Rents in south Delhi set to go up
The MCD's eviction drive has put further pressure on availability of legitimate office space in and around Delhi, reports Aruna P Sharma.india Updated: Nov 01, 2006 15:17 IST
Rental values of residential properties in prime localities of south Delhi are likely to go up by 5-7 per cent in the next three months owing to high demand and — after the sealing drive — paucity of good-quality space, a real estate consulting firm has said. "High demand and limited supply of good-quality accommodation in prime localities of south Delhi are likely to increase rental values by approximately 5-7 per cent over the next quarter," Cushman and Wakefield said in its updates.
The MCD's eviction drive has put further pressure on availability of legitimate office space in and around Delhi, the consultant added. "Rates across markets have also risen due to commencement of the Metro rail network in certain locations and plans to connect other destinations within Delhi," C&W said.
Shveta Jain, head of residential services with the real estate consultants, said development in south Delhi had reached saturation point as there were no new land parcels available for new supply of residential houses. There is tremendous demand for independent houses in posh south Delhi colonies especially from embassies and expats," Jain said.
Prime localities in south and central Delhi such as Vasant Vihar, Shanti Niketan, Jor Bagh and Golf Links have witnessed heavy demand for 'builder apartments'. However, considering the projected supply of apartments in Gurgaon, the rental values in south Delhi's micro market are expected to remain stagnant.
In office space category, C&W has said the lease rentals and capital values are expected to further strengthen across all markets in Delhi during October-December quarter.
The consulting firm projected this expected rise to affect Noida and Gurgaon as well.
C&W pointed the demand in Central Business District (CBD) like Connaught Place and surrounding locations has clearly outstripped due to absence of fresh supply of the office space. "The CBD vacancy rate is presently under two per cent and has resulted in an annual rental escalation of about 95 per cent," Cushman and Wakefield said.
The annual rental escalation in south Delhi micro markets has been about 65 per cent due to inadequate supply of authorised office space and vacancy rate of only 3-4 per cent. The suburban markets like Noida and Gurgaon have been witnessing a similar trend. "Prime buildings in Gurgaon reflect a vacancy rate of less than two per cent and prices have risen by about 80 per cent since last one year," C&W said.
(With PTI inputs)