Dubai has seventh costliest office property market globally

According to a report by real estate consultancy firm, CB Richard Ellis, as reported by Emirates Business 24/7, emirate of Dubai falls seventh in the list of costliest office market globally with an occupancy cost of Dh449.90 per square foot per annum.
Three of the most expensive office markets worldwide are Tokyo, London and Moscow, according to the report, Global MarketView Office Occupancy Costs. Abu Dhabi came in at 11th in the rankings, with a cost of $91.21 per sq ft per annum.
Current financial crunch has made huge dent on the world's office markets with the most expensive ones considerably less expensive than six months ago, the report said. Financial service providers have been responsible for driving up the rents of prime office space in recent years, particularly in the dominant global financial centres.

Mumbai slips to No. 6 on global office rental list

Mumbai, which became the second-most expensive office property market globally one-and-a-half years ago at the peak of a real estate boom in the country, has now slipped out of the top-five list, as per a survey of 170 cities by real estate consultant CB Richard Ellis. The city remained at the sixth position among the world’s costliest office markets.
The cooling realty prices have also brought down New Delhi from the number eight position globally in November 2007 to the 12th slot in the latest ranking released on Thursday.
“The latest ranking highlights the decrease in rentals due to a reduction in demand. However, Mumbai continuing in the top 10 list and Delhi being at 12th place globally reflects the shortage of prime office supply in India,” said CB Richard Ellis South Asia, CMD Anshuman Magazine.
Office rentals in Mumbai fell 31% since November 2007 from $189 per sq ft a year to $131 per sq ft now. Similarly, office rentals in New Delhi also fell 31% from $126.7 to $86.9 per sq ft a year. Mumbai ranked fifth in CBRE’s last survey released in November 2008, while Delhi was placed 13th. CBRE conducts the surveys every six month.
Tokyo (Inner Central) tops the latest ranking with a rental of $183 per sq ft. It over took London’s West End that led the pack in November 2007 with $329 per sq ft rental, just ahead of Mumbai then. London’s West End is placed second with rentals almost half of what they were at their peak.

DLF puts Andheri project on the block

DLF, India’s largest real estate firm by market capitalisation, is learnt to have put its commercial property in Andheri, a Mumbai suburb, on the block. This project was being developed with Akruti City, and the asking price for the property is said to be at least Rs 500 crore.
The project is spread over 1 million sq ft in the MIDC area of Andheri. Sources familiar with the development said DLF has approached a couple of Mumbai-based property consultants and brokers to execute the transaction.
According to a senior official at a property consultant firm, the decision to sell the asset was taken a week ago. DLF is also believed to have sounded out prominent builders and individual investors. DLF holds 75% in the project with Akruti holding the rest. This is the second big ticket project that DLF has put on the block in the recent past.
Last month, DLF finalised a deal to sell its stake in Hindoostan Mill in Central Mumbai to a Chennai-based investor for Rs 310 crore.
“DLF, which was developing the project with Akruti, is looking to sell the property for Rs 5,000 per sq ft over the actual cost of construction,” said the official. Interestingly, the prevailing market rate in Andheri is around Rs 10,000 per sq ft.
The rationale behind selling the property at half the price is its size. Currently, the project has only a basement and the ground floor. It is divided into two parts by a road with one part covering 7.16 lakh sq ft, with the balance 2.84 lakh square feet on the other side.
An official with DLF confirmed the deal, though the company spokesperson said, “The company would not like to comment on this issue.” It is not clear whether Akruti too would be selling its stake at this point. When contacted, Vimal Shah, MD, Akruti, refused to comment.
DLF had earlier announced that the project would be ready by the end of this year. The company is believed to be selling it to raise capital to repay its debt of around Rs 14,000 crore. A potential buyer will also have to pay for the construction cost that DLF has incurred. DLF officials had earlier announced that they could raise money by selling portions of the land from their existing land banks.

Fortune Park Hotel launches third property in Bangalore

Fortune Park Hotels Limited, ITC's wholly owned subsidary, on Wednesday launched the launch of its 29th property, 130-room the Fortune Park JP Celestial, in the city.
The hotel, owned by the the JP Group and now managed by Fortune Park Hotel, is a contemporary business hotel that offers state-of-art- conference and banquet facilities, Pawan Verma, Senior Executive Vice President, ITC Ltd-Hotels Division told reporters here on Wednesday.
This is the third Fortune Property in Bangalore and fourth one in Karnataka, he said.
Currently, out of the 29 operational hotels, 14 are in the south, he said.
Fortune, whose properties are all management-contract run, except for a sole owned property, proposes to construct two hotels of its own with a total investment of Rs 100 crore.
"We plan to have our hotel in Bangalore and Coimbatore", he said, adding that they will be subranded under Fortune Select.
"This calendar year we have opened four hotels- Lavassa, Manipal, Jaipur and Bangalore and later this month we will open a hotel in Mussorie", he said.
There were also plans to open hotels later this year in Gnadhinagar, Goa, a second property in Hyderabad and a third property in Mumbai

Indian real estate back as favorites of NRIs and PIOs

With the India Realty Expo 2009 opening in Dubai on Thursday, Indian real estate is back on the radar of NRIs and PIOs, says Zubin Mehta, CEO, Markets cheer election resultsSectors and stocks to look out forPick stocks on fundamentalsFive facts on stock fallsShort-term plans are safe bets MCHI. The reverse is also true, says Sandeep Joshi, CEO of EventPro International. Global property investments are making a comeback, searching for Indian HNIs, who would be willing to buy property abroad.
With slick presentations and smart brochures, backed up by an even better sales pitch, projects in Mauritius, Australia, Thailand , UK and even the USA, are being offered to the Indian HNI willing to buy property abroad, says Joshi.
"With media reports talking of sales picking up in the residential segment, in the past five months, the global property market feels that the Indian HNI has money to invest and their aim is to get a piece of this. The only question is whether the sales pitch would be interesting enough," says Joshi.
At the Gulf Real Estate Conference in Bahrain last year, Manju Yagnik, vice-chairperson of Nahar Group, who pitched investments in Indian real estate, to GCC-based developers, had a cospeaker in her session, who pitched Australia and Thailand real estate options.
"When a Bahraini delegate asked him about returns on investments in these locations, he was candid enough to admit that they were merely projected returns and that no one could guarantee that these would actually happen, within the time-frame suggested in the presentation. The same issue comes up, when Indian HNIs are wooed by global property consultants," she says.
The post-election political stability and continuation of existing pro-reform economic policies, has been a positive for global property sellers, says realtor Bharat Malik. "The global market scenario is bad. India is seen as being economically better off, plus there is the realisation that Indian HNIs have money to invest. So, logically , you would have global projects pitching for Indian investments," he says.
In line with this, Abdul Majeed Ismail Al Fahim, chairman, Pearl Dubai FZ LLC, which is developing the 'Dubai Pearl' , in the UAE, maintains that India would be 'an integral part of our growth strategy'.