1. Many large business entities are now branching out into real estate development, while real estate companies are entering other areas. What is the reason behind all this?
Diversification is a natura1consequence of India's economic boom. This boom is happening across various sectors, not only one. The action is spread across telecom, IT/ITeS (Information technology and IT-enabled services) retail, logistics and various other sectors. Any profit-making company has to invest its profits, and it makes eminent sense not to put all eggs in one basket. Moreover, bullion is not very strong and shares are volatile. Government bonds and fixed deposits are at best stable, the commodity market is seeing ups and downs and real estate is subject to various intricate market dynamics. It is not a good idea to depend on any single market when it comes to investment.
2. There is a lot of talk about a 'bubble' in the Indian real estate sector. Many are in a watch-and-wait mode, waiting for prices to crash. How do you see it?
When a bubble develops in any market, it is because prices for that particular commodity or asset have gone through the roof - beyond all affordability the current sentiment in the Indian real estate market is one of quiet outrage over the skyrocketing prices, but demand is still strong. It pays to keep in mind that increased incomes and strong economic fundamentals help balance the scales to a significant extent. We can talk of a 'bubble' when transactions slow down significantly or even grind to a complete halt. That would certainly indicate a dire need for prices to come down.
3. Facility management seems to be the new mantra among developers. What exactly does it entail and what is its future in India?
Developers who offer facility management in their projects do so because they wish to attract quality clients and establish a professional image. Obviously, in today's ever-changing scenario, what constitutes cutting-edge facility management is a very fluid concept. Some of the most advanced projects now offer concepts such as Computer Aided Facilities Management, in which computers are used to automate the collection and maintenance of facilities management information. In India, facility management is still a small sector in terms of volume. However: it is now recognized as a significant component in any real estate project established to garner high returns on investment. We see immense scope for expansion of this sector in context with special economic zones (SEZs), integrated townships, hospitals etc.
4. Is it true that Indians investing in property are getting younger almost every year?
Property buyers in the contemporary Indian context are certainly getting younger The average age of the Indian property buyer has dropped from 45 to 32 over the last decade. This is not surprising, considering that a majority of the young Indian entrepreneurs and IT employees are personally wealthy in their own right by age 32. This new, young breed of property buyers has its collective eye trained on stability and upward mobility in the future.
Courtesy:HT dtd 25-02-08
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