Time to innovate and reimagine, says Nair of JLL.
Renewed interest from Non-Resident Indians (NRIs) and joint families are emerging in the Indian residential sector, according to an industry report.
While there are certain uncertainties, the worst is behind for the residential sector. With interest rates at their lowest levels and developers offering more flexible to accommodate buyers’ concern, this could be the best time to buy a property, added the report by JLL
Residential sales in the affordable and mid segments are expected to show the fastest turnaround, according to the report.
Consolidation in the market is likely to further speed up, added the report from the 12th Edition of CII Realty & Infrastructure Conclave 2020, organized by the Confederation of Indian Industry (CII) in association with JLL as Knowledge Partner on 11 Sept 2020.
The current situation has given developers an opportunity to innovate, reinvent and revisit their strategies on maintaining business continuity to navigate through this pandemic.
While the primary focus is shifting to overall well-being, the focus on health, sustainability and wellness is renewed vigor and is gaining prominence across asset classes. But a broader recovery is expected in 2021.
There are positive signs aplenty. With the economy opening gradually, retail footfalls have started picking up, office absorption levels improving and industrial production accelerating.
Hotels have been allowed to re-open and many companies are planning a re-entry into their offices. Over the next couple of quarters, all eyes will be on the ability of India to survive or contain the pandemic, said JLL in the report.
As the country’s most anticipated annual real estate event, CII’s annual Realty & Infrastructure Conclave provides a fitting platform to the foremost stakeholders of the Indian real estate industry to discuss, debate and share their vision for the sector’s collective and progressive growth.
“These are dynamic times. We all agree that no sector has escaped the slowdown caused by the pandemic. The stakeholders of the real estate need to prepare for long-term impacts of the pandemic,” elaborated Ramesh Nair, Chairman, CII Realty & Infrastructure Conclave and CEO & Country Head, India, JLL. The event was held 10-11 Sept 2020.
“But this is also a time to innovate and reimagine. Ongoing changes will only accelerate the pace of transformation that would have taken many years, otherwise. It is time to reinvent spaces, rethink strategies, bring collaboration into workplaces and make them more human,” Nair said.
He elaborated, “The office is here to stay, but its format and functions may change significantly. With significant levels of capital available, investors continue to see real estate as a valuable asset class. This has brought many investors who took a ‘wait and see’ approach at the onset of the pandemic back into the market.
“While the office will lead the recovery, the worst is behind the residential sector. Home loan rates are at its lowest in 15 years and developers are offering attractive discounts, payment plans and schemes. Since May, each month has been better than the previous month for our industry. Growth prospects look brighter for the remaining months of 2020 and 2021.”
The retail, hospitality, and commercial segments within the real estate sector were growing significantly, thus providing the much-needed infrastructure boost for India’s growing needs.
‘Due to the pandemic, the worst impacted sub-segment of the real estate sector is the retail and hospitality sectors,” said B Thiagarajan, Deputy Chairman, CII Western Region MD, Blue Star Ltd.
“Demand for warehousing is now increasing due to an increase in E-commerce activities. The non-resident Indian (NRI) investment in the sector is very prominent.
“We have seen a hike in the numbers of enquiries from the NRI community,” added Thiagarajan.
As businesses open in a staggered manner, companies need to be prepared to face the short-term jolts and be ready to embrace the impending prospects of growth in the medium to long term.
While globally, all stakeholders in the real estate industry are preparing themselves for the long-term impacts of the pandemic, this is also an opportunity to reinvent. Real estate businesses will have to understand, comprehend, plan and implement innovative ways to stay ahead of the curve.
Real estate as an asset class is here to stay, however, adaption is important to survive.
The adoption of technology will be the key to going ahead. Corporates globally are revaluating real estate strategy to make it more resilient to shocks. De-densification, splitting up of offices will gain momentum as more focus will be on collaborative technology.
More corporates will adopt flexible working practices. The phenomenon of Work from Home (WFH), at best, a supplement to the traditional way of working from the office.
There will be an increased focus on health, safety and wellness features and the importance of property management to expected to grow, said the report from the conclave.
Workplaces will undergo massive design modifications. There will be a combination of core and flex, long term and short term and urban and suburban. One thing is for sure, the future will be hybrid.
Apart from creating a human experience, landlords and corporates will have to provide a sense of safety and security. There will be greater demand for better quality office buildings that have the best technology systems and sustainability features.
“Office is here to stay but the format will change,” underlined the report. #residential #realestate #property #houses #investments #NRIs #developers /fiinews.com
