India calling

As one of the emerging markets that has stood resilient in the downturn, India offers much hope for investors, especially as a construction and real estate destination. The housing market has remained considerably buoyant, driven by rising demand, positive growth and favourable government policies. No wonder then that the country has attracted interest from global firms looking to make the best of some robust opportunities offered in the country.

"There is no doubt that India remains an extremely attractive option for foreign investment of any kind, particularly in the real estate sector. Obviously, the recession did cause some concern and a certain amount of readjustment in sorting the wheat from the chaff, but overall the market has remained buoyant. Of particular advantage to potential investors is the level of bureaucracy, although initially confusing and time consuming it is this complexity which does eventually offer a high degree of security in ownership that many countries fail to provide," says Geoff Jackson, general manager of Belhasa Projects.

Jackson is categorical that India will remain a focal point for his company. A leading firm in the UAE, Belhasa Projects recently supplied and installed six running tracks at the Commonwealth Games (CWG) stadiums in New Delhi. The company has also lined up projects in Ranchi and is also tendering for more running tracks and indoor multipurpose sports floor projects in the country.

Also, joining the flux of UAE firms is Ras Al Khaimah's Rakeen, which has formed a joint venture with Chennai-based Trimex group to develop Kovai Hills, a 1,000-acre township in Coimbatore. Also, not far behind is Abu Dhabi-based Marib Holdings which has initiated plans to set up Space City, a complex near Bengaluru which will include recreational, commercial and residential facilities.

Retail and hospitality

Other companies such as Lama Tours and Flora Hospitality are exploring opportunities or are in the process of launching hotel projects in the country, while retail majors such as Lulu Group, a subsidiary of supermarket chain, Emke Group, has gone full steam ahead to develop India's largest mall — The Lulu Shopping Mall in Kochi, offering 2.5 million square feet of built-up space at a cost of Rs3,500 crore (Dh1,242 million).

Scheduled to open mid-2011, the mall will include the country's largest hypermarket, a nine-screen multiplex, family amusement centre, a food court with the capacity to seat 3,500 diners, parking for 3,000 cars and a 315-room luxury Marriott hotel.

Seeking the opportunities the country can offer, Yusuffali MA, managing director of Lulu Hypermarkets and Shopping Malls says, "There is no better time to enter India than now.... with its huge middle class population and exponent growth potential we see tremendous opportunity for us. Though this is going to be our first retail project in India, the Lulu brand is quite well known to Indians especially the Keralites and we hope to leverage on this brand loyalty and affinity."

Explaining the rationale behind this sudden rush, Abhishek Kiran Gupta, head — research and REIS (real estate intelligence services), Jones Lang LaSalle India says, "Improved construction quality, enhanced market transparency, and availability of suitable options have made the Indian real estate market a definitive asset class to invest in, which provides a stable and predictable income yield along with a possibility of capital appreciation."

According to JLL-India, the market value of investment grade real estate in India under construction crossed $100 billion in the second quarter of 2010, with residential contributing up to 66 per cent of this market value.

Residential offerings

This recent enthusiasm to grab a share of the Indian real estate industry was demonstrated by one such Dubai-based developer, ETA Star Properties, the property development arm of conglomerate ETA Ascon Group, which announced that the group plans to consolidate and expand its footprint across India. With a record of undertaking and delivering projects such as Liberty House, Belvedere and 23 Marina in the UAE, ETA Star Properties recently launched Globevill Township, a 350-acre residential complex in India's southern city of Chennai.

The project is a result of a joint venture between ETA Star Properties and Tamil Nadu Industrial Development Corporation (TIDCO).

"The development of the project is happening in a phased manner. The first two phases of the project are already sold out with the third phase likely to be announced shortly," says Fayaz Ahmad, director, ETA Star Property Developers Ltd in India.

The township's two phases in total will offer 706 units comprising from one-, two- and three-bedroom-hall-kitchen units ranging in sizes from 600-1,200 sq ft. Prices start from Rs14.7 lakh to Rs32 lakh (Dh117,600 - Dh264,960).

Setting new trends in lifestyle amenities, the developer claims that Globevill has some of the finest feature that any township in the city of Chennai has seen to date. "The project has been the biggest success to date for ETA Star Property Developers Ltd, with bookings of more than 700 apartments taking place in two days since its launch in August," says Ahmad.

Located on National Highway 4, opposite Sriperumbudur's Sipcot industrial hub, Globevill will also feature an international school, a hospital, restaurants, a business hotel and a commercial complex. The township will offer modern amenities, including a club house, swimming pool, jogging track and 24-hour security. Plans for the third phase are yet to be announced.

While demand for housing has been immense in the Indian property sector, ETA Star Properties which has concentrated mostly in the South has a series of upcoming projects in Chennai, Bengalaru and Madurai. The developer believes that the recovery of the property market in Chennai has been very good.

"Although the buying decision is still cautious, investments by customers has started coming in a big way for the sector. We have started seeing a steady increase in the number of investors from north and western parts of India, vying to invest in the Chennai market," Ahmad points out.

Adapting an optimistic approach, the group does not deny the possibility of its expansion strategy to other cities in the country. "We would first like to establish ourselves as the most preferred property developers in South India before moving to other markets in India and which we feel would happen in the next two years," adds Ahmad.

ETA Star Properties, which made its foray in India in 2007 with the launch of its first residential project — Jasmine Court in Chennai, has since then sought new challenges in developing residential projects such as Le Chalet, a villa development off Chennai-Bengaluru highway with prices ranging from Rs26 lakh to Rs60 lakh (Dh215,280 — Dh496,800) and Lalique, a high-end apartment block with prices starting from Rs3.5 crore (Dh2.8 million) upwards.

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