22 August 2018
1. Ease of Living Index: Pune ranks first in 'livability', Delhi languishes at 65
The Ease of Living Index is a government initiative to assess cities' 'liveability' with regards to global and national benchmarks and encourage them towards urban planning and management.
(Source: Business Today, 13 August, 2018)
The Ease of Living index, 2018 released by the Ministry of Housing and Urban Affairs (MoHUA) clearly indicates that the livability quotient is reducing in the key metro cities in India such as Bengaluru, Delhi, Hyderabad and Chennai. Regardless of the fact that the above-mentioned cities are progressing fast in terms of economy, employment opportunities and are establishing themselves as dynamic commercial markets in the country, livability likely to remain a challenge in the backdrop of overburdened physical infrastructure. The ranking indicates that Pune, Navi Mumbai, Greater Mumbai, Tirupathi, Chandigarh, Thane, Raipur, Indore, Vijayawada and Bhopal as the top ten cities in India in terms of ease of living. The ranking also shows that the major Indian cities are lagging behind in livability criteria with Delhi at 65th position, Bengaluru at 58th, Hyderabad at 27th and Chennai at 14th place. According to Colliers Research, the key reason for most of the metro cities falling behind in the ranking is primarily due to the increasing pressure on the available infrastructure such as water supply, solid waste management, transportation and mobility and power. Moreover, the cities are also facing other challenges such as increasing net density with rising population, lack of slum rehabilitation measures, increase in pollution and lack of green cover and open spaces. The cities such as Bengaluru and Delhi have received very fewer points in terms of safety and security as well. In our opinion, considering the progressive phase of the metros, it is high time for the city administrators strengthen their efforts towards planning resilient cities and increase resource allocations. The local governments should collaborate with private developers, corporates and other private parties to build the cities of the future by incentivizing them to participate in infra development.
2. DLF Eyes Partner for Project on INR 1,600-Crore Land in Gurugram
Realty major DLF Ltd. is in talks with private equity players to raise funds for the development of a commercial property on its 11.76-acre land in Gurugram. The developer had recently bought the Gurugram land for about INR 1,600 crore.
(Source: Bloomberg, 11 August, 2018)
The 11.76 acre (0.04 million sqm) land is situated in Vanijya Kunj of Udhyog Vihar opposite to the flagship asset of DLF in Gurugram ‘Cybercity’. The INR1,496 crore (USD 215 million) transaction took place after DLF won an e-auction conducted by the Haryana State Industrial and Infrastructure Development Corporation (HSIIDC), it was the highest any Haryana government agency has received through the auction process ever. In our opinion, the location of the land parcel is at Phase V of Udhyog Vihar should fall in the Transit-Oriented Development (TOD) zone and is likely to be eligible for higher Floor space Index. DLF is in advanced talks with multiple Private Equity firms to partner for the envisaged commercial development. The developer may dilute its stake by 50% in the overall development potential of around 2.5 million sq ft (0.2 million sqm). As per the recent presentation made by DLF, the company is aiming to grow its portfolio from 32 million sq ft (3 million sqm) to 40 million sq ft (4 million sqm) by 2022. In our opinion, DLFs decision to develop this project is in line with their target of achieving 15% growth in its rental portfolio by 2022, which is based on an equal mix between new development and rental renewals. The nature of this deal is expected to be the same as the investment made by Sovereign fund GIC of Singapore in two of the residential developments of DLF in 2015.
3. First flyover of SRDP project to be opened today
The first flyover under the Strategic Road Development Plan (SRDP) for signal-free traffic flow will be inaugurated by Minister for Municipal Administration and Urban Development K.T. Rama Rao.
(Source: Mint, 31 July 2018)
The Strategic Road Development Plan (SRDP) is a crucial infrastructure initiative that has been taken up as a high priority project for the development of Greater Hyderabad by the government of Telangana and Greater Hyderabad Municipal Corporation. The project comprises construction of skyways, significant corridors, roads, grade separators and flyovers across the city’s key locations to ensure improvement in connectivity and ease traffic congestions. The entire project has been planned in four phases and is likely to entail an investment of around INR20,000 crore (USD2.9 billion). So far only two underpasses have been completed at Chintalkunta and Mindspace locations under SRDP. Out of four flyovers proposed at LB Nagar, the corporation has first completed the construction of left-hand side flyover at Kamineni Junction. In our opinion, it should ease the traffic flow from Srisailam road towards Secunderabad, but it will be more useful once the right-hand side flyover and underpass on the road to Mansoorabad will be operational which is scheduled for completion by March 2019. As the flyover is located away from the commercial micromarkets in the city, it is likely to have minimal impact on the office markets in Hyderabad. However, as part of the SRDP, 54 junctions have been identified for a complete overhaul across the city in the form of elevated corridors, skywalks, flyovers and underpasses envisaged covering 111 km. We expect the completion of these under construction projects over the next two years should positively support the growing commercial market of the city.