality and hotel like homes thereby offering luxury and personalized touch to its residents and owners. Currently, we have two ongoing projects in Gurgaon: Central Park Resorts & Central Park Flower Valley.

Central Park Resorts is our flagship asset class that has been attracting the crème de la crème and expats for its unique Ready to move in homes in a Resort ambience. The Resort is unique for its ZERO vehicles on ground surface, an international tunnel driveway and more! With many a highlight and feature to see, you need to take a Resort Safari to explore the beautiful Resort with its gorgeous, expansive undulating greens dotted by water bodies and fountains, a rich landscape of amenities for leisure and recreation. Some of the highlights of Central Park Resorts are:

8. ZERO vehicles on ground surface. International Tunnel driveway experience in 5 star drop offs at this fully delivered project that has a fine mix of nationals and expats.
9. Master Planned by HOK (Hellmuth, Obata and Kassabaum) International Ltd., Landscape Designed by Green Architects of Thailand, winner of many an award including Asia’s best brand, experience Resort living for the first time in India.
10. Spread over approx. 47.5 acres with over 85% dedicated to greens with more than 15000 trees beautiful views, water bodies, grand fountain, open chess and also amphitheatre, pet hotel and even a mess and gym for your staff
11. 360 degree recreational facilities-Physical, social and more! Walking, jogging track, cycling, skating, racquet sports, golf putting, zumba, yoga, laughter club etc. amphitheatre, grand fountain, 20 acre of central greens and much more including a clubhouse spread across 50000 sqft
12. Wide variety of F&B delights: Juice bar, Multi cuisine restaurant, specialty Italian, vegetarian gazebos.
13. Superior level 3 tier security. On call hospitality services – launderette, concierge, housekeeping. You think of it and it will be there.
14. 5 Quality certifications at the time of possession by leading 3^rd party firms like JLL &Dema

Central Park Flower Valley is a Premium Global Township with many firsts. Replete with 10 World Class Academies,  myriad choices of Fleur Villas, Lake Front Towers, The Room, Flamingo Floors and Mikasa Plots, world class amenities and to top it all, a main road location in South of Gurgaon, just minutes away from Golf Course Extension Road and other landmark destinations. Positioned to be the cynosure of living of the ‘upper crest’, Central Park’s Flower Valley befits the who’s who with amenities, facilities and a township that’s truly at par with the world’s best. Some of the key features of Flower Valley are:

9. 10 World Class Academies – Boxing, Badminton, Lawn Tennis, Cricket, Day & night  Golf Academy, Fitness, Swimming, Yoga, Acting & Dance
10. Fitness Farm-Aquatic Gym, Jogging Tracks, Cycling & more
11. Social Networking hub– Experience Café, Gazebos, Fine dining Restaurants, Clubhouse,  Juice Centre, Reading Room, Banquet hall
12. Wellness Sanctuary-Meditation, Yoga , Gym, Steam, Sauna, Jacuzzi, Aroma Baths, Sun baths, herbal parks, organic farming, nature walk
13. Green Sanctuary – 9000 trees & flower lanes, Flora fountain
14. A world of all Conveniences – Grocery shop, medical facilities, Shuttle service, 24X7 security, 24 hours power & water backup
15. Kid’s World – Children’s amusement park and Nursery school
16. Proposed Helipad

What kind of special support you are getting from Indian Banks facilitating home loan for NRIs?

We have all major banks empanelled with us who are providing home loans for our various properties.

Do you offer some special schemes and incentives targeting NRI’s?

We offer a transparent work environment and best of customer service with dedicated relationship managers who work round the clock to offer best of services.

What is your opinion on the future of Real Estate in India?

The short term outlook for the industry is negative as home sales will come down by at least 20-30% with weaker credit profiles of top developers. The credit profiles of particularly those companies will be hit which have aggressively expanded their land banks in the last two years, using cash collections from previously sold properties.

Due to demonetization, slowdown in new property launches could revive home sale bringing stability to the sector and improve credit profiles. In 2017, it is expected that the real estate market will go through a phase of consolidation. The overall industry will see a lot more confidence from the buyers/investors, greater transparency, positive outlook by foreign investors and cashless transactions.