Time-frame for depositing TDS on sale of property extended

BENGALURU: As a relief to property buyers, the Income Tax department has extended the time period for depositing TDS on sale of property by 23 days.

Anyone buying real estate worth more than Rs 50 lakh has to deduct 1% of the sale price of the property before paying the seller. That TDS has to be deposited with the tax department using Form 26QB. Earlier you had to deposit this TDS within seven days of the following month of making the payment. Now, it can be deposited within 30 days from the end of the month in which it was deducted. So, those who make purchases towards end of a month would get more time to fill up the extensive 26QB challan and deposit the income tax.

"Earlier if you bought a property on 30-31st of a month, you only had seven days to submit Form 26QB. Now, the buyer would have at least a month to comprehend and comply by the rules," says Archit Gupta, founder and CEO, ClearTax.in

The rule will come into effect from from 1 June 2016. However, there is a confusion about payments made during the month of May on whether they should follow the old-7 day rule or the new 30-day time period. While some CAs are of the opinion that if any property payments are made before 1 June, TDS will have to be deposited within 7 June, others believe that you should be allowed to submit the TDS by 30 June for transactions that took place in May.

Last month several taxpayers had received I-T notices for failing to deposit the TDs with the department on time. The forfeit for late filing is an interest on the TDS--1% per month if tax wasn't deducted and 1.5% in case this was done but not paid, which is calculated from the date of payment. There is also a Rs 200 per day flat fine for missing the deadline. The AO, under Section 271H, can also put penalty of up to Rs 1 lakh for defaulting. So, to be on the safe side, it is better to submit th ..

Resource: http://economictimes.indiatimes.com

Distressed office projects emerge as good buyout options

Bengaluru: Distressed office assets are emerging across cities, throwing up opportunities for large developers backed by private equity (PE) funds to buy into incomplete or stalled office projects, special development enclaves or undeveloped land, a trend that has played out in the residential sector in recent years.

Bengaluru-based Embassy Group is buying out a 60% stake in a stalled special economic zone (SEZ) in Chennai’s Pallavaram area, in a transaction that is expected to conclude soon. In a revenue-sharing arrangement, Embassy will pay an initial deposit of Rs.60 crore to Hyderabad-based SNP Infrastructure Ltd, which built the basement of a few buildings in the SEZ and then decided to not continue with the project.

“Embassy is going to invest about Rs.1,400 crore to construct the project, about 4.5 million sq. ft in area, over the next 5-6 years,” said a person familiar with the development, who didn’t wish to be named.

Despite the gloom-and-doom situation in India’s residential sector in recent years, the office space has fared relatively better. A number of large developers, with a background in building office projects, are now mainly focusing on these, while smaller and mid-sized developers, who don’t have the operational competence to build such projects or the financial bandwidth to stay invested in them, are looking to exit fully or sell stakes to the former.

Mumbai-based Tata Realty and Infrastructure Ltd (TRIL), a subsidiary of Tata Sons Ltd, and its investor partner, Standard Chartered Private Equity, are looking at both greenfield opportunities as well as brownfield projects, where they can step in and take over.

TRIL’s managing director Sanjay Ubale said that they are evaluating all kinds of assets in mostly Tier I cities.

There are mainly two dominating trends in the office sector—one, buying out of built and leased office assets where global PE investors such as Blackstone Group Lp predominantly operate and, second, buying land to build greenfield office projects.

In one of the biggest transactions in commercial office space this year, DLF Ltd, India’s most valuable property developer, has sought expressions of interest from several top global investors to sell a 40% stake in its rental assets arm as it seeks to pare debt. The rental assets arm holds about 20 million sq. ft of leased-out office space and is valued at about $2 billion.

“While there are many such opportunities to buy projects that are incomplete and stalled, and we are open to them, the most critical factor for us would be to get the right partner,” said Vinod Rohira, managing director, commercial real estate & REIT, K. Raheja Corp.

Pune-based Panchshil Realty Ltd, which has partnered with Blackstone for some of its projects, is in talks to take over a brownfield project in Mumbai. Panchshil chairman and chief executive Atul Chordia said that Mumbai has many such so-called distressed office projects, where developers are looking for new partners and investors to come in and enter into joint development agreements or buy partial stake.

Prominent office developers are evaluating projects in top property markets such as National Capital Region (NCR), Mumbai, Hyderabad and Chennai. Bengaluru-based developer RMZ Corp. bought over a partially stalled project in Chennai from a Kolkata-based firm last year and is looking at similar deals in Mumbai, Delhi and Chennai.

RMZ managing director Raj Menda said that while there are many opportunities, the question is if it is at the right price. “This year we will see more such under-development office asset deals along with buyout of completed assets. These are slow times for the sector and it’s a matter of time when someone has to let go. Our model is to take 100% control in a project we like, or do a joint development where the assets are clearly divided between the partners,” Menda said.

Property analysts also believe that commercial real estate will also witness the kind of consolidation and collaboration that the residential sector has undergone in the last two years. Though commercial office projects are doing far better than their residential counterparts, the capital-intensive development and niche skills needed for the former will see only a few large developers remaining in the fray over a period of time, they said.

“Commercial office is a niche game and many developers will find it tough. Unlike residential, it is a B2B (business-to-business) and not a B2C (business-to-consumer) business, where a developer needs the skill to build and then lease it out to corporate groups and operate them over a long tenure,” said Juggy Marwaha, managing director-south, JLL India, a property advisory.

Resource: http://www.livemint.com

Housing prices down 1% during March quarter in Delhi-NCR: 99acres

NEW DELHI: Housing prices fell by 1 per cent in Delhi-NCR during January-March this year compared with the previous quarter on sluggish demand, according to a report by realty portal 99acres.

Rentals also fell by 1 per cent during the last one year.

The report captures capital and rental price trends of the residential realty market on quarterly basis across seven major cities of India.

"Property prices per sq ft in Delhi NCR witnessed a minimal downtrend of 1 per cent in January-March as compared to October-December 2015," the company said in a statement.

The rental market, too, plateaued over the last one year, it said.

"Delhi NCR's real estate graph continued to delineate a marginal downtrend, with the land pooling policy of the government offering a ray of hope," said Narasimha Jayakumar, Chief Business Officer, 99acres.

The national capital also witnessed the second highest absorption of office space in the country, predicting an optimistic future for the rental landscape, in the long run, he added.

"Most buyers and inventors await the completion of the Noida-Greater Noida metro corridor, anticipating an overhaul in the real estate story of the twin cities," Jayakumar said.

In Delhi, the capital market of apartments continued to remain lacklustre in the first quarter of 2015 with limited number of new launches across the city.

"A few localities fared well on the capital growth index, primarily due to over-ambitious 'ask' rates by sellers. One such locality, Dilshad Garden, noted a capital hike of 5 per cent in January-March 2016 against the previous quarter,"

Despite the huge supply pipeline, some sectors in Dwarka -- sector 14, 12 and 7 -- witnessed a quarterly increase in capital values to the tune of 2-3 per cent.

Resource: http://economictimes.indiatimes.com

Delhi-NCR has highest unsold housing inventory: Assocham

NEW DELHI: Levels of unsold inventory in the residential and commercial real estate segments have risen to between 18% and 40% in different cities with the maximum unsold stock lying in the Delhi NCR over the last one year, according to a new study by industry body Assocham.

This is creating a big drag on several other sectors like financial services and steel, according to the study.

"In spite of a fall in prices and interest rates, the demand for residential market has witnessed a steep decline by 25-30% in the whereas the demand for commercial space dropped by 35-40% in the NCR region over the last year," Assocham pointed out.

Mumbai which had been witnessing an increased activity around Navi Mumbai, Thane and other suburbs, is carrying the second largest unsold inventory, followed by Bengaluru and Chennai.

While Mumbai had unsold sold of 27.5%, for Bengaluru it was 25%, Chennai (22.5%), Ahmedabad (20%), Pune (19.5%) and Hyderabad (18%).

According to Assocham, NCR has an estimated unsold inventory of 250,000 housing units, which is approximately 35% of the units under construction due to delay in regulatory clearances and litigations.

"It is a difficult period both for the developers and the consumers who have booked flats. The regulators, developers, banks and consumers should form joint groups to work out the solutions," DS Rawat, secretary general of Assocham said.

"The ticket price (of) three-bedroom, two-BHK and single room flats has seen correction by 35% in Noida, 30% in Gurgaon and 25% in some key areas of Delhi but still, the demand stays subdued," the Assocham paper said.

This year the unsold inventory in residential real estate was the highest in Delhi-NCR at 250,000 units, followed by the Mumbai metropolitan region at 98,000. Bangalore came next with 66,000 units, Chennai with 60,000 units and Pune followed with 55,000 units.

The subdued construction activity has had a huge negative impact on the labour market since there are about 10 to 12 million workers engaged in the real estate sector. The slump in sales and launches clearly indicates that the ressidential market is facing a strong price resistance.

According to the report, many stakeholders including developers, financial institutions and other supply-side stakeholders believe that the current market scenario is worse compared to last year. Delayed reforms seem to have affected sentiment. Residential launches, sales, and price appreciation are at a much lower level than the last year.

The total number of new project launches in the National Capital Region (NCR) had come down by 30-35% in comparison to the last year. The unsold inventory is highest in Noida, with over 120,000 units while the remaining unsold inventory is in Delhi, Ghaziabad and Faridabad.

Resource: http://economictimes.indiatimes.com

Ashiana Housing launches Ashiana Tarang

Located in a fully developed neighbourhood of Bhiwadi, Ashiana Tarang offers a huge location advantage along with affordability. It’s just 45 min. from Gurgaon & 55Kms from Indira Gandhi International Airport & just off the Delhi- Jaipur Highway.

Delhi based, Ashiana Housing Ltd., (NSE & BSE Listed), one of the renowned developers in India, has launched yet another project in Bhiwadi, christened as Ashiana Tarang. In the past two decades, Ashiana has successfully built and delivered 15 projects in Bhiwadi. Now it’s time for another offering.

Located in a fully developed neighbourhood of Bhiwadi, Ashiana Tarang offers a huge location advantage along with affordability. It’s just 45 min. from Gurgaon & 55Kms from Indira Gandhi International Airport & just off the Delhi- Jaipur Highway. This iconic marvel is located strategically in the heart of the city at Sector -24, UIT, Bhiwadi. This project is well -planned and equipped with facilities and features for a modern comfortable living.

Commenting on this new offering Mr. Vishal Gupta, Managing Director, Ashiana Housing Ltd. said, "Aimed at providing that comfy experience with an uncompromised leisure, Ashiana Tarang, offers spacious apartments in affordable price range. Its strategic location and proximity to school, malls &  hospitals  are yet another advantage.”

With a total saleable area of 11.10 lakh sq ft. (approx.), Ashiana Tarang is spread over 12.76 acres of land. The project will have 11 towers with 960 residential units (approx.)  In Phase -1 they will  have 192 residential units (approx.), S+12 including 2 and 3BHK option in sizes ranging from 1065 sq ft to 1331sq ft at a starting price of 30.99 Lacs all inclusive.

Over the past 25 years, Ashiana Housing Ltd   has already been built and delivered 15 projects in Bhiwadi itself. The project will provide facilities for comfortable living with organized lifestyle and better community living. Facilities include secured gated complex, in-house club, green area, jogging tracks, swimming pool, gymnasium, landscaped gardens, kids play area, badminton, and tennis courts.

At Ashiana Tarang, the potential buyers will be offered easy access to reputed educational institutes like Modern public school, UCSKM School, Presidency School, St. Xavier’s, DPS & Raman Munjal Vidya Mandir. Hospitals, Banks, Supermarkets, Shopping malls, multiplexes, like Capital Mall, BB Mall & Central market are in close vicinity.

Not only this, the phenomenal industrial growth gives a good return on investment, due to high rental returns. Industrieslike St. Gobain, Relaxo, P&G, Federal-mogul and much more in   proximity offering thousands of employment opportunities. The established and upcoming industries will offer great employment opportunities and Ashiana Tarang will be offering housing alternatives to its employees.

Resource: http://www.indiainfoline.com

Widening of NH-24: The highway to affordable housing

Connectivity and infrastructure development are the two most critical elements needed for the development and evolution of a real estate destination. If construction of the Yamuna Expressway saw realtors moving to develop residential housing and townships, developers in the Delhi-NCR region feel that the construction of the Delhi-Meerut Expressway, recently launched by the Prime Minister Narendra Modi, will not only improve the connectivity of various towns in the region with Delhi, but will also change the dynamics of the real estate market in the zone.

Developers and real estate experts told The Indian Express that the NH-24 Expressway may emerge as a hub for affordable housing and could offer solutions for accommodation in the 1-2 BHK category within the price range of Rs 15 lakh-Rs
30 lakh.

Manoj Gaur, managing director, Gaursons India and president of Credai-NCR, pointed that it is a long stretch and the development around the highway was stuck because of heavily clogged roads. He added that the widening of the road would not only ease the traffic and reduce travel time but would also result in development of residential housing along the road.

“I think that this has the potential for development till Hapur-Pilkhua and it will be one of the most preferable stretches because of its approach and access to Delhi-NCR,” said Gaur. However, he added that while there has been a slowdown in sales across Delhi-NCR, there is demand in the affordable housing category and developers should ensure that they cater to the demand of that segment. “I see development of affordable housing around this road going forward,” he said.

Importance of NH-24

Among the several highways/expressways that connect Delhi to cities — Meerut & Hapur (NH-24), Jaipur (NH-8), Panipat (NH-1) and Agra (Yamuna Expressway and NH-2) — NH-24 is probably the most densely populated, as there are several small cities along the corridor. Providing access to Ghaziabad, Noida and Greater Noida, the road, once fully developed, will connect up to Meerut and Hapur and is set to be a very busy stretch. Therefore, widening of the expressway will only act as a catalyst for real estate demand and development on both sides of the road in the future.

Rami Kaushal, head of consulting and valuations at CBRE said that while decongestion of the roads will help the existing cities such as Noida, Greater Noida and Ghaziabad, it will also help in decongestion of Delhi.

“All the cities leading up to Hapur will become more accessible and habitable. Since a lot of manpower comes from adjoining cities, lack of good connectivity forces them to stay in NCR only. However, once this expressway is built and there is good public transportation available, a lot of these people will live in their home towns or in the new destinations that develop around the road and can commute to Delhi for work,” said Kaushal.

There are others who agree to this fact. Gulam Zia, executive director at Knight Frank said that it is a long highway and passes through dense localities. “By declogging, it will provide a new lease of life to all real estate destinations along the road. The widening of road will also result into realignment as the travel time will reduce significantly and therefore will allow people to move away from the cities,” said Zia.

Activity and impact on pricing

While it is too early for things to kick-start, existing projects around the proposed road have received a shot in their arm. Gaur said that his existing projects around the road in Noida Extension and in Crossing Republic will benefit as the connectivity will improve. While he said that he would look to take up new projects on the proposed expressway, he said that he would take up the phase II of his project in Crossings Republic.

Aman Agarwal, director, KV Developers also did not rule out the possibility of land purchase and development of residential housing project on the stretch. Stating that the activity will pick up over the next two years, he said, “Most of the activity will be in the affordable housing category and there will be a number of projects offering 1 and 2 bhk flats in the price range of Rs 15 lakh and Rs 30 lakh,” said Agarwal. While aspiration for better housing is growing, the need for better livelihood will see fresh demand in the affordable housing segment.

While prices in the Delhi NCR market is currently impacted by high unsold inventory, the market has not seen any uptick in prices over the last couple of years. In fact, the prices have witnessed some correction. Experts say that fresh supply on NH-24 in the coming years may keep the prices under check even in the existing markets of Noida, Greater Noida and Ghaziabad.

“Over the last couple of years the prices in Noida and Greater Noida have been stable because of huge supplies. With more supplies, the prices may remain under check in these existing markets,” said Zia.

Even Kaushal said that the prices in these areas may not rise in a hurry and there will be stability in prices across these markets.

While it is almost certain that the development of the expressway will add a new dimension to the real estate market in Delhi NCR and help decongest Delhi by development of affordable housing in the proposed expressway, the planners will have to be thoughtful and ensure that better connectivity is complemented with a stable public transportation system so that residents have multiple options to reach their work places in Delhi NCR.

Resource: http://indianexpress.com

Rajasthan clears Bill for govt to set up townships in DMIC

The Bharatiya Janata Party-led Rajasthan government threw another surprise after it managed to pass the Special Investment Region Bill, 2016, in the Assembly amid strong protests from its own legislators and the Congress.

The Bill will allow the state government to set up integrated industrial townships in the Delhi-Mumbai Industrial Corridor (DMIC), which runs 150 km on either sides of the 1,500-km dedicated freight corridor.

The state government is initially planning to set up townships in two nodes identified in Khushkhera-Bhiwadi-Neemrana and Jodhpur- Pali-Marwar regions of Rajasthan. But its Bill has already run into rough weather.

Sachin Pilot, Rajasthan's Congress chief, called it an anti-farmer Bill. His party had staged a walkout when the Bill was being passed in the Assembly on Monday.

"The Bill has draconian clauses and moreover it will not pass court scrutiny as no state Bill can override any central law (Land Acquisition Act, 2013)," he said.

According to the state Bill, the state government "may, by notification in the Official Gazette, declare any area of land, including an industrial area, to be a special investment region."

The Bill entails the state will set up a board and a regional development authority having 15 members, including the minister in-charge of the DMIC project in the state, and parliamentarians and legislators representing the areas included in the special investment region. These areas will only be governed and developed by the regional development authority.

Maneesh Chauhan, Commissioner, Rajasthan DMIC, clarified that the Bill was required to provide a legal framework and power to the regional development authority. "The authority will acquire the land according to the provisions of the Land Acquisition Act, 2013. It is similar to the Jaipur Development Authority, which acquires land for residential purpose, and the Rajasthan State Industrial Development and Investment Corporation, which acquires land for industry," Chauhan said. "Those who don't wish to give up their land will be given the option to develop it according to the master plan of the special investment region," Chauhan said.

The state government has identified 165 km for the Khushkhera-Bhiwadi-Neemrana node. The state government will develop a nucleus of 14 km and the first phase of development is expected to be over by 2021, followed by the second phase in 2031 and the third in 2041.

Officials in Delhi said setting up of the regional development authority was necessary to speed up the DMIC project, which passes through Uttar Pradesh, Rajasthan, Madhya Pradesh, Gujarat and Maharashtra.

"We force the state governments to set up regional development authorities so that the DMIC along with the state government can launch a special purpose vehicle for the development of a particular area," said an official on condition of anonymity.

"Some states already have legislation that allow them to set up regional development authorities, while others like Uttar Pradesh and Gujarat have brought in amendments," the official added.

Around 40 per cent of the freight corridor passes through 22 districts of Rajasthan, which was the last state to set up a board and regional development authority. The state, however, has surprised everyone after Chief Minister Vasundhara Raje introduced a series of industrial and labour reforms in the last two years.

Resource: http://www.business-standard.com