Vikas Rikhye, Real Estate Gurgaon Blogger

Land Prices in Gurgaon In early 2005 the land prices which were quoted @ Rs 10000-15000 per.sq.yd had seen its peak of more than Rs.50000-55000 per.sq.yd by the year 2007-2008. Whereas now in the present scenario more then 35% fall in price seems to have been recorded. The experts feel that more then 25% correction on present prices is still expected in next 4-5 months

This “U -Turn Trend” is visible, in other “Gurgaon real estate” related fields/ activities, as well.

Gurgaon Shopping Malls:  With original booking price of Rs.6000-7000 per.sq.ft, during peak time, the figure had touched the price of over Rs20000-25000 per.sq.ft. As on day the investors of Shopping Malls in Gurgaon feel a fall of over 30% in some cases, with a further correction in coming months. Unfortunately in some of the Malls, the investors are willing to sell on the purchase price.

Office Space in Gurgaon: In the year 2004-2005,In a good “Glass–curtain building” , the rent quoted was in the range of Rs 40-45sq.ft finally reaching a figure of more than Rs 125 per sq.ft by the year 2008 With the recent Melt-down, fall of over45%, has been recorded.

Residential Apartments in Gurgaon : There is a massive correction is being felt in this segment as well. Taking the year 2004-2005, as a base when “Apartments in Gurgaon” were launched at a basic price of Rs 1500-1600 per sq.ft had reached the the height of over Rs 5000 per sq.ft by the year 2008, have suffered a correction of over 40% fall in basic price. And the” New Housing–Projects in Gurgaon” are being launched @ Rs.2800 per sq.ft

Builders and Developers in Gurgaon: The Global meltdown has very adversely effected this segment of real estate as some of the prominent builder are almost at the point of insolvency.

-Even, some of the Prominent builders have put their existing Projects on hold.

-Whereas ,some of the “Builders in Gurgaon” seem to have abandoned their projects.

-Some of the construction sites are giving deserted look. All as stated above has left the investor in the state of fear & confusion

Real estate Agents in Gurgaon -Real estate Brokers in Gurgaon In the year 2005,there had been sudden increase in number of Brokers in Gurgaon ,as every one could see a big boom in real estate with rewarding result.& during the peak time Professionals like Doctors & qualified Engineers had been seen ,adopting Real estate Agent as profession.

But with recent slowdown & recession, this segment of real estate is equally effected & a large number of “Brokers in Gurgaon” have left this profession , while many others are exploring alternate avenues of employment.

In present scenario of recession “U -Turn in Real estate Gurgaon” was inevitable

Disclaimer: The Author is a freelance Blogger and real-estate consultant, The readers are advised to do their own research & analysis before taking any action. The author is not responsible for any consequence good or bad. The author is only delivering his views & inviting response in the way of comments/views from
the readers.

This is a guest post by Mr. Saurabh Dhawan of India Medi Treat. You can get in touch with him at saurabh [dot] 3767 [at] gmail [dot] com.

The Article by Mr. Vikas Rikhye is a bitter truth which every Gurgaon resident mall realizes but somewhere doesn’t want to agree that the Retailers in Gurgaon are truly striving for existence. A lot of times while going towards Delhi from my old Gurgaon residence I feel like having a burger and ice tea but I don’t reason being are many, firstly the traffic, secondly the economy (spending Rs.30 as parking for a Rs.20 Burger is scary) and you cant stop your car for five minutes even as the recovery vans can take your cars. These are very basic things but this is what is eating the customer from the malls.

The builders sold the shops in mall at a time when stock market, economy, real estate market all were roaring high which meant higher purchasing power of people and the fact is that people in Gurgaon had good money and were willing to spend for good products. This lead to increased rentals for shops along with a heavy maintenance for upkeep of the mall. But no one was complaining as cash was the king.

Repercussions of financial meltdown on Gurgaon Shopping Malls

Now in post Sub-prime era the things have changed the real estate market has corrected badly, the Stock market is below 10,000 points and the big builders are looking for some shelter. The US sub prime has effected jobs in India, people have been given pink slips and uncertainty is prevailing among people who are in job whether there job is safe or not. This hysteria has resulted in reduced consumer spending and there is no doubt that the next two years are going to be tough for retailers and only the fittest will survive.

The retailers need to re-look into their marketing strategies. While walking through these deserted malls I realized that everyone had one thing in common. SALE yes guys SALE. From 20% to 70%, 50%+40%, buy 1 get 1, buy 2 get 3, buy 2 get 6 and so on. But I thought does their target market really knows it. The answer I guess is no. these malls don’t have heavy foot falls to attract there prospective customers.

I liked the way Kishore Biyani made money on our republic day. The Big Bazaar’s SABSE SASTE 3 DIN 24,25,26 January was a super hit. Big Bazaar advertised heavily from internet, mails, newspapers and YELLOWPAGES and community portals. The guy can surely make people run for money. What he did was buy in bulk and sell in bulk by passing the profits to customer. What was interested to note was that a good proportion of its sales came from its Online portal. Mr. Biyani was always sure that his Online store will be a hit among people in Metros and I guess he was true.

Now coming onto the small retailers I guess the need of the hour for them is to reach their customer desperately. They cannot go in for Signage as it is not affordable, a front page of news paper is too expensive for small to medium retailers but YELLOW PAGES sites( like www.yellowpagesgurgaon.com ) can be a comparatively cheap and effective medium. The customers who shop in malls are generally youth and people working in and around Gurgaon who are generally well read and computer savvy. By advertising there Special offers and seasonal discounts and sending mails to their customers through internet marketers the retailers can easily reach their customers. This is not something new and retailers in cities like New York and Melbourne have practiced with success. This out of the box effective medium can be a good savior for the retailers in the city. As it is said that winners don’t do different things but they do the things differently. Both have to reach the customer but it depends how you reach and how effectively you reach.

Vikas Rikhye, Real Estate Blogger

About four years back Gurgaon shopping malls emerged a “Feather in a cap” in Gurgaon’s progress. Enthusiastic investors & retailers with optimistic vision & positive attitude attracted customers from all walks of life and in no time City center , MGF-Metropolitan & Sahara Mall became most happening place. Delhi shoppers also found a new shopping experience .Besides the swanky crowd, the visitor from neighboring villages & towns witnessed the glory modern shopping.

With visual prosperity, new “Real estate Players” jumped into building of Shopping Malls & the also received massive support from investors, retailers & real estate brokers.Thus all this resulted into mushrooming of shopping malls, besides M.G.Road,it started spreading all over the town including NH-8, Sohna Road ,Golf course Road & even in areas around Nirvana country, where more than eight local shopping markets are either functioning or Markets are giving deserted look.

Mall Fever is over in Gurgaon

It seems that Mall fever is over in Gurgaon as Several malls although they are complete in all respect , are still giving a sad look due to lack of demand and more of space availability. Such vacant malls can be seen not only on M.G.Road but also giving a vacant look on Sohna Road, Ardee City, N.H.-8 as well as on Golf course Road etc.

Why there is a Negative Trend of malls in Gurgaon?

The answer seems to be as following:

Delhi Shopping Malls: It seems that now Delhi Shopping Malls are geared up with larger areas and wide range of products at better prices as a result Delhi shopper is no more interested to visit Gurgaon Shopping Malls with an exception to Ambience Mall which caters to Classes & not to the masses .The credit goes to the strategic planning of the Management who has made Ambience Mall, most sought after place for “Rich & Famous”

Parking Problem: in Gurgaon shopping Malls has given negative contribution for Busy/Serious shoppers.

Reliance Fresh/Reliance Mart/Reliance Trends/Reliance Digital: has stolen the show as far as retail sale is concerned, stores are well stocked with wide range of products matching the consumer needs & budget Having selected the best location, ensuring visibility & enough of car parking, the Management of Reliance Group has proved high skills of management strategies. The success seems to continue having adverse effect on Retailers in Mall

Lack of Advertisement for Retailers in Gurgaon shopping Malls there is no such Platform which enables the Retailers in shopping Malls to advertise about their existence to there Target Audience.

The following source of Advertisements have not contributed for this cause:

• Signage it is not that every Retailer can afford to have its Signage out side the mall.
• News Papers an expensive Media with short life of one day
• News Papers Leaflets : Are thrown away while picking the Newspapers.
• Magazines :People prefer T.V Serials instead of Magazines
• TV. Advertisements: Besides being an expensive, it is seen usually the viewer either change the channel or a housewife rushes to the kitchen.
• Road Side Banners: have a life of 2-3 days and are either wiped away by strong winds

It is noticed by all concerned in the trade that www.yellowpagesgurgaon.com is in the process of creating reasonably good platform of awareness for retailers from Gurgaon shopping malls, who have listed their particulars with this site. www.yellowpagesgurgaon.com is an informative site to create awareness of various “Products & Services” available in Gurgaon.

With my concluding note I would like to convey ” A lot of effort is required by all concerned in the trade to create awareness in the Gurgaon community, about the “Retailers Striving for existence”

Vikas Rikhye,India Real Estate Blogger

In one of my articles I had mentioned that we never seem to hear about real estate investors who go bankrupt.I had also cautioned that it does not happen very often unless the decision is rash or it is due to lack of basic relevant information and facts.

But I am sorry to state that in the recent past many innocent investors have been trapped by the” Rosy pictures painted” by some of the masterminded Broker Turned Builders (BTBs) who wanted to enter the real estate market as New Players for New Real Estate Projects.Neighbor’s prosperity, News paper &,T.V. advertisement backed up with lucrative assurance of their neighborhood broker was good enough for them to be tempted them to get ready for a Bright & Prosperous future through investment in property.

The new investor having lured by “Real Estate Prosperity” all around got eager to join the “Prosperity Race”. It is understood that while some had
put in their life time savings ,others managed to raise funds at a very high rate of interest & some had raised funds to invest in property by selling their personal belongings as well as inherited gold ornaments.

In 2006-2007 as we all know that “Unheard investment destinations” were being advertised with New Townships besides NCR townships with:

1.Pre-launch offers

2.Rock bottom Prices

3.Assuring heavy return on investment

4.Costly Sales Brochures depicting Quality of life matching International Standards supported by strategically designed marketing techniques

5.Heavy commission to Brokers

6.Cocktail Dinners on Pre-launch (In ***** Hotels)

7.Luxury Cars as gifts on achieving Sales Targets

All this as stated above was good enough for these investors to have the direction, they had in mind.

I often use to wonder ,that how would a builder be able to bear such expensive cost of marketing and yet would be able to deliver the promised project.

I could feel very close to the answer, when I remembered my Business Guru’s saying ‘The Brower who pays 10% interest never returns the original capital”

As I understand almost same thing happened, as while many of the smart investors made a quick buck at the same time where “Fly by Night Operators “have disappeared or Builder/ Promoter has failed to deliver the project, many of the victims are either running from pillar to post for refund or some accepted it as a bad luck/wrong decision .

At the same time some of the ‘Stay Back’ Builders are asking for future installments without any visible progress as the payment plan seems to be time bound & not construction linked

In Gurgaon after master plan 2021 has earmarked 58 new Sectors,
I understand from news paper advertisement that some of the new Developers are offering apartments in remote locations at a lesser price ranging 2200-2500 per sq.ft with 15% Cost along with application along with a 45day PDC of 10%, which means that with 25% of the selling cost builder receives almost more than 40% of his cost ,without even starting the construction & since the remaining payment is construction linked, therefore apparently the developer has already got his chunk of profit and yet stays in the business at the cost of his investor’s money having a stake free existence .

Secondly, even if the builder delivers the project in time in these remote locations, how would that become livable in absence of basic infrastructure like Public Transport , Sewer, Electricity ,Water etc.

Whereas , so called booming almost 12 years old “New township of Gurgaon” still is awaiting its “Infrastructure dream” to come true

It is also noticed that some of the better known builders are selling Builder floors , which as per present rules do not enjoy a clear title on secondary sales ,where, in some of the cases the builder has already taken more than 25% of the price, without any visible progress

I very frequently get, desperate phone calls from some of such investors, that they would like to get rid of their investment at any cost in some cases they are ready to sell out the booked property below cost

The scene of the Gurgaon shopping malls is no less gloomy as few of the specialized malls give a deserted look awaiting the occupants & investors/owners are asked to pay Maintenance charges, while others Malls which are under construction have slowed down the construction process with a fear of lack of occupancy.

IT office space / IT Parks ( victim of overtrading) had become an investor’s craze , who are continuing to invest ,without realizing the Government’s Plans & Policy.

To me it seems “Some can not think due to lack & greed of money others
Can’t think due to overdose of money”

Mr Vikas Rikhye,Realtor and Real Estate Blogger

Mushrooming growth of shopping malls in Gurgaon creates a question mark in the mind about the negative future of the shopping malls in Gurgaon.

In NCR Gurgaon was one of few first Towns to witness the modern trend of Retail selling & Multiplex culture.

The excited youth and fashionable shopper found their destination at MGF Metropolitan & DLF City Centre ,While moderate & price conscious found their place in Big Bazar in Sahara Mall . Stylish day today shopping got attraction at Spencers and specialized fashion shopping found its place in Grand Mall.

DT and PVR Cinemas attracted people from all walks of life. While on one side one could see elite & hi fashion crowd at the same time one could also see escalator-shy rural crowd looking dazed at modern shopping glamour. Making it most happening place.These Malls were attracting crowds not only from Delhi & Noida but also from distant rural areas of Haryana.

While all this was happening a very few noticed that on this prominent MG Road only while one Mall project was abandoned by the builder and other three malls(under construction were put on slow speed for the lack of market Demand.

Not only on MG Road, but shirking market trend was also felt on Golf course Road &NH-8Where proposed shopping malls gave a deserted look.

On Sohna Road the scene is no different as beside one operational mall, where more than 50% shops are still to open. ( despite the fact that this mall has been so called operational for more than 15 months ). Yet another Marriage mall stand complete in isolation awaiting to be occupied.

And to my utter surprise I see still about seven more malls under construction under such a bleak future .

Mall fever is not yet over it is spreading to Rewar,Dharuhera Bhewadi and as remote places as Punahna etc