RERA & GST compliance to remain a challenge for developers until 2017 end: Colliers Research
RERA and GST compliance will continue to remain a challenge for several developers towards the end of 2017, says Colliers Research. In H1 2017, there was a 17% decline in the number of new launches in comparison to H2 2016 with 40,600 new units introduced in the in prime cities. Mumbai and Bengaluru were at the forefront with 35% and 33% of total launches, respectively, while Chennai, Pune and NCR accounted for the remaining 13%, 10% and 9% share. Commercial leasing remained firm with about 29 million sq ft of gross office absorption YTD.
“The introduction of RERA is expected to be a game changer for the real estate industry, thus leading to the professionalisation and corporatisation of the industry- launch with all approvals, sanctioned building plans, last mile funding in place, etc. It will support players who are focused and committed to the business and paying attention to their processes and cost structures. It is now a discipline that is going to allow them to be successful. Further, logistics, warehousing and affordable housing is drawing the attention of both foreign and domestic investors who believe that these sectors can ensure healthy returns on investments”, says Gagan Randev, National Director, Capital Markets and Investment Services at Colliers International India.
The demand for commercial office space and retail properties continues to drive fund flows with a significant contribution from institutional players focusing on Real Estate Investment Trust (REIT)-compliant portfolios and key commercial and business hubs, it says.
In 2017 so far, global economic growth is strengthening, reflecting improving international trade, investment and manufacturing. As per Colliers International’s views on Asian markets, China, Hong Kong, Singapore, and probably Japan and India will achieve stronger economic growth in 2017 than most observers predicted six to nine months ago.
Additionally, the industrial and logistics sector witnessed increased activity in 2017 across the Asia-Pacific region. Manufacturers, logistics companies and industrial office developers are continuously looking for good long-term investment opportunities, particularly in countries such as India, Taiwan, Indonesia, Thailand and Philippines.