The Gera Newsletter

Issue: # March 2011

Dear Friends and Associates,
 

Pune is a city which is expanding in all directions.With new businesses heading towards the city and rising demand for housing, its spreading towards outer areas and peripheries. We take a look at two areas with which are fast becoming success stories. In this months article we discuss the Kharadi growth story.

Do share your views and comments with us.


Sincerely,

Kaajal Shaikh

GM Marketing - Gera Developments Pvt. Ltd.

  

 

EMERGING NEIGHBORHOODS - Kharadi

By Rohit Gera

     
 Having developed properties over many decades, one gets to see development patterns emerging over time. Neighborhoods come into being, grow, develop, flourish, mature.  

 

In 1991 when we were building a project called Gera Landmark in Kalyani Nagar, I recall speaking with customers and receiving feedback that crossing the river (i.e. Past Bund Garden bridge) was unthinkable.  Over the years, Kalyani Nagar has developed into a thriving neighborhood - complete with schools, shopping, entertainment, hotels- all this has also resulted in high real estate rates in the neighborhood. 

 

This same pattern is visible in two neighborhoods - Kharadi in east Pune and Baner in west Pune.  Much has been said about Kharadi being a suburb of Pune that would develop well - I believe this is an understatement.  Kharadi has the potential to be the best suburb in Pune. Here are some reasons why. 

 

A visit to Kharadi takes you on roads that have not been seen in the city ever before at this early stage of development of a neighborhood.  One of the earliest concrete roads was the road past the Le Meridein hotel - this road had been in use for over a century before it was upgraded to a concrete surface.  In contrast, the new arterial roads in Kharadi are coming up as full width concrete roads from day 1.  On a separate note, I believe we must give credit to our city fathers for breaking out of the mould of doing roads 10 feet at a time.  

 

The road network is planned with integrated infrastructure for water supply, sewage and storm water lines. The land holding pattern in Kharadi is not fragmented like in other parts of the city. There are a number of large parcels of land that can be developed into gated communities.  Infact one has to look at the projects coming up along what will surely be the residential high street of Kharadi - starting with the Garden Villas and Sky Villas at Geras GreensVille, to projects by Marvel, Panchshil, Yin Yang and others - all premium projects line up along the newly developing 100 foot wide concrete road.  Lesser fragmented land parcels leads to longer stretches of clear driving without people trying to get on and off the street to visit small shops and small project gates. 

 

The neighborhood is already a place to work and new projects coming up offer new shops, offices and other social infrastructure. The Nagar road is in the process of being widened - it will be a 5-10 minute drive to 5 - 4/5 star hotels and 5 shopping malls (InOrbit, Pheonix Mills to name a few) - each the kind Pune has not seen till date.

 

The other factor that sees an inflection in the desirability of a neighborhood is the fact that it ceases to be the last destination - Wagholi is quickly becoming an alternative destination with lower prices to cater to the needs of the more budget conscious home buyer.  This will help further drive up the desirability of Kharadi for homes and businesses alike.  

If one studies the average price in the Kharadi micro market over the last 5 years, we see a spike in 07-08 and then 10-11.  The in between years have been mostly flat.  

Feb 2007 - Rs. 2,463/- psq.ft.
Feb 2008 - Rs. 2,932/- psq.ft.
Feb 2009 - Rs. 2,937/- psq.ft.
Feb 2010 - Rs. 3,084/- psq.ft.
Feb 2011 - Rs. 3,752/- psq.ft.

Compounded average growth rate of 8.8% for 5 years.  However, if one looks at the last year, prices have moved up over 20% while prices for the preceeding 4 years are up merely 25%. Increases in prices are based on a number of factors including economic outlook (looking positive), salary increases (looking positive), development of the neighborhood (lot said already).  All these factors are poised to drive prices in the micro market up.  The story however, is not purely one sided.  While we have tail winds that are buoying the prices upwards, the risks are inflation, interest rates and most importantly, affordability of the homes themselves.  The silver lining in this risk scenario however is the fact that the infrastructure once built, the gated communities once created do not receede with a slowing real estate market.  All in all, I believe that Kharadi is a super destination in East Pune.  

Given the shortage of space, I will discuss Baner in the next edition of the newsletter.

I would love to hear your thoughts, opinions on the article above. Your views, experiences are also welcome.

 

  

Rohit Gera

JMD - Gera Developments Pvt. Ltd.

 

As with other investments, real estate too carries a certain amount of risk. Readers are advised to undertake their own due diligence and take judgement calls based on their own research and not on the article.

 

 

www.gera.in 

 

Virtually visit the ready possession villa apartments at Gera GreensVille - Kharadi. Preview the show unit alongwith the beautiful inner courtyard as well as the outdoor amenities, in this Virtual Reality Tour - Click here to start the tour. (Please allow a few seconds to load.)

Kaajal Shaikh
 
kaajal.shaikh@gera.in