With new projects’ vigour, Hyderabad’s real estate blooms out of slowdown blues

Rahul V Pisharody
With new projects' vigour, Hyderabad's real estate blooms out of slowdown blues

The locales in and around Mokila village, about 30 km away from the IT hub of Gachibowli, is emerging a major residential township on the west of Hyderabad. (Representational Image)

The gloom of the economic slowdown that was impending on the real estate sector in Hyderabad, like in many other cities, has subsided and the market looks at a positive growth, claim builders and developers in the Telangana capital. "Several new projects are coming up, many are underway. As it is very close to the upcoming IT hub, Kokapet, there is already a huge demand for housing," said a real estate professional, whose new project commences next month.

The locales in and around Mokila village, about 30 km away from the IT hub of Gachibowli, is emerging a major residential township on the west of Hyderabad.

Here, 2 BHK premium apartments in highrises are available at prices starting Rs 45 lakh. The amenities include a clubhouse, gym, swimming pool, etc. According to him, prices around Gachibowli have touched Rs 10,000 per sqft and the choice of better infrastructure and lung space is drawing people to Mokila.

In the words of KT Rama Rao, Minister for IT, municipal administration and urban development, "Hyderabad's growth story and momentum have just begun." Even as the sector elsewhere stares at a slowdown, new projects are being started around Hyderabad.

Another major builder who has already sold close to 150 acres of premium land plots of 267-600 sq yard in Mokila said: "We are offering land plots at Rs 34,000 per sq yard. Our land comes in the R1 zone and hence high rises won't be allowed. These are also close to Gandipet lake. Apart from underground water supply lines, electric lines, drainage, we are offering up to 60 feet wide roads and a clubhouse of 1 lakh sq feet. One could buy our smallest plot for Rs 90 lakh and build a villa of own choice." According to him, even after the correction of land prices in 2018 which led to the escalation of land values, Hyderabad has much cheaper prices to offer when compared to many other Indian cities.

While the city has been stretching towards its West, other localities such as Medchal, Kompally, Adibatla, Boduppal, Keesara, Gundlapochampally, Kandlakoya, Thukkuguda, and Hayathnagar, etc have adjustable and affordable housing to offer at below Rs 4000 per sqft.

The Telangana government, which till recently spoke of 'Look East policy' as most of the IT companies and housing projects are concentrated in West of Hyderabad, now says "Look anywhere, but west". Minister KT Rama Rao, speaking at the CREDAI property show Friday, spoke of 'GRID' which means 'growth in dispersion'.

He invited developers to travel Telangana and explore opportunities across 12 municipal corporations 120 municipalities, other than Hyderabad. Making a series of announcements, he said two new IT parks are coming up in the north of Hyderabad, at Uppal and Nagole. The Phase-2 of government's start-up incubator, T-Hub, spread across 4 lakh sqft, will be inaugurated by July 2020. India's largest hardware prototyping lab, T-Works, will be operational in 2020. Hyderabad pharma city too will become a reality in 2020. In the South of Hyderabad, the electronics manufacturing cluster(EMC) will come up in 2020. Quoting Deepak Parekh, chairman of HDFC, the minister said Hyderabad is the only bright spot in real estate in the country. To ensure builders are attracted to set up commercial housing projects in other parts of the city or state, the minister said the government is bound to provide a value proposition. He also announced that the state government will soon introduce 'TS bPass' for building approvals, similar to 'TS iPass' which ensured industrial approvals in a time-bound and corruption-free manner.

The city of Hyderabad was recently adjudged the world's most dynamic city among 130 cities in the seventh edition of 'the City Momentum Index 2020' by global real estate services firm JLL. The city also recorded the highest office net absorption (as a proportion of existing stock) of any city globally in 2019. It is also among the world's best-performing cities for prime office rental growth.

V Rajasekhar Reddy, general secretary, CREDAI-Hyderabad, told indianexpress.com that political stability and able leadership in the state paves way for positive growth in the real estate market in the state. Quoting the Greater Hyderabad municipal corporation, he said there is a steady growth in revenue earned from building permissions which were around Rs 1,000 crore till December 2019, almost doubling from 2016-17. "As many as 1902 permissions for 37,328 flats with a total built-up area of 63,49,766 sq m of residential space and 236 permissions with an area of 32,32,416 sq m of commercial real estate have been issued till December 2019. These permissions indicate the expected real estate supply in the city in the next 2-3 years and the growth over the years," he said.

According to Reddy, the escalation of land prices by four to five times in the last two years has certainly burdened the developer but has also instilled a fear in the minds of buyers. "The land prices will further escalate in due course of time and it is scary for the purchasers. So whatever inventory that is available is being purchased. The increase in land prices will increase project costs and hence, as of now we have no unsold inventory here," he stated.