'Hyderabad saw lowest unsold inventory with pick up in residential demand'

Finding was part of a joint report by JLL and Telangana Real Estate Developers Association

A joint report on residential and commercial property development by JLL and Telangana Real Estate Developers Association (Treda) said capital values of residential properties increased 8-10 per cent year-on-year in the last three years in Hyderabad with the revival in demand after the state bifurcation.

The property launches increased by 30 per cent year-on-year since 2014 due to the policy support along with infrastructure developments like the Hyderabad Metro Rail, strategic road development etc, according to the report.

Despite demonetisation, the implementation of GST and the introduction of RERA (Real Estate Regulatory Authority), the city saw a 6-10 per cent increase in residential sales in the past one year on the back of the launch of projects in various price brackets. "Hyderabad, therefore, remains the city with the lowest volume of unsold inventory," the report stated.

With the entry of large corporates investors also started scouting for opportunities to invest post bifurcation due to which land costs in the city revived from first half of 2014 to the first half of 2017 in prime locations. Commercial office space rents edged up significantly by 23 per cent in the same period.

Office space absorption was a record high at 6.5 million square feet in 2016 while the vacancy rate dipped to as low as 5-7 per cent in key IT hubs. There was a 15.06 million square feet of office space built and 23 million square feet of office space was launched from first half of 2014 to first half of 2017, according to the report.

The report observed that retail demand witnessed a huge boost in the growth of office space and residential sales during this period. Restaurants and cinema halls were the key drivers for generating more footfall in malls. Restaurant space in malls is likely to double to about 25 per cent of the total available office space going forward, it says.