What Is Driving Pune’s Real Estate Success?

Pune has been the talk of the town when it comes to overcoming the real estate slump. At the recently held Realty+ Conclave in Pune, developers from the city gathered together to explain the trends of Pune realty market.

  Aditi Watve, President- investment Sales & Reit Advisory, Anarock capital began with taking a look back at 2019 and what is in store for real estate in the year 2020, “The housing market did limp through 2019 but now, there has been a marginal increase in new project launches in Pune. That means there are people who are buying. They just need the right product and at the right location. The government measures to combat the crisis are more long term in nature though, I believe better city infrastructure is what will lead the consumer to buy in suburban affordable housing and in that way the government has truly taken a lot of initiatives.” Emphasizing on the importance of good infrastructure in the construction of better cities, Kishanakumar Goyal, Chairman & Managing Director- Kohinoor Group Kohinoor Development corporation shared, “Pune has continued to grow steadily and do well. The real estate demand never drastically dropped and in fact, in the last few years this city has caught the attention of even more real estate stakeholders from co-working, co-living to warehousing and student housing operators. Pune’s future is very bright and demand is only going to rise.” Sharing his opinion on Pune city’s transformation Apurva Shah, country manager, evervantage expressed, “Over time Pune has built a very strong residential push and this is purely due to availability of space. When it comes to other segments of real estate, I feel Pune has not managed to keep up. However, this is gradually changing with the increased inflow of private equity in the city. It all comes down to where the supply comes from as every segment of the real estate market is different.”   WHAT PUNE DID RIGHT? In 2020, Pune can look at about 10 million sqft of supply hitting the commercial market with the numbers increasing year on year. The increase in supply and construction of good infrastructure has in-turn stabilised and brought down the property costs. Hrishikesh Manjrekar, Executive Director- Amar Builders & Developments Pvt. Ltd elaborated, “About 10 years ago the commercial market in India was down in the doldrums. The Lehman brothers had just crashed and the entire situation was bleak. At that point commercial developers in Pune were looking at investing in projects solely for a cash out purpose. No one wanted long term investments with commercial projects. The so called commercial boom that everyone talks about today, is just a shortage of supply. Pune still cannot compete with Hyderabad and Bangalore as we do not have those many developers constructing serious commercial projects. That however, is now changing for the better. Pune’s biggest advantage is the available manpower. In the next 2 years we will see Pune’s real estate market on the forefront nationwide.” On the housing segment, Sachin Bhandari, CEO-VTP Realty was of the view that year 2019 was not only a year of disruption but also a learning curve for the industry. “We have realised that the amenities and location is what attracts millennial buyers and as developers we need to stay contemporary to offer projects that will not get obsolete in 15-20 years. As the trends and lifestyles keep changing, our homes should be able to keep up with the changing needs of the buyers. Pune has been setting records in past years and I don’t see that falling at all.” On the same note, luxury real estate seems to be less explored and is still a niche segment in Pune. Roshan Oswal, Executive Director, Goel Ganga Group expressed, “With the new regulatory reforms every builder is taking the business very seriously. That has transformed every segment of real estate, be it luxury or otherwise. When you talk about luxury in Pune it has a very different meaning every three kilometres. A developer needs to understand each pocket of Pune and build according to the requirement of each pocket. If a developer can accomplish this then any and every project will do well.” Pune is one of the major cities in India that is dominated by local developers and thus has been less impacted by the slump as local Pune developers know their buyers and they understand the market. They just need to stay attuned to the new segments emerging in real estate, diversity and cater to them to stay ahead of the game.