Real Estate Hyderabad

Genuine or just an eyewash?

2009-01-08T05:57:00.002-08:00

A major casualty of the current global meltdown has been the real estate sector. With uncertain job scenarios and companies cutting costs across the board to tide over recessionary trends, buying a property is lowest on the priority list. Making do with what you have is the new mantra with focus narrowed down to keeping the job in hand where spending is tightly reined in.

Luring such an unwilling customer requires more than perfunctory corrections in pricing and developers are undoubtedly aware of this. The last few months have seen a range of freebies and incentives offered to tempt the buyer.

Thus, offers like “buy a flat and get a kilogram of gold free” or “opt for a free site,” “buy a farm land and get a farmhouse free” are no more a product of imagination. Of course, offers such as these raise doubts about units actually getting constructed and delivered on time, questioning the prudence of investing in such ventures.
Sustainability

Some offers do appear genuine, the cost built into the unit offered for sale, yet others fail to have economics and sustainability in place. The question arises, is the customer being sensible to fall for such offers. Is the price quoted genuinely marked below market rates?

Says Girish Puravankara, Managing Director, LGCL, “Our offer of 30 per cent below the prevailing market rate for our villas was possible through smaller profit margins, good planning, low overheads and an efficient team.” According to him, there is no case of falsely luring customers as they are well aware of existing prices and quality expected.

“This is especially the case in a recessionary market as compared to a boom period when not many checks are done before purchase.” The villas are to be built with 98 per cent efficiency in the usable area with no compromise on quality to accommodate the lower price, he adds.

Concurs Parag Sen, V-P, Sales and Marketing, Golden Gate Properties, “Typically our margins are less and we reduce cost through innovation and low wastage. Besides, our volumes make our pricing competitive.”
Goodwill money?

Construction cost remains the same throughout the country for a given level of quality, he says. The high price differential is attributable partially to goodwill money charged by established developers and the unwillingness to pass on to the customer any reductions in cost. Incidentally, the developer offers value-added promotions such as furnishings for the finished apartment at a marked down price of 30-35 per cent.

“The discount is offered by the brand that sells the furniture. We work out a deal with them on a no profit-no loss basis,” he adds.

With the bleak market scenario deterring even customers who want to graduate from an apartment to a villa from doing so, the Alliance Group recently came up with an innovative option of exchanging an old apartment for a villa in one of their upcoming projects.

“We believe in innovation in product and sales and this exchange was a result of that in tune with today’s market conditions,” says Manoj Namburu, Chairman and MD, Alliance Group.

As for piling up of stocks in the form of unsold apartments impacting liquidity of his venture, he is quick to add the exchange offer is open only for the first 50 units. “We ensure sustainability of our projects by not only making prices realistic but progressive where the first set of units is sold at cost price and the rest at a higher rate in relation to their level of completion.”

Referring to the severe liquidity crisis in the residential market, Anurag Mathur, Managing Director, India, Cushman Wakefield, says, “Developers are facing severe resource crunch with sales at an all-time low. Some of the freebies offered to push sales are genuine while others a mere eyewash. The discounts are significant in fresh projects.”

He points out that these discounts and freebies are more to do with lesser-known projects though the future may see this extended to reputable ones. As for determining the realistic price of a unit, he uses late 2005 or early 2006 prices as the benchmark for getting good value on a purchase.

Indicating correction of prices started in early February, Amit Bagaria, Chairman and CEO, Asipac, says, “The bottom of price correction is bound to be hit in the next 5-6 months.”

According to him, while price correction would not exceed 30-40 per cent, those yet to correct their prices will do so in the coming months while those who have will be unable to reduce it further, given cost considerations.
Volume sale

“Increase in margins by top builders to 50-60 per cent has prompted buyers to shift to lesser known developers who have realistic margins. The present crisis is not merely of low demand that has dipped by 20 per cent but of huge increase in volume on the supply side.”

As for sustainability and genuineness of the freebies and discounts offered, he feels the best deal would be in terms of payment while liquidity factor is solely dependent on individual builders.

Adds Koshy Varghese, MD, Value Design Built,

“Any price correction should be realistic, based on cost considerations. Any discount or offer should be sustainable to prevent the project from running into problems.” Sums up Guru Prasad, Joint MD, Chaithanya Projects,

“To develop a sustainable model, the incentive should be a price cut that affects EMI positively. Innovative schemes can lead to trouble, more so where projects are large and risks equally so.”

A garden with a pond is complete

2009-01-08T05:57:00.001-08:00

Water is the elixir of life for all the living beings. Apart from being the basic sustenance factor for greenery, water can also shelter various kinds of beautiful plant-life. Those who have seen and experienced the splendour of the aquatic greenery will vouch for the same. Apart from nurturing plants, water bodies complementing the home garden will offer a diversified landscape and relief to the eye.

Water bodies in the garden may include fountains, artificial waterfalls, or small ponds, all rendered more elegant if decorated with pebbles, rocks, and lighting. Apart from plants, they can also have fish, snails and other small creatures, sharing a symbiotic relationship with plants.

Choosing the appropriate spot could be the trickiest job while venturing to have an aquatic garden. Almost all the water plants need good amount of sunlight to live and hence, the spot should be exposed to sun at least for five to seven hours in a day. And also, care should be taken to see that the pond does not fall into the shade of any tree or undergrowth.

“The pond could be natural, dug up in the ground and equipped with perennial source of water. In such case, there will not be a need for pots. In case there is no such naturally viable spot, one can build a concrete one or use a plastic tub. One can even dig up sufficiently and cover the area with thick plastic sheets to hold water. In any case, one should use only fresh water and not saline water,” informs an official from Buddha Purnima Project Authority.
Variety of plants

The number of aquatic plants one can display obviously depends on the space available. However, one should be cautious to fill only 50 to 60 per cent of the surface with plants, so as to avoid cluttering.

Aquatic plants can be of many types depending on their growth specifications. Prominent among them are floating, partly emerging, marginal, and submerged.

Floating plants, as their name suggests, float about in water and do not require root penetration for survival. Most of them have weed-like growth and hence, need to be restricted manually. Water hyacinth and Pistea are the best example of the floating plants. Partly emerging plants are the ones that have their roots entrenched in soil, while the leaves and inflorescence are above water. They offer a beautiful sight to behold. Water lilies and lotuses are examples of the partly emerging plants.

Emergent plants, in some cases, could be taller and have their stems visible above the water. Submerged plants are the ones that remain beneath the water surface. Mostly aquarium plants, they do not offer much visual appeal, yet are instrumental in curbing algae growth by consuming excessive nutrients. They also produce oxygen during daytime and are known as Oxygenators.

Trees such as Salix babylonica, Barringtonia and Bottle Brush varieties can be planted on the edges of the pond by virtue of their tolerance to water logging. These are known as marginal plants and include palms such as Nipah (Nypa) fruiticans and Ravenea palms.
Useful tips

While natural ponds can have the plants in the soil, pots could be used to accommodate the same in the concrete ones and plastic tubs. Alternatively, the container may be half-filled with soil.

“Heavy soil should be used for the aquatic plants with choice mix of horse manure or chicken manure. Algae should be removed from time to time. Periodical replenishment of water is must,” informs the official.

Those desiring a mix of partly emergent and emergent plants may use pots fixed atop a perch (bricks or inverted pots) as per convenience. One can also use ornamental fish to clear the algae. They will prove to be an effective deterrent to insects and mosquito larvae.

Private trust can be formed through a Will

2009-01-08T05:56:00.001-08:00

A trust can be created orally by the author of the trust and it may be done in the presence of the trustees and the beneficiaries and terms of the trust will also be specified orally. For the sake of certainty, oral trusts have to be confirmed by sworn affidavits made by the author of the trust and the trustees. Normally, such trusts do not exist in practice as there will be a lot of uncertainties relating to the matters governing the rights and responsibilities of the trustees, beneficiaries etc.
Normal trusts

The second category is where the shares of individual beneficiaries in the net income of the trust and in the net assets of the trusts on dissolution are definite and are clearly indicated in the instrument of trust itself. For the sake of convenience, we can refer to them as “Normal Trusts.”
Discretionary trusts

The third category will be where the individual shares of the beneficiaries are not specified in the instrument of trust and the trustee or trustees are given the option or discretion to divide the net income of the trust among a set of beneficiaries (indicated in the instrument of trust) at any proportion or ratio as the trustees may deem fit and proper. Such trusts are called “Discretionary Trusts.”

A Private Trust can be formed through a Will also. It will come into effect on the death of the person who creates it or on a date with reference to the death of the person. Such a trust is called a “Testamentary Trust.”

A trust also can be declared by a person, as the author, during his life time itself but can be made to come into effect only on his death or on any date with reference to his death.

A normal trust by itself is not taxed to income tax on its net income and only the individual share incomes of the beneficiaries are taxed in the hands of the beneficiaries independently. However, the trustee will fill the returns of income of such beneficiaries as a representative assessee for and on behalf of the respective beneficiaries, by virtue of provisions of Section 160(1)(iv) of the Income tax Act, 1961.
Rate of tax

The rate of taxation applicable is the rate at which the beneficiaries total income including the share income from the trust will be taxed. On the other hand, a discretionary trust as well as an oral trust will be assessed in the name of the trust itself at the maximum marginal rate fixed under the aforesaid Income Tax Act 1961.

The maximum marginal rate means the highest rate of tax fixed for an individual at the highest slab including surcharge on income tax, if any.

An instrument of a private trust shall contain: the name and description of the author of the trust; the name and description of the trustee or trustees; the sum of money or property including immovable property declared as trust property duly described in detail in a separate schedule; the operative portion of the instrument of trust formally declaring the creation of the trust and the trust property; the name and description of the trustees, their powers, authority, rights and responsibilities.; the name and description of the beneficiaries and the nature, scope and extent of the interests of each of the beneficiaries, including their rights to assign their beneficial interests in parts or as a whole to and in favour of third parties.; the duration of the trust.; the mode and manner of determination and dissolution of the trust and the mode and manner of division of trust property among the beneficiaries of the trust; the mode and manner in which the instrument of trust itself can be amended. The schedule shall contain the details of the trust property and in the case of immovable properties, their clear descriptions, dimensions, boundaries and locations.

Developer asked to pay monthly rent to flat owner

2009-01-08T05:55:00.000-08:00

In a recent verdict, the Andhra Pradesh State Consumer Disputes Redressal Commission (APSCRDC) ordered a developer to refund the monthly rent to flat owner, as the former refused to hand over the flat. The Commission also upheld the decision of Visakhapatnam District Consumer Forum-I on compensation to the customer.

Nagari Parameswara Rao, a resident of Visakhapatnam, was a member of a group of 20 Low Income Group flat owners. The group entered into a contract with Sai Thirtha Constructions for development of the place. According to the deal, the developer has to return a three bedroom flat along with car parking place and other facilities to the owners. Mr. Parameswara Rao passed away in June, 2003. Since then, the developer refused to hand over the flat in spite of execution of sale deed. Mr. Rao’s wife Ch. Vijaya Lakshmi Parameswara Rao filed a case in the District Forum requesting to direct the developer to pay Rs.2,000 for monthly rent from October, 2003, the month she was supposed to get possession, along with damages and court costs.

The developer resisted the case by arguing that Mr. Parameswara Rao was supposed to submit the land title to them and Ms. Vijaya Lakshmi had to pay Rs.20,000 towards the charges of underground drainage and municipal water connection.

However, there was no evidence provided in support of these arguments.

The District Forum directed to hand over the flat to the customer along with Rs.78,000 for loss of monthly rent, compensation of Rs.25,000 and Rs.1,000 towards court costs. The aggrieved company contended the decision in the State Commission.

It argued the District Forum should have directed the complainant to hand over the land title deed to them, besides the payment of Rs.20,000 towards the underground drainage and municipal water charges.

However, State Commission upheld the decision of the lower forum as the arguments of the builder were not substantiated with any evidences. It directed the builder to deliver possession of flat, besides payment of compensation and rent.

It also ordered Ms. Vijaya Lakshmi to hand over the original title deed to the builder on the date when flat is handed over to her. Time given for compliance was four weeks.

K. VIJAYA BHASKARA REDDY

Shamirpet is the new hot spot

2009-01-02T05:11:00.001-08:00

Shamirpet happens to rank high among the emerging real estate hot spots of the city suburbs these days. Once known only for the lake and deer park, the vicinities of Shamirpet have in the last couple of years underwent a metamorphosis making it a preferred destination.

A lot of residential and commercial projects are changing the landscape in and around the place. Existing projects and future prospects plus an affordable price tag has in a way, helped Shamirpet score positively with the middle class in particular.
On global map

Emerging as a Biotech Hub, the place has won a position on the global map. The state-of-the-art Biotech Park has been earmarked here in three phases over hundreds of acres.

The ICICI Knowledge Park developed and maintained by ICICI Bank apart there are other projects being taken up by APIIC. A spread of 25 acre is also to be developed as SEZ by Parswanath Developers. Rough estimates suggest that 62 companies are already functional here with a good enough workforce. The upcoming projects include Giga City in 2,000 acres, DLF in Jawahar Nagar, Genome Valley and Tata Chemicals.

The other major infrastructure taking shape includes a new bypass from Biotech Park II to Biotech Park III, Manjeera water supply up to Biotech Park III, ORR, six lane express highway from Parade Grounds to Shamirpet. It is in this backdrop, Desire Estates and Property (Ph. 9246156109), has come with a project aimed at middle class.
Clear title

With clear title, it is next to Biotech Park Phase III and is spread over 20 acres. On offer are plots of 200 sq.yds with a price tag of Rs.1,450 per sq.yd. Assured are basic amenities including gated community, blacktop roads, underground drainage, club house and swimming pools and ‘vaastu’ compliance, according to the promoters.

T.L.S.

Home loan @ 6.5 p.c. interest?

2009-01-02T05:10:00.002-08:00

The benefits available for home loan repayment under the Income Tax Act, 1961, if appropriated towards the interest paid on loans, will bring down the effective interest to 6.5-7 per cent. Here is an effort to substantiate the same.

The income tax benefits available for home loan borrowers are:

Under Section 24 of the IT Act 1961, interest paid up to Rs. 1,50,000 is set off as loss from salary/business income, for self-occupied property (if property is acquired earlier to April 1, 1999, interest up to Rs. 30,000 per annum is allowed).

For rented out property, entire interest paid is deductible from taxable income after computing the rental income. If loan is availed for house renovation, interest up to Rs. 30,000 p.a. is allowed as deduction.

Under Section 80C, home loan borrowers can claim deduction up to Rs. 1,00,000 from taxable income on the loan repaid during the year (along with specified saving instruments).

The entire PEMI interest amount (the interest amount paid during construction period), is allowed as a deduction under Sec. 24, equally over five years (20 per cent of total interest paid), starting from the year in which the construction is completed.
Registration cost

Under Section 80C, along with other specified savings and home loan repaid, the amount spent for stamp paper and registration cost on registering house property up to Rs. 100,000 is deductible from total income.
An instance

Let us analyse the benefits for Ashok, who is working in a MNC with a taxable income of Rs. 900,000 p.a. He needs to pay income tax of Rs. 180,250 as per the slabs applicable for assessment year 2009-10. Plus, there is education cess of 3 per cent on the income tax payable. 10 per cent surcharge, if the taxable income is Rs. 10 lakh and above.

For female assessee, the ceiling is Rs. 180,000.

For senior citizens, ceiling limit is Rs. 225,000.

As per the income tax slabs, his income tax burden comes down to Rs. 133,900 (including education cess) from Rs. 180,250, a saving of Rs. 46,350.

If this saving of Rs. 46,350 is appropriated towards interest paid on home loan, the effective interest on home loan reduces to 8.67 per cent.

Mr. Ashok can also claim deduction up to Rs. 100,000 towards the principal loan amount paid.

Since he was burdened with a whopping EMI of Rs. 34,773, he could not save in other specified instruments such as Provident Fund and LIC premium.
Deduction

By claiming deduction of Rs. 100,000, his taxable income got reduced to Rs. 650,000. And as such, his income tax burden got reduced to Rs. 103,000, thus earning him additional savings of Rs. 30,900. If this additional saving of Rs. 30,900 is appropriated towards interest paid on home loan, the effective interest on home loan reduces to 7.12 per cent.

Build up evidence base in your own interest

2009-01-02T05:10:00.001-08:00

n consumer disputes, it is always imperative to set legal process in motion at earliest date possible. Writing letters to the company to build an evidence base, serve them with legal notice and filing the case at consumer fora ought to be taken place quickly. Otherwise, consumers would lose the interest compensation as the fora consider the date of legal notice, date of complaint or date of verdict as the base date to award interest on amount of the incurred loss.

A recent verdict by Visakhapatnam District Consumer Forum can vouch for this.

Although the verdict was in favour of the consumer, she could get interest compensation only from January 2006, the date of legal notice, while she had paid money to the builder in July 1995.

“Delay in filing case will not only cost interest compensation, but at times, the cases also can be rejected for taking such a long gap from the date of incident,” said C.V.L. Narasimha Rao, an advocate and consumer rights activist.
Registration

L.T. Vineela joined in Sai Kanaka Durga Layout of GPR Housing Pvt. Ltd., Visakhapatnam in March 1995.

She paid Rs.36,800 towards the plot with in four months but it was not registered in her name in due time.

In spite of a legal notice, the developers failed to register the site with an approved layout from Municipal authorities or to refund her money.

In April 2008, she filed a case in the District Forum seeking a direction to the builder to refund Rs.36,800 with interest of 18 per cent per annum from July 1995, Rs.1 lakh towards damages and court costs.
Compensation

The forum observed that the builder received substantial amount from the customer, but could not get approval from authorities to register the plot and it was nothing but deficiency in service.

It ordered the builder to refund Rs.36,800 with 12 per cent interest per annum from January 6, 2006, the date of legal notice, to the date of realisation and Rs.7,000 for compensation along with Rs.1,000 for court costs. Time given for compliance was four weeks.

To avoid pitfalls in compensation the consumers should move to the court at earliest date possible and seek the compensation they deserve.

The icing on the cake

2009-01-02T05:09:00.000-08:00

Since a major focus of the real estate activities in coming days is expected to be in the extended areas of the Hyderabad Metropolitan Development Authority (HMDA), a decision has been made to reduce the developmental charges in these areas by 75 per cent.

The recently constituted HMDA in its first meeting chaired by the Chief Minister Y.S. Rajasekhara Reddy, who also is the HMDA Chairman, reviewed the issue of developmental charges for the extended area and decided to reduce it by 75 per cent here on the rates prescribed in G.O.Ms.No. 439 dated June 13, 2007 of Municipal Administration and Urban Development.
More teeth

The meeting also discussed and decided on delegation of development control powers to the local bodies. For properties coming in the HMDA area, it is decided to delegate these powers to the Commissioner, Greater Hyderabad Municipal Corporation. All residential, institutional, commercial building permissions below 18 metres height (non multi-storied building) and issue of No Objection Certificate to the Commissioners of Sangareddy and Bhongiri Municipality while grant of residential building up to G+2 on plot area up to 1,000 sq. mts to the Panchayat Secretary/Executive Officers of Village Panchayats in HMDA.

The HMDA Board decided to adopt the concept of Green Channel for speedy approval of Building Permissions and Layouts.

As per this, non-MSB cases would be cleared in six working days and applications coming through this channel would be liable for charging special fee.
Incentives

The meeting reviewed the progress of work in preparation of Master Plan for HMDA extended area and observed Transportation Plan, Environmental Development Plan should be given importance along with land use zoning plan. The need for additional Railway passenger terminals and freight terminals was also highlighted and the Chairman also directed to provide duct along the roads for utilities. He also instructed to check the feasibility of providing gas pipeline in the duct. The HMDA also directed Metropolitan Commissioner that suitable incentives are worked out to encourage builders in taking up buildings as per the Green Building Code.

While sanctioning Rs.100 crore for the new HMDA building at Hitech City, the Board also approved four zonal offices and eight service centres.

While the zonal offices are to be located at Shankarpally, Medchal, Ghatkesar and Shamshabad, the HMDA service centres would be at Chevella, Sangareddy, Narsapur, Shamirpet, Bhongir, Pochampalli, Ibrahimpatnam and Maheshwaram.

Dream homes still in distant vision

2009-01-02T05:07:00.000-08:00

The bubble of real estate boom finally had to burst. Or it may seem so. Even as many ‘incentives’ are being brought forward by the government and real estate players alike, middle-class families are still playing the ‘wait-and-watch’ game before buying property. The prices have been scaled down to woo the potential buyer too.

“I will wait for the prices to come down further,” says E. Srinath, a government employee. It was two years ago that he decided to buy a house but given the high property, he went for a car instead. “The market was already beyond our reach and we kept hoping that the rates will come down,” he adds.The boom was created artificially only to increase demand, Srinath feels. “It was created by builders because a segment of people were buying property. The per sq.ft. rate at Champapet was Rs.1,600 and in matter of months, it skyrocketed,” says A. Aparna, his wife. “Today, even with a combined income, it is difficult to get a house,” she adds.

Their interactions with local builders in the area also fuelled their decision to wait for prices to drop further. “Six months ago, a builder offered us a flat for Rs.3,100 per sft.

Three months later, he came down to Rs.2,800 and a month back, he called us up and offered as low as Rs.2,600 per sft,” says Srinath.

Now, the couple is waiting for the prices to fall even further so that they can go ahead with the purchase. “We didn’t expect the market to go up that way. But with prices spiralling down, we are going to wait for two to three months before taking the plunge,” concludes Srinath.

Indian economy: will the stimuli work?

2008-12-19T06:44:00.002-08:00

The global financial market meltdown and its effect on the Indian economy has forced the Reserve Bank of India and the government to initiate some more measures for uplifting the sagging economy. Let us examine the details of the ‘stimuli” and its possible effect on the housing sector.

The main accent of the RBI’s stimuli is on interest rates. The government’s package is a mixed bag — additional budgetary expenditure of Rs. 20,000 crore, tax/duty cuts and increased lending by public sector banks.

The major policy announcements by the Reserve Bank made on December 6 are:

Reduction in repo rate to 6.5 per cent and reverse repo to 5 per cent

Housing loans up to Rs. 20 lakh to be treated as ‘priority sector’ lending

Refinance of Rs. 4,000 crore ( details to be announced after the meeting of RBI Board, slated for the current week), for the National Housing Bank for financing construction/purchase of dwelling houses under the priority sector to individuals/families

Five per cent ceiling on housing sector priority quota within the overall priority sector lending; such loans sanctioned up to March 31, 2010

Concessional treatment to commercial real estate lending and consumer loans extended up to 30-6-2009.
Interest reduction war?

Even before we read the news item in the morning papers, the television channels beamed the decision of ICICI Bank to reduce interest on home loans to 11.5 per cent from 13 per cent, a hefty reduction of 1.5, on housing loans up to Rs. 20 lakh. While the general public may be carried away by this high speed action, since the ongoing interest rate movements are a by-product of the ‘stimuli’ to the sagging fortunes of the Indian economy as a result of the global meltdown, other steps are necessary as a follow-up measure.

The government came out with a package of economic revival ‘stimuli’ on December 7, which has certain direct and indirect measures to support the real estate sector, such as

Housing loans up to Rs. 5 lakh to be treated on special footing.

Loans above Rs. 5 lakh and up to Rs. 20 lakh to be treated as priority at concessional rate.

CENVAT relief of four per cent for all dutiable items.

Special approach to residential housing segment.

Why the reduction in rate only to loans up to Rs. 20 lakh?

The specific plan behind the RBI’s declaration of housing loans up to Rs. 20 lakh as ‘priority’ sector is not very clear. However, this only prompted the ICICI to pass on the repo rate reduction to lower and middle class investors who are shying away from investing due to high prices.

Interest on home loans during the last two years.

The home loan rates climbed from around nine per cent to about 14 per cent during the last couple of years. This, along with the increasing cost of construction materials, service charges, cost of stamp duty and registration charges, enhanced the cost of investment in the housing sector by 20-25 per cent. Coupled with the general rise in land cost, this increase has discouraged investors, especially the lower and middle class. Promoters and builders who had big plans for expansion have deferred their plans to invest in new ventures. As a result, the housing market has been dull and demand has came down by almost 25 to 30 per cent, according to top builders.
Cheap money policy

The urgency shown by the RBI and the open direction from the former Finance Minister last month will certainly encourage banks to pass on the reduction in their cost of funds to the borrowers in general and to the small investors in real estate. However, not extending the reduced rate to all the existing borrowers may have negative effect. Most of these loanees may opt to change over to other banks. Another possible effect can be the borrowers utilising the opportunity to limit their borrowing to the upper limit of Rs. 20 lakh in order to get the benefit of lower interest. Yet, the idea needs to be welcomed.

Major effects on the sector can be:

Fillip to long term lending, say 25-30 years.

Preference to floating rates.

Relocation from congested cities to less crowded towns.

Movement from central districts to outskirts.

Green structures to counter climate changes.

Development of townships in and around metro rail terminals.
Cautious approach

Another point to be debated is whether all banks will be in a position to reduce interest on lending unless their cost and asset liability match. Despite positives, it is better to wait and watch for a while. In case the recession is to continue for a while, say 2-3 years, the money value can come down substantially. Optimism pays, but caution can be the watchword. If interest rates go down continuously, the benefits should be fully availed by the borrowers, as the up-cycle will come, may be a tad late in the day! The good news, however, is the positive responses from many banks such as BOB, BOI and Oriental to reduce the rates.

Compensation for mental agony too

2008-12-19T06:44:00.001-08:00

In a recent case, the A.P. State Consumer Redressal Commission increased the compensation amount to offset at least a reasonable portion of loss incurred by a customer.

M. Srinivasa Raju, a resident of Saroornagar, purchased a plot from Sreemitra Real Estates Pvt. Ltd. in August 2002. He made the initial payment of Rs.49,625, but however, stopped the further payments as the developer refused to allocate him the plot. His repeated requests were ignored.

Mr. Raju filed a case against the developer in Ranga Reddy District Consumer Forum seeking repayment of his money together with Rs.50,000 towards interest, Rs. 1 lakh as compensation and Rs.50,000 for mental agony.

The District Forum ordered the builder to refund the paid money Rs.49,625 along with interest of 9 per cent per annum from July 2004 till the date of realization and compensation of Rs.2,000 and Rs.500 for court costs.
Better compensation

Upset with the amount of recompense, Mr. Srinivasa Raju challenged the verdict in the State Commission. He argued that if he was refunded the money when he had asked, he could have purchased another plot in city and would have earned a good market value for it.

He further said he would get only a meagre compensation with the interest rate granted by District Forum and pleaded for better compensation.

The State Commission found force in the contention of the customer.

It observed that if customer was refunded his money in 2003 itself, he could have bought another plot and benefited from the increased land rates.

The State Commission modified the order of the District Forum keeping and asked the builder to repay Rs.49,625 with interest rate of 15 per cent per annum from August 2004 to the date of realisation.

It increased the compensation and legal expenditure amounts from Rs.2,000 and Rs.500 to Rs.25,000 and Rs.1,000 respectively.
Cases cited

The Commission cited three cases - Lucknow Development Authority v. M.K. Gupta, Haryana Development Authority v. Suman Bansal, and Haryana Development Authority vs. S. P.Gupta, which were tried by the Supreme Court.

In the verdicts of these cases, the apex court stated that consumer fora should specify the amount under each head while awarding the compensation and due compensation should be awarded for mental agony and harassment. The time given for compliance was one month.

Too many tongs in the fire

2008-12-19T06:40:00.000-08:00

Now that the government’s integrated townships on a Public Private Partnership mode’s draft policy has come into the public domain, initial excitement seems to be giving way to trepidation. Stakeholders concerned like real estate developers, technocrats and experienced officials have been raising quite a few pertinent points on the issue.

Few are ready to buy the argument that the current slump is the right time to get “budget projects” grounded, the basic premise on which the new policy envisages. As much as 40 per cent of the purported township’s plotted area is to be earmarked for economically weaker sections, low income and middle income groups.

People in the business wonder if it’s practical to go for such housing when 10 per cent of the township is reserved for open spaces and another 10 per cent of residential area is to be handed over free to the sanctioning authority for its own usage? “Can any entrepreneur be successful by taking such a project? Is the government washing off its responsibility to provide housing for poor,” asks an official, incredulously.
Business lobby pressure

He points out that an earlier plan to earmark 20 per cent land in each layout for such a purpose in Hyderabad Metropolitan Development Area (HMDA) came tumbling down to five per cent following incessant pressure from the builders-politicians lobby. “And, even there are no proper modalities on how the reserved space is to be utilised, the cost factor, selling price and probable beneficiaries,” he says.

A previous attempt to sell such houses did not serve the purpose as even the “low price” was way above the affordable range of the target group.

Putting onus on private parties to develop townships is fraught with risks as the contentious land acquisition could lead to more legal wrangles as incentives are simply not enough, argue few others.

“The market value rates upon which cash compensation is to be paid will not be acceptable since it denotes to official values which is too low,” points out a developer. There was also a danger of such townships becoming inaccessible from rest of the urban area.
Gujarat example

Instead, the government should follow the Gujarat example where the urban development authority takes over all the land delineated for a township, builds basic infrastructure like internal and arterial roads, earmarks public spaces, etc. Most importantly, it allows a plot owner to retain his ownership allowing him or her to sell when the time is ripe.

Also, asking developers to build and also maintain civic amenities in such townships is expecting too much, say critics. “When governmental agencies have failed to provide for proper civic infrastructure anywhere, is it possible for private players to do the job? What is the guarantee the developer will do it, if at all or qualitatively, after the plot or apartment is purchased? There are many cases of such failed promises,” says an official.

While giving a push to real estate is imperative, government should seriously consider giving it an industry status as there will be easy finances and tax benefits along with some much needed regulation to protect the consumers’ interests, feel some.
No Master Plan

Without a proper Master Plan in place, it is foolish to go ahead with such projects as it would do against the very tenets of the policy of organised growth, is an overwhelming opinion among stakeholders. Hyderabad itself had a Master Plan in 1975 and a new one is yet to see light of the day even as it has been a stupendous growth.

The prices…..in the wake of terrorism

2008-12-09T05:07:00.002-08:00

Most of us consider the interest rate as the key factor affecting real estate prices. While a combination of factors can affect the demand and consequently prices, terrorism can be the most lethal market buster.

Commenting on the terrorist attack on Hotel Taj, Trident-Oberoi and Nariman House, the Singapore Prime Minister expressed the view that investment in India can be adversely affected by the developments. The then Finance Minister, P.Chidambaram, admitted that the Mumbai siege may mar the mood of the investors and could have negative impact on investor sentiments at least in the short run, but the Indian economy has the strength to overcome it fast. The rating agency, Standard and Poor, however, does not expect any negative impact on India’s macro economy. The terror strikes, they say, are isolated incidents. Percy Mistry, economist and head of an expert committee on making Mumbai an international financial centre, which recently submitted a road map for the same, is reported to have stated that the terrorist attack can erode investor confidence. What is the factual position relating to property prices?
Risk perception

Investment in real estate mainly depends on the risk perception. Risks are from many angles. First and foremost is the safety of one’s investments and the return for it. Next, the class of investor/s who contribute a good percentage of the investments in property. In the case of Indian real estate, individuals form only 10-15 per cent of the transactions, especially from the volume point of view. Surveys have shown that the institutional investors form around 40-45 per cent of the value of deals done in the last 3-5 years. Banks, finance companies and software firms own office premises in major cities as they plan for medium to long-term benefits. If this is true, risk perception will be high in the short term. Yet, the global financial meltdown does not give many alternatives for funds and trusts to get reasonable returns for their investments in liquid assets and they have to turn to the property market. Some may even use the slump to buy property in risky metros.

If terror attacks are dampeners, the 9/11 World Trade Centre attack in New York did not affect property prices in New York city. Even in the Philippines, the killings of tourists did not stop further property development. Nearer home, the 2001 terror attack on Parliament in Delhi did not have any adverse effect of property prices in the metropolis. The risk perception is a wholesome feeling and again comparative in nature. In fact, terrorism is now a global phenomenon and there is no place which can be considered insulated against it. This means among the risk Factors such as fire, flood, earthquake, and now terror all have pivotal role in risk perception.

In this background, Indian property prices cannot be considered high as compared to the ‘street specific’ top few cases as reported recently. For example, the most expensive sq.ft. prices at Rs 8.45 lakh on Avenue Princes Street in Monaco, Rs. 5.40 lakh in Seven Road, Hong Kong, Rs 3.60 lakh in Fifth Avenue, New York, etc are not comparable to any area in Mumbai or Delhi or Kolkata . At best, the price of Rs. 52,000 reportedly paid by a foreign bank in Mumbai last year for securing an office space could well be the highest in India. In such a situation, a reported slump of 10-15 per cent seen in Mumbai market overnight cannot be considered alarming.

Much needs to be done to protect properties from terror risk. Some important steps can be:

Insurance against risk of terror attacks.

Business Districts must spread its wings to interior locations.

International property exchanges covering property stocks, so that risk can be neutralised by investing in stocks of different countries.

Cities including Hyderabad, Bangalore and Chennai have lower property price rates as compared to Mumbai or Delhi. In such a situation, it is likely that investors may turn to these cities for taking the advantage of lower prices. This may perhaps help the sagging market too to look up. Let us wait and watch.

Consumer can no longer be taken for a ride

2008-12-09T05:07:00.001-08:00

In a recent verdict, the A.P. State Consumer Disputes Redressal Commission (APSCDRC) censured Narne Estates Pvt. Ltd. for its unethical business practices.

The State commission commented that the company was harassing and causing loss to the consumer and its efforts to repudiate the agreement were unethical.

T. Vijaya Kumari, a resident of Indian Airlines Employees Colony, purchased a plot from the company in its East City extension in January 1998. She paid Rs.40,000 by the end of 2000 as per the initial agreement. She was asked to further pay an amount of Rs.43,750 towards development charges.

Accordingly she paid the charges by February, 2003. The company refused to register the plot on her name and it offered an alternative plot, which was not acceptable to the buyer.

Hence, the buyer asked for repayment of her amount. However, she could get only Rs.81,250 out of Rs.83,750.

She was told that Rs.2,500 was deducted towards outstanding dues, which never existed.

The company neither paid interest on the money for keeping it for three years nor compensation for going back on its promise.

The annoyed buyer filed a case at Hyderabad District Forum-III seeking for Rs.3,75,000, the then market rate of the plot, with 24 per cent interest rate per annum, Rs.2,500, which was deducted illegally and Rs.50,000 towards compensation besides court costs of Rs.10,000. The company didn’t oppose the case at the Forum.
Deficiency in service

All in all, the District Forum stated that not registering the plot after taking the entire sale consideration, amounts to deficiency in service.

However, the forum awarded only a compensation of Rs.50,000 besides costs of Rs.2,000. The company contended the verdict in the State Commission. It said that the compensation of Rs.50,000 was on the higher side and it argued that it was not liable to pay either interest or compensation since it proposed to register an alternative plot.

The commission pointed out, that the reasons put forth by the company for not registering the plot were inconsistent. It further stated that compensation of Rs.50,000 cannot be termed high, as the company locked up the consumer’s money for three years by which she has lost her plot at a time when land prices in the city escalated.

However, Ms. Vijaya Kumari was not granted the market rate as she couldn’t submit any proof to support her argument.

Home loans: rise in slippages worry banks

2008-12-09T05:05:00.000-08:00

Banks have begun stress testing their realty assets as delinquencies in loan service payments begin mounting.

Bankers said that many banks were facing overdues on some of the past realty loans and some home loans. The slippages noticed were mostly through an increase in overdue debt service payments for up to one month. In the past, overdue payments were very low.

Bankers said that in at least 10 per cent of the home loan accounts, they had experienced such slippages.

Two years ago, when rates were low, the slippage was minimal. Only about 2 per cent of the home loan accounts experienced such slippages, the bankers said.

Such slips in debt service payments notwithstanding, banks see little need to classify the accounts as sub-standard assets.

Vijaya Bank’s Chairman and Managing Director, Mr Albert Tauro admitted “There is an increase in debt service payment slippages. But this is not an immediate cause of worry.” This was because despite the overdue payments, they were yet to reach the threshold level of 90 days. Assets are classified as non-performing only if the debt service payments were overdue for more than 90 days. Besides, for most banks, realty and home loans comprised less than five per cent of their gross assets.
Unfinished projects

Bankers said some realty projects had been left unfinished for want of buyers, increasing the risk of loan delinquencies.

As a result, most of them were limiting loans to the realty sector to contain risks and assessing potential risks through stress testing of the assets.

Stress testing implied assessing the potential for asset delinquency. Asset delinquencies were on the rise in several public sector banks.
Rising NPAs

Bankers are resorting to moral persuasion, persuading borrowers to settle their overdue payments.

However, despite such efforts, NPA accounts have been on the rise. In the second quarter of the current financial year, the average NPAs of the banking sector is already close to 1.5 per cent of advances.

For the last financial year, the average was about 1.3 per cent of advances.

Banks’ worries are not just confined to rising NPAs in the realty sector. In many cases, the loan-to-value (LTV) ratio has dropped below the prudential level of 1.5. Under current guidelines, banks are expected to maintain physical asset coverage of at least 1.5 times (150 per cent) the loan value.

Normally as loans are amortised, LTV ratios tend to rise. A falling LTV, however, implied depreciation in the value of assets.
Distress sales

Mr Lakshmi Narayanan, president and Chief Executive Officer, The Real Estate Bank of India, said “Distress sales have increased. Some developers are resorting to discounted sales for meeting liquidity requirements.”
Balance sheet losses

Realty prices consequently are sliding. LTV ratios are currently down to 1.22 with the drop in the value of realty prices in most metros.

Bankers said that if realty values dropped further, LTV ratios were also likely to drop further. This meant that in the event of loan foreclosures, banks would have loan losses on their respective balance sheets.

Carpets as tiles

2008-11-23T01:50:00.000-08:00

While commercial spaces, especially corporate houses, use wall-to-wall carpeting for interiors, carpets do have maintenance issues and can cause allergy if not properly maintained. With certain areas wearing out more than others based on foot fall, the need to replace large chunks of the carpet arises, which is not eco-friendly.

To negate these factors, the concept of carpet tiles has emerged where pieces of the carpet are used, enabling specific pieces to be changed in the event of sections getting worn out.

InterfaceFlOR is into manufacturing carpet tiles and the company has achieved a green tag for its process of manufacture. These carpet tiles incorporate features such as no VOC content and contain a proprietary anti-microbial preservative, Intersept, which protects the floor from mildew, bacteria, mold and other odour-causing micro- organisms. Glue-free TacTiles are used to install the carpet tiles, which reduces the environmental footprint by 90 per cent.
Air quality

These features improve the ambient air quality, thus contributing to reduction of the sick building syndrome, says Raj Menon, CEO, InterfaceFLOR. “The added advantage is the minimal 3-4 per cent wastage of material at the time of installation which is against conventional broad looms which amount to 13-14 per cent,” he adds.

Nothing commercial about it

2008-11-23T01:49:00.000-08:00

Given the consciousness and increasing need to opt for greener solutions to promote sustainability, corporate houses appear serious about carrying out operations from buildings that sport a green tag. Unlike earlier times when few sustainable options were incorporated, commercial buildings now evince the need to go not only totally green but be rated green.

Buildings that have incorporated green aspects of construction and ensured thermal comfort and indoor air quality have been found to increase employee productivity and reduce attrition rates.
LEED-rated IT park

While none of the presently occupied commercial buildings have a LEED rating, Xylem, the first LEED (Gold) rated IT park in the city, developed by the Tata Group, became ready for occupation recently.

With an area exceeding 240,000 sq.ft., Xylem incorporates all the essentials in terms of design, materials, orientation, energy savings and indoor air quality.

The objective is to tackle the ‘sick building syndrome’ and focus on occupants’ health, ergonomic design and architecture to increase employee productivity.

Boasting of a 19 per cent saving in operational cost as compared to a conventional building, the IT park packs in features such as efficient water use, right orientation to let in maximum natural light, efficient and intelligent air conditioning that results in energy savings of up to 26 per cent as well as energy saving lighting options.

To ensure indoor air quality, the building has 22 CFM of fresh air as compared to 15 CFM in a conventional building. The use of double-glazing glass and aluminium aerofoil louvers further reduces indoor temperature, reducing the need for air-conditioning.

The building has lounges at each level with a terrace garden to serve as relaxation centres. A fully-equipped club house complements this.

Says Brotin Banerjee, COO, Tata Housing, “While this IT Park is the first of its kind in Bangalore, we propose to make all our future projects green compliant.” While there is a marginal increase in the cost of construction, the operational and health benefits negate this extra cost.

Following closely on this path is Bearys Global Research Triangle, currently under development by the Bearys Group. Being the first green building research park in the IT sector, the development aims to incorporate all aspects of a green building to attain a LEED Platinum rating on completion.

Aesthetically designed, the building is in the midst of the lush green belt in Whitefield and built with no changes to the contours of the landscape. The building is to be surrounded by trees to add to the green factor. While all the open terrace spaces are to sport a terrace garden to minimise heat besides enhancing the green look, even the commonly used aluminium louvers have been replaced by creepers.

“The building occupies only 28 per cent of the site area with the rest covered by trees. Even in this 28 per cent, all open areas are to be greenery”, says Syed Beary, Chairman, Bearys Group.

The building is uniquely designed with a portion of it slanting to provide shade to the relevant section. Similarly, the fire escape incorporates a fresh air vault to successfully push the fire out of the section.

While the orientation of the building is structured to let in maximum natural light while cutting out heat, double-glazed glass and Aerocon blocks act as an extra level of insulation.

To ensure indoor air quality, separate ducts are provided for fresh air which minimises stale air traditionally circulated in an air- conditioned interior. Green-compliant carpet tiles will improve indoor air quality.

About 50 per cent savings in energy is expected to be realised with CFL and LED lights. In conference halls, sensors are to regulate air-conditioning as well as lighting.

Similar to energy saving, water conservation features will be in place, not only in terms of waste water recycling and rainwater harvesting, but by using methods like dual flushing and sensor taps.

While the facilities of a club house are to be available for the occupants, the building also proposes to incorporate a Montessori and child care centre to take care of the needs of working mothers with young children.

To promote green modes of transport, special bicycle parking zones and facilities for charging battery-operated cars are to be provided besides making available a fleet of buses for long distance commuters.
Remove the myth

Says Chandrashekar Hariharan, CEO of BCIL-GIL, “the concept that green buildings are more expensive than conventional buildings is a myth.” According to him, a green building veers around the basic approach to design and the right design will reduce the cost of construction, making the cost difference minimal.

BCIL is a green building consulting firm assisting corporate houses with green options. Its wing, GIL, is into research and innovation to promote new ways of adopting green technology.

The company has developed and is in the process of developing various end-user products that are not only energy saving but economically viable.

These products extend to home appliances and address commercial needs such as innovative ways to increase the level of fresh air in an air-conditioned interior.

Adds Hariharan, “There has been tremendous response from builders to incorporate green features not only in commercial spaces but residences too.

This response is seen across the board to imbibe the green concept even in other sectors like food processing and manufacturing.”

Going forward, he envisages increased awareness and steep growth in the percentage adopting the green concept.

These midgets can be mysterious and mindboggling

2008-11-23T01:45:00.000-08:00

The mention of the word ‘tree’ immediately conjures up an image with enormity as its key character-- trunks of vast circumference and wide-spread canopy stemming from innumerable branches and sub-branches. If one can think different; think of midget trunks and insignificant canopy with scaled-down heights, growing from trays and having only so many branches as the owner wishes, one has known and seen the bonsai beauties.

The Japanese word ‘bonsai’ means ‘potted plant’ and does not in literal sense convey what it denotes—a miniature tree. Though said to be originating from China, Bonsai technique reached its acme only in Japan, where it was transformed into an art, and spread across the world. Not many noticed the presence of bonsai in the world’s first Horticultural Show of Paris in 1848, yet the show in 1912 at London drew hordes that immediately attributed mysticism to the art of bonsai. Post World War II, the veil of mystery removed, it became a craze even in the Western world.
Artistic touch

“While horticulture is a healthy diversion from mundane activities, bonsai adds a touch of art to it. A bonsai tree is the result of a series of physical manipulations, not genetic modifications. Hence, sowing of a bonsai’s seed does not yield a Bonsai tree,” says D. L. N. Prasad, eminent plastic surgeon who first brought the art to the city.

Showing around his much-loved and cared for garden of miniatures, he explained how he and his wife first started off in 1967 with minimal knowledge, how they used the curd-bowls to plant the saplings, and later tried out earthen trays and failed, and how finally got the miniature Ficus bengalensis that survived till now, with prop roots et al.

“Now, I can tell you the shortcuts, but initially it was a story of repeated failures. Patience and perseverance are the two investments needed for bonsai cultivation. First thing you should know is that there is a pre-bonsai stage in which sapling from the nursery is prepared,” Dr. Prasad says.

Seedlings from nursery, if planted directly in a typical bonsai tray, will not last long. Instead, they should first go straight into earth or a pot as the case may be, and grown like normal plants.

Even before obtaining the plant, one should have a vision about what one would like to do with it, about its growth orientation and the number and size of branches one would like to retain. It is more or less similar to the creation of an artwork, in that, both are driven by an idea.
Selection process

Though there are no rigid rules in selection of saplings for bonsai, a few practical considerations could go a long way in ensuring trees as family legacy.

“Any species that branches freely may be chosen for bonsai. They should be soft-stemmed and be able to take pruning of roots and branches. All Ficus varieties apart from trees such as tamarind, badam, baobab and guava may be trained as bonsais,” says M. M. Hussain from Plants Land Nursery. Another point to be borne in mind is the life of the plant. It takes about five years for a plant to be made into a bonsai. Those with marginal lifespan will not be suitable for the art, as they die sooner.

As miniatures, bonsais should always represent nature in its myriad forms, but not beyond that. A few basic growth orientations adopted straight from nature will help one to visualise what one would like to design. For single-trunk bonsais, it might be formal upright, informally upright with scattered branches, slanting, curved/twisted trunk, semi-cascading with down-ward bend, cascading with total fall, wind blown, or literati with foliage in the top.

Those with multiple trunks may be double-trunked, triple-trunked, a series of trunks, growth akin to a raft, or rambling ones. Seasoned growers may also plan a landscape of bonsais in a single tray. Once the orientation and the number and placement of branches to go with it are clear, one should visit a nursery and choose a plant that shows promise of the desired growth.

Pot should be of the same size as the plant and the tap-root of the sapling may be cut and a rock placed underneath to encourage growth of secondary roots.

After planting and nurturing it in a pot, one should allow vigorous growth of the desired branches, albeit after slicing off all the superfluous ones.

Any unwanted growth disturbing the desired branching should be immediately curbed. One should not mind the growth of the required branches till the thickness intended for the stem is arrived at. Pruning of the branches to suit the proportions comes only at a later stage.
Do’s and don’ts

The focus of a bonsai artist should largely rest over trunk and canopy which are known as primary features and over the branches—main, secondary, tertiary and lateral—and roots that are the secondary features. One aspect typical of bonsai is the discouragement of thick foliage at the middle stem.

“Care should be taken to make the main branches visible. They should be trained in such a way to have gaps among them. No two branches on either side or vertically should begin from the same point of the trunk and they should not be at right angles. Branches may also be trained in the desired direction by tying them with wires,” says Dr. Prasad, his hands automatically pruning away the excess foliage.

Once the stem becomes thick—which might take upto five years—the plant is ready for transplantation into a tray. Selection of a tray should follow the tree’s height and branching. If it is rectangular, planting should take place to a side, for attaining that ravishing look. While displaying, the tree should always be at the eye level.
A creative touch

Much depends on innovation that amply manifested itself in Dr. Prasad’s garden as knots wherever he cut away the branches. By scooping away a bit of wood from the cuts, he made them look like natural hollows.

He also resorted to air-layering as a method to curb the tree’s height, and pruning of the selected leaves to keep the size of the rest small. Leaf-size reduction and also root exposure come at a much later stage and a beginner need not worry about them.

“There are three limitations for bonsai, namely light, water and time. Bonsai is not meant for indoors and needs as much sunlight as a grown up tree. Hence, it must be kept outside and carried in only occasionally,” says Dr. Prasad.

“Watering is a must three to four times a day depending on the season, as the roots are shallow.

Time, in my opinion, is not difficult to shell out for a passionate heart,” he adds as an afterthought.

Bonsai buffs may call him at 040-23392424.

YSR offers land for ISRO centre

2008-11-17T22:56:00.000-08:00

HYDERABAD: Chief Minister Y.S. Rajasekhara Reddy has urged the Indian Space Research Organisation to establish its astronaut training centre under the Human Spaceflight Programme (HSP) at Anantapur and offered land, even as the space body announced plans to set up a facility for advanced atmospheric studies near Tirupati.

Replying to Dr. Reddy’s congratulatory message following the launch of Chandrayaan-I, ISRO Chairman Madhavan Nair said the National Atmospheric Research Laboratory (NARL) was functioning at Gadanki, near Tirupati, since 1992.

BJP seeks details of land alloted to SEZs

2008-11-16T22:56:00.001-08:00

HYDERABAD: Bharatiya Janata Party president Bandaru Dattatreya on Sunday demanded that the government publish a white paper on the land allotted for various companies and individuals in Special Economic Zones as also the details of the firms which were set up in them.

In an open letter to Chief Minister Y.S. Rajasekhara Reddy, the BJP leader also urged the government to stop acquisition of the land at Chillmathuru and other places where public purpose was not served.

Accusing the State government of acting inhumanly against farmers, Mr. Dattatreya said that lands were being taken away from them in violation of their fundamental rights.

A prelude to painting

2008-11-16T22:53:00.001-08:00

Surface preparation prior to that long-needed coating is as important as choosing the right colour(s), type of paint and brand to go with your tastes and settings. In fact, many seasoned painters and interior designers emphasise on proper preparation before going in for actual coating.

A good paint on a surface well-prepared always gives one the satisfaction of the final product. In fact, experienced painters say paints on well-prepared surfaces always last longer.

Better the surface cleaning and preparation, better will be the life and gloss of the paint and lesser the cost will be ultimately, says T. Narayan Rao of Monarch Paints in Jambagh. In fact, all major paint companies stress on proper surface preparation to avoid disappointment once the final coat is done.

The first thing one should do before the painting work begins, obviously, is to take away all the curtains and fixtures from their places. All the furnishings in the room should be placed in middle of the room and covered fully so as not to let the dust settle on them or the paint ruin some expensive showpiece.
Prelims

Carpets, rugs or any such loose covering on the floor should be removed and placed in safer areas. Use covers or dustsheets for the purpose. Oily and greasy marks can be removed by using a sand paper. It also takes care of dust particles or rust in case of metals.

Insects or termites (wooden surfaces) should also be taken care of. Applying two to three coats of Kiricide 15 days prior to the day of painting should help. The substance penetrates the surface. Make sure it is dried up by the time it is painted.

Once the walls are clear of their adornments, wash their surfaces with soap or detergent to get rid of dust and debris. That done, the about to be painted surfaces should be carefully inspected for any kind of holes, cracks or loose plaster.

The look of a room can be greatly diminish if painted on a damp surface, says Vijay Kapoor of Tirupathi Paints in Jambagh. Besides, damp surfaces are not really conducive for wall painting. One of the golden rules when painting a room is to ensure all the surfaces to be painted are dry and clear of dust. A damp surface also can lessen the life of paint, says Mr. Rao.
‘Fix its’

Hence the maxim, a stitch in time saves nine always holds true in case of damp surface areas. In case any damp spots are spotted, they should be dealt with immediately. There are several ‘fix-its’ like Algi coat RE104 or Dr. Fix damp guard available in the market to stop/block small leakages. These ‘fix-its’ should be applied only after the first primer coat.

In case the seepage is more or there is excessive leakage, professional help should be sought. According to Mr. Rao, a new primer ‘Zysocil Primer’ is now available in the market. This primer can be applied directly on the wall’s surface before the application of first primer coat. Cracks and holes are another aspect that should be dealt with care. If not tended to in time, the risk of the cracks widening or the wall surfaces peeling after a point of time is greater.

Loose and flaky plaster can be detected by tapping the wall or ceiling surfaces. Portions where cracks have developed or are doubtful should be very carefully examined, says Yusuf, a professional painter. Once the cracks or holes are identified, correction measures can be taken.

Specific crack healing solutions are available at paint shops. While some just cover up small cracks, there are others like ‘wall care putty’ that act both as putty as well as to hide or rectify cracks.
Repairing cracks

While covering up the holes or cracks, it is advisable to fill it up more than the levelled surface, Mr. Kapoor says.

It is always possible for us to smoothen and level it to the wall’s surface by rubbing it with fine sandpaper, he adds. Seek professional help in case the cracks are larger.
Primer coat

Once these problems are dealt with the wall should be dried before the first coat of primer could be splashed over it.

In case one is planning to go in for a new coat of paint that is lighter than the existing colour, a primer should be applied so that it neutralises the older paint. Last but not the least one must ensure that the area to be painted is well ventilated during and immediately after the painting.

Do you get your promised quality?

2008-11-16T22:52:00.000-08:00

You zero in on a development which meets your requirement, fits your budget. You then proceed to raise a loan, garner all your savings and pay for the apartment. It is a proud, satisfying moment when you walk into the Sub Registrar’s office to make the apartment legally yours.

But move into your finished apartment and you realise to your dismay that your residence is anything but satisfying. For, the quality of construction is a far cry from what you had bargained for. You find that cracks and leaks are now part of your life. You learn to contend with bad tiling in bathrooms, leaking sewage pipes, badly aligned doors and windows, and discoloured flooring, amongst an endless list of complaints.

You try to hold the developer accountable only to be told that his liability ends after one year of handing over the apartment complex. When attention is drawn to the promised quality, fingers are pointed towards subcontractors.
Penalty clause

The penalty clause for the subcontractor is again to the tune of one year after completion which means that he is not accountable beyond the one year period. This means the customer pays for the apartment at the current exorbitant price only to be delivered questionable quality with no place to appeal or find recourse.

If developers insist that top priority is given to ensure quality construction, why then are developments increasingly coming up with substandard quality. This is true with not just small builders who are yet to make an impact but with established and highly reputed developers.

Gopal V, Senior Vice-President Projects and Planning, Prestige Group says, “materials like cement, steel, and finishing materials like granite, tiles, sanitaryware are supplied by us to ensure quality. We have developed a series of checklists with a quality control audit system, besides backward integration. Site engineers are assigned to monitor workmanship.”
Reasonable controls

Perhaps the developer has in place reasonable quality controls. A surprising factor is that a few developers have managed to deliver quality to the extent of leaving customers with very little to complain about. Says Guru Prasad, Joint Managing Director, Chaitanya Projects, “While the main structure is subcontracted, finishing part of the construction is done by our own labour contractors. While detailed monitoring is done to ensure quality compliance, our approach is extremely focused on the project in execution. The volume of our projects is kept at manageable proportions to enable higher levels of supervision. But the clinching factor is the level of commitment that successfully eliminates questionable quality.”

Syed Beary, Managing Director, Bearys Group says, “quality can be delivered only when approached with a conscience and commitment. It is also dependent on how you manage to extract quality work from the subcontractor. In a boom time, the volume handled is extensive and given the time constraint, enough focus is not paid to quality and this leads to substandard workmanship. Shortage of skilled labour adds to this. Being proactive limits this occurrence” Perhaps boom time and high volumes add to low quality of constructionPerhaps the scenario may change making quality mandatory with customers gaining the upper hand to dictate it.

You can be floored by this concrete

2008-11-16T22:51:00.002-08:00

Concrete has come a long way from the warehouse floors of yesterday. Now, people are finally warming up to the beauty and versatility of concrete and decorative concrete can be found among others, even at places such as upscale restaurants and charming bed and breakfasts, says Colourcrete Systems which has an impressive line-up of products using decorative concrete technology.

The applications have become wide and varied from kitchen and bathroom countertops, sinks, tub surrounds, tabletops for dining, coffee tables and end tables, interior floors, driveways, patios and outdoor living areas.

Decorative concrete has become the new material of choice for designers and homeowners. One of the most common places the decorative concrete is seen these days is under the feet. Even the elaborately detailed pieces of these can be more cost-effective than marble, slate, granite and others. Decorative concrete flooring is resistant to the wear and tear or decay and unlike other floor coverings, it does not warp or buckle, Colourcrete says. Receptive to colouring methods, it offers the flexibility to cut, pattern and impress, making it possible to produce near exact replicas of even the most expensive building material from granite to marble.

The other features assured by Colourcrete include high capacity to absorb, store and slowly release heat and coolness, easy maintenance, water resistance among others. For those keen on putting specific designs, logos and custom graphics can be recreated on concrete floors.

The products of Colourcrete include Stampcrete which duplicates textures with realism, Overlay-crete that comes as cover-up for existing concrete surfaces, Stain-crete that creates mottled colour tones in the existing concrete, apart from Texture-crete, Stonecrete and Walkcrete.

There really are no restrictions that usually come with other material, for one can unleash one's imagination and get the desired surface with decorative concrete. "Any colour and any pattern and any design can be worked out," says Vasant Sunerkar of Wide Spread (Ph.9866326686), local dealer for Colourcrete.

Asset reconstruction, home loan

2008-11-16T22:51:00.001-08:00

Reconstruction is nothing but converting the loan portfolio into a sort of securitised debt which will be sold to other institutions at a ‘discount’

Many of us would have noticed a statement from the Chairman of H.D.F.C (Housing Finance and Development Corporation Limited) a few days back that there is great scope for development of asset reconstruction in real estate sector. Let us examine this concept and find out the effect of asset reconstruction on the home loan.

While on the subject, we can either start from the lenders end or the borrowers end. If we start from the lender, as all of us know, the lender is always looking for,

* Increasing business

* Higher income from lending

* Quality of assets

* Zero bad debts

* Be the leader in the business segment

When a lender talks about reconstructing his asset, in this case the loans to real estate sector, either he is not happy with the quality of his asset or he wants to get more solid income. The quality of asset can suffer due to many reasons, such as,

* Repayment delays

* Delay in completion of projects

* Cost escalation

* Borrowers at the cross roads
The property sector

No one complained till a couple of months ago when the stock market was ‘up-ish’ on the portfolio. Even the turmoil in the U.S. property market did not worry anyone as Indian market was high on demand, new projects were many and the economy has been buoyant.

The slow down: Where did the slow down start? Is it because of less demand? Is it because of tight money conditions? Dear money policy of the Reserve Bank of India? Growing inflation? …Or a combination of all these factors? Much can be said about all the above.

Effect of slow down on loan segment: When cash generation is affected adversely, repayment suffers and the ongoing projects suffer. New projects will virtually be nil. Cost increase will be the other issue affecting the sector. Cost of land, construction materials, cost of rising labour and service charges are basic problems. Allied problems are widespread industrialisation and conversion of farm lands for housing purposes. The proliferating Special Economic Zones, in spite of strife and struggles from the land owners here and there make land rare for further construction of houses and office complexes.

What do bankers do when their loans are stuck? Banks will have to provide for the low quality assets; Income by way of interest will stop; New lending will be few to come by; Recovery proceedings will have to start.

One way of recovery will be to ‘sell’ the loans before it is classified as non-performing. Loan securitisation is the concept which is now called ‘asset reconstruction.’

The reconstruction process: Reconstruction is nothing but converting the loan portfolio into a sort of securitised debt which will be sold to other institutions and investors at a ‘discount’. Some lenders set up subsidiary ‘holding companies.’ What the HDFC and other major real estate lenders may be looking at is to ‘sell’ the loans to Asset Management Companies (AMCs). Some primary lenders may set up their own AMC to which the home loan portfolio can be transferred. Such reconstructed asset can be treated as a ‘securitised debt’ by extending a Corporate guarantee and sold to other banks or private investors, with attendant risks.

The borrower vis a vis asset reconstruction and securitisation: If the process yields extra income to the lender, the retail borrower has to be given at least a portion of it by way of interest reduction. This is an opportunity for the retail borrower to benefit from reduction in cost.

The bank should in fact obtain the borrower’s consent for securitization. So, here is the benefit for the retail home borrower who should bargain for interest concession.

Sky is the limit here

2008-11-16T22:50:00.000-08:00

The buzz continues. The site swarms with architects, engineers and thousands of skilled workforce. The ground is excavated, pillars rise and records are set with slabs too. Lanco Hills at Manikonda which promise to metamorphose the city skyline with tallest of the structures is doing a slab every fourth day!

Spread over 30 million sft which include residential, SEZ, retail and hospitality, the Lanco Hills which is promoted by developers as one of the world’s largest single-phase development and represents a world of luxury, convenience and comfort, is getting ready to make available the IT space for utilisation by June next year. “The residential space will be available after that followed by the commercial and then hospitality,” informs S. Pochender, Lanco Hills CEO.

It is a single phase development and the entire work is on.

Nearly 8,000 skilled personnel were already at the task and similar numbers are to join in next few months. “There were some problems but we overcame them and are on path of progress now,” he says.
Villas

On the progress of work, he says a slab every fourth day is what is being done. This is one step further when compared to some of the best developments across the globe that did it in six days or so.

The developers have now decided to add villas to the project. “Villas have a strong demand these days and we will cater the intrinsic demand. The villas are at a drawing board stage and will be finalised in next two months,” Mr. Pochender says.

The residential towers are to be completed in the range of 27 to 34 floors including duplex and three and four BHK types worked out from 1,900 sft to 4,500 sft.

The Signature Tower that promises to stand well above everything else is pending with the Union Ministry of Civil Aviation. “The entire project will be over in three years time”. While 70 per cent commitment has been made for the residential, three major partners have committed for the IT spaces.

The effects of the economy slowdown are clear, but Mr. Pochender is confident that it will stage a strong come back. “There is a slowdown in enquiries. However, the phase is a passing phenomenon and we are sure it will bounce back,” he says.

Frills and flounces seam your garden

2008-11-16T22:49:00.000-08:00

Secateurs are to plants what barber’s scissors are to the hair. Just like a haircut shapes and styles the hair apart from clipping the overgrowth, pruning can be done not only for the healthy growth of the tree, but also to chisel the foliage into desired shapes. Hedges are mostly sheared to bring about the look of the border, while not resorting to any experiment. However, the same trees when planted individually with definite intervals across the lawn or collectively to form a levelled pattern, can be pruned to represent different shapes, thus resulting in Topiaries. They not only present a visual treat, but also improve the overall appearance by breaking monotony. For this very reason, they can be tried out in colony parks and children’s play areas.

“Soft stemmed plants with thick growth of shrubbery should be preferred as topiaries. Those with woody stems can not tolerate regular or heavy pruning,” says M. M. Hussain of Plants Land Nursery.

The soft-stemmed ones include varieties such as Ficus, Duranta, Golden melaleuca, and Clerodendron inerme. These, apart from being soft in stems, tolerate regular pruning and throw out new branches easily—a quality desired for shaping and maintaining the topiaries. They should also be evergreen to sustain leaves throughout the year.
Hedgers

Hedge plants such as Murraya exotica, Thuja, and Casuarina equisitifolia can also be used for making topiaries. Big trees such as Putranjiva roxburghii, Polyalthia pendula, Polyalthia longifolia, and Acalypha while used as hedges, are not conducive to being trained as topiaries. Most popular ones are Ficus benjamina, Ficus reginald, Ficus prestige, Ficus nuda, Ficus panda, Ficus bushy king, Duranta speciosa variegata, Duranta plumeri, Duranta golden shower, and Duranta speciosa golden.

Training a topiary is much akin to grooming a bonsai in that similar techniques such as bending, shaping, and distancing the branches from each other are employed in both cases.

Topiaries can be small, medium-sized or large in size. They can be pruned to represent as many shapes as one’s imagination permits. The most common shapes are balls, cubes, obelisks and cones with multiple tiers in them.

At times, they can also be trained in spiralling shapes. Tiered topiaries can be made by allowing foliage to spread at different levels in single stem.

To begin with, a plant with abundant branching should be chosen and be allowed to grow thick foliage on all four sides. Then a desired shape should be carved by pruning out unwanted portions using secateurs.

However, the desired result can not be achieved with a single pruning. Regular shaping is required to get the topiary with the perfect finish. Mechanical saws are widely used instead of secateurs to shape the topiary.

Topiaries can also be worked into hedges by shaping them in a running length and forming pillars or balls in intervals. Most popular are the ones representing animal life and attracting children’s attention. Usually, such topiaries are wrought by using thin metal frames to clip away all protruding branches. The most preferred plant for animal shapes is Clerodendron inerme (Bombay Border), as these can take any amount of pruning.
‘Turning table’

For achieving perfect similarity among a group of topiaries, one may use the ‘turning table’ technique, whereby the plant may be placed on a turning table and rotated across a frame to cut off the protruding branches. Same process can be repeated for all the plants to create harmony.

Nowadays, a trend whereby a clump of soft-stemmed plants are grafted and trained to represent various mesh-like three-dimensional patterns is catching up. These are mostly imported from nations of Far East and the West.

Bankers watch while buyers wait

2008-11-16T22:47:00.000-08:00

That the real estate boom has to take a back seat thanks to the topsy-turvy state of economy is quite evident in the market. However, with interest rates on home loans being relaxed by most of the banks owing to ‘Repo’ rate cut, number of loans taken since the announcement has almost remained stagnant.

With borrowers heaving a sigh of relief owing to the 0.75 per cent reduction in the benchmark Primary Lending Rate (PLR) that most of the banks have adhered to, bankers are seeing it as a good move on the part of the government.

“It’s definitely a good strategic move because a slash in interest rates is always welcome by those investing in apartments who mostly comprise the middle class. This should bring in some stability to the demand as well,” says Noel D’Silva, relationship manager of the Vikrampuri branch of the .State Bank of Hyderabad (SBH).
Ray of hope

However, given the current scenario in real estate, most of those who have invested in property in the past few weeks through home loans have withdrawn from the purchase.

But builders are positive that this trend may soon change. “We have seen quiet a number of young professionals who have taken back the booking amount after the markets turned volatile. At present, there are very less buyers in twin cities due to the prevailing market situation. But due to the revised interest rates, the number of investors may grow in the coming days,” says an optimistic official from a construction company.

As per the new revised home loans, the floating interest rates of State Bank of India for loans taken up to Rs. 30 lakh with a repayment period of up to five years is 9.75 per cent.

For a repayment period of five to 15 years on the same amount it is 10 per cent and that of 15 to 25 years, it is 10.25 per cent.

Under the fixed rates, for loans taken up to Rs. 30 lakh, the rate of interest is 12 per cent and loans taken above Rs. 30 lakh will have to be repaid with an interest of 13 per cent.
BoI rates

Moreover, the Bank of India too released a list of revised interest rates on home loans where in a loan of up to Rs.30 lakh that is being paid within five years, the rate of interest is 8.75 per cent.

The same loan with a repayment period of five to 10 years is 9 per cent, while for between 10 and 15 years, the rate of interest is 9.25 per cent.

Even though prices of apartments in the past few weeks have gone down, buyers have been holding back their decision to go ahead with the purchase.

“Prospective buyers are waiting for prices of construction materials to drop further and are keeping a tab on market trends,” opines Mr. D’Silva.

“The movement of markets during the past few months have made them indecisive about investing in property. We will have to wait and watch for sometime to see how people have taken to the slashed interest rates,” he further adds.

Kokapet is the new realty hub of Hyderabad

2008-11-16T06:09:00.000-08:00

Kokapet is now being touted as the city’s most attractive real estate location. It is situated in the epicentre of prestigious IT corridor and is also strategically located between Gachibowli and the Greater Hyderabad zone. The realty sector in the city is still vibrant despite the shake-up of economy and many national players are zeroing in on Kokapet. Also, real estate has become the best investment option with the stock market acting erratically and the global economy going for a spin. Dozens of residential and commercial projects are under various stages of construction in Kokapet.

It is virtually raining SEZs in the area and big names such as Google, PCS, Cognizant, Tech Mahindra, Cbay, Qualcomm, Sonata, DQ and others have already pitched camp. In the vicinity is Gachibowli and Madhapur where over 200 major corporates are together employing more than 5,00,000 persons. All these factors have spurred construction in Kokapet, which can provide living space to many of these people. The Outer Ring Road is 1.5 km from Kokapet and the metro is around 10 km away. The Shamshabad International Airport is also close enough at 17 km and the Secunderabad Railway station is only 30 km away.

There are many good schools and colleges in the region and the Hyderabad University is 8 km away. For entertainment, one can go to Treasure Island (3 km), Ocean Park (2 km ) and the Golconda Resort. Malls and hospitals are also close by. “Kokapet has already been giving rich dividends to investors who came in early,” said Mr Somayajulu, a property analyst. “Investments of Rs 1 lakh have yielded 1,000 per cent returns in a year. But the boom is just about to start.” Land, which was valued at Rs 10,000 per square yard in Kokapet two years ago is now selling at Rs 22,000.

Prominent residential projects coming up near Kokapet include Lanco Hills, Aparna Sarovar, Aparna Cyber Commune, Ramky Towers, NCC Urban, Meenakshi Trident Towers, Jain Carlton Creek, Manjeera Diamond Towers, SMR Symphony and Emmaar Boulders Hills. Mantri Developers and Ramky are developing commercial projects, and Ashoka Builders and Meenakshi Infrastructure are developing IT Parks. IT SEZs are being planned by Matyas Properties as also Lanco and Emmaar while Dynamic Constructions, Salarpuria Properties and Jayabheri Properties are developing IT Parks. “Kokapet has emerged as one of the focal points of the area,” said Mr Srinivas, facility manager of Qualcomm India Pvt. Ltd, a leading CDMA technology company. “The demand for residential property will grow further since the staff strength of companies is expected to increase further within five years.”.........

GHIAL's plans hit air-pocket

2008-11-16T06:07:00.000-08:00

HYDERABAD: The expansion plans of GMR Hyderabad International Airport (GHIAL) have hit an air-pocket. The global economic slow-down and
credit crunch have forced the company to defer the over Rs 150-crore capital expenditure on the new airport and slow down development of real-estate development and special economic zones. An austerity drive is on to trim operating costs.

The current crisis could pull-down revenues as passenger traffic is expected to drop by a million. “We expect passenger traffic to touch 7.3 million this fiscal compared to the original forecast of 8.4 million,” said P S Nair, chief executive officer, GHIAL. This, in turn, would delay the break-even from 6 to 6.5 years.

Domestic and international passenger traffic dropped by a near 10% drop from April to October this year compared to the same period last year. The story was much the same for domestic cargo. But the silver-lining was the 46% growth in international cargo traffic, thanks to higher exports and project imports.

GHIAL has targeted an initial passenger capacity of 12 million. The drop in passenger traffic is a cause for worry, though it mirrors the global trend. Loss making airline companies in India have been provided some relief, with the government cutting jet fuel prices and exempting customs duty on jet fuel.

Nair reckons that airport operators such as GHIAL also have a legitimate right and case to seek government help to tide over the crisis. The operator already has a state-support agreement on a slew of fiscal incentives including refund of value added tax. However, it is too early to take a call on reviewing the concession agreement, he said.

To shore up revenues, GHIAL plans to seek a hike in the user development charges for domestic passengers from Rs 375 per passenger to Rs 600 per passenger. “Our initial business projections and break-even period were based a UDF charge of Rs 600 per passenger. We will approach the Airport Economic Regulatory Authority (AERA) with our case, once it is set up,” said Vishwanath Attaluri, chief commercial officer, GHIAL.

The company also plans to step up marketing efforts for cargo and international airlines and routes and increase the spread on duty free, retail and food and beverages for passengers to fight slow down.

“Our target is to increase the share of non-aero revenues from 40% to 60% in due course, in sync with international trends,” said Peter W Noyce, chief operating officer, GHIAL. GHIAL is a joint venture between the GMR Group, Malaysia Airports Holdings Berhad, the state government and the centre. The GMR group has a majority 63% stake, while MAHB holds 11%. The state government and Airports Authority of India (AAI) hold a 13% stake each in the project.

Official Gmail Blog: Say hello to Gmail voice and video chat

2008-11-14T11:37:00.000-08:00

Official Gmail Blog: Say hello to Gmail voice and video chat

A milestone in infrastructure development

2008-11-14T10:20:00.000-08:00

HYDERABAD: When the 11km stretch of the Outer Ring Road (ORR) between Gachibowli and Shamshabad is thrown open for public use on Friday, the State capital will be crossing a milestone in development of the civic infrastructure.

Though the eight lane expressway of phase-I of the 158 km long ORR is expected to be completed by August next, the government has now decided to open the four-lane stretch to improve connectivity between the IT Hub Gachibowli and the Rajiv Gandhi International Airport in Shamshabad (RGIA). The four-lane road will traverse through Narsingi, Andhra Pradesh Police Academy and Himayatsagar.

The 158-kilometre long ORR is estimated to cost a staggering Rs. 6,787 crore and is expected to be completed by December 2011. The ORR project is split into three phases, with the first phase covering the stretch between Gachibowli and Shamshabad (24.38 km); Phase-IIA between Narsingi to Patancheru and Pedda Amberpet to Shamshabad (62.30 km) and the Phase – II B between Patancheru to Pedda Amberpet via Medchal, Shamirpet and Ghatkesar (71.30 km).
Phase I

Presently part of the phase-I, the four lanes on the left side of the central median is being thrown open for bi-directional traffic reaching or originating from the RGIA only. The 11 km eight-lane stretch under package one is to cost Rs. 315 crore, (including land acquisition) while the second package of 13.38 km is to cost Rs. 384 crore. While a Russian company, Corporation Transstroy, OJSC has taken up works for this stretch, the second package is being executed by Continental Engineering Corporation of Taiwan.

The works of ORR phase-I commenced in July 2006 and there was a considerable delay, firstly in handing over the right of way to contractors as the stretches meander through the lands of Chilkur forest and the APPA. Then controversies over land acquisition followed by litigations over the alignment and removal of religious structures and rock excavations took much time.

The progress of the work was again affected due to deep excavation of upto 25 meters at several places. Authorities had to excavate nearly 28 lakh cubic meters of hard rock to form the road. Authorities had to go for controlled blasting of rocks near inhabited areas and this was another major stumbling block.

Investment in infrastructure preferred

2008-11-14T10:14:00.000-08:00

HYDERABAD: Frequent changes of leadership (CEOs) cannot turnaround companies that are making losses, instead the companies should strengthen the baseline of their balance sheets by cutting down on unproductive expenditure, according to venture capitalists (VCs).

Against the background of valuations of companies dwindling in the wake of economic recession, the VC and private equity (PE) funds have become wary of investments.

Mergers and acquisitions (M&A) appear to be one solid option for the VCs and PEs to exit from any setting.

VC Circle Investment Forum organised a series of panel discussions here on Thursday on ‘investing in a perfect storm’.
First investor

While the VCs and PEs desire to invest in infrastructure companies building airports, ports, roads, etc, they wanted the government to be the first investor to propel the activity.

Sudhir Sethi, CMD of IDG Ventures felt that the investors wanted to wait and watch, as the sizes and number of deals would plummet.

Realty blues hit foreign hotel majors' India plans

2008-11-11T06:55:00.000-08:00

International hotel chains like Hilton, Accor, Carlson and Starwood are concerned about the viability of their India plans. Many of these
hotel chains have tied up with real estate developers like DLF, Emaar MGF, Unitech and Parsvanath to set up five-star hotels. However, fund-starved developers, who are trying to raise money for their core activities like residential and commercial property projects, are understood to have put the hotel ventures on the back burner. A drop in occupancy and room rates, inflow of business travellers and tourists to India have also raised concerns on the viability of these projects, industry sources say.

“Out of a total of 1.14 lakh proposed room supply, only 58% or about 66,000 rooms, will actually be developed over the next few years. So, we feel many announced projects may not take off as planned,” said Manav Thadani, MD, HVS International, a hospitality consulting firm.

“Now, debt raising is a difficult process,” says Homi Aibara of Aibara Consultants. Lemon Tree Hotels CMD Petu Keswani said: “Only developer-led hotel projects will face a problem as their priorities are different.” However, when contacted by ET, real estate developers insisted that projects were on track.

According to the latest HVS report, cities like Bangalore, Chennai, Delhi-NCR, Hyderabad, Mumbai and Pune, where massive new room capacities are planned with real estate operators, are seeing trouble. In Bangalore not more than 60% of the new capacity is likely to come up. The same goes with Chennai, Delhi, Hyderabad, Mumbai and Pune.

However, cities like Agra, Hyderabad, Jaipur and Mumbai saw a negative growth in room supply in 2007-08 as compared to 2006-07.

The last few months have seen a demand-supply mismatch in tier II cities like Bangalore, Pune, Hyderabad and Chennai. Room rates too have fallen steeply in these markets, making it unviable for real estate developers to go ahead with the planned hotel projects. This is happening at a time when there is a severe shortage of branded hotel rooms.

Unitech MD Sanjay Chandra said: “We have management tie-up with the Marriott Group for three projects, and one of them will be commissioned in January. Other two projects are very much on.” Recent media reports had suggested that DLF’s hotel JV with Hilton had hit a rough patch. However, DLF clarified to the stock exchanges that “DLF’s JV with Hilton is on a firm footing and all plans for the development of hotels stand as originally envisaged”. However, industry sources said DLF has put the hotel project on the back burner for at least a year.

An Emaar-MGF spokesperson said there were no change in the hotel plans of the real estate firm and its tie-up with Accor. Says Uttam Dave, president and CEO, Interglobe Hotels and head of development, Accor Hotels India (Accor has tied up with Emaar MGF to launch Formule 1, a budget hotel): “Most of our projects are on track, and so far at least none of our projects have been either cancelled or put on hold, and this includes both managed and investment projects. There have been some delays in the actual development and commissioning of projects, and this has been on account of obtaining development approvals from municipal authorities and not due to real estate values.”

DLF New Residential Apartments Lake District Gachibowli, Hyderabad 9603649027

2008-11-11T06:48:00.000-08:00

DLF now brings a residential project “The Lake District” - Gachibowli Extension in Kokapet Hyderabad. It spread over 75Acres and offering 3 and 4 bedroom apartments in Gachibowli Extension (Kokapet), Hyderabad.

The Lake District a vertical of DLF Ltd, India’s largest real estate company is proud to announce the proposed launch of its residential projects in Hyderabad. With a lineage of 6 decades of excellence and over 20,000 proud residential owners who today enjoy the privilege of owning a “The Lake District” it’s our endeavor to bring the same quality and values to intending house owners of Hyderabad.

Common Amenities:
• Gated community with solar-powered security system.
• Sewage Treatment Plant.
• Reticulated Gas.
• Underground drainage and cabling system.
• Security & Reception block.
• 100% power backup
• Water Treatment Plant.
• Solar powered street lighting.
• Lush, manicured Landscaping.
• Home automation and security system.
• Car parking.
• Car wash facility within the complex.

Location:
• 75 Acres Integrated Township.
• Scenic view of Osman Sagar Lake.
• Green Zone on one side.
• Financial district on the back drop.

This project is at a very scenic location overlooking the Osman Sagar (Gandipet Lake) on the one side and IT Hub on the other.

Affinity Consultant is a Real Estate Agent in India operating since last 10 years. A.K. Jain heads a team of dedicated professionals with more than 10 yrs of experience in real estate services handling the entire project in India.

To know more about us kindly visit www.affinityconsultant.com you can also get in touch with us by at info@affinityconsultant.com and we will be at your service instantly.

Contact:
Mr. Dependra – 9603649027
Mr. A.K. Jain - 9811159064
Affinity Solutions Pvt. Ltd.
8 - 3 - 231 / B / 13,
Opposite Tea Club, Sri Krishna Nagar,
Yusufgunda, Hyderabad - 500045
Website: www.affinityconsultant.com
Email: - affinitycredit@yahoo.co.in

Promoting a pruned look

2008-11-11T06:47:00.000-08:00

Removal of dead cells forms part of the natural cycle of every living organism, be it a mammal, reptile or a tree. For human beings, it manifests in removal of dead skin and cuticles, while for reptiles, the process is more significant in the shedding of skin. However, not many are aware that trees too should be perceived as undergoing such phenomenon when they shed their leaves. Old has to give way for the new and it is not any different with plant life. However, with plants, we can get our way, by pruning away the old and unwanted parts much before it is done the natural way.

Most often pruning is associated either with hedges, border plants or topiaries, or with fruiting varieties such as grapes, and apples. Among the ornamental plants, only roses are construed to have the requirement. Contrary to the common perception, almost all the plants and trees need pruning to lead a disease-free life with vigorous growth of foliage.

“Every plant needs to be pruned to promote new vegetative growth and inflorescence leading to higher yield of fruits. Old foliage becomes less conducive to transpiration due to various reasons such as dust accumulation, insect attack and other such problems. Pruning leads to better absorption and photosynthesis,” says M. M. Hussain (Ph: 9848024654) from Plants Land Nursery.
Food consumption

Another benefit of pruning is the optimisation of food consumption. Decimation of branches results in lesser food requirements and hence the excess nutrients will be diverted to the growth of new branches, in a way forcing the tree to throw out fresh shoots. This is particularly true when the trees are transplanted from one location to the other. Pruning of foliage before uprooting the tree will sustain it after the transplantation when due to shock the tree will not be able to absorb nutrients from the new soil.

Planned pruning will also result in better crop, a fact noticed in case of trees such as guava, pomegranate, and ber. The plants are starved for a period of one to one-and-a-half months before the planned crop, till they shed all their foliage. Then the plant is provided with fresh compost, watering and pest management, which will lead to vigorous growth of new foliage, flowering and thus, fruits.

When it comes to ornamental plants, most often, the ones to get pruned would be roses.

“Roses are pruned twice a year, at the beginning of the monsoon and the winter respectively. Heavy pruning should be done at least once, which means that except for the prominent stems, the plants should lose all other branches and leaves. Then the plant should be fed with manure, fertiliser and pest control,” says Mr. Hussain.

Pruning is in no way the privilege of roses. Though vigorous growth of flower shrubs fills the gardener with pride, it should not keep him away from regular pruning. The bigger the plant becomes, the greater the requirement of nutrition. With older branches refusing to flower as much as the new ones, the uncut bushes will end up with more of foliage and less of flowers. Also, the ones without the touch of secateurs will soon grow out of shape.
Within time

It is advisable to prune the foliage and also the roots of potted ornamental plants such as Dieffenbachia, and Philodendrons at the time of annual or biennial re-potting. Roots of a few Asparagus varieties, if not pruned, will occupy the whole pot, leaving no space for soil and nutrients.

In case of climbers such as Adenocalymna, Bougainvillea and Bignonia, pruning should be carried out before the plant is allowed to flower, while in case of winter bloomers, it is advised to prune the tips much before the season begins. Trees and thick branches should be pruned with a saw to get a smooth cut, lest the jagged ends and peeling of bark should lead to stem dry-back.

“Mowing the lawn regularly and also raking it once a year can also be termed as pruning.

In the event of heavy fungal diseases and insect attacks, pruning is recommended along with application of pesticide,” says Mr.Hussain.

Sharp secateurs is a must to administer clean cuts, after which a paste of fungicide and insecticide may be applied or sprayed on the exposed parts. When a stem is cut for propagation, the location of cuts should be based on the number of nodes and the distance between two nodes.

Cuts should be given just above the top node and just below the bottom node of the required stem, to avoid stem dry-back. Cut ends have to be slightly slanting to avoid infections.

If a plant has to be trained straight, side and lower branches need to be pruned and if the requirement is of a good canopy, then the top foliage should be trimmed regularly.

Resident welfare bodies take up only civic issues

2008-11-11T06:41:00.000-08:00

It is true that the resident-owners while obtaining loans from various banks for reconstructions/ modifications /alterations /extensions, face certain queries on genuine residing status and occupancy and in order to prove the same items such as electricity bill, landline telephone bill, registered document and up-to-date Encumbrance Certificate from the Sub-Registrar concerned have to be produced in support of the claim.

It is not fair on part of the residents to obtain certificates from the Welfare Associations concerned to claim home-loans.

It should be noted that Resident Welfare Associations are registered only to mitigate hardships collectively on the civic irregularities/ requirements. Therefore, obtaining loans is to be done by owner solely in personal capacity.

C.V.K. MOHAN VARMA Begumpet

Have an opinion on issues concerning building policies and real estate developments? Feedback on stories appearing in the supplement is welcome.

Home loans to Non-resident Indians

2008-11-11T05:41:00.000-08:00

Many of us may not be aware of the terms and conditions applicable to such loans

Generally, almost all of us are aware that banks and other Financial Institutions do grant loans for investing in properties to Indian Nationals staying abroad. But many of us may not be aware of the terms and conditions applicable to such loans.

Let us have an in depth look into the subject.
Who is an NRI or PIO?

The Foreign Exchange Regulation Act (FERA), 1973, defines an NRI as:

an Indian citizen -

a) who stays abroad for employment

b) who is carrying on a business abroad

c)a Govt servant who is posted abroad on duty and drawing salary out of Govt resources

or Govt servant who is deputed abroad on assignments with Foreign Govts or Regional / International Agencies like, World Bank, International Monetary Fund, World Health Organisation, Economic and Social Commission For Asia and the Pacific.and the like,or. d)Employees of State Govts and Public Sector Undertakings in similar manner..

There is no time limit prescribed for the foreign assignment, though one has to be away from India for a minimum of 181 days to be treated as NRI..
Purpose of the loan

The home loans are normally extended for-

purchase of a site

Building a house

Extension and improvement of the existing house, and

Renovation

Other than the above, if the request is for investment in property as a saving plan, even that is not barred , but it should not involve any speculative activity.

RBI Guidelines

The guidelines of Reserve Bank of India lays down a maximum loan of 85% of the cost of dwelling house. The applicant’s contribution is required to be brought in by direct remittance or through the NRE (external) account or NRE (Ordinary) account of the applicant. Repayment of the loan instalment also should be by direct remittance or through NRE accounts.
How to apply?

All the Banks/Institutions have their websites and one can access it, download an application form and apply ‘on line’ for the loan. In case a foreign branch of the institution is located near by to your place of stay, that branch can be approached for assistance.

Application form

A look at the application form prescribed by most of the lending Institutions may be elaborate the form is.

In addition to the various routine information/particulars, a resident has to fill in and provide, the NRIs will have to provide the following additional particulars-

Details of occupation or business abroad

Details of employer

Particulars of salary/ income

Credit history

Bank accounts

Details of properties in India

References in India, including that of a relative

Passport no and date of expiry, along with an attested copy of specified pages

Copy of driving licence (international) Credit card information, etc The declaration at the foot of the application also includes a certificate regarding cheque return history, and authorization to make references to listed agencies/people..

Some additional questions such as, the length of stay abroad, who will occupy the house built/purchased , special reasons for going in for the proposed investment in the place proposed,

area specific details like, carpet, bult up, super built etc which are India specific

Cost break up like, site cost, building cost, agency commission etc, will also need to be answered.

Consultancy services

Some lending institutions in India offer consultancy services like, ‘location selection’, engaging of architect/designer, etc. free of cost, which may be useful as they are of vital importance to the decision to buy the property.

Critical aspects relating to lending to NRIs

In many cases, the NRI goes by the web site data, which may need to be cross verified by ground level realities as, often the web site data may not be quite up to date.

The banks may do its own verification, which will be in the interest of the NRI.

The lending institutions have massive experience in the field and this may be of good use to the NRI borrower.

Special Real Estate Zones

2008-11-10T07:43:00.001-08:00

Andhra Pradesh could well be the next site of contestation against Special Economic Zones (SEZs), going by the growing protests by farmers over the manner in which huge chunks of land have been — or were sought to be — taken away. It is not industrialisation per se but what is happening in the name of promoting SEZs that is certainly cause for concern. Close to a 100 SEZs have already been approved in the State and an equal number are in the pipeline, but a deeper analysis would reveal that the intent behind these projects is not exactly the furthering of what the special zones are meant for — encouraging export-oriented units and thereby generating additional employment and foreign earnings. One is inclined to believe that the hue and cry being raised by citizens’ organisations and opposition parties over the manner in which the Y S Rajasekhara Reddy government has gone about sanctioning SEZs is not without basis.

With close to 50 per cent of the approved projects clustered in and around Hyderabad, the rationale behind locating them here has more to do with the high value of the lands, so much so that they are being described as “Special Real Estate Zones” rather than SEZs. In one case, a huge chunk of land allotted within the capital for what was described as an IT SEZ has now more or less been converted into a group of residential/ commercial complexes. In the case of another SEZ, not far from Hyderabad, the oustees have been staging protests for months over the paltry compensation paid to them but the government has done nothing to redress their grievances. On the other hand, the promoters have so far not achieved anything concrete in terms of the projects supposed to be developed, giving rise to doubts that the land was taken for a purpose different from that stated.

Elsewhere, in the coastal belt, fishermen and farmers are blockading roads and holding dharnas over the proposed “Coastal Corridor'”which envisages highly polluting chemical units along the coast, unmindful of the fact that they would seriously endanger the environment apart from displacing thousands of people. The sooner this government realises the need for corrective measures, the better. Two key aspects need to be borne in mind: One, ensuring that only those projects conforming to stated criteria are cleared and those displaced on that count are adequately compensated; two, the projects are closely monitored to ensure that their objectives are not compromised at any stage.

SKS Microfinance Raises $75 Million (Rs. 366 Crore)

2008-11-10T07:42:00.001-08:00

Hyderabad, Andhra Pradesh, India, Monday, November 10, 2008 -- (Business Wire India)
-- Funds will be used to accelerate outreach to 8 million members

SKS Microfinance Pvt. Ltd. has announced the closure of a fourth round of equity funding in which it has raised $ 75 million (Rs. 366 crore). The landmark transaction, led by Sandstone Capital, represents the largest private equity investment to date in microfinance globally.

Based in Hyderabad, SKS has provided micro-insurance products and Rs. 4,729 crore ($ 979 Million) of micro-loans to 3.3 million poor households across 18 states in 50,000 villages and urban slums of India. Its members have maintained a 99% repayment rate. The new equity investment will help SKS expand its outreach to 8 million members over the next two years.

Commenting on the investment, Vikram Akula, Founder and CEO of SKS Microfinance, said, “the fact that this investment has come during the global economic meltdown is proof of the confidence that investors have in SKS—and more importantly of the resilience and entrepreneurial abilities of the poor not only to survive in today’s economic crisis but actually to prosper because the poor are largely de-coupled from global trends.”

Sandstone Capital led the investment and was joined by existing SKS investors Kismet Capital and SVB India Capital Partners (an affiliate of Silicon Valley Bank). Edelweiss Capital is the investment banker to the issue.

Paresh Patel, Founder and Managing Partner of Sandstone, said, “At SKS there is a unique opportunity to build one of India’s next great companies, such as Bharti, Infosys or L&T. SKS has the right pedigree of leadership, an enormous market where they possess a superior operating model, a desire to incorporate best practices in corporate governance and a passionate set of employees that are driven by the singular mission of enabling the poor, profitably. Our investment will give some of India’s poorest communities the opportunity to improve their lives while simultaneously providing investors returns that are uncorrelated to traditional finance businesses.”

Ashish Lakhanpal, MD, Kismet Capital added, “India’s microfinance industry is evolving rapidly, with greater efficiency, improved transparency, and increased professionalism. SKS is at the forefront of this movement and is an excellent example of how well-run businesses are able to deliver social solutions that are scalable, sustainable, and profitable.” Indeed, impact studies of SKS show that its borrowers earn returns on their micro-enterprises of up to 100% and that their increased incomes lead to improved health, education, and general welfare.

Commenting on the fund raising, S. Dilli Raj, Chief Financial Officer, SKS Microfinance, said “Capitalization of this size has a positive impact on leverage and capital adequacy. The impressive net worth of Rs.610 crore ($126 Million) further encourages credit extensions from SKS’s stable funding partners in the banking system and this will enable us to meet the financial needs of our existing micro-borrowers as well as new borrowers.”

SKS was launched in 1998 and is India’s leading microfinance organization. It works on three inter-linked principles to scale microfinance. This includes using a for-profit methodology to access capital, drawing on best practices from the business world to speed growth, and deploying technology to overcome high delivery costs. SKS blends this rigorous business approach with a strong social mission that includes ensuring that its members continue to hold a significant stake in the company and benefit from profits that the company earns.

Sequoia Capital, Vinod Khosla, SIDBI, Unitus and Columbia Ventures Corporation are among the existing equity partners of SKS Microfinance. SKS Borrowers represented by Mutual Benefit Trusts are also one of the largest shareholder groups in the company.

About SKS Microfinance

SKS Microfinance is a non-bank finance company (NBFC) whose mission is to eradicate poverty by providing financial services to the poor. Launched in 1998, SKS Microfinance is India’s largest and one of the world’s fastest growing microfinance organizations with an annual growth rate of 200 per cent. It currently serves 3.3 million clients across 50,000 villages and slums in 18 states and has disbursed Rs. 4,729 crore ($979 Million) in loans with a 99 % repayment rate. SKS also provides life and health insurance to its clients.

SKS operates in the states of Andhra Pradesh, Karnataka, Maharashtra, Orissa, Madhya Pradesh, Bihar, Uttar Pradesh, Rajasthan, Uttaranchal, West Bengal, Jharkhand, Chhattisgarh, Gujarat, Kerala, Punjab, Haryana and Delhi.

SKS has received numerous awards including the CGAP Pro-Poor Innovation Award, the ABN-AMRO/Planet Finance Process Excellence Award, Information Integrity Award, the Digital Partners SEL Award and the Grameen Foundation USA Excellence Award. It was founded by Vikram Akula, who was named by TIME magazine as one of the 100 Most Influential People in the World(2006).

About Sandstone Capital

Sandstone Capital is a long-term investor in public and private companies in India and the subcontinent. Founded in 2005, its objective is to deliver world class, absolute investment returns by investing in Indian companies across all sectors and market capitalizations. Sandstone has invested and executed transactions in multiple industries including oil & gas, power, banking, retail, real estate, technology, telecommunications, internet, infrastructure and commodities. Sandstone believes that, with investors and management teams, there is a need to forge lasting relationships, built upon the values of integrity, trust and mutual respect. Sandstone is one of the larger India-dedicated funds with a worldwide investor base that includes university endowments, public and private foundations, family offices, individual investors and other institutions.

About Kismet Capital

Kismet Capital is an investment firm focused on private equity, mezzanine, distressed, and special situation opportunities in India and ASEAN countries. Since its founding in 2004, Kismet has invested across numerous sectors including real estate, financial services, hospitality, energy, and contract manufacturing. Kismet has operations in New York, Mumbai, and Bangkok.

About SVB India Capital Partners an affiliate of Silicon Valley Bank

SVB India Capital Partners I, L.P. is a venture capital fund focused on Indian companies and co-invests across various industries and stages with other top-tier venture capital firms. Silicon Valley Bank is the premier commercial bank for companies in the technology, life science, private equity and premium wine industries. SVB provides a comprehensive suite of financing solutions to its clients worldwide. Founded in 1983 and headquartered in Santa Clara, California, the company serves clients around the world through 27 U.S. offices as well as operations in China, India, Israel and the U.K. Silicon Valley Bank is a member of global financial services firm SVB Financial Group(NASDAQ: SIVB). More information on the company can be found at www.svb.com.

About Edelweiss

Edelweiss Capital Limited (www.edelcap.com) is one of India’s leading financial services firms. The Group’s businesses include investment banking, institutional equities, private client broking, asset management, wealth management, mutual funds, wholesale financing and financial products distribution. The Group has built strong corporate, institutional and investor relationships backed by a research-driven approach and a proven ability to capitalize on emerging market trends. The Edelweiss Group employs over 1800 employees including 90 research professionals, leveraging a strong partnership culture and unique model of employee ownership. It now operates from 60 offices in 25 cities.

When IT loses sheen, dark days await techies

2008-11-10T07:40:00.000-08:00

BANGALORE, INDIA: October 29, 1929, is written in the world history in black letters. It was on that 'Black Tuesday' that the stock market crashed, officially setting off the Great Depression. More than 25 per cent of the workforce lost jobs in the months to come and the bleak scenario prevailed for over a decade, till the World War II.

And now every day is a 'Black Tuesday' with things getting darker every moment. The techies who led a hi-flying life till yesterday are in a state of uncertainty, as they don't know what would happen tomorrow.

Any moment anybody can become unemployed… As the financial tsunami has hit the Indian shores as a result of the economic disaster in the West, many Indian companies have started giving pink slip to their employees citing the reason of poor performance to poor dressing.

Non-performing asset!

It was quite recently that IT major Satyam had laid off nearly 100 employees from its offices in Hyderabad. In Chennai too the company had terminated over 30 employees, saying that they may have 'fudged' bills after being relocated to Chennai from Hyderabad.

They reportedly got hardly two hours' notice "to resign or face termination", sources said. Most of them were shown the door for "behavioral issues'', "poor performance'' and in some cases, "poor dressing'' at work! When economy slumps employer finds problems with the behavior of the employees and even their dressing patterns!

During the good times these companies never bothered as to what the employees wore or how they behaved.

In Wipro nearly 1,000 employees have been given the marching order, while around 300 employees are under the scanner for non-performance.

In February, Tata Consultancy Services had asked nearly 500 'non-performers' to leave while IBM had asked about 700 Indian employees to leave, again on ground of non-performance.

Quite recently, another software company, Virtusa, laid off nearly 300 employees in Asia, most of them from India. But the sacking in the name of 'nonperformance' is actually a belt tightening exercise, though the companies would say this is part of the appraisal ritual.

Pressing the panic button

The panic in the industry was very clear when ASSOCHAM had warned in a recent report that Indian firms are likely to lay off 25 to 30 per cent of the work force very soon and IT-enabled services (ITeS/BPO) was also included in the list that faced a potential threat of job loss.

Though the government had criticized the organization for making such 'irresponsible' statement, the present state of affairs shows that ASSOCHAM was right.

Indian Prime Minister Manmohan Singh had even asked the industry not to resort to retrenchment and the industrial leaders had assured him that such a step would not be taken.

But what happened in reality, everybody knows. Even the Reserve Bank of India's amended monetary policies did not help save the India Inc, where many employees are facing the blues in the form of pink slip and forced resignation.

According to a recent report, L&T Infotech is planning to reduce its workforce by 5 per cent, which means 10000 people would soon be jobless there. Last week only IBS Software of Thiruvananthapuram Technopark had sacked around 30 employees, who were branded 'non-performers'. Yes, the present development is a global phenomenon.

From IT to real estate to finance to hospitality, the workforce is facing the heat of the financial meltdown all over the world. According to market analysis firm briefing.com, in October, job cuts were huge in almost all fields in the US.

More than 2,40,000 people lost their job in October only. Over the first 10 months of 2008, 1.2 million jobs have been lost, but tellingly, over half of those losses have occurred in just the past three months, briefing.com said.

Evaluating the scene in America, President elect Barack Obama had said prior to the election: "Washington needs fundamental change because it has failed the American people". But now we will have to wait and see whether Obama will be able to save the world from the economic disaster.

Who will wage the war?

In the backdrop of the global economic meltdown, fresh graduates might find it difficult to get rewarding jobs for the next two years, according to Kris Gopalakrishnan, CEO of Infosys. "Fresh graduates will be affected in the next two years. They may not find the sector very attractive," he had stated the other day. And the recent trend among the software engineers justifies what he had told.

According to a report from Hyderabad, the IT mania is more or less over in India. While many of them have left the job to get into the field of their choice, the fear of being unemployed is also forcing them to switch over to other fields.

The heat can be felt in many premier institutions as well. Campus recruitment is fast becoming a thing of the past. A recent report said that 15 students of IIT-Kharagpur got regret letters from three top US IT firms.

These students were initially offered a huge package during the campus recruitment but this changed all of a sudden and the offers were withdrawn. Ironically the Great Depression of the twentieth century ended with America joining the World War II in 1941.

And the present Depression began from the same country only. Now it's time to wage another war - a war without bloodshed - to revive economy and make the high-flying ones to come back to the down-to-earth realities.

Do you think the present scenario will provoke the techies to come into terms with the social realities and come down from the ivory towers of of high-class lifestyle?

Regularisation of quarters sought

2008-11-10T07:39:00.001-08:00

HYDERABAD: Members of the Joint Action Committee of Ex-Servicemen living in Band Lines and other areas like AC Guards, Masab Tank have offered to pay 50 per cent of the land market value of their existing quarters and requested the government to regularise them.

Over 480 ex-servicemen families, successors to the soldiers who served in the erstwhile Nizam Army reside in these quarters, including those at Mohamedi Lines in an area spanning 27 acres.

After disbandment of the Nizam Army, the soldiers were provided temporary rehabilitation in PWD quarters at concessional rents in the above localities.

Of the 479 quarters, the government authorised 315 and the rest were declared un-authorised, claimed JAC general secretary Rajendra Prasad.

He said the government, while accepting applications for regularising encroachments, was denying the same for them.

He also charged the government of planning to hand over the quarters land to private developers and also to make way for Rajiv Gruhakalpa Apartments.

An Assembly Committee had even recommended the government to regularise the quarters under hire-purchase system, he claimed.

Time to buy...

2008-11-10T07:37:00.000-08:00

Is it time to look at purchasing property? Has the correction set in? These are questions most property seekers want answers to.

Realtors, buyers' opposite views hit housing market: ICRA

Here’s a reality check:

Experts in the industry believe it would not be appropriate to assume and wait in anticipation that the property prices will come down like in the stock markets. It is unlikely, they feel.

‘Realty market to see mismatch in demand-supply’

However, buyers need to be cautious about where they are investing and opt for either well established builders or projects that are nearing completion or they warn that their investments may be locked up as projects may not be completed for want of funds. In an interaction with senior executives of real-estate firms, a few common trends emerged.

Downturn now, pick-up possible

The Chief Executive Officer of Lanco Hills, S. Pochender, said, “overall the mood is apparent and is somewhat downturn. We expect such sentiment to remain for anywhere between three and six months and the market will again pick up.”

Chennai sees correction in some pockets

However, Pochender said, “we have no reservations about saying the market will take off again and possibly get much better than what it is today.”

As the interest rates are likely to ease a bit more due to regulatory actions and banks possibly slashing rates, buyers will look at acquiring properties again. Generally, there is a tendency to postpone buys, given the current market sentiment, he said.

Wanna buy a home in US?

“The real-estate market went into a hyper boom phase and people purchased properties as if all the land bank available was getting exhausted. This resulted in a steep hike in prices. As the market went up beyond sustainable levels, this kind of correction was on the cards,” Anand Reddy, Executive Director of PBEL, said.

“What is interesting about the current scenario is that the prices have already corrected by 15-20 per cent. Buyers can now take much more informed decisions then ever before and pick and chose from projects,” he said.

Nagarjuna Construction puts real estate projects on hold

Consolidation on the cards

The Chief Executive Officer of MAK Projects, A. Murali Krishna Reddy, said “if the years 2006-07 and 2007-08 witnessed enormous growth in the real-estate market and prices, it is now a phase witness to correction, driven by both external and internal factors.”

Private equity deals in realty sector down

Asked about the construction industry itself, Krishna Reddy believes that consolidation is on the cards. While big ones with financial muscle will continue their growth or may delay some projects, small developers who are dependent on buyers’ money to execute projects are under pressure.

On builders possibly changing their strategy and focussing on middle-income group apartments and houses, Anand Reddy said, “generally, the quality of construction has gone up in recent times and people’s expectations are also high. We expect all types of properties to be developed.”

Land prices firm, for now

Zones with special incentives

If you look at any project, of the Rs 100 spent for project work, about 40 per cent goes into Government kitty in some form of taxes. Therefore, it is time to look at this afresh. Possibly, Government could consider zones with special incentives which will help make housing more affordable, Anand Reddy said.

A lot of funding from overseas led to local prices shooting up, coupled with buying through domestic loans. While the former RBI Governor, Dr Y.V. Reddy, cautioned against this rapid growth in real-estate prices, no one was willing to look into this aspect as the market continued to boom.

Cautioning against herd mentality of purchase or sale of property, Krishna Reddy said this is time to invest as land prices stopped going up about a year ago and built-up space is also witness to correction. Due to choices, buyers could get good deals.

“Despite concerns of slowdown and some price correction, Hyderabad continues to be a vibrant market and people continue to invest. I am against bargains as this only exposes those who have priced steeply. In fact, if you look at Lanco projects, we arrived at a fair price and have stayed with it despite the spiralling cost of materials,” Pochender said.

Trends in Hyderabad

A recent study of makaan.com analysing property trends in Hyderabad shows that 38 per cent of property seekers are very specific about preference of choice of purchase of their property and the rest are willing to buy a property anywhere in Hyderabad.

Depending upon the location of property, there has been a slowdown in demand ranging between 11 and 12 per cent.

More India business stories

Broadly classifying Hyderabad into three major areas of Hyderabad, Secunderabad and Greater Hyderabad, the report finds that the demand is highest in Hyderabad, followed by Secunderabad and Greater Hyderabad.

The demand equation for residential property indicates a huge appetite for properties in the sub-Rs 60 lakh segment. Significantly, the Rs 30-60 lakh segment is where there is shortage of supply while Rs 60 lakh and above has oversupply.

This only illustrates that there is demand for affordable housing, the report noted.
Mo

State Bank of Hyderabad to expand

2008-11-10T07:36:00.000-08:00

State Bank of Hyderabad (SBH) aims to expand its presence in Orissa by setting up four new branches in the state in 2009-10.

Addressing media persons on the sidelines of National Management Seminar held here at the Asian School of Business Management, Renu Challu, managing director of SBH said, “We have already applied to the Reserve Bank of India (RBI) for setting up our new branches in Orissa and these branches will come up in the next fiscal.”

At present, SBH has six branches in Orissa, which includes three branches in Bhubaneswar, two in Cuttack and one in Berhampur.

SBH is also looking to ramp up its pan India network and it has targeted to set up around 200 branches by the end of 2009-10 out of which 50 new branches will be added by the end of this fiscal.

On credit offtake, Challu said, “SBH is expecting a credit growth of about 25 per cent in the next two quarters of 2008-09. The bank will extend its credit to firms in sectors like power, cement, fertilisers and real estate. However, we will be selective in extending real estate loans and only those real estate developers with a proven track record and good net worth will be considered.”

SBH has recently rolled out the Smart Salary Account solution for corporates which includes features like pre approved credit facility besides offering car loans and personal loans.

Hitting the brakes?

2008-11-08T10:19:00.000-08:00

The speedbreakers are becoming more numerous on job street. According to the latest BT-TeamLease Employment Outlook Survey (October-December 2008 quarter), the caution visible in the last quarter has turned into a decisive downturn—both in hiring and business sentiment. The Employment Outlook is down 10 index points while the Business has dipped nine index points in the quarter. The Business Outlook for the next quarter is at an all-time low of 56 index points, compared to 65 index points in the last quarter, a clear indication that the overall downbeat sentiment is hurting business prospects.

Employers are in the wait’n’watch mode. The result: hiring activity is likely to be sluggish in most sectors—IT, infrastructure, retail, FMCG & media, financial services, telecom and manufacturing & engineering. ITES is the only sector that is buoyant, according to the survey. However, this buoyancy has turned into caution after the Wall Street crash because many companies depend on the now sick US financial services companies for major portions of their revenues. The survey, incidentally, was conducted before the crash.

So, is it time to panic? Not quite. Companies are not talking layoffs or even a freeze on hirings. Their focus has shifted towards improving efficiency and productivity of employees in order to remain competitive in the market, rather than on increasing staff strength. What does that translate into for you? Read on.

In the survey, the Net Employment Outlook (the difference between the percentage of respondents reporting an increase in hiring and those expecting a decline) stands at 65 per cent, a decline of 10 index points over the last quarter. That’s the lowest across the last eight quarters surveyed (See The Freefall). Points out Sampath Shetty, VP, Permanent Staffing, TeamLease Services: “The last quarter for this calendar year shows a grim overall outlook and continues to reverse the employment growth in India.”

Spread across eight cities—Mumbai, Delhi, Bangalore, Kolkata, Chennai, Pune, Hyderabad and Ahmedabad—the survey drew responses from 495 companies (See Methodology). In Bangalore, the Business Outlook for the October-December quarter of 2008 plummeted 20 index points (See Mixed Bag). But this is a minor blip compared to Ahmedabad and Hyderabad, which are facing the slowdown blues, with drops of a whopping 41 and 31 index points, respectively. It’s a dismal business sentiment across all sectors. While the sentiment for retail, media & FMCG sector has shown a marginal improvement, all other sectors reported a negative sentiment. After a massive decline of 47 index points in the last quarter, the financial services sector has touched another low with another decline of 16 index points. The sector has spiralled downward over the last few quarters due to the global meltdown in last one year.

Adds Shetty: “The IT sector has shown a steady slowdown in hiring over the last few quarters, which is indicative of the maturity of this sector, whereas the ITES sector has been volatile on hiring forecasts in last few quarters. The glimmer of hope for the ITES sector—that the US recession will have a positive impact for the Indian ITES industry— has not really been borne out by facts.”

Neelam Gill Malhotra, Vice President (HR), CSC India
Neelam Gill Malhotra
P.B. Nageshwar, Head, HR, Jones Lang LaSalle Meghraj
P.B. Nageshwar
Infrastructure holds ground
Telecom, along with the retail, media & FMCG sector, leads the downward spiral. There will be fewer jobs in manufacturing and engineering, financial services, infrastructure and IT. ITES is the only sector that has bucked the trend, but the financial crisis in the US and Europe could dampen the positive sentiment. This is because most outsourcing players have large global financial services companies as their clients. Explains Tim Huiting, Vice President (HR), Convergys: “The impact is mixed—some companies that have a major part of their revenues coming from sick financial services players have been hurt badly. For others, the impact may not be that big or even neutral.” Huiting sees the net employment growth in the BPO sector remaining neutral till December 2008. In terms of hiring activities, the last quarter of 2008 will be very different from the first three quarters for Convergys. It recorded a strong recruitment growth of 25-30 per cent in the first three quarters, fuelled by high attrition rates. The company expects instability in the BPO business to lead to less movement of people, across levels.

CSC India, too, sees no cause for alarm. One of CSC India’s clients in the banking, financial services and insurance (BFSI) space, like Washington Mutual (WaMu), has recently been sold out to JPMorgan Chase, after being a victim of the implosion of the US mortgage market. Says Neelam Gill Malhotra, Vice President (HR), CSC India: “The global crisis hasn’t affected us much, though we have got our antennae up. We have already been committed a large amount of work under long-term contracts with WaMu. That means, irrespective of WaMu’s ownership change, CSC will continue to fulfil its IT services requirements.”

The manufacturing sector, though down, is not too worried about the global financial crisis. Yet, at the same time, employers in the sector are not upbeat about the current market scenario and are increasingly cautious about their hiring intentions. “I think the slowdown has little to do with domestic consumption; the major factors affecting India’s economy will remain unchanged,” says Yashovardhan Verma, Director (HR), LG Electronics India.

Tim Huiting, Vice President (HR), Convergys
Tim Huiting
Surprisingly, the telecom sector, which has been fairly insulated from the global turmoil, is very conservative in its outlook for the quarter. But infrastructure has been steadiest of the lot. “This is thanks to the public private partnership (PPP) projects being a long-term play. These have negligible exposure to the current economy scenario,” adds Shetty.

The intention to hire in the financial services sector is at 59 index points, a drop of 8 index points compared to the last quarter. Will the situation worsen as the global financial markets remain in turmoil? Recruiters say that other than insurance sector, which is linked to the domestic economy, the entire BFSI pack, including investment banking, retail banking, and stock broking, is bracing for major lay-offs. “The situation is so dire that it is expected that ICICI Bank, which had announced plans of hiring 40,000 new employees during 2008-09, may not be able to add more than 5,000 new employees,” says Kris Lakshmikanth, Founder CEO & Managing Director, The Headhunters India.

IT bellwether Infosys Technologies is trying to soften the slowdown blow by reducing the size of its ‘‘bench’’ and increasing utilisation. Says Mohandas Pai, Director, HR and Administration, Infosys: “We expect hiring and salaries across the IT and ITES sector to be muted for the next few quarters as the full impact of the slowdown in the US and now Europe sinks in.”

Maveric Systems CEO Ranga Reddy has a word of caution: “On the IT front, nothing much was expected last quarter because of Christmas—but from January, companies will feel the (negative) US impact more—many have more than 60 per cent of their revenues coming from the US. They will be more impacted in the coming financial year.”

Reddy foresees curtailment in new hiring till financial projections from customers are more clearly outlined next year—this will have an impact on campus recruitment in June, too.

The hiring outlook for cities across the spectrum has taken a beating. The survey puts Job Outlook for Mumbai at 60 index points, down 15 points compared to the previous quarter. Ahmedabad, Bangalore and Delhi see a dip in the fortunes with the cities posting declines of 40, 16 and 10 index points, respectively. Chennai’s bad run also continues with a drop of 10 index points. The only city that has a positive Job Outlook is Hyderabad, which, incidentally, witnessed a drop of 31 index points in business sentiment. T. Sreedhar, MD, TMI Network, a leading talent hiring company, headquartered in Hyderabad, offers an explanation for this. “I see no contradiction here as both (Employment Outlook and the Business Outlook) are in sync.

The Employment Outlook is up because the projects that have been lined up (especially in infrastructure) will have to be executed now and the Business Outlook is down in tune with the dampening of the business sentiment, which has now been exacerbated by the happenings in the US.” In fact, it is also visible in the Employment Outlook, which should normally have been up by 15 to 20 per cent and not just 7 per cent, he adds. But then, why is this happening in Hyderabad alone? “Well, a bulk of the infrastructure players operate out of this region; then, new projects like the Rs 12,000-crore metro rail project have just been awarded,” says Sreedhar.

This contradiction has left S.V. Krishnan, Global Head (HR), Satyam Computer Services, puzzled. “There is a lot of buzz (in Hyderabad) and this is true for any sector—construction, infrastructure, real estate or IT.” Bangalore, according to Pai, has problems around both expensive infrastructure and talent. Other cities have been able to address both the issues more aggressively.

Despite the bleak job outlook projected for Chennai in the survey, companies are optimistic on the employment front. Shekhar Arora, Executive Director (HR), Ashok Leyland, attributes this to new units coming up, particularly in the auto sector, like Renault Nissan, Daimler and Mahindra Design Centre, which will be ready a couple of years down the line while Satyam Computer is scaling up its auto design centre in Chennai. Companies like Maveric Systems, which have greater presence in the UK, West Asia and Asia Pacific and little exposure to the US, are going ahead with recruitment and training plans. But others will take a more cautious view.

S. V. Krishnan, Global Head, HR, Satyam Computer Services
S. V. Krishnan
Setback for Tier-II cities
The metros continue to corner most jobs created, and Tier-I and Tier-II cities have lost ground. The intention to hire in Tier-I and Tier-II cities has dropped six and seven points, respectively, in the survey. Tier-I cities are largely considered the growth centres for the BPO industry (See IT Special, BPO 2.0). “In India, we still don’t have wide infrastructure support to shift to Tier-II and Tier-III cities in a big way. Tier-I, though expensive, still attracts the best talent compared to other Class-II, Class III towns,” says Huiting. P.B. Nageshwar, Head (HR), Jones Lang LaSalle Meghraj, says that the demand for relevant talent will continue to grow in the metros. “On the other hand, if Tier-II and Tier-III cities can attract good people, they can grow at tremendous rates,” he says. Infosys has expanded across the country and is looking beyond its headquarters in Bangalore. It has built large campuses in Chennai and Hyderabad as well as emerging towns such as Mangalore and Thiruvananthapuram to keep pace with its growth.

The problem of weak infrastructure still persists in Class-II and Class-III towns. In these cities, infrastructure growth hasn’t really picked up the way it was expected to, says Verma.

Parsvnath sees 30-40% sales growth in H2FY09

2008-11-08T10:17:00.000-08:00

Pradeep Jain, Chairman, Parsvnath Developers, said that going forward, the next half of this financial year is going to be stronger than the previous one, because in the previous one there were a lot of concerns related to the global economy
etc. "Also in this first half, the investor driven demand has entirely gone away and the talks about the prices going down also impacted end-user demands. But now, since the last two months, the end-user demand kept increasing as the prices are not going to come down and the sales keep going up. In the next half of this financial year I am expecting growth to the tune of about 30-40%."

Here is a verbatim transcript of the exclusive interview with Pradeep Jain on CNBC-TV18. Also watch the accompanying video.

Q: It’s been a disappointing and a tough first half for real estate sector and also punished by the market as well. But talking about future, you think the second half of this year is going to be as tough as the first half or do you think there is some scope for improvement there?

A: Going forward, the next half of this financial year is going to be stronger than the previous one, because in the previous one there were a lot of concerns related to the global economy etc. Also in this first half, the investor driven demand has entirely gone away and the media keeps talking about the prices going down and the end-user demands was also impacted because of that. But now from the last two months the end user demand kept increasing and the user is able to understand that the prices are not going to come down and the sales keep going up. In the next half of this financial year I am expecting growth to the tune of about 30-40%.

Q: Isn’t there a bit of disconnect here, in the second half you see demand going up, but a report said that the sales we have seen in October are the lowest we have seen in some time as far as real estate sector is concerned?

A: I don’t know which report you are quoting about but as compared to the month of September, the October month’s end user demand increased substantially.

Q: You are at the heart of the action where there was maximum price surge and channel checks have suggested that there has been some bit of a price correction, Gurgaon, Greater Noida and Delhi, going forward both on demand and on pricing front, how much of a correction do you expect?

A: The prices in Delhi are bound to go up because there is very limited quality land available and I don’t foresee any cool down in prices in adjacent to Gurgaon also, but in Greater Gurgaon the prices are bound to cool down because of non-infrastructure and the non-availability of the customer who wants to buy the property for the end use propose. Greater Gurgaon will take time to come up. Similarly in Noida, I don’t foresee any cool down but in the Greater Noida extension, there is a cool down in demand because the end users don’t want to take property into the futuristic location.

When the end user buys the property, he wants to understand the kind of the property he is buying and he wants to shift to the property in 2.5-3 years. The end user will look for that property be it in Noida, Greater Noida, Gurgaon etc where he can shift in 2.5-3 years.

Q: If you are saying that October sales were higher than September sales, can you give some hard numbers in Gurgaon, Noida, and the areas that you spoke about?

A: Related to our own projects in Gurgaon, Delhi, in Greater Noida and Sonipath, as compared to September, we have seen growth to the tune of 22-25% in the month of October.

Q: Was it at same prices or lower prices?

A: It’s a surprise for you that it was on higher prices. We are developing a project in the North of Delhi, in the month of September we were selling at Rs 8,000 per sq ft, and in the month of October we increased about 20% and now we are selling at Rs 10,000 per sq ft.

Q: A lot has been riding on your SEZ projects - out of the 211 million sq ft that you have currently and which were slated to be developed in the next 4-5 years, have you seen any pullback on account of higher liquidity constraints or high interest costs?

A: We haven’t seen any pullback in SEZ and we are getting all the sanctions from the regulators and local authorities. Our Indore, Dehradun, Gurgaon, Hyderabad and Cochin projects are on the track and we are going to start in the next couple of months and we don’t foresee any cool down in that. We are in talks with the private equity investors and we are on the way to close those transactions very soon.

Q: With RBI taking the steps, do you think it’s too little to late or going forward, your interest costs may come down just a wee bit?

A: The RBI and the government very aggressively cut the CRR, repo and the reverse and also the SLR. So one side though want to congratulate government on taking this step but on the other side I am really disappointed because related to real estate, the risk weightages and direct liquidity into the real estate is not there yet.

We are requesting from the association and the Chamber to the government to come forward and to give some liquidity into the real estate system. The money needs to come out on the street which is not happening.

Q: What is the current debt equity ratio that you are sitting at and what are the debt levels on your balance sheet?

A: Our net debt is in the tune of about Rs 1,640 crore and our cost of debt is 13.78% as of now and debt equity ratio is about 0.85.

Crack in Indian realty firms

2008-11-08T10:16:00.000-08:00

Future economic historians may remember the month that just ended as Black September. Lehman Brothers collapsed; the Bank of America acquired Merrill Lynch; AIG was nationalised; banks such as Washington Mutual and Wachovia were wiped out. As credit and finance markets around the world tumbled like ninepins, so did stock markets in India, with the Bombay Stock Exchange Sensitive Index (Sensex) falling 3.35% or 469 points on September 15. The worst affected was the realty index which dropped 7.6% on the same day. Since then, while stocks prices in India have seen massive swings, shares of real estate firms have remained depressed, falling a total of 20% as of October 1.

In addition to housing stocks, home prices are taking a beating. By some estimates, prices have dropped by 25% in certain urban markets. While in the US -- and also in Britain -- the subprime mortgage mess has seen home prices fall dramatically, in India, such slowdowns have been rare -- at least in the past. Prices may soften, sales activity may slow and occasionally a distress sale occurs, but there has not been an overall fall in home prices. "India has not seen a boom-bust cycle in real estate mainly because the industry is still nascent," says Anurag Mathur, joint managing director of Cushman & Wakefield, a global real estate solutions company. "India has not seen a boom and bust cycle in almost any sector," adds Rajesh Chakrabarti, a professor of finance at the Hyderabad-based Indian School of Business (ISB). "While there have been variations, we have not had cycles of the kind we see in the developed countries. It is only after liberalisation that the Indian economy has been seeing more cyclical movements."

According to Irfan Razack, chairman and managing director of the Prestige Group, a Bangalore-based real estate developer: "We have boom and bust cycles in India but because of our huge population, the demand keeps growing and that sustains the industry. You can build for the next 100 years and there will still be demand for housing in this country."

India has inadequate data on the real estate sector. For instance, no one tracks housing starts, an indicator that is regarded in many countries as an important yardstick of economic health. However, several real estate companies have gone public during the past couple of years, which makes information more transparent. Secondly, equity analysts have begun tracking these companies and the real estate industry.

Still, confusion continues. Consider the reaction of the markets to the Lehman collapse. Real estate was hit for two reasons. Lehman had invested $200 million in DLF Assets, a company belonging to DLF, India's largest real estate company. It had also acquired a 50% stake in Unitech's Mumbai project for $175 million. (Unitech is India's second largest real estate company.) Among other Lehman investments or proposed investments were those in the Mumbai-based Peninsula Land Ltd. and Housing Development & Infrastructure Ltd. (HDIL).

The market was worried that if the money had not already been received, the projects would be in limbo. Most companies (Unitech, for one) claim that the cash is already sitting in their bank accounts so there is no cause for concern. Others, like HDIL, have said the deals were not with Lehman Brothers but with sister companies. These are unlikely to be affected.

The crunch might hit in the future. "With banks reducing their exposure to real estate, coupled with rising interest rates and volatile stock markets diluting the confidence of retail investors over the past one year, private equity investments have emerged as one of the most important sources of capital for real estate developers," says a FICCI-Ernst & Young (E&Y) report on the Indian real estate market released in early September. "The overall private equity investments reported in the real estate sector in India from August 2007 to July 2008 are estimated to be more than $5 billion." This tap could be turned off as a result of the financial crisis in the U.S.

Real estate investors in India were also worried that Lehman might resort to a fire sale of its assets. While India has a three-year lock-in period for foreign direct investment (FDI) in real estate, it is unclear whether this applies when a company declares bankruptcy. The government is holding a meeting to decide the norms in such cases. The other issue is that Lehman holds small stakes -- bought from the market or in bulk deals -- in real estate and infrastructure companies such as IVRCL Infrastructure, Consolidated Constructions, Orbit Corporation and Vijay Shanti Builders. Here, too, there was the possibility of a fire sale, encouraging other investors to bail out.

Temporary slowdown

Amid this gloom and the real estate-bashing that is going on in the market, many people are optimistic about the sector. Even the bears see only a temporary slowdown. "The Asia-Pacific property markets, which have seen a rapid run-up in rents and capital values in recent years, are now entering a slowdown that will continue over the next 12 months at least," says a report by real estate consultants Jones Lang LaSalle (JLL). Shobhit Agarwal, joint managing director (capital markets) of JLL Meghraj (JLLM), the global company's Indian division, says there is still some pain left. "There is now a period of stagnation, soon to be followed by a fall in prices in certain sectors and locations. Certain overheated micro-markets will see a 5% to 15% price decline. A correction of up to 10% is also expected in South Mumbai, some locations in Mumbai's suburbs, and certain areas of New Delhi that have seen unrealistic price trends.... The market will eventually consolidate."

"In the short term, we expect the market to consolidate," echoes a spokesperson of DHL. "We have not been impacted by any slowdown. We have launched many premium residential projects across the country during the past six months and have gotten a very good response. We feel that the market is moving in the right direction and there is no bubble to burst."

"In the past three to four years there has been a huge inflow of companies and funds in the real estate sector," says Chakrabarti of ISB. "It is possible that there may be a bit of a shake out and consolidation now. Given the fact that we have already seen a 20% to 25% correction, I don't expect prices to fall much further. It will probably now grow at a decent enough rate. Also, infrastructure development is a major area of emphasis and this will fuel real estate prices, especially in the smaller towns."

The problem seems to have affected residential property rather than commercial real estate or infrastructure developers. Several factors have contributed to this. First, the Reserve Bank of India (RBI) has been raising interest rates to tackle inflation. As a result, housing finance companies have had to raise rates on loans. In 2004, interest rates on housing loans were 7.75%; they have now gone up to 12.75%. On a $50,000 loan borrowed for a period of 20 years in 2004, the interest burden was around $48,000. This has now gone up to more than $100,000.

Most housing loans in India are at variable rather than fixed interest rates, which means that monthly mortgage payments -- or EMIs (equated monthly installments), as they are called in India -- go up when interest rates rise. As a first measure, housing finance companies increase the term of the loans. When that period extends beyond the working life of the home buyer, the EMIs are increased. Housing finance companies typically consider EMIs up to 50% of net income. If, in extreme cases, these payments double, home buyers can be left with nothing to live on.

Understandably, defaults on loan repayments are increasing. While specific numbers are hard to come by, bankers say this could develop into a crisis. The financial meltdown in the US -- and the turmoil in the finance sector, which is a key market for information technology and IT-enabled services -- has seen a large number of finance professionals lose their jobs. These young, upwardly-mobile executives were the new generation of house buyers. They are now saving for the proverbial rainy day -- which has arrived. Confidence levels are down and house purchase plans have been put on the backburner.

Finance companies and banks are also being careful about approving loans. Their vetting process is taking more time. Even people who want loans and have the capacity to service their EMIs are being put through greater scrutiny.

Business as usual?

India's largest mortgage company, Housing Development Finance Corporation (HDFC), however, says that it is business as usual. As Renu Karnad, HDFC joint managing director, told CNBC TV 18: "The demand story is a compelling one. Its plot is often repeated by HDFC's senior management that younger and younger Indians are opting for home loans. The average age of borrowers is down from 40 years to 35 years. Thanks to tax breaks, the effective cost of a loan works out to a moderate 6%. Unquenchable housing demand has the country short of 25 million homes. The loan market is a vast untapped one yet. It has taken 30 years for mortgage penetration to grow from 2.5% to 6% of GDP. With middle India kicking in, HDFC is confident that unlike other consumer goods, home loans are not that vulnerable to a slowing economy."

The FICCI E&Y survey agrees. "Despite the momentary slowdown witnessed over the past 12 months, 62% of developers foresee Indian real estate embarking upon a high growth trajectory in the long term," says the study. It does, however, point to one change. Real estate had become a speculators' haven. Now, seeing no hope of quick returns, they are bailing out. Builders believe it's the speculators who are responsible for the perceived slump. Once they are squeezed out -- many are selling at whatever price they can get to take care of their stock market losses -- things will return to normal. The study notes, "Respondents believe that genuine end-users have taken over from investors and account for 80% to 90% of sales in their current projects."

What are real estate companies doing to deal with the downturn? Well, they are putting their eggs in different baskets. In a way, it is a replay of the rush into real estate. Over the past decade, companies with no experience in property development had entered the market. Some had legitimate reasons. The textile mills in Mumbai, for instance, had been priced out of the market because of high labor costs. One of the first off the block -- Phoenix Mills -- has converted itself into a commercial, residential and entertainment complex. In August this year it raised 200 million euros from German real estate fund MPC Synergy for further development. Morarjee Mills has moved its operations to smaller (and cheaper) cities. Its properties are being developed by its real estate wing -- Peninsula Land.

In addition to the textile mills, 70-year-old Nesco Engineering, a moribund company, is today thriving because it has set up an exhibition center on its Mumbai property and has plans for an IT park. Media Video, an electronics games manufacturer and distributor, has recently listed its real estate subsidiary MVL. Its market capitalization at $87 million is eight times that of its parent. The Kolkata-based Emami group, a FMCG player, has moved into malls and housing complexes.

Now, real estate companies are exploring new investment opportunities. Builders of residential property are taking to developing commercial space. Others, such as Raheja -- a leading homebuilder -- are constructing special economic zones. Omaxe is modernizing and maintaining airstrips. DLF, Unitech and Omaxe are bidding for road projects being offered by the National Highways Authority of India. The Brigade Group is building a health spa in Chikmagalur near Bangalore. It will run the spa in tandem with Singapore-based hospitality brands Banyan Tree and Angsana. Sobha Developers already has an ayurvedic spa offering the traditional Kerala ayurvedic massage at Sobha City in Thrissur in Kerala.

Overseas markets

The second trend is a move abroad to market real estate companies' products, raise funds, source raw materials and launch projects. PRA Realty has set up shop in Chicago to be closer to venture funds. It has also opened a marketing office in Dubai. According to JLLM, non-resident Indians (NRIs) are major buyers of Indian properties, accounting for up to 25% in certain categories.

Sobha Developers has opened an office in China, from which it sources a lot of raw material. It is building a five-star hotel in Dubai. Parsvnath Builders has a subsidiary in Singapore. Puravankara Projects has started operations in Sri Lanka to build super luxury villas on the outskirts of capital Colombo. It already has a presence in the UAE. "Considering that every market is subject to fluctuations, diversification is certainly the best hedging tool for avoiding the pitfalls of sudden downward movements in any sector," says Agarwal of JLLM. "If one component fails to generate anticipated returns, others will compensate."

Other real estate companies are casting their nets wider and embracing every opportunity that comes their way. Unitech has already made a foray into telecom. It is now eyeing insurance. Preliminary talks are on with a foreign major. Omaxe is moving into steel and cement. It has on its drawing board plans for a medical college and a hospital.

Mantri Realty has earmarked $500 million for a thermal power plant in Nagpur. The Hyderabad-based JR Realtors has aquired a 10% stake in Pennar Aluminium. Indiabulls Real Estate is setting up a solar power plant in the Bastar region of Chhattisgarh. Sobha has even moved into retailing mattresses under the brandname Restoplus. IT major Infosys has already placed the first order.

HDIL has lined up a whole array of diversifications. It is getting into entertainment under the Broadway brand name. It plans to invest $200 million in a chain of 150 theaters. It is also building a coal-fired power plant. It will begin power trading soon. In perhaps the oddest move, it is bidding for oil and gas exploration blocks being auctioned by the government. "Although oil and gas is completely disconnected from our core business and what we are doing now, I can say that it will help in providing better services to customers who we serve in our projects," Sarang Wadhawan, managing director of HDIL, told business daily Mint recently.

"In the long run, given that the India growth story is likely to continue, real estate prices will certainly increase," says Chakrabarti of ISB. "However, they will not see a meteoric rise as they did earlier. It will be a more stable market. Real estate companies are therefore diversifying into different areas where they expect better growth (like telecom). This is probably not so much by choice as by compulsion. It also reduces their risks. In some sense it is sensible given that the market conditions have changed, but whether it plays out in the long run remains to be seen. In general [not just with regard to real estate] unrelated diversifications don't work out very well."

The efforts of various companies haven't had much impact on their share prices. As a high share price is necessary for fund raising, some companies are trying financial engineering. DLF, for instance, has announced a share buyback, but it is also seeking fresh funds. Analysts wonder how the two can go together. "Promoters work in the best interests of the company," responds a DLF spokesperson. "The DLF share has been quoting much below its intrinsic value. We see the share buyback decision as a highly attractive opportunity for our shareholders and a strategic move of sharing returns with investors." HDIL, meanwhile, has come out with a 2:7 bonus issue. All this doesn't appear to have helped sentiments much; both the shares -- as with most real estate companies -- are quoting below their original IPO price.

"The companies that went public rode the boom, and they will bounce back once the markets and the sector picks up," says Razack of the Prestige Group. "At that time the valuations were so aggressive that we were also tempted to go public. We didn't do it because one can't really show quarter-on-quarter growth in real estate. It becomes more [like] window dressing."

Affordable housing

Another major area into which many real estate firms are moving is affordable housing. Puravankara has set up a wholly-owned subsidiary -- Provident Housing & Infrastructure -- which will build 64,500 homes in Bangalore, Chennai, Hyderabad and Coimbatore over the next five years. Omaxe has set up the 100%-owned National Affordable Housing and Infrastructure, which will invest $20 billion over the next five years in building one million such homes. Many other builders are also climbing on the bandwagon.

The rush is partly explained by the response to government-led housing programs. The public sector Maharashtra Housing and Area Development Authority (MHADA) plans to sell 600 low-priced apartments in Mumbai around Diwali. They will be priced around $50 a sq. ft., at a time when market rates are four times as high. MHADA expects 200,000 applications; there will be a lottery to decide the buyers. Demand for such housing is obviously very strong. A similar prgram earlier this year for 900 apartments attracted 65,000 applications. In Delhi too, the Delhi Development Authority has received 850,000 applications for 5,010 low-cost apartments.

"Affordable housing, until now, was not a part of the Indian real estate sector boom," says the FICCI-E&Y report. "However, affordable housing has recently attracted attention from prominent developers and private equity players. The investment rationale for this asset class largely encompasses an early mover advantage, volume-driven profitability, priority-sector status accorded by government and subsidised land costs, among other drivers."

Yet skeptics see dangers here. First, affordable housing may end up as substandard housing as builders cut costs to maintain margins. Second, affordable housing will go to the less-privileged classes, financed by easier norms for bank loans. Earlier this year, the government wrote off $15 billion of farm loans, which severely impacted its finances. Some observers fear that "affordable home loans" could face a similar fate. They are, after all, subprime mortgages of the kind that sparked the housing crisis in the U.S.

The consensus view about Indian real estate is that the slowdown is temporary but lots of reasons exist for optimism about the future. "Short-term concerns on the sector remain," says a report by research house Enam Securities. "End user demand (is) subdued on account of high capital values and global uncertainty keeping the capital markets under check. Developers remain strapped for liquidity. However, the long-term outlook (is) still positive. Favorable demographics, increased urbanization and higher disposable incomes will result in continued demand." According to Mathur of Cushman & Wakefield, "If you believe in the India story, the outlook for real estate, which is a critical part of the whole development process, is bright. I am very bullish about it."

Demand for residential property dips in Hyd

2008-11-08T10:12:00.000-08:00

The demand for residential properties in Hyderabad declined by 11-12 per cent between June and August period, this year, according to a survey conducted by online real estate portal Makaan.com.

Nevertheless, property prices have gone up in 22 out of the 37 localities surveyed in the city. In 15 localities, the prices declined in the range of 1 to 10 per cent in these months.

According to portal’s vice-president and business head Aditya Verma, the survey covered 53,577 persons who are looking towards purchase of residential properties.

While 44 per cent of the demand is for residential properties costing less than Rs 30 lakh, 25 per cent demand is for properties ranging between Rs 30 lakh and Rs 60 lakh and 20 per cent of the demand is for properties costing Rs 60 lakh to Rs 1 crore. The demand for properties valued at over Rs 1 crore is 11 per cent.

Interestingly, the survey reveals, 62 per cent of the property seekers are willing to purchase residences anywhere in the city provided their essential requirements are met.

For the purpose of the survey, the state capital was broadly divided into greater Hyderabad, Hyderabad and Secunderabad. However, the report did not explain on what basis the divisions were made. For instance, Hitec City and Banjara Hills areas were included in the Hyderabad division while Jubilee Hills, located between the two areas, was included in the greater Hyderabad division. Verma said that such “flaws” would be removed in the future surveys of Makaan.com.

Similarly, with regard to the residential property for rent, the report stated that the sample size was lower than that of seekers looking to buy, which “might cause some error in the analysis”. The demand for rental properties, the report indicated, too declined by 5 to 11 per cent.

He Earned Rs 14 Lakhs In 1 Hour

2008-11-06T05:56:00.001-08:00

While the whole city is frying under the economic crisis and the crumbling real estate crashes, there are a few individuals who are unfazed by all that and continue their life as usual, especially when it comes to spending money or staking money on games of cards.

About a week ago, a get together happened at a friend's place in one of the posh areas of Hyderabad and soon all of them got down to the game of pool. It is heard that there were about fourteen of them who took part with a minimum stake of one lakh and the winner takes all.

So here was one guy who managed to beat the rest and in just a span of one hour, he got richer by a stroke of fourteen lakhs. Well, this does not mean that all of you must close your shops and start running for such things since these are rare happenings. There are many who have lost their lives in such gambles.

Patancheru Becomes Golden Land

2008-11-06T05:51:00.000-08:00

Anybody who has ever seen Hyderabad about 15 years ago would never had imagined that Patancheru would one day become the Golden land that it is now. In the earlier days Patancheru was considered an industrial area and people would fear buying lands there as the water and land were polluted. So much so that the industrial development authority had given up hope of developing this area and the land was being given to big IT companies. Two big IT parks are coming up there in coming 2 years.

Now the scenario is all changed and land is a premium in this area and thanks to the many ventures coming up there. The farmers have become rich with the escalating prices here. It's not just the people from near by areas who are buying up land here. Many people from different parts have already invested and are already reaping good benefits. Patancheru also is growing much faster than other areas in and around the city and it is now the golden land in Hyderabad.

As real estate is in slump now, investment experts are advising to buy the lands at this juncture for better growth of asset value in coming future.

Gulf property developers could boost India's real estate market

2008-11-06T05:47:00.000-08:00

The real estate sector in India is set to grow by 30% and be worth $16 billion by 2010 despite the global economic downturn, it is claimed.

Middle East property investors and developers are likely to be the saviours of the property industry which is currently facing financial problems due to high interest rates and tight lending conditions.

They recognise that the economic climate may be difficult but they also recognise that they can benfit from lower land prices, lower material and labour costs and a market where demand is unlikely to disappear.

'The internal demand for commercial and residential real estate in India is undeniable. But providing finance is in place many developments are likely to be approaching completion after the downturn has bottomed out,' said Graham Wood, exhibition director for next month's Cityscape India.

His company's latest research predicts a 30% growth rate for India. It is also estimated that India is currently facing a shortage of 21 million homes. Wood also points out that more and more Gulf developers are interested in India.

'The demand for affordable housing is immense and potentially the long term returns for investors and developers are colossal,' he added.

Dubai-based Limitless is confident about the long term prospects of India's real estate sector and will be showcasing key Indian projects including a 4,000 hectare mixed use development near Bangalore with accommodation for 750,000.

Dubai Properties recently confirmed that the company hopes to expand its development projects into India. And Dubai-based real estate developer Majid Al Futtaim has also announced it is investigating India as a possible region for investment and development.

Younis Al Mulla, MAL business development officer, said that the company was looking to enter a joint venture with a local firm to help it build a mixture of residential and commercial real estate in the country.

The investment arm of Ras al-Khaimah also plans a $5 billion business centre at Hyderabad.

This year's three day Cityscape India conference which starts at the Bombay Exhibition Centre on December 8 is expecting 7,000 participants from around the world.

'Cityscape India will reach out to over 350,000 senior decision makers seeking to invest in one of the world's fastest growing economies,' added Wood.

Laconic responses

2008-11-06T05:45:00.000-08:00

When resident owners apply for bank loans, in most cases loans are rejected for non-production of original documents such as land ownership (encumbrance certificate from owner), occupancy certificate, details of carpet area and link documents relating to agreement with the departments concerned like electricity, water and sewerage. The residents’ welfare associations must be in possession of such documents and assist their members.

About most of the residents’ welfare association, the little said the better. Contrary to the constitution, yearly audit of the accounts is not done by a qualified and practising chartered accountant.

Even after decades of the registration, some associations at times pass resolutions asking for huge amounts with estimates running into lakhs of rupees for purposes such as painting, colouring, corpus fund and the like.

It is admitted fact that the ceremonial meetings of most welfare associations take place without quorum. The same office-bearers continue in the so-called committee. The Registrar of Societies should inquire into the functioning of the welfare associations as residents of middle income group are burdened.

K. SUBRAMANYAM

Hyderabad

Correction in real estate prices largely done: DLF

2008-11-04T02:36:00.000-08:00

DLF Vice President, Rajiv Singh said Monday that correction in real estate prices and volume in realty sector is largely done and he expec
ts stability to return in prices and volume in next eight months.

DLF scrip gained near about 10 percent early Monday. At 11:15 am, the share was trading at Rs 244, up 10.78 per cent from Friday’s close.

Rajiv Singh said he expects cash flows to remain positive in the sector but added that the tight monetary policy and the rise in home loan rates has severely affected the sector. Real estate developers are working on very thin margins, he added.

According to Singh, mid income housing continues to grow. However, he added that government polices should support the first time home buyer.

The Delhi-headquartered developer - which sells a large portion of its commercial assets to DLF Assets Ltd, a company promoted by DLF Chairman K P Singh, said DAL will raise Rs 5,000 crore from the market in next two quarter.

DAL's portfolio as of now includes IT parks in New Delhi, Hyderabad and Chennai and two large office complexes in Gurgaon. DLF posted a 4 per cent drop in net profit for July-September quarter at Rs 1,935.35 crore, as change in product mix towards the mid-income housing compressed margins.

About Us

2008-11-04T01:51:00.000-08:00

Welcome to greater hyderabad real estate developments information.

Realtors optimistic despite recession

2008-11-04T01:47:00.001-08:00

The global meltdown has spread gloom in the real estate sector, which had been on a roll in the last five years. However, major realtors expect the industry to bounce back within six months since the traditional home market in India is very strong. The country’s realty sector, which is growing at 35 per cent, is estimated to be worth $15 billion. Experts assert that the realty sector will continue to grow at 30 per cent annually over the next decade though it is on a low at present because of the worldwide recession.

The AP Builders Forum, which studied the current scenario, feels realtors would be facing a tough time for a while. But the problems would be solved once the government takes steps to save the industry. “We think the real estate market will have a wonderful future in the next few years though the sale of houses has been affected temporarily,” says Mr C. Sekhar Reddy, president of the AP Builders Forum. Real estate companies such as Aliens, Lanco, and Landmark Builders feel that the situation will improve within six months.

“The recession may have its impact temporarily but cannot disturb the market for a longer period,” says Mr Hari Challa, managing director of Aliens Group. “Buyers are still coming to invest in our projects including Aliens Space Station I and Aliens Space Station-II. It indicates that the traditional home market is strong in Hyderabad.” “Timely intervention by the Reserve Bank has given a big relief to the real estate sector,” says the Lanco Hills chief executive officer, Mr S. Pochendar. “With the reduction of Cash Reserve Ratio, banks will have more funds and will be keen on encouraging industry again. We hope the worst is over.”

However, Landmark Builders managing director, Mr. Sanjay Kumar, admits that many buyers are adopting a wait and watch policy hoping that rates will come down further. “The market will stabilise slowly and it will witness a fresh boom after the elections,” he says. “It is better to invest when flats and villas are available at affordable rates.” According to Mr Prem Kumar, general secretary of the Greater Hyderabad Builders Federation, the recession would not have any impact on the sale of flats meant for middle-income groups. “There is a heavy demand for functional flats though buyers are not interested in luxury flats,” he adds.

PEB technology is in

2008-11-04T01:46:00.001-08:00

The concept of pre-engineered buildings (PEBs) is slowly gaining momentum in the city. Several construction firms are banking on this new technology to cut down costs and finish the task of construction quickly. Pre-engineered building comes with a readymade building designed to suit one’s needs and plans. All the components of the building, matching the architectural and service requirements, are made at the manufacturer’s workshop and then set up on site under expert supervision. This technology is being extensively used in the construction of shopping malls and other commercial ventures. Builders say this will cut down construction cost by 30 per cent when compared to conventional methods.

Construction firms such as PBEL, Bharat Infra, Prajay Engineers Syndicate and Maytas Infra have built up their huge sales and marketing offices using this technology. The minimum plot area required to build structures using PEBs is 500 sq.yards. “From foundation to finish, like laying of pillars, erection of beams and using concrete, will happen at the site.

With PEB technology, the readymade blocks made with steel are manufactured in the factory. They can be assembled using nuts and bolts, which will considerably reduce the time of construction. That’s the reason we opted for PEB to build our huge sales and marketing office spread over 10,000 sq.ft at Madhapur,” said Mr Anand Reddy, director, PBEL Holdings Ltd. Earlier, PEB technology was utilised for building godowns, cold storages, cement industries and sugar factories. Slowly, the trend has spread to building commercial complexes, showrooms, super markets, restaurants, shopping centres, recreation centres, schools and hospitals.

Building upto three floors can be effectively built through PEBs. “We plan to build our sales and marketing office in 1,000 sq.yards plot using PEBs as PEB structure looks modern and attractive. Architectural versatility is ensured as buildings can be supplied with special fascias, canopies, curved eaves and other features,” said Mr Vijaysena Reddy, director of Prajay Engineers Syndicate.

He says the technology enables faster and better construction apart from significantly cutting down costs through elimination of expensive structural redundancies and delays created by the multiple suppliers. “We can develop 50,000 sq.ft of built-up area just in six months using PEB technology. In conventional mode, this will go up to nearly two years,” said K. Rajashekar Rao of Maithili Constructions Ltd. He says even the cost-factor can also be controlled with this technology as it will incur an expenditure of less than Rs 600 per sq.ft, whereas it will be Rs 800 per sq.ft in conventional method.

Several manufacturers such as Saudi-based Zamil Steel, Kirby, Tate Bluescope, Era Building Systems, Tiger Steels etc have set their eyes on metro cities where the construction of commercial complexes and shopping malls is going at a rapid pace. “We produce 5,00,000 metric tonnes of PEBs. This year, we expect to sell 20,00,000 sq.ft of PEBs in India,” said Adnan Al Mansour, president, Zamil Steel.

Radha Realty sets new benchmark in ultra luxury living with U31

2008-11-04T01:30:00.000-08:00

With the objective to set a new benchmark in ultra luxury living, Radha Realty, one of the leading real estate developers, today unveiled U31, a never-seen-before single family homes gated community project in Hyderabad. U31 is a fusion of the best of traditional and modern living, a new way of living. Commenting on the project, Mr N Ravindranath Reddy, Managing Director, Radha Realty Corp, said, “it was our vision to create something extraordinary to meet the aspirational needs of the discerning customer that U31 was conceived for. Every component of the project be it the concept, the people, the design, the materials, are meticulously planned and will be executed similarly, in order to ensure that U31 is an ultimate statement of exclusivity that is difficult to replicate.”

The 31 limited edition ultra luxury townhouses will be built on a massive 9 acre “green“ podium. 19 courtyard houses and 12 pavilion houses will be surrounded by greenery and water streams. Each of these four-storied homes will have a property area of 1250 square yards, built up area of 11,800 square feet, 5 bedrooms, private swimming pool, exotic interiors, a designer home entertainment room, private elevator, 5 car parking spaces (each large enough to park a luxury SUV or minivan), accommodation for up to 8 domestic helpers and a bulk storage garage. The entire garden ground level will be a car free zone – with all vehicular movement restricted to the below podium level thus ensuring a pedestrian friendly community. U31 has many special features for the most special residents the kids. The community also has an indulgence club and a signature day spa. “Located in the heart of the new CBD Kondapur the project offers multiple benefits of convenience, luxury, comfort, health and security, negating the ills of modern living, apart from the biggest USP of - Ultra Exclusivity” added Reddy.

Dream Designers U31 is designed by Andrew Maynard world acclaimed architect from Australia who has designed unique projects in Japan, Australia and UK, apart from Australia. Interestingly, Maynard has used 31 different patterns from Charminar in designing distinct exteriors for the 31 homes. Dilip Chabbria, India’s only world renowned luxury product designer, known for custom-designing vehicles for the rich and famous worldwide, has for the first time ever, custom-designed a complete Home Entertainment Room, which is part of each townhouse. The DC-designed hi-tech Home Entertainment Room integrates a home cinema with a video games arcade. Blend of Traditional and Contemporary.

The project is a perfect symbol of synergizing the best from traditional homes with the best of today’s contemporary lifestyle, bringing in uniqueness and incremental benefits to the look, feel and utility value of the homes. “The houses are based on 7th century vaastu homes with a central courtyard. The master plan of the entire community is based on factors such as climatology, topography, views, and locale. All facilities, amenities and the design are centered on the basic principles of family and community living. Bringing back the joys of growing up seen only in yesteryears, U31 has treasure hunt trails, secret hideouts, hopscotch courts in the midst of eco-friendly surroundings” said, Mr Amit Bagaria, Chairman, Asipac Group. Additionally, the architecture is a perfect fusion of historical and contemporary design, keeping in mind the city’s rich cultural heritage without compromising on the modern lifestyle of the residents, and the master plan has derived its inspiration from pedestrian friendly cities like Rome & Edinburgh.

U31 is promoted and developed by Radha Realty Corporation. Tempus Infra Projects is the infrastructure and construction services partner. X-Cube Advisors (an Asipac Group company) are the strategy consultants. Asipac in the past had conceived and planned the most successful luxury project Casa Estebana in Hyderabad. About Radha Realty Corp Radha Realty Corp. commenced business in 1997 and has emerged as one of the renowned realty developers in South India. In Hyderabad, they have developed several gated communities and plotted townships such as Dews Ville, Maple Town (1 & 2), Creek Town, Green Lands, West End, Dew Drops, Fortune Meadows and Mulberry Meadows.

Consumer courts can try construction service cases

2008-11-04T01:25:00.000-08:00

The National Commission rules that transactions of flats or construction activity come under consumer affairs, writes K. Vijaya Bhaskara Reddy

What if a builder refuses to register the flat after accepting advance amount? A recent verdict by A.P. State Consumers’ Disputes Redressal Commission (APSCDRC) assured that it is possible to hold the service provider respio in this kind of cases, if the victim has enough documentary evidence. It also clearly stated that construction services come under the jurisdiction of consumer courts.

According to the case, D. Vijaya Kumar, a resident of Abids, made a payment of Rs. 4 lakh to Sai Victory Constructions in August, 1997 as advance towards purchasing a flat in their residential complex at Himayatnagar. The total amount of the deal was Rs.10 lakh. However, Mr. Vijaya Kumar couldn’t get his flat registered and he later came to know that the flat was sold to a third party without his knowledge. He filed a case in Hyderabad District Forum-I in 2003, seeking the agreement to be executed or refund of his money with as interest of 24 per cent per annum, together with compensation of Rs.20,000 and court costs of Rs.10,000.

The respondents, Sai Victory Constructions, resisted the case and said the payment of Rs.4 lakh was never done to them. They also argued that this case doesn’t fall under consumer courts, but that of civil court, and prayed the dismissal of the complaint with court costs. The district forum saw that six years gap between the commencement of agreement and filing of case as a reason for disqualification and asked the complaint to file a civil suit. It dismissed the complaint.
Bank statements

Aggrieved by the decision, Mr. Vijaya Kumar appealed in the State Commission. He argued that registering the flat to a third party after receiving an amount more than 20 per cent of the deal as advance was against the A.P. Apartments (promotion of construction) Act. This time, he took care to furnish the detailed bank statements, which said that the banks had issued checks in favour of the Sai Victory Constructions. The company filed no evidence to disprove the bank statements.

The State Commission took this point into consideration and stated that company had entered into an agreement. It made two important observations at this juncture. It said that - a decision of National Commission reported in 2005 (2) CPR 1 (NC), holds that the problem will continue if the developer failed to give possession of property or refund the money and the transactions of flats or construction activity by builders come under the consumer affairs with an amendment inserted by Act 62 of 2002.It asked the builders to refund Rs.4 lakh with interest of 12 per cent per annum from August, 1997 to till date along with compensation of Rs.20,000 with court costs of Rs.5,000. Time for compliance was four weeks.

Lend an oriental charm to your interiors and savour the experience

2008-11-02T22:23:00.001-08:00

Quite often there is a strong desire to decorate a home in a manner that affords not only elegance but lends a totally different character to the interiors, setting it apart from the run-of-mill décor elements. Thematic décor is thus sought after to impart that exclusive air.

While themes are aplenty, at times it is not practical to incorporate a theme in totality, given the cultural as well climatic differences and location-specific requirements. It is then best to adopt a representation that is the closest match to current living needs.

An Asian or oriental theme is designed to bring peace, balance and serenity to the space. The accent here is less clutter and predominance of natural materials. Simple yet elegant, this décor focuses on the display of a few choice accessories that act as highlights.

The furniture used is often ornate with intricate detailing. The pieces display exquisite craftsmanship. Bright colours and interesting textures mark the interiors. Given the minimalist leaning, oriental décor are great options for small interiors.

An oriental interior design scheme typically veers around Chinese or Japanese way of décor. A Chinese-influenced design can give both a dramatic as well as unusual look to the décor. It is vibrant, filled with colour and patterns yet relaxing, exuding a cosiness and warmth to the interiors.

Chinese colours are primarily bright red and black, though blue, yellow and green are also used. Embellishing with gold is a significant feature of Chinese décor. The walls are normally plain though painted in rich colours but also display use of patterned wall paper featuring calligraphy, oriental lettering, flowers, birds, fish or bamboo.
Beige, brown and grey

In contrast to the Chinese theme, a Japanese theme uses soft natural colours in muted tones. Thus, beige, brown and grey are popular colours. Furniture is, however, dark wood like black lacquer.

Given the ornate nature of furniture in a Chinese decor, the quality of wood used is excellent with glossy lacquer in black or in various shades of red. The fabric used is again rich, depicting embroidery in silk using motifs such as dragon, flowers, birds or fish.

The furniture and other items displayed are, however, delicate and petite, representative of the oriental leanings. Thus, low tables, tiny chairs, pillows and footstools are common features of a typical oriental interior. The furniture used essentially reflect functional practicality without sacrificing the artistic element.

Ceramics and pottery is yet another significant feature of Chinese influenced décor. Blue and white pottery is a typical China ware featuring motifs. Jade, like silk, is an integral part of oriental décor. It is used in plenty in accessories.

Similarly, Chinese paper lanterns and oriental style rugs lend an authentic oriental feel to the décor. The beautiful floral wool rugs and the dark exquisitely detailed furniture lend a special charm to the interiors. In a Japanese theme interior, floor mats are made of straw and cloth and are known as Tatami mats.
Decorative windows

Windows are again treated to elaborate decorative elements featuring tassels and texture, the colours and patterns forcefully drawing attention to it. However, if the rugs and furniture used are elaborate, it is a good idea to tone this section down to prevent it from getting too heavy.

Providing a green cover in the form of bamboo plants in both large and small pots is yet another character of an authentic Chinese décor. These plants are typically adorned with red and gold tassels. In a Japanese décor theme, bonsai plants feature on a greater scale.

Again, water being an essential part of an oriental interior, the delicate sound of falling water or just static water with fish is an important element in a Chinese design theme.
Bamboo furniture

Bamboo features not only as plants in a Chinese theme décor but also as furniture. For, the Chinese used bamboo as liberally as wood in making furniture. Chairs, stools, beds, tables, matting, curtains, were made from bamboo. As seen in wood, bamboo furniture too packed in elaborate work with black lacquer finish, the ends capped with ivory or bone. Various types of bamboo, such as golden, speckled and purple, were used.

Other elements that are representative of a typical oriental décor are bamboo candles and picture frames, rock gardens and fountains, Shoji room dividers, and scrolls with Chinese script. Rice paper is another element that features significantly in an oriental design theme.

Nagarjuna clamps down

2008-11-02T22:22:00.001-08:00

Nagarjuna Construction Co. Ltd. has clamped down on future real estate projects due to current slowdown in the sector and has tempered its capital expenditure plan for 2008-2009, a top official said. The company is also planning to spin off its real estate operations by March 2009 to its subsidiary NCC Urban Infrastructure Ltd, Subba Raju, vice president-finance, told analysts after the company’s results, reports Reuters.

NCC Urbanis working on a games housing project in Jharkhand.,
US new homes’ sales up

New home sales in the U.S. showed a modest 2.7 per cent rebound in September helped by falling prices, government data showed, according to AFP report. The sales of new one-family houses rose to an annualised pace above market expectations.
Fire safety seminar

A 2-day national seminar on ‘Fire Safety and Security of Mega Structures’ is being organised by the Fire and Safety Association of India at Hotel Taj Krishna from November 14.

Rooted in art

2008-11-02T22:21:00.001-08:00

Colourful butterflies, designs including those of deities and wall hangings that catch the eye with an aesthetic finish. If one is looking for a different touch to the interiors and that too at a cost that is highly affordable, then Lavancha from Karnataka is the ideal choice.

A good collection of décor pieces made from Lavancha (khus/vettiver) roots were on display at the recently held expos in the city. It boasted of simplicity, variety and beauty and that made it stand apart from the regular items that one goes to shop to decorate the interiors. These handmade pieces came as cute Ganeshas in different sizes and few boasted of an artistic touch that made them irresistible.

These are made from aromatic ‘khus’ roots and that fragrance lingers on for a long time, the store in-charge at the expo held at Exhibition Grounds informs. “Each piece is handmade and the fine craftsmanship takes up to three days to finish in cases of bigger ones,” he adds.

Butterfly patterns as hangings come in subtle colours that promise to go with any wall finish and add a soothing effect. There were buttis, those traditional woven baskets that offer a varied usage . Pouches designed as tiger and cat faces apart, the collection included letter racks and key stands in different sizes .

The Ganeshas ranged from Rs.120 to Rs.250 while the butterfly designs sported a price tag of Rs.120 and for those handy pouches, one only has to pay Rs.100.

Regain your paradise the Brand Organic way

2008-11-02T22:20:00.002-08:00

With the Green Revolution and its positive contribution to the nation’s self sufficiency fast on the ebb, the 21st century India is in the need of another revolution in its farming sector. While a few argue that biotechnology is the panacea, a few others vociferously prescribe organic farming in the context of a second Green Revolution.

Whatever be the larger picture, it remains a fact that nothing works better than organic cultivation on the home front. After all, one would expect the fruits and vegetables from one’s backyard to be in their pristine form for consumption.

Organic cultivation basically has two branch-offs namely fertilizers and pesticides. While organic pesticides are available under different brand names in the market, manure is very simple to prepare within one’s own premises.
Nutrients

“Nutrients required by plants can be broadly divided as primary, secondary and micro nutrients. While chemical fertilisers boost the yield by supplying primary nutrients in excess, they ignore the proportionate demand for secondary and micro nutrients. As a result, plants absorb the latter totally from the soil, thereby draining it of its fertility. Organic manure, on the other hand, supplies all the nutrients in a perfect balance. It also improves the disease-resistance of the plant,” explains M. Ananth Reddy, chairman of Agri-Horticultural Society (Ph: 040-23299779).

A method almost synonymous with organic cultivation is vermi-composting.

“Vermi-composting as a method of organic farming is extremely beneficial to the plants. It binds the soil, supports the soil microbes, improves the water retention capacity, and aids the root penetration. Compared with the farmyard manure, it provides the plants with five times more nutrients. In addition, it aids growth by supplying plant hormones,” says M. Narayana Rao (Ph: 9440552660), a member of the Society.

Vermi-compost can be prepared by any plant lover irrespective of the space one is disposed with. One can also have the unit on the terrace if there is no availability of backyard. The process involves converting the decomposable organic waste into compost with assistance from earth worms. Temperatures between 15°C to 25°C and due protection from the sun and rain are the minimum requirements for a vermi-compost unit.
Worm contribution

Unlike the heaps composted for a farm, vermi-compost unit for a home garden requires a concrete ring, 1.5 feet in height. It should be filled with pre-composted manure (largely dung manure dried for six months; commercially available), kitchen waste, dry leaves and such decomposable waste. However, the waste should not contain non-vegetarian particles, pebbles, or glass shards. After filling the ring, a kilogram of earth worms should be introduced for every square foot of waste. Earth worms too are commercially available and can be obtained from the Society too.

Once the worms are added, the compost should not be disturbed for 60 days, except for the daily sprinkling of water. Excessive watering should be avoided while ensuring that the mixture is slightly moist all the time. However, watering should be stopped a day before the completion of the prescribed gestation period. The odourless, coffee-powder-like compost in the top portion should be made into a heap for easy collection while leaving the wet portion for the earth worms to thrive in. The powder, mixed with soil in equal portions will work wonders with the plants.

Where there is not sufficient space for the elaborate procedure, one can directly introduce earthworms into the potted soil. In preparation for this, one has to loosen the soil and add dung manure to it.
Vermi-wash

One more method recommended by Mr. Rao involves preparation of vermi-wash. Primary requirement for this would be an ordinary barrel fixed with a faucet in the bottom and provision to place a pot of water in the top portion.

“The barrel should be filled upto six inches with pebbles, and a further six inches with sand for easy drainage of water. A Netlon mesh should separate the sand from the organic waste in the topmost chamber. A kilogram of earthworms should be introduced to the compost with inflow of water only drop by drop from the pot above. The compost should be allowed to rot for two months,” explains Mr. Rao.

After two months, the faucet fixed to the barrel will yield vermi-wash as yellow, sparkling liquid, while the top portion can be used as compost as usual. One part of vermi-wash sprayed along with two parts of water will be more effective than the compost itself.

The process may be continuously repeated once in every 45 days thereof.

Other forms of organic manure include oil cakes, which may be applied like any other manure, and leaf mould that involves gathering of dried leaves and sprinkling them regularly with water. Traditional composting technique involves mixture of manure, dried leaves and waste that gets decomposed in a trench.

Consumer courts can try construction service cases

2008-11-02T22:20:00.001-08:00

What if a builder refuses to register the flat after accepting advance amount? A recent verdict by A.P. State Consumers’ Disputes Redressal Commission (APSCDRC) assured that it is possible to hold the service provider respio in this kind of cases, if the victim has enough documentary evidence. It also clearly stated that construction services come under the jurisdiction of consumer courts.

According to the case, D. Vijaya Kumar, a resident of Abids, made a payment of Rs. 4 lakh to Sai Victory Constructions in August, 1997 as advance towards purchasing a flat in their residential complex at Himayatnagar. The total amount of the deal was Rs.10 lakh. However, Mr. Vijaya Kumar couldn’t get his flat registered and he later came to know that the flat was sold to a third party without his knowledge. He filed a case in Hyderabad District Forum-I in 2003, seeking the agreement to be executed or refund of his money with as interest of 24 per cent per annum, together with compensation of Rs.20,000 and court costs of Rs.10,000.

The respondents, Sai Victory Constructions, resisted the case and said the payment of Rs.4 lakh was never done to them. They also argued that this case doesn’t fall under consumer courts, but that of civil court, and prayed the dismissal of the complaint with court costs. The district forum saw that six years gap between the commencement of agreement and filing of case as a reason for disqualification and asked the complaint to file a civil suit. It dismissed the complaint.
Bank statements

Aggrieved by the decision, Mr. Vijaya Kumar appealed in the State Commission. He argued that registering the flat to a third party after receiving an amount more than 20 per cent of the deal as advance was against the A.P. Apartments (promotion of construction) Act. This time, he took care to furnish the detailed bank statements, which said that the banks had issued checks in favour of the Sai Victory Constructions. The company filed no evidence to disprove the bank statements.

The State Commission took this point into consideration and stated that company had entered into an agreement. It made two important observations at this juncture. It said that - a decision of National Commission reported in 2005 (2) CPR 1 (NC), holds that the problem will continue if the developer failed to give possession of property or refund the money and the transactions of flats or construction activity by builders come under the consumer affairs with an amendment inserted by Act 62 of 2002.It asked the builders to refund Rs.4 lakh with interest of 12 per cent per annum from August, 1997 to till date along with compensation of Rs.20,000 with court costs of Rs.5,000. Time for compliance was four weeks.

Get it right, from design to finish

2008-11-02T22:18:00.000-08:00

In the olden days, master craftsmen, called ‘Thachans’ or ‘Asaris,’ used to design and construct buildings. Without any formal engineering education, these highly-skilled carpenters used to design, fabricate and erect wooden floors and trusses for tiled roofs. Intricate roofs of huge temples and palaces, with ridges and valleys of complex shapes, reveal their skill. Fabricating and assembling the components of trusses is no easy task, especially wit hout accurate drawing tools.

The legendary ‘Thachans’ disappeared as concrete replaced timber in floors and roofs. With reinforced cement concrete (concrete with steel reinforcements), engineers design beams, slabs, columns and foundations. Essentially a civil engineer’s domain, building engineering is considered part of civil engineering.

This is true as long as the buildings are of up to three or four storeys. For designing and constructing high-rise buildings, civil engineering skill alone is not enough. A coordinated effort of specialists in diverse disciplines is needed to build high-rises. A specialist in one discipline should have more than elementary knowledge of others.
It begins here

The architect is the first to enter the scene. He prepares the conceptual plan, considering the functional requirements of the building and the owner’s preferences. While planning the building layout, he or she must make provisions for electrical systems, plumbing, air-conditioning, fire-fighting, water supply, sewage treatment and lifts. The limitations likely to be imposed by the structural designer should be kept in mind.

The architectural design must conform to building rules. If it violates any statutory requirement and consequently, the building owner suffers a loss, the architect is liable to compensate him or her. So, the architect should know more than just architecture.

Specialists in other disciplines, such as plumbing, electrical, fire- fighting and air-conditioning, will study the plan to ensure that requirements of their works are taken care of. The plan then goes to the structural engineer for the design of the structure.
Crucial survey

The geo-technical engineer comes on the scene before or when the architect and other specialists work on the building design. He or she conducts a soil survey and studies the soil properties, determines the load-carrying capacity of the soil and suggests the type of foundation suitable for the structure.

The survey findings are important for the architect to decide the number of floors below the ground level for cellar, car park, underground tanks and so on and to determine the type of waterproofing below.

Experts in several disciplines thus work together to finalise the design. When the construction starts, services of other experts become necessary.

Before commencement of any activity on the site, several permits and approvals from various departments are required. Some of them, such as the building permit to construct the building on the site and registration as principal employer, are legal. Some others, such as environmental clearance, are techno-legal. The work on the field starts with the survey to mark the location of the building on the ground. This is called ‘setting out.’

Earlier, skilled masons used to set out the buildings using just a tape and a transparent hose. Today, sophisticated instruments, such as ‘Total Station,’ are used.

The surveyor is required not only for initial marking but also till the structure is complete to locate the columns on each floor. After the survey, agencies for executing each package of work start their work in the predetermined sequence.
Packages

Usually, the entire work is divided into the following packages:

• Piling, if the building is supported on piles

• Civil works consisting of earthwork, concrete, masonry, plastering, flooring, painting, doors and windows, hand rails, structural steel, false ceiling, and internal roads and drains

• Waterproofing: this may be a separate package if special waterproofing for underground cellars and car park are required. Otherwise, waterproofing of exposed slabs, toilets and balconies may be included in the package for civil work.

• Special finishes such as structural glazing and aluminium composite panels

• Plumbing and sanitary work

• Electrical work

• Fire-fighting

• Water, sewage treatment

• Lifts

• Security systems

• Communication system

• Centralised cooking gas distribution system

• Swimming pools

• Landscaping
Assigning work

The entire work may be entrusted to one executing agency, which will make the owner’s task of monitoring easier because he need deal with only one agency. But the disadvantage is the increased cost.

No agency has in-house wings for executing all the packages. So, work which cannot be executed in-house will be sub-contracted. The owner will end up paying the cost of execution by the sub-contractor and the margin on that to the nodal agency.

A high level of mechanisation is unavoidable in a major project. Machinery, such as batching plant, concrete pump, tower cranes and slip form shuttering, is expensive. Engineers and technicians familiar with operation and maintenance of these machines should be available on the site.

The works are inter-linked and inter-dependent. One agency can do its work only if the other completes its tasks. For example, the civil works contractor can cast a slab only after the electrical contractor lays concealed conduits. The electrical contractor can continue his work only after the civil contractor completes the slab and masonry.

Planning and scheduling the myriad activities is a complex job. Planning has become a special discipline by itself. Planning must take into account the limitations, such as availability of space, restrictions in movement of lorries, restrictions in working beyond normal working hours and fund flow.

Monitoring the progress is equally complex. Services of planning engineers conversant with the latest software are as essential as the services of civil, electrical and mechanical engineers.

Quality control and safety are other important functions in project implementation. It is a desirable practice to have these departments function independently and directly under the top management.

Materials management in construction project requires special skills for two reasons. One is that materials purchased for one project may not be required in another. Even if it can be used, transporting it to another site will be expensive. Hence, the estimate of materials has to be accurate. Also, because of the restrictions in storage space, supply must come in phases and in time.

This requires close and continuous monitoring. Finance and cost control is another area requiring an expert’s service.

During the construction, several labour laws have to be complied with. Compliance with statutory requirements and keeping records is another specialised job and non-compliance might invite punitive action.
Team work

Thus, implementation of a modern building project requires team work by professionals in various fields. Managing these professionals is a demanding and difficult job.

According to Peter Drucker, management expert, managing professionals is the most difficult job of a leader. This is because a professional usually respects only a more competent professional in the same subject.

He has scant regard for the work of others. So, the leader should have special skill to persuade the professionals to work as a team focussed on the ultimate goal of the organisation. Building engineering is, thus, a multidisciplinary specialty, and in fact, implementation of a building project is more than engineers’ job.

S.R.C. NAYAR

82 house sites distributed to the poor

2008-11-01T12:05:00.000-07:00

Bhimavaram: Grandhi Srinivas MLA, Bhimavaram has distributed 82 house sites to poor beneficiaries at Gunupudi Township under Indiramma housing scheme today.

Speaking on the occasion local MLA Srinivas said that the Congress government had commuted for the welfare of the poor and weaker sections by grounding various welfare schemes like Arogyasri, , Pavalavaddi scheme to SHGS. He said that the Township would consist of 580 Indiramma houses and they would be inaugurated byChief Minister Y.S. Rajasekhara Reddy, soon.

He has vehemently criticised that during TDP regime the welfare of poor and weaker sections were utterly neglected. G. Srinivas MLA said that another 9,000 houses under Indiramma Housing Massive Programme would be constructed.

70 lakh houses sanctioned in State, says Minister

2008-11-01T12:02:00.000-07:00

KADAPA: The State government is committed to the welfare of poorer sections and has sanctioned 70 lakh houses and 71,000 pensions in the State, Minister for Medical Education Galla Aruna Kumari said on Friday.

Speaking after the inaugural of Indiramma Sambaralu in Kadapa municipal stadium, she said the government constructed 19,000 pucca houses in Kadapa city the last year as against 4,732 houses built between 1982 and 2004. It sanctioned 17,814 pensions in the corresponding period in addition to 6,000 existing ones. The government was implementing innovative schemes such as Rajiv Arogyasri, which were not among the election promises, and spent Rs. 370 crore for 1.40 lakh surgeries performed in corporate hospitals in the last one-and-half years, the Minister said. One hundred and forty speech and hearing impaired children were operated upon at a cost of Rs. 6 lakh each. House site pattas would be issued to 16,000 poor persons in Kadapa at a cost of Rs. 6 crore. The Minister lauded Kadapa Mayor P. Ravindranath Reddy for supplying bricks out of his personal contribution of Rs. 8 lakh. She urged the public representatives to extend their support in a similar manner. Chief Minister Y.S. Rajasekhara Reddy has developed Kadapa into a model town in Rayalaseema region, she said. Mr. Ravindranath Reddy, who presided, said housing and pensions were being sanctioned to all eligible beneficiaries irrespective of political affiliation, caste and religious considerations. Women were being given Pavala vaddi loans of Rs. 18 crore in order to ensure their empowerment, he said.

Rs. 550-crores for housing in city: Raghuveera Reddy

2008-11-01T11:58:00.000-07:00

The State government will spend Rs. 550-crores to provide housing for 31,000 eligible families in the city under Jawaharlal Nehru National Urban Renewal Mission (JNNURM), said Minister for Agriculture N. Raghuveera Reddy on Friday.

The Minister inaugurated two blocks, of 32 houses each, constructed under the scheme at Radhanagar in Kundavari Kandrika. The Minister, along with MP Lagadapati Rajagopal, Kankipadu MLA Devineni Rajasekhar (Nehru), Mayor Mallika Begum and Deputy Mayor Samanthapudi Narasaraju, participated in the house-warming ceremony (boiling of milk until it boils over) in a few new dwellings.

Mr. Reddy said “development and prosperity will swell up in the lives of poor in the way milk boils over.” He said it was no more the privilege of the rich to look down from multi-storeyed buildings. Even the poor would be able to live in apartment buildings. For a token amount of Rs. 5,000 from the beneficiary, the State government was giving them a house worth Rs. 5 lakhs.

‘No right to talk’

Describing the erstwhile Telugu Desam Government as a “non-performer”, Mr. Reddy said leaders of the TDP, who relegated the ideals of a great leader like NTR to the dustbin, had no right to talk. The party had failed to perform in its nine-year rule, but was now promising to give the people everything free. “If they say one word against us, they should be prepared to hear a hundred words in reply,” Mr. Reddy said. Mr. Rajasekhar said TDP leaders were trying to kick up a racket, but no other chief Minister could extend welfare and development to the people like Y.S. Rajasekhara Reddy.

The Minister earlier laid a foundation stone in Pathapadu village for several infrastructure schemes that would be taken up by the Vijayawada Municipal Corporation at an estimated cost of Rs. 1 crore in compensation for dumping of solid waste in the village limits. The Minister also inaugurated a 1,500-KL water tank constructed at a cost of Rs. 93 lakhs in Ajit Singh Nagar and laid the foundation stone for a cement concrete road in Kundavari Kandrika and Vambay Colony.

Court directs registry to list case

2008-10-31T10:54:00.001-07:00

HYDERABAD: A Division Bench of the A.P. High Court comprising Chief Justice A. R. Dave and Justice R. Subhash Reddy on Thursday directed the registry to list the case challenging the validity of G.O. Ms. 111 which prohibits development around drinking water lakes, before an appropriate Bench. The writ petition was filed by G.O. Ms. 111 Vyatireka Porata Committee and others. They contended that the G.O. prohibits development activity within 10 km radius of Osmansagar and Himayatsagar lakes.

They complained that the officers issued notices to people in the name of implementing the G.O. pursuant to the petition filed by Jeevananda Reddy for implementing the G.O.

They contended that the G.O. was illegal as it violated their right to property and life. The Bench felt that this case should to be listed to an appropriate Bench to hear such matters.

Minister unveils Hinduja’s project

2008-10-31T10:53:00.001-07:00

HYDERABAD: The automotive park coming up at Toopran mandal in Medak will not only change the face of the district, but pave way for the State emerging as automotive hub in future, said Minister for Major Industries, Sugar, Commerce and Export Promotion J. Geetha Reddy here on Thursday.

After unveiling the plaque of the new foundry project, she said the 250-acre automotive park at Kallakal village will have 34 units, including the prestigious 60-acre Hinduja Foundries, which already has a unit in Uppal here. It will produce cylinder-heads and blocks.

The automotive park would bring in investment of Rs.2,000 crore in addition to MLR Group’s investment of Rs.1,200 crores and with a potential for generating 15,000 jobs. The Hinduja Foundry alone would provide employment for 500 youth.

The company would be setting up an Industrial Training Centre at Mukkireddipalle to train local youth.
Vital for growth

Hinduja Foundries Managing Director Mahadevan said that Foundry was important for growth of automotive sector and their Toopran unit would make most sophisticated castings, especially cylinder blocks and cylinder heads, on a par with global standards and meet 30 per cent requirements of the tractor industry and also cater to light commercial vehicles and export segment.

The Rs.150-crore foundry would be ready by 2010-11 with a production capacity of 48,000 tonnes per annum.

Residential workshop

2008-10-31T10:51:00.000-07:00

A residential workshop for film society organisers and activists will be held at Karimnagar on Nov. 8 and 9. Details can be had from Vizag Film Society joint secretary P.V. Ramana on phone No. 2720089.

Property tax date extended

2008-10-31T10:50:00.000-07:00

Property taxpayers of GHMC are informed that the last date for payment of the tax without penalty on the current year demand has been further extended to December 31. Citizens have been told to make use of the opportunity. Penalty will be levied on tax arrears only.

GHMC urges R&B, NHAI to take up road repairs

2008-10-31T01:38:00.000-07:00

HYDERABAD: The GHMC has urged authorities of State and National Highways to take up repairs of damaged road stretches in their respective jurisdiction immediately as the former too had targeted December-end for re-carpeting all its roads.

GHMC Commissioner S. P. Singh made the request during a coordination meeting convened with senior officials of the State and National Highways on Thursday. It was pointed out that 190-km long roads under the control of the municipal corporation and about 45-km long roads belonging to the R&B and the National Highways were in bad shape.

Mr. Singh while impressing upon them the need to expedite the works immediately said he would also be taking up the issue with the Principal Secretary (Transport). Senior engineering officials and others attended the meeting.
Storm water drains

The Commissioner also held an interactive session with experts in engineering, town planning, urban planning, architectural consultants and NGOs to seek their suggestions for developing an integrated storm water drainage project.

The city’s catchment area has been divided into 16 drainage basins and the total length of storm water drains is estimated to be 625 km, a press release said.
Project report

A detailed project report was prepared by a private agency -- Voyants Solutions Pvt. Ltd., to take up widening and deepening of nalas along with restoration and renovation of all existing tanks besides floodwater management for each tank, said Engineering chief Dr. P. Panduranga Rao.

Iran to fund Rs. 200-cr. heritage project

2008-10-31T01:32:00.000-07:00

HYDERABAD: The Government of Iran will fund a Rs. 200-crore project at Hyderabad to develop seven famous tombs of the Nizam period as also Premamati Mosque and Badshahi Ashur Khana as sites of heritage and culture.

Iran has chosen these structures for its project as all of them were said to have been constructed under the supervision of architects brought from Iran at that time.

Deputy Foreign Minister of Iran Syed Mohd. Ali Shaeedi told reporters after discussions with Minister for Minorities Welfare Mohd. Ali Shabbir here on Thursday, that the proposal for the project was lying with the Centre and sought the AP government’s intervention to facilitate its clearance at the earliest.
Ancient ties

Mr. Shaeedi said Iran’s ties with India dated back to thousands of years and it had several connections with Hyderabad in particular.

The first consulate in Hyderabad was established by Iran 38 years ago. “Iranian families here are happy with the Hyderabadi hospitality.”

He said: “Our love for India is such that when India is developed, we feel our own country is developed. We always want to strengthen our age-old ties with India. To achieve this goal, the Iranian President visited New Delhi six months ago.”
Exchanges

Mr. Shaeedi offered to facilitate exchange of visits of teams from both nations, saying this would facilitate signing of MoUs, covering different areas.

Mr. Shabbir said there were 5,000 Iranians in Hyderabad at present while another 2,000 students from that country were pursuing studies in various Indian universities.

Maytas bags award

2008-10-30T08:13:00.000-07:00

HYDERABAD: Maytas Infra Ltd. has bagged the ‘Fastest-growing construction companies in India’ award. Maytas Infra is ranked first amongst several other participating construction companies in the large size category, according to a company release. The award is based on a study carried out by the leading magazine Construction World.

-Special Correspondent

Joint action to improve amenities

2008-10-30T08:12:00.000-07:00

HYDERABAD: The United Federation for Residents’ Welfare Association (UFERWAS-Alwal) is the saviour for the residents of Alwal and neighbouring areas. A unique initiative, which motivates residents to take a proactive role in the development of their area, UFERWAS-Alwal is just a month-and-a-half old. An affiliate of UFERWAS-GHMC, it is working towards the betterment of the civic amenities in entire Alwal zone comprising Alwal, Old Alwal, Venkatapuram, Bolarum, Yapral, etc.

The primary objective of UFERWAS is to bring together all independent resident welfare associations on a common platform and for collective action, says Ashwin Nalluri, Coordinator, UFERWAS-Alwal. As many as 93 welfare associations are part of UFERWAS in Alwal.

According to Mr. Ashwin, the problem areas are brought to the notice of the Federation during the monthly meetings. UFERWAS, in turn, brings them to the notice of the officials concerned of GHMC.

Each volunteer or member of the Federation is in charge of different cells such as Education, Sanitation and Health, Engineering (which covers roads and buildings), Town Planning, Horticulture, Senior Citizens Cell, etc.
Citizens apathetic

From handling mosquito menace to development of parks to checking the quality standards of eateries, the Federation is all set to solve its own share of problems. Though the GHMC has been responsive to the Federation, Mr. Ashwin feels that there is very little empathy from the residents themselves.

“Except a handful of people, citizens are generally apathetic and are not responsive. They attend the meetings only when they have a problem and don’t turn up to address others’ problems,” he says.
Interactions

Currently, the Federation initiates interactions between citizens and the police. Plans are also on to invite representatives from schools for the interactions.

For a federation just a month old, it’s already become a change-maker. UFERWAS-Alwal has brought to the notice the deplorable sewerage conditions near Tirumala Enclave located in Alwal.

GHMC Alwal immediately took notice of the conditions and initiated action to address the problems.

Probe into Faisal’s city connection

2008-10-30T08:11:00.000-07:00

HYDERABAD: The city police are investigating into terror suspect Faisal’s Hyderabad connection.

He was arrested recently in Kannur of Kerala on charge of recruiting youngsters for terrorist outfits.

Faisal, in his confessional statement, reportedly said that he had recruited youths from Malabar region of Kerala to work for terrorist modules and had sent them to places like Hyderabad for training. Faisal’s confession and connection to Hyderabad assumed importance because he admitted that Mohd. Fayas and Mohd. Fahis, who got killed in an encounter with police in Jammu and Kashmir few days ago, were recruited by him to work for terrorist organisations.
Fresh probe

According to police, Faisal maintained that he had sent the two youths to Hyderabad in September.

In the backdrop of Faisal’s startling disclosure, the city police began a fresh probe into training camps in or around Hyderabad organised by terrorist modules.

A team from Andhra Pradesh would leave for Kerala to question Faisal. All these days, police had information that youths only from Maharashtra, Karnataka and other north Indian States were involved in terror plots and network in Andhra Pradesh.
First time

For the first time, the alleged role of youngsters hailing from Kerala in Hyderabad terror network had come to the fore.

‘Scrap Maytas deal’

2008-10-30T08:04:00.000-07:00

HYDERABAD: The Citizens for a Better Public Transport in Hyderabad (CBPTH) has once again questioned several aspects of the Concession Agreement (CA) signed by the government with Maytas Metro Ltd., (MML) for building the elevated metro rail system in the city.

After perusing the CA document, it was “proved beyond doubt” that the project “promotes the interests of Maytas than public interest,” alleged CBPTH convener C. Ramachandraiah and others at a press conference on Wednesday. A CBPTH team had earlier studied the papers under the RTI Act few days ago.

The organisation maintained that the agreement should be “scrapped immediately” and the “issue of public transport should be debated.” Dr. Ramachandraiah pointed out that the GHMC alone stood to lose “hundreds of crores of rupees” in various taxes as no such levy was being imposed on the rail system. There was also no guarantee that more land would not be given to MML in future or if the estimated passengers per day (26.76 lakh a day) would fructify considering the poor record of Delhi Metro which was not even carrying 30 per cent of the projected commuters, he said.

The CBPTH felt there was a possibility of the lease period being extended due to lack of sufficient passengers and the scheduled completion date of March 2014 not being met.

Considering the delays in getting railways permission for various projects, it wondered if the plan of building an overhead metro line over the Secunderabad station would materialise when the SCR itself was proposing a world class facility.

The other issue faulted by CBPTH was that the government was not allowing a competing public transport system on metro rail corridors and agreeing for electricity tariff on commercial principles when the detailed project report prepared by Delhi Metro called for ‘no profit, no loss” basis.

On the threshold of vaastu

2008-10-26T08:03:00.001-07:00

Promising to set a new benchmark in ultra luxury living, Radha Realty has unveiled ‘U31’, a single-family, gated community project in the city. Spread over nine acres adjacent to Botanical Gardens, Kondapur, the project will have 31 limited-edition townhouses of which 19 will be courtyard houses and the rest designed as pavilion houses.

Each house is to come up on 1,250 sq.yd. with a built-up area of around 11,800 sft and designed by award-winning Australian architect Andrew Maynard. Surrounded by greenery and water streams, these four-storied homes boast of five bedrooms, private swimming pool, exotic interiors, a designer home entertainment room, private elevator, five car parking space, accommodation for up to eight domestic helpers and a bulk storage garage.

The unique feature of the project is that the entire garden ground level is to be car free zone with all vehicular movement restricted to the below podium level. A blend of historical and contemporary design, it draws inspiration from Charminar to come up with 31 unique and intricate design elements for incorporating in each of the unit.

N. Ravindranath Reddy, Managing Director, Radha Realty Corp describes the project as an ultimate statement of exclusivity .

Adds Amit Bagaria, chairman, Asipac group, “the houses are based on 7th century vaastu homes with a central courtyard. ”

Cut the coat... is the mantra now

2008-10-26T08:02:00.001-07:00

In the changing real estate scenario, the demand for properties in the price segment of Rs.30 lakh to Rs. 60 lakh was high but this segment also face a shortage of supply in the city. Contrary to this, there is an excess supply of properties costing above Rs.60 lakh. And this could reinforce the view that the year could end up as ushering in the concept of affordable housing.

The online real estate portal ‘makaan.com’ which has come out with property trends for the city, in its research publication notes this factor and points out that a high per cent of the property seekers are looking for properties in the range of less than Rs.60 lakh. “Over the past few years, all major developers have been focussing on higher end of the price band which now has fewer takers,” it says while stating that there is a huge oversupply of properties above Rs.1crore.
Movers & Shakers

Trends on property rates brought out by the portal record the prices rising in some areas while in others, they dipping a bit. It categorised Kandakuru, A.S. Rao Nagar, Habsiguda, Medchal, Motinagar, Tellapur and Thimmapur among others as ‘Movers’ that have recorded more than 8 per cent appreciation during the review period, that is June 2008 to August 2008. The ‘Shakers’, locations which have seen more than 6 per cent softening of prices, include Safilguda, Vijayawada highway, Venkatapuram and New Bowenpally.

On the rental front, the demand for rental properties is the maximum in Hyderabad followed by Secunderabad and Greater Hyderabad. And the demand also happens to be maximum from tenants willing to spend less than Rs.10,000 per month followed by the slab of Rs.10,000 to Rs.25,000 per month. A mismatch in demand and supply gets underscored in this aspect with the portal survey putting the supply of properties for rent of less than Rs.10,000 at only 25 per cent against 28 per cent supply of properties for rent in the range of Rs.10,000 to Rs.25,000.

“Due to rising property prices, house owners are increasingly finding it difficult to rent out their properties in the sub-40,000 budget as a result the supply of properties with rentals above Rs.40,000 is more than the demand for those properties in the market,” it says. As part of its nationwide series of events, the Makaan.com organised a two-day property show in the city last week. The show inaugurated by its Business Head Aditya Verma had 20 leading developers showcasing over 100 property options in the range of Rs.5 lakh to Rs.5 crore.

Terms of agreement a vital factor

2008-10-26T08:01:00.000-07:00

The rights and obligations of an owner and the tenant are determined as per the terms of the agreement they sign, says senior advocate K. Ravinder Reddi.

What options are available for an aggrieved party when the other refuses to honour a deal in matters of property? We are interested in a house that was up for sale and after negotiations settled for Rs.42 lakh. An advance of Rs.4 lakh was duly paid following a written agreement and it was then agreed that the rest would be paid within three months to close the deal and take occupancy.

The deadline is approaching and we are in the process of raising the necessary amount for the property. Meanwhile, the owner has contacted us and demanded that we pay Rs.3 lakh more than what was actually decided. Else, he wants to return the advance and sell it to others who are willing to pay Rs.45 lakh.

Since an agreement is in place and we are willing to honour it before the agreed date, can we approach the matter legally?

R.Rameshwara Rao.

You are entitled to seek specific performance of the agreement entered into with the owner. The terms of the agreement are important as they reflect the intention of the parties and duties and obligations of the respective parties. Since your question indicates with regard to the time of agreement, the other clauses of the agreement should also be examined for giving proper advice. The rights and obligations of the parties are determined as per the terms of the agreement.

Last year we had given the first floor of our home for rent to a family and an oral agreement was reached for an annual revision of the rental. The family has been nice to us and did not create any problems in this one year. But now, when we asked for a revision of the rental and sought to hike it by 5 per cent, they are refusing. They argue that nothing of that sort was agreed upon and that no agreement on paper exists.

Fact is that we did not enter into any written agreement and this is to our disadvantage. When we suggested that we have an agreement now, they are delaying it. As a landlord, can I now insist them on entering into a written agreement? Is there a way for me to seek a hike in the rental in absence of a written agreement?

Mohd.Yaseen

You did not mention the amount of rent and the age of the building.

The quantum of rent and age of the building are the criteria to approach appropriate forum in case of a dispute by the landlord. It is advisable to have a written agreement in respect of a tenancy since it binds both the parties with regard to the terms agreed upon.

In case of an oral agreement, it becomes word against word. You can demand the tenant to enter into an agreement. You are advised to consult a legal practitioner in solving your problem.

Dubious developers can be nailed

2008-10-26T07:58:00.000-07:00

Realtors should not forget that the consumer keeps a watchful eye, says K. Vijaya Bhaskara Reddy

With unprecedented rise in property prices, non-execution of sale deeds by real estate firms became a prevalent practice in recent years. Many of them are cancelling the agreements by citing reasons which could turn out to be dubious. This situation could be faced with the help of consumer courts and experiences of realty cases are showing that consumers can handle such frauds by being watchful. A case against Narne Estates Pvt. Ltd. provides some of the useful details in this regard.

O. Yella Reddy, a resident of Sainikpuri, bought a plot of 250 sq.yds. for Rs.27,000 in a project of Narne Estates in September, 1999. There was no mention of site development in project brochure or in allotment letter. He made the payment in monthly instalments, but couldn’t get his plot registered. Mr. Reddy shifted his residence from Musheerabad to Sainikpuri and informed the same to the company. After a long pause, he received a letter in February, 2006 saying that his deed was cancelled and the payment made by him was returned.The reason company showed for the cancellation was – Mr. Reddy failed to pay the instalments of development charges albeit continual correspondence from the company. After receiving this letter, Mr. Reddy tried to pay the development charges and also returned the cheque, but both were rejected by the company. His legal notice was firmly replied. Then, he filed a case in Hyderabad District Forum-I for registration of his plot . The company resisted the case. After considering the evidence, the district forum felt that the cancellation was an arbitrary decision and asked the company to register an alternative plot along with a compensation of Rs.50,000 and costs of Rs.2,000. It also asked Mr. Reddy to pay the development charges of Rs.42,550 along with registration charges. Not satisfied with the decision, Narne Estates challenged the verdict in A.P. State Consumer Disputes Redressal Commission (APSCDRC). It argued that there was a breach of contract on part of the consumer. The commission said - it was clear that Narne Estates notified Mr. Yella Reddy about the due of development charges from March 1996 to May 2004. But it sent all the letters to his old address despite notification of his present address. It also observed that while land rate was Rs.30,000, the development charges demanded was Rs.66,581.

At this point, Mr. Reddy submitted the photographs which showed there was no development whatsoever taking place, contrary to the claims of the company. With that, the commission stated that the company cannot collect the fee for the development which it hasn’t done. Mr. Reddy also got the information from HUDA that –nine alternative plots, which the company suggested to register at the time of case, didn’t have approval of HUDA.

With these evidences, the APSCRDC made a major modification in the verdict of district forum. It said allotting an alternative plot will not arise since there was no documentary evidence to show that the allotted plot was sold to a third party. It ordered that the same plot to be registered for Mr. Reddy and also damage charges of Rs.50,000. The time for compliance was four weeks.

Demand for residential properties slowing down in twin cities

2008-10-24T09:34:00.000-07:00

Hyderabad (PTI): The demand for residential properties in the twin cities of Hyderabad and Secunderabad has slowed down by 11 to 12 per cent as compared to the demand in June, a survey by an online real estate company revealed.

The demand for rental properties is maximum in Hyderabad (53 per cent), followed by Secunderabad (30 per cent) and Greater Hyderabad (17 per cent), Makaan.com's Business Head, Aditya Verma said after inaugurating a two-day property exhibition here.

The second such exhibition in Hyderabad showcases over 100-property options with properties, while displaying properties ranging from Rs. 5 lakhs to Rs 5 crores.

The company plans to host 15 such property shows across the country this year, Verma added.

On a query, Verma said they did a business of over Rs 30 crores last time around but were expecting the business to Rs 20 crores now.

Registration charges for women reduced

2008-10-24T09:33:00.000-07:00

HYDERABAD: The government on Thursday issued orders, reducing the registration charges collected on registration of properties by one per cent in case of women. Accordingly, the total registration charges payable by women hereafter will be only 8.5 per cent as against 9.5 per cent applicable to others.

— Special Correspondent

Workers seek minimum wages

2008-10-24T09:31:00.000-07:00

HYDERABAD: Hundreds of workers under the aegis of Centre of Indian Trade Unions (CITU) staged demonstrations in front of MRO offices in the city and suburbs on Thursday demanding the government to solve their problems pertaining to minimum wages, providing houses, ESI and PF facilities.

Workers squatted in front the offices and raised slogans against the government for its failure to solve problems being faced by them for the last few years.

Weaker section housing colony progress reviewed

2008-10-21T11:56:00.000-07:00

HYDERABAD: Kiran Dhingra, Secretary, Ministry of Housing and Urban Poverty Alleviation, along with PK Mohanty, Joint Secretary, Housing, inspected the progress of the weaker section housing colony at Abdullapurmet on the city outskirts here today. The Greater Hyderabad Municipal Corporation (GHMC) had taken up construction of over 20,000 houses for weaker sections at different places in the city under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), GHMC Commissioner S P Singh said.

The officials also visited several projects in the city taken up under the JNNURM scheme and reviewed their progress with the municipal administration officials. Later, they inspected the housing colony where 5,000 houses were nearing completion at Abdullapurmet near here and expressed satisfaction over the quality of construction.

As many as 25,000 people would live here and it was proposed to be inaugurated soon, he said.

Don’t pay ad fee to NEPL: GHMC

2008-10-21T11:55:00.000-07:00

HYDERABAD: GHMC Commissioner S P Singh today requested the public and owners of shops and other establishments located in the Greater Hyderabad Municipal Corporation (GHMC) limits not to pay any advertisement fee to M/s Nest Enterprises Private Limited (NEPL).

Singh said the NEPL was not entitled to collect or demand any amount towards advertisement fee either from shops or other establishments within the GHMC limits.

If any amount is paid to the NEPL or any agency other than the GHMC, the public will be doing so at its own risk. The GHMC would not be responsible for any consequences, the GHMC Commissioner added.

The NEPL had been authorised to collect advertisement fee from shop owners in the twin cities on behalf of the GHMC for a three-year contract period (2005-08). After the expiry of the contract on March 31, 2008, the GHMC had neither renewed the license nor given it to any other private agency, as the matter was pending in the AP High Court, Singh said. He appealed to the public to pay the advertisement fee as per the schedule of rates at any GHMC office or to authorised GHMC officials and demand an official receipt.

GIS project: GHMC to seek professional help

2008-10-21T11:54:00.000-07:00

The Greater Hyderabad Municipal Corporation (GHMC) has decided to seek the help of professional technocrats to complete its Geographical Information System (GIS) project.

A full time project leader and a part-time consultant are being recruited to take the project to its logical end besides verifying data collected and maps done by the six private agencies.A seven-member committee has been formed to select them and it has the Additional Commissioners of IT, Planning, Works and Finance.

Three outside experts from A.P. Forest Department, Hyderabad Metropolitan Water Supply and Sewerage Board (HMWSSB) and the Andhra Pradesh State Remote Sensing Application Centre (APSRAC) too have been drafted into the panel.

Taking professionals became imperative as GHMC’s own GIS cell has failed to do the job.

An internal note submitted to the Commissioner and Special Officer C.V.S.K. Sarma has pinpointed how the cell headed by a Chief Information Officer (now moved out) has blundered.

Damning report
“Nothing worthwhile has been delivered by them implies that the cell is in a perpetual hibernation and they are being paid wages for non-performance,” said the report in a damning indictment.

Arguing for reviving the project, the note said that there was “no regular and focused monitoring visible at any stage.”

“The contractors have been left free for themselves and we did not care to validate the data submitted” in July-Sept 2007.

The private agencies “should have completed the work in four months (December 2006) but till date no extension was given to them,” it further stated. Recalling that agency for ex-circle four had ‘vanished’, it said that “no efforts were made to penalise him” or another agency found. “We have been functioning as if there are only six circles and circle four had vanished!”

‘Common thread’
“GIS and IT are the common thread binding all sections of GHMC and mostly used by taxation, town planning and engineering sections. An officer with commitment…may be kept in charge of both initiatives in the interests” of the corporation, it added.

Inexplicably, the officer heading the GIS cell had been allowed to go scot-free, despite this indicting report, thanks to the benevolence of the top boss.

Occupational hazards, a factor to reckon with

2008-10-21T11:39:00.000-07:00

The construction industry boom can be seen in almost all the developing countries. The demand is high for supplies such as raw materials, builder hardware, paints, manpower and everything else related to construction. And India being rich in all the resources, it is but natural that the construction industry is the largest employment generation sector next to the agricultural sector.

Currently this sector employs around 30 million construction manpower (CMP) which is expected to grow up to 98 million by 2012, and similarly the market size is predicted to grow from 3,000 billion to 4,800 billion over the same period (source CIDC country report 2005-06).
New hazards

By its very nature, physical conditions at construction sites change radically every day if not every hour and new hazards surface continuously and pose safety and health-related risks to people engaged in work and to the general public living in the areas surrounding the construction site.

Though many hazards are recognised well in advance and precautions are taken against them during the course of operations, a delayed approach can be dangerous and as a result, accidents become inevitable.

The building sector mainly employs migratory, unskilled workers. Being a CMP-intensive sector, a large number of people are exposed to the risk of workplace incidents as there is no formal induction planned by the employers/organisations to train the people about the possible risks and hazards.
Burden on management

Every year thousands of construction workers are losing lives due to accidents at the workplace and many more are ending up with work-related injuries and occupational illnesses. This is a totally unacceptable human and social cost as well as heavy burden on the management. Poor safety and health conditions at work site reduce the employment potential of workers and weaken their competitiveness in our economy.

Generally whether in the past or in the present, be it at a construction site or in a factory or even for that matter at home, the importance of safety comes into play only after the damage / accident has occurred. However, prevention is better than cure, and so the industry should aim at creating safe working hours in a safer environment.

Effective management of worker safety and health protection is a decisive factor in reducing the extent and severity of work-related injuries and illnesses and their related costs. In fact, an effective safety and health management system forms the basis of good worker protection. This can save both time and money – two most valuable commodities in this fast-paced world.
Risk factors

With rapid urbanisation and boom in the building sector, construction is happening at a very rapid pace. Mainly the following activities pose a great risk to the workers and the general public in the nearby areas:

1. Blasting activities

2. Working at heights

3. Working with scaffolding

4. Heavy vehicle movement

5. Unskilled workers

6. Construction power utilisation.

7. Sociological effects

8. Environmental effects

9. Occupational Health effects
Ecological imbalance

Rapid urbanisation at times causes ecological imbalance. While creating good infrastructure, one should follow environmental friendly processes like rainwater harvesting, development of greenbelts, etc.

While mobilising huge labour force of the construction workers one needs to build temporary camps for their stay. Generally we do not see any hygiene in these camps and by virtue of this very lack of hygiene, epidemics spread and cause considerable nuisance in the adjoining areas. Also these epidemics can cause delays in the project schedule.

Providing proper living conditions to workers at camps would definitely increase morale of the workforce and result in better productivity.

Kotak, Sun-Apollo buy stakes in Janapriya projects

2008-10-21T11:36:00.000-07:00

At a time when equity and debt deals involving real estate companies are dwindling, realty-focused investment funds Kotak Realty Funds Group, or KRFG, and Sun-Apollo Ventures Llc. have bought stakes in two ventures of Janapriya Engineers Syndicate Ltd, a Hyderabad Real estate builder of affordable homes.KRFG, belonging to the Kotak Mahindra group, focuses on real estate investment opportunities with $800 million (Rs3,896 crore) of funds. Sun-Apollo is a joint venture between the Khemka business family and global real estate investor Apollo Real Estate Advisors with $630 million of funds. “Kotak Realty has picked up 50% holding in one of our special purpose vehicles Janapriya Projects coming up with an integrated township of 5 million sq. ft over 32 acres of land at Kapra in the outskirts of Hyderabad,” said K. Ravinder Reddy, chairman and managing director of Janapriya. Other deal terms were not disclosed. Construction at the Kapra project will begin in six months and will be completed over 36 months, resulting in an estimated valuation of around Rs1,000 crore on its completion, said Reddy. Janapriya has entered an arrangement with Kotak Realty, vesting the right of first refusal with the investor for equity stakes in new housing construction special purpose vehicles, or SPVs, of the Hyderabad firm with a cap of Rs350 crore on investment over the next five years, said Reddy.

Chaluvadi Srinivas, chief financial officer at the construction group, said it expects to announce two more township projects through SPVs in the next six months or so. Kotak Realty’s director of investments, Vikas Chimakurthy, said, his firm “found significant scope for growth in the low and medium housing construction sector”. A study by industry lobby Federation of Indian Chambers of Commerce and Industry and consulting firm Ernst and Young last month showed growing interest among real estate developers and private equity firms in affordable housing projects. Sun-Apollo has entered into an agreement with Janapriya to buy a majority holding in an SPV Janapriya Townships developing a township project at Madinaguda near Hyderabad’s new international airport at Shamshabad on the city’s outskirts. When contacted, a Sun-Apollo executive, who was involved in the Janapriya deal, confirmed its investment. This executive, who preferred anonymity, declined to reveal the terms.

Srinivas, Janapriya’s CFO, said Sun-Apollo had invested more than Rs75 crore for a more than 65% stake in the venture. The construction work on this project, with 1.5 million sq. ft of built-up area coming up over 14 acres of land, has begun and the project is expected to be completed over the next three months, said Janapriya executive director K. Kranti Kiran Reddy. “Though several private equity firms had shown keen interest in picking up stakes in the company at the enterprise level, we did not favour it since it involved significant transaction costs for transferring some of the unattractive lands and properties to other group companies,” he said. Janapriya, which has built 21,000 homes and at least 20 million sq. ft of residential and commercial spaces over the last two decades in Hyderabad and Bangalore, says it has a land bank of around 120 acres in the two cities valued at Rs656 crore. It also has an additional 100 acres of land in these two cities valued at around Rs537 crore under joint development agreements.

Townships have no land

2008-10-17T21:30:00.001-07:00

Twenty-two satellite townships planned to be set up around the Outer Ring Road have remained on paper three years after the erstwhile Hyderabad Urban Development Authority announced them. The reasons are said to be many: Slump in the real estate market; problems in land acquisition and widespread agitations by farmers and political parties.Efforts by the government to rope in private parties and get the townships started in the public private partnership mode also fell through, with real estate giants keeping away. The HMDA, the successor of Huda, tried its best to raise money by auctioning land but builders and developers stayed away.

The townships were planned at Medchal, Goudavelli, Dommara Pochampally, Bowrampet, Aliyapur, Sultanpur, Khardanur, Paatighanpur, Edulanagulapalli, Kollur, Balapur, Nadargul, Thorrur, Munaganuru, Kuntluru, Korremul, Rampalli, Cheryala, Dharmaram and Shamirpet. With land owners, particularly farmers, objecting to land acquisition by the HMDA, the officials announced a change in some sites. The new sites are at Mankhal, Adibatla, Raviryal, Srinagar, Turka-yamjal, Injapur, Tellapur and Gacchibowli where the government has acquired about 3,000 acres of land.

Work was supposed to start on these projects within six months after they were announced but not a brick has been set till date. The government announced that it will come up with a township policy which would propose handsome compensation to land owners, particularly farmers, from the benefits to be accrued out of township projects."The government is sitting on the policy. Unless the government announces the policy, townships cannot be started," sources said. Mr Sridhar Chitturi, officer on special duty (OSD), on the Outer Ring Road, HMDA, told this correspondent that it would be feasible to start work on townships after the new policy is announced. According to him, the policy is likely to offer land owners 50 per cent share in the benefits accruing from townships.

HMDA to sell 82 more plots

2008-10-17T21:29:00.001-07:00

Unperturbed by the poor response to its earlier auction drives, the Hyderabad Metropolitan Development Authority is preparing for a fresh round of auctions. This time the HMDA has decided to auction a few more sites along with those which were not bought earlier. In September, the HMDA put up as many as 99 plots for e-auction of which tenders only 17 were finalised.

Now, HMDA is planning to sell 82 plots, including some new plots. The new sites have been added to the list as a special attraction to woo builders and developers who have not been evincing keen interest in investing in real estate sector off late. Plots up for grabs are located at Nandgiri Hills layout, Asifnagar new layout, Huda Techno Enclave, Madhapur (SectorI), Ramchandrapuram (chandanagar), Tellapur Residential Complex, Nallagandla Residential Complex, Vansthalipuram Residential Complex, Miyapur Residential Complex, Asifnagar(old) Residential complex and Mushk Mahal Residential Complex.

“This time we are adding additional infrastructure features to the land area and auctioning those plots so that people can apply tenders in large numbers. Earlier, plots were auctioned without any infrastructure specifications which yielded a very poor response. The formalities of on-line auctioning will be completed in two days before opening on-line auction in the coming week.

R-Infra plans Rs 2,500-cr debt mop-up

2008-10-17T21:28:00.000-07:00

Anil Ambani-controlled Reliance Infrastructure (R-Infra) plans to raise Rs 2,500 crore as loan in this financial year for a real estate project in Hyderabad, a railway line linking Delhi airport and the city and for road projects across the country.The company is in talks with a slew of banks, including IDBI Bank, IIFCL and Axis Bank, for raising the fund at a time when credit crunch has put pressure on interest rates."The company has a healthy balance sheet with a cash reserve of Rs 10,000 crore, which could help raise 80 per cent of the debt for projects at the special purpose vehicle (SPV) level. Considering the situation, the interest would be slightly higher for the loan, but for us, it is not the concern. Our focus is to execute projects before the time," Lalit Jalan, the chief executive officer and director of R-Infra, told Business Standard.

The company plans to achieve financial closure for its Delhi airport rail-link project and the Hyderabad trade tower project before December this year, while the Parbati-Koldam transmission project will take three months for tying up funds.The company, formerly known as Reliance Energy, requires Rs 30,000 crore in the next five years for execution of its ongoing projects.R-Infra's nine projects, including roads, a metro rail and real estate projects, will require Rs 16,000 crore, while power transmission and engineering, procurement and construction (EPC) projects will need Rs 9,000 crore. Power distribution projects will require about Rs 5,000 crore, said Jalan.

R-Infra has Rs 5,400 crore in debt at present, including external commercial borrowings (ECBs) of Rs 3,500 crore.The company has invested Rs 5,000 crore of its total Rs 10,000-crore reserves in inter-corporate deposits (ICDs). It has also parked about Rs 4,000 crore in overseas assets, while the remaining Rs 1,000 crore is invested in domestic ICDs and fixed maturity plans, said Jalan.Through a buyback of its shares, the promoter has so far increased its stake in the company to 36.5 per cent at an investment of Rs 650 crore. It still has Rs 150 crore at its disposal to buy back more shares. "We have already got the shareholders' approval to invest Rs 1,200 crore for the second round of buyback," said Jalan.

This is ‘real’ estate, no place for sentiment

2008-10-17T21:27:00.000-07:00

The real estate prices that soared in and around Visakhapatnam, spurred by the Telangana sentiment two years ago, have more or less stagnated.

After the 2004 general elections, the State began promoting Visakhapatnam as Tier Two IT destination. The Pharma City, Brandix Apparel city and IT SEZs have spurred demand. But then, after peaking till about a year ago, it plateaud.

The Visakhapatnam Urban Development Authority has focused on the Madhurawada area, the IT hub. Though a number of big names in the real estate have bought land in VUDA's auctions, no significant development has been taken up.

"Had that taken place, the demand would be on," says K. Subba Raju, president of Apartment Builders' Association. Industry-watchers admit that Telangana sentiment did jack prices in Vizag, but the progress has not kept pace with the projections.

"Now the natural strengths of the area for development of software isplaying a major role ," says N.C. Saran, Director of SatyaVani Projects and Consultants Pvt Ltd.

G. V. PRASADA SARMA
Visakhapatnam

The issue of Telangana, whenever it took centrestage in last few years, has sent the real estate into a tizzy. From a mere pronouncement of the issue to electoral battles fought over it, the subject ended up casting shadows of worry on the industry. Animated debates on the possible effects have been doing the rounds ever since.

However, now though the political scene is warming up to a protracted electoral battle and Telugu Desam Party came out with its stand on Telangana, the real estate industry is no longer interested in the matter. Its cup of woes is brimming, what with near stagnation in the growth and happenings in far-off US creating troubles here.

Developers and builders admit that the Telangana issue was not worrying them as it did earlier. The property prices, which had boomed , have stabilised to a large extent . “Speculators have dried up from the market and only genuine home buyers are left, so these issues are not going to matter much,” avers Anand Reddy, PBEL Executive Director.

Earlier, a small statement from TRS would send the industry into jitters but now even the TDP’s major decision on Telangana fails to have an effect, he adds.

“If the industry was in boom phase, it would have mattered. But already we are in trouble and this is not going to affect us any further,” says C. Prabhakar Rao, president, Greater Hyderabad Builders Federation President.

Unrealistic growth and lack of fundamentals propelled the boom but its effects were being felt now. “There was a time when the T-factor would shake us badly, but not now. The real estate is already faced with difficult time,” he says.

Biotechnology to drive office space market

2008-10-14T12:07:00.000-07:00

Yet again, another growing sector in the country will push the demand for commercial real estate northwards. This time, it is the biotechnology industry, which is expected to contribute approximately 140 million square feet to the office demand within India by 2010 as per a recent study by Cushman & Wakefield. Even though the country currently holds a minimal market share of 2 per cent of the global biotechnology market, it has immense potential to develop as one of the major players by 2010 and is expected to generate US$ 5 billion in revenue, creating employment for one million people by 2010 through its products as well as services.

Bangalore, Hyderabad, Chennai, Pune and Mumbai are being seen as emerging destinations for the setting up of biotech facilities and scored considerably high on the parameters with each city having distinct fundamentals/ factors driving the growth.

The study conducted by Cushman & Wakefield across 40 cities in India to evaluate the top 15 locations which have or would witness growth in the biotechnology sector was based on various parameters related to three crucial factors that affect the industry viz. investment environment, social and physical infrastructure as well as polices and framework. These cities hold a proven potential and have sustained the confidence of corporate entities operating under the sector. They offer better infrastructural facilities and a talent pool, the two most important factors in setting up a biotech facility.

Sanjay Dutt and Anurag Mathur, Joint Managing Directors, Cushman & Wakefield India said, “The biotech story is still in its infancy in India, but it appears poised to witness a successful replication of the IT/ITeS precedent. The location preference is also following a similar trend as in IT with most of the biotechnology activities currently concentrated in southern India; however, a strong momentum towards western and northern India is anticipated.”

In addition to these emerging cities, there are a number of locations that have the potential to grow in this sector like Indore, Banasthali, Alwar, Sotanala, Shimla, Bhopal and Silliguri. Although some of these cities have not witnessed much development in the past, there have been proposed physical infrastructure initiatives in the form of biotech parks and SEZs as well as policies that have been proposed or implemented to improve the location advantage.

The biotechnology sector in India has grown exponentially over the last few years with the market size reaching INR 85 billion (US$ 2.08 billion) in 2006-07 and revenues registering a growth of 31 per cent over last year. To cater to this burgeoning demand from the biotech sector (that is expected to be an integral part of the next boom in India), there have been a considerable amount of investments and infrastructural developments during the last few years.

At present there are six operational biotech parks in India and another 27 are proposed across the country. The highest number of planned biotech parks is in Gujarat followed by Tamil Nadu, Andhra Pradesh, Rajasthan and Karnataka. In addition, there are 24 approved biotech and allied SEZs being planned that will spread across the country covering a total area of approximately 1,043 acres. Maharashtra has the highest number of SEZs approved followed by Karnataka.

Slump in IT sector hits ‘real’ hard

2008-10-14T12:02:00.000-07:00

It has started. And it could end up lingering for a while much to the chagrin of many. The much talked about IT slowdown has begun and the recent financial crisis in the global markets has only made matters worse. And one sector that looks at the developments with a certain degree of apprehension is the real estate sector.

The sector which received a push from the IT boom in the country could also feel the heat from the sudden slowdown. Young IT techies and executives are no longer looking at investing in real estate. For many youngsters, luxury villas and duplex apartments now seem like a distant dream.
Wait and watch policy

Sumeet Sharma and his wife Spoorthi have dropped plans to buy a duplex on the city outskirts. “Right now, our first priority is to make sure that we don’t get laid off,” says Sumeet who works in the IT sector. “We were planning to avail home loan for a duplex apartment, but with interest rates fluctuating so wildly, we decided to wait and watch,” adds Spoorthi.

“The slowdown has suddenly made everyone from a fresher to someone in the managerial level insecure,” says Rajesh Kumar, project leader in an IT firm. Major investment decisions are being withheld as the first priority right now is to make sure you don’t lose your job, he adds.

Others like Brijesh Kumar and M. Aditya feel that the inflated land prices along with property rate have never been within the reach of a middle class person. “True that a large percentage of IT employees invest in real estate, but then a major chunk of the same sector also belongs to the middle class. It’s only the mid-career employees who even dare to invest in real estate,” says Brijesh, who has been working for a top US based IT company since four years.

The overall mood in the IT sector is that of apprehension. “Every week someone or the other I know is losing his/her job. And companies have stopped recruiting too, so right now all that I am want is financial security and stability,” says Srikanth Parthasarthy, a programmer.

So, does the slowdown in IT sector mean that the prices of property would fall? “It is true that the slowdown has affected the real estate sector in the city, but it doesn’t mean that the property rates will fall,” says B.V.P. Raju, CEO, ‘ www.ghar4u.com’, a city based real estate portal. “Over 40 per cent of buyers are IT professionals; the slowdown will have an impact on the real estate scenario. The natural reaction is to defer investment decisions in property, retail shopping and other goods,” he adds.

According to him, the rising construction and labour costs will discourage the builder to reduce the property costs. Inflated land prices are also one of the prime reasons for inability to reduce the rates. “Why would a land owner sell his land for a lesser price? Need has to be the only reason,” he adds.

Varun Naidu, who works for a construction company says that projects stalling is the biggest fear facing builders. “We are finding it hard to convince people to invest in property now,” he says. “Projects stalling mean that the supply goes down. And in real estate there is always a latent demand for housing”, adds Raju.

With the salaries in other sector considerably going up, like in Biotech and Civil, builders and real estate agents hope that these sectors would come to their rescue. But the fact remains that the slump in IT could end up leaving builders high and dry, force many to shift their focus from high end luxury houses to affordable housing that is within the reach of the vast middle class.

Reliance Infra plans to raise funds in phases

2008-10-14T12:01:00.001-07:00

In a tight credit market where real estate developers are scurrying for funds to launch their projects on time, Reliance Infrastructure Ltd plans to raise funds in multiple rounds for its 100-storeyed trade tower and business district project on the outskirts of Hyderabad. A new player in real estate, Reliance Infrastructure, part of the Reliance-Anil Dhirubhai Ambani Group, needs about Rs4,000 crore in the first phase to pull off a large part of the project, which will be executed at a cumulative cost of Rs8,000 crore in the next three-five years.“We will have to raise the money in two-three phases from banks, though we intend to develop the project in one go,” said a senior official of Reliance Infrastructure in charge of the Hyderabad project, who is not authorized to speak to the press. Last November, Reliance Infra, which is a two-thirds partner in the project that is to be implemented through a special purpose vehicle (SPV), won the bid. The other stakeholders in the venture are Bangalore-based Sobha Developers Ltd (technical partners) and Andhra Pradesh Industrial Development Corp.

with 23% and 11% stake, respectively. The project is the business group’s first venture into the real estate, with the second being a mixed-use project planned on about 220 acres, which it got by winning the contract to build a metro rail line between the New Delhi railway station and the international airport. Considering the current market downturn, the SPV has decided to lease, rather than sell, the tower, which will be the central attraction in the 77-acre project. “Leasing out space is much more flexible when property prices are on a downward slope and you don’t relinquish ownership rights. However, we will lease out the space in phases in the next few years,” said the same official. With capital values per square foot touching Rs6,000, building residences in the tower has been ruled out. Hospitality and commercial office space will be built instead. Construction costs will also double from the 60th floor upwards. These will be resistant to high wind velocity. Superior quality of steel is required to construct such buildings.

However, 10 months after winning the bid, construction is yet to start and the project is still at the planning stage finalizing the design and appointing project consultants. There is no hint at when construction will take off. An August office space report by Cushman and Wakefield Inc., a property advisory firm, said Hyderabad witnessed fresh office space supply of 755,000 sq. ft in the second quarter, about 12.5% of the expected 6 million sq. ft supply this year. Deferred pre-commitments, primarily attributed to supply overleaping absorption during the quarter, indicated a situation of oversupply. Though vacancy rates in the city have been low, there are areas with large unleased concentration of grade B stock of office space, the report said. Pawan Swamy, managing director (markets) of Jones Lang LaSalle Meghraj, a property consultancy firm, said, “Hyderabad will be over-built in the next six-eight months with a lot of fresh supply coming in. Though leasing offers better returns, selling is easier in the current market. Only developers who can hold on to their properties can afford to lease out space, but the good part is that the value of a property is higher after you lease it.” “It is a challenge to put up 4 million sq. ft of space for lease in the current market situation because of a demand-supply disbalance. Hyderabad is also going to face a problem of over-supply soon, with a lot of development happening,” said Santosh Martin, chief executive officer of Bangalore-based Divyasree Developers Pvt. Ltd, which is primarily into office space and has a hospitality venture coming up in Hyderabad.

Pre-EMI interest waiver lures buyers

2008-10-14T11:55:00.000-07:00

Several builders in the city are coming forward with ‘pre-EMI interest waiver’ schemes to attract buyers and to beat the glut in housing sector. Usually, once the bank disburses the loan, the pre-EMI interest has to be borne by the customer. This adds to the financial burden of the customer who may already be paying a high rent for the place where he is staying. Builders are now volunteering to pay the pre-EMI interest on behalf of the customer till he or she possesses the flat. The EMI payment of the customer starts after possession. With sales of flats decreasing and prices showing little signs of cooling down, many builders such as Manjeera Constructions, Indu Projects, Aliens Groups and Parsvnath are offering such schemes to boost sales.

They have tied-up with banks such as ICICI, HDFC, IDBI, Axis Bank and Birla Home Finance for this. “Of the three categories--Rs 40 lakh and below, Rs 40 lakh to Rs 1crore and Rs 1 crore and above--the middle category is the hardest hit,” says Mr Yoganand, chairman and managing director of Manjeera Constructions Ltd. “We are concentrating on this sector.” He adds that the firm was giving customers of this category a two-year pre-EMI interest holiday. “With this, they can book the flat just by paying 15 per cent of the amount and take a bank loan for the remaining 85 per cent,” he adds. “And for the first two years they need not pay pre-EMI interest. After two years, when they get the property, they can start paying their EMI straightaway.”

Builders say such schemes have pushed their sales up by 10 per cent to 25 per cent and are also enabling them to finish projects at a faster pace. Buyers are also finding it attractive since interest rates of housing loans have risen to 12 percent from the earlier seven percent. “This will help reduce the burden on customers,” says Mr D. Kiran Kumar, marketing manager of Parsvnath Developers.

The penchant for things of the past

2008-10-14T11:50:00.000-07:00

Plush sofas, innovative lighting system, steel furniture, glass doors and many other interior design objects have hit the markets. But when it comes to giving that classic and appealing look to a house, office or even a hotel perhaps, nothing comes in as handy as those good old and antique items.

But finding an old item or an authentic antique piece in twin cities is not as easy as signing an interior designer to decorate your house. This is where Moghal Arts Decoration House at Banjara Hills Road No. 1 caters to your needs.

Be it wall clocks, porcelain articles, chandeliers, coins, old photographs, furniture, wooden chest and above all gramophones and records, a visit to this small shop on the ever busy Banjara Hills gives one the pleasure of making a journey into the past.

“We have been in this business since three decades and have lots of collection, particularly different furniture, cupboards and gramophones. Our source of collection are the nawabs, jagirdars, tahsildars and other eminent families in twin cities and surrounding districts,” says Mirza Azhar Ali Baig, owner of the shop.
Range and rate

While the clocks collection date back to 1940’s and cost from Rs.2,500 to Rs.6,000, pocket watches range from Rs.1,000 to Rs.5,000, dining tables costs from Rs.8,000 to Rs.20,000 (the more the intricate carvings, the more is price), Mughal paintings made by water colours cost about Rs.15, 000 per piece.

Mr. Baig claims that majority of the items sold at his outlet are four decades-old and some date back to pre-Independence era.

The good thing about this outlet is, that apart from offering old and antique items, they also take up repair works of old gramophone player needles, 78 RPM records, furniture, pocket watches, clocks etc. Ask him as to how to recognise an authentic antique or old item, pat comes the reply saying that one needs to have an eye. “While checking for furniture, normally we look for the style adopted in fixing the joints and based on carpentry, the period of the furniture is judged. For porcelain products, the style used in naming the place of the products origin, the period is judged,” he explains.

Mr. Baig says items at his outlet are used in film and television serials shootings on hire system.

He also works as a commission agent for selling and buying old and antique items on behalf of the owners. “Kharidne jao to milta nahi our bechne jao to biktha nahi, usi ka naam antique piece,” says Mr. Baig even as he continues to adjust the products in the display cupboards.

Rs. 1,000-crore contract to TCS for quicker passports

2008-10-14T11:44:00.000-07:00

NEW DELHI: The government on Monday said passports would be issued in just three days, once police verification was complete, with the awarding of a Rs. 1,000-crore contract to Tata Consultancy Services.

The project would gradually be rolled out countrywide, with citizens of Bangalore and Chandigarh being the first beneficiaries from June next. It is expected to be completed by January 2010.

Passports under the Tatkal (instant) scheme would be delivered in just one day. Apart from the reliance on software to bring the entire process online, the number of passport counters would be increased from 345 to 1,250, said official sources at a ceremony held to award the contract to TCS. This is the latest initiative by the Ministry of External Affairs (MEA) to simplify issuance of passports. It earlier raised the fees for various services, reduced the number of requirements, pared the application form, enabled online tracking of the passport and permitted select police stations to accept application forms.

“The sovereign and fiduciary function of granting and issuing passport remains with the MEA and TCS will be our technology and operations partner in this project,” said Foreign Secretary Shiv Shankar Menon said.

Mr. Menon said the project was imperative because as against 50 lakh passports issued last year, the Ministry expected the number of applicants to double in the next three years.
Technology partner

The software company would provide only support functions such as improving citizen interface, managing the technology backbone, call centres, training and change management. The government would continue to exercise all sovereign and security-related functions in the issuance process. Security aspects were fully taken care of in the project with the government owning all strategic assets including the data centre, database and the application software, Mr. Menon said.

The MEA has started issuing e-passports, also known as biometric passports, in the diplomatic and official categories since June 2008, and full rollout of e-passports in the ordinary category will be done by September 2009. The e-passports will be much safer against forgery and will further facilitate the movement of their holders through the border points equipped with e-passport reading machines.

“After implementation of the project, which will be managed end to end by TCS, the ministry expects that the process of issuing a new passport will be completed in three working days while passports issued under the Tatkal scheme will be dispatched the same day, subject to address and police verification of applicants,” explained TCS CEO and managing director S. Ramadorai. The TCS would open 77 new fully computerised passport seva kendras across the country by January 2010.

Communication between the police and the passport office would also be done online and a secure network is being created. Bangalore and Chandigarh would get the new kendras by June 2009 on a pilot basis.

Bend it with bamboo

2008-10-12T00:39:00.000-07:00

Break the monotony of the concrete jungle and the buzz of modern day living. Into your living rooms, usher in the peace of the rural side, the pristine beauty of nature and the creativity of the artisans.

Rich offerings to decorate the home with come from Tripura in the form of bamboo. A riot of colours is unveiled for paintings and wall hangings and the same come with the rural portrayals. The hues are rich and the themes just aesthetic and capture th e day-to-day activity of the villages and also the nature’s bounty in full. With right backdrops to suit any living room and done on bamboo, these décor pieces at the recent expo at Exhibition Grounds, Nampally were priced at Rs.100 each. And then, a little bargain too is not frowned upon on these prices.

Sure to give a new touch to the décor, smaller paintings with a wide and varied depictions including a series on gods also was hot seller during the event. Fans to decorate walls, both circular and semi-circular spreading out beautifully with a splash of colours too happen to be an ideal hanging. They came at Rs.160 apiece. In bamboo came tastefully constructed Taj Mahal and also a line-up of smaller table pieces . A cute little hand mirror with thin pieces of bamboo at Rs.15 was a take away. “We are from Agartala and bring our products regularly for different craft and furniture exhibitions held in the city. Each piece is hand crafted and done with patience and perseverance till desired effect is got”, says Sanjay Debnath of the stall.

The Saras expo at Necklace Road, open till October 12 also offers bamboo artefacts.

Earthen beauties for an ethnic touch

2008-10-12T00:38:00.001-07:00

Indian homes which had moved from the old world warmth to contemporary design features with a clinical ambience are now making a full circle with modern designs meeting old concepts that create spaces and gives us the best of both worlds.

And pottery and terracotta art is one that is helping this transition. Its ability to take one closer to an ambience of the homes of yore even in the most modern of the duplex apartments is one of its most appealing features. And pottery is one art that helps us remain a little closer to nature. Whether it be the terracotta lantern that you can hang near the entrance of your home or the mud wind chimes which move with the slightest of breeze, the options are endless.
Choicest spread

If you are the kind who likes the rustic, ethnic look of terracotta, then you should head straight to the bustling Habsiguda-Tarnaka road. The whole stretch has hawkers squatted on sidewalk with their varied product range. And the best pieces of art can be found here that promise to add that ethnic, a la village touch to the house.

Most of the artefacts are from Rajasthan and a few from Bihar. Different types of vases, which are not too heavy to carry are available here. The stool with an elephant carving on it is also an ideal piece for the house. Or choose the plate shaped bowl (also known as ‘uruli’), pour water into this and decorate it with flowers and voila! You have the perfect showpiece for your living room. Terracotta is also a natural choice to decorate your gardens. From the birdbaths to huge earthern bowls with exquisite designs or the motifs of animals and birds add to the beauty of the patch of green at home. One can also choose from a wide range of pitchers imparting a look of tradition to the homes. If you are a lover of music go in for the mud shaped ‘veena’ or sitar in different sizes from small to large. The clay used is multi-layered one which is moulded into different shapes and then baked in a traditional oven. Most of the items are light-weight while a few vases are heavier.

The price range of these terracotta art pieces are much lesser than those that are bought from a mall or at an exhibition. And if you are an expert haggler, then the hawkers are sure to reduce the price by at least Rs.20 to Rs.30.

The vases are priced at anywhere between Rs.250 and upwards, while the ‘urulis’ or the earthern bowls are priced from Rs.180 and more depending on its size. The elephant shaped stool with a pitcher on top comes for a cool Rs.550 while the hanging lamps are priced in the range of Rs.50 to Rs.100. And with Deepavali round the corner, you can choose the lamps for Rs.45. So, the next time you want terracotta, you know where to go!