Chennai real estate faced intense challenges in year 2014.

Q: Year 2014 was noisy for chennai real estate market with declining sales & high inventory levels as well as piled up debt.

Madhukar, Chennai

29th December 2014

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Replies (2)

Hi,
According to me, on the retailing sector, malls which are witnessing declining revenues are in for a bonanza. With 100 per cent FDI being permitted in completed projects for operation and management of malls/ shopping complexes, some of these strata title malls could have a better future .The participation of mall management companies will streamline mall operations to a great extent.

Abhineshwaran, Chennai

29th December 2014

Comment

Hi Guys,
As per my knowledge, on the commercial front, Chennai is close to absorbing 4 million sq ft by the end of this year. Interestingly, no new IT space is coming up with the result the city may face shortage of quality office space in the coming years. This may even lead the city losing its potential to create job opportunities to neighbouring cities.

Alex Stephen, Chennai

30th December 2014

Hi Madhukar,
According to me, a significant factor is that corporate houses and MNCs are looking at 2-3 BTS campus facilities, a clear indication of the spurt in demand for quality office space. In fact, this is the first time that large floor plates are in demand, indicating the opportunity to create employment in the city.

Shyam Sundar, Chennai

30th December 2014

@ Madhukar,
Though Chennai has inherent potential for all-round development, lack of initiative to address the genuine grievances of investors and pragmatic policies by the state government are major deterrents for development. However, property consultants feel that the coming Union Budget would bring a turnaround in development for the realty sector.

Devendra, Chennai

31st December 2014

Hi Madhukar,
As per my knowledge, with government approvals for planning getting inordinately delayed, even new projects are kept on hold by developers for fear of entering a sluggish market. However, the city saw some significant land deals during the year. Moreover, inquiry levels have now gone up, reviving hope for better days ahead.

Javed, Chennai

29th December 2014

Comment

@ Madhukar,
As regard residential segment, sales volume dipped by 20-25 per cent over the previous year. While developers are willing to absorb the pre-EMI interest, banks which bore the brunt of overall slowdown, had eased lending norms to absorb the processing and legal fee. Even soft launches at good locations saw only moderate response and it was hardly sufficient to carry on full scale launching. While approval delays caused debt burden, market uncertainty has aggravated the overall scenario and delayed even official launches.

Priya Sharma, Chennai

29th December 2014

Hi Madhukar,
In a related development, not every developer took a backseat as land transactions continued to hit headlines in prime locations in the city with corporates and leading developers from Bengaluru investing in strategic locations. Though inventory levels at the IT corridor caused concern, corporate developers such as Godrej Properties are bullish on OMR and inked a deal for the second project in the city.

VKumar, Chennai

29th December 2014

Hi Madhukar,

As per my knowledge, land development is taking a new high as leading developers are planning to enter the much neglected sector and give a new twist to plotted development projects. Bengaluru’s successful model has paved the way for leading developers to plunge into this sector.

Pavan kumar, Chennai

29th December 2014