Real Insights: Real Estate Overview April-2015 A CommonFloor Report

Executive Summary

Powai, in north-east , is considered as one of the upscale suburbs in the country’s financial capital. In recent years, Powai has surpassed other in its luxury quotient as well as demand for housing. Multiple factors have been the driving forces behind Powai’s growth into a posh residential hub.

The following report tries to identify the various factors that led to the growth of the suburb and its real estate market. Further, the report identifies the present real estate market scenario in terms of housing sale and rent, the key trends, the top builders and their projects available, the civic issues, and the opportunities available for the suburb’s future growth, amongst others.

To summarize it all, Powai continues to grow as an attractive real estate hub for the upper middle class and high net worth individuals. Interestingly, a significant demand for housing comes from the tenants rather than property buyers. Nonetheless, offering properties for both sale and rentals, the area continues to witness growth in infrastructure and appreciating property prices over the years. Moreover, considering the various parameters, one can expect a positive real estate growth in the area in the near future.

Index

Executive Summary ...... i Index ...... ii List of Maps ...... iii List of Figures ...... iii List of Tables ...... iii Introduction ...... 1 Connectivity ...... 1 Infrastructure ...... 1 Major landmarks ...... Error! Bookmark not defined. Civic issues ...... 2 Latest Updates ...... 2 Commercial updates ...... 2 Market Outlook ...... 2 Residential launches from 2011-2014...... 3 Major Developers and Projects ...... 3 BHK-wise and segmentation split in 2013-14 ...... 3 Price Trends...... 4 Weighted Average Price (WAP) and resale values ...... 4 Resale trends from 2013-2015 ...... 5 Housing Rentals from 2014-2015 ...... 6 Rental Yield ...... 6 SWOT analysis ...... 7 Key points ...... 7

List of Maps

Map 1: Powai Location and Context ...... 1

List of Figures

Figure 1: BHK wise availability in Powai ...... 4 Figure 2: Classification of housing segments ...... 4 Figure 3: Weighted Average Price (WAP) in Powai, 2013 - 15 ...... 4 Figure 4: Type of residential units available for resale ...... 5 Figure 5: Configuration of units available for resale ...... 5 Figure 6: Resale prices in Powai, 2014 - 15 ...... 6 Figure 7: Average Rentals in Powai, 2014 -15 ...... 6 Figure 8 Average Rental Yield in Powai, 2014 – 15 ...... 7

List of Tables

Table 1: Important infrastructure projects in Powai ...... 2 Table 2: Major builders and projects in Powai ...... 3 Table 3: Characteristics of different BHK types for resale ...... 5 Table 4: BHK wise average rentals, 2014 - 15 ...... 6

Introduction

Map 1: Powai Location and Context

Source: Google Maps

Situated in the north-eastern part of Mumbai, Powai is a premium locality situated on the banks of Powai . From a prominent picnic spot to one of the most upmarket business and residential hubs, the way in which this central village has metamorphosed is nothing short of remarkable. While there are a host of factors that make Powai a prominent address, the presence of Kensington SEZ, which houses several IT and ITeS companies, has given a major fillip to the residential market of the area.

Connectivity

Powai enjoys swift connectivity with most of the prime suburbs of Mumbai via important roads such as - Link Road (JVLR) and LBS () Marg. The (EEH), which connects the eastern suburbs, passes close to Powai. The which was open to public in 2013 (I Phase) and 2014 (II Phase) has significantly improved the area’s accessibility to . Further, Powai has regular BEST and A/C bus services along with auto-rickshaws, another common mode of transport within the suburb.

Powai does not have its own railway station, but and Vikhroli railway stations are just situated at a distance of 3.5km and 5km respectively. The nearest planned metro stations are in Jagruti Nagar, and . The Mumbai International Airport is just about 5 km away from Powai.

Infrastructure

The suburb boasts of robust civic and social infrastructure with an array of malls, healthcare centres, dance academy and mega stores. The presence of just adds another feather to its cap.

Further, there are several business and commercial establishments in and around Powai. These include:  L&T Manufacturing Plant  Deloitte, CRISIL and Bayer.  Kensington SEZ  SEEPZ SEZ in is just about 5 km away while Complex (BKC) is about 16.5 km.  IIT-Bombay and National Institute of Industrial Engineering

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Off late, Powai has been termed the start-up valley of Mumbai. “Skycity”, developed by Mumbai International Airport Ltd, will be in proximity to Powai. It will have 24x7 work and leisure zones with hotels, restaurants, malls and convention centres among others.

Some of the important infrastructure projects in Powai as follows.

Table 1: Important infrastructure projects in Powai

Present Infrastructure Upcoming/Planned Infrastructure Eastern Express Highway passes close to Powai. Skycity, developed around Mumbai International Other important roads include JVLR and LBS Marg Airport will be in close proximity Nearest suburban railway stations at Kanjurmarg BMC has floated a tender to clean up and (3.5 km) and Vikhroli (4.8 km) rejuvenate the Powai Lake Mumbai International Airport in proximity Metro stations are planned in Jagruti Nagar, Marol and Saki Naka, all 4-5 km away Presence of Kensington SEZ, IIT-Bombay, NIIE

Civic issues

There are not many issues the suburb faces. However, problems start once a person moves out of Powai. These include:

- Powai-Vikhroli Stretch has been witnessing increased traffic congestion during peak hours. The Haico junction specifically witnesses frequent traffic jams as the traffic converges here from all sides. - LBS Marg going towards is narrow and faces severe traffic congestion in the evening. - Unlike the main roads in the area, inside roads are plagued with potholes. - Insufficient parking space is a major problem on the Powai-Vikhroli Stretch. - Though there are several BEST buses to the locality, the frequency of buses is very erratic. - There are complaints of untreated sewage being released into Powai Lake. There is also a significant growth of water hyacinth here, which is a major environmental concern. Latest Updates

Commercial updates

- According to sources, a top real estate portal has taken up a lease of 1.5 lakh sq. ft. in Powai’s Hiranandani Complex. - Powai is emerging as Mumbai’s new start-up valley as it is witnessing a good number of start-ups in recent times. Some of the recent start-ups include Powai Lake Ventures and TinyOwl. Residential Market Outlook

About 25 years ago, Powai started witnessing significant development when the Hiranandani Group took charge of developing a large scale township. Besides developing residential complexes, the Group also developed the overall infrastructure of the suburb. And rest, as they say, is history.

Today, Powai is one of the few eastern suburbs that is upscale when compared to others. This is due to the presence of sound infrastructure, good environment, commercial establishments, and IT companies and electronics industries, all which have created demand among the affluent class of people.

Interestingly, Powai is considered more of a rental destination than a hub for property purchase. Having said that, Powai does see a few property launches once in a while, most of them being in the luxury and ultra-luxury segment.

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It currently offers a Floor Space Index (FSI) of 1. The latest draft of the Mumbai Development Plan (DP) has proposed an FSI between 2 and 3.5 in areas with low-rise development. This means that if the draft DP is approved, Powai along with few other suburbs may witness a boom in residential realty. Some of the key localities within Powai include Yadav Nagar, Hiranandani Gardens, Savarkar Nagar and Panchkutir Ganesh Nagar.

Residential launches from 2011-2015

Powai doesn’t often see many project launches. Having said that, the suburb has witnessed a decent number of project launches in the last 3-4 years. While there have not been many launches up to 2012, there seems to be a sudden increase in launches since 2013. This is majorly because, while a few new projects have been launched, the remaining are new phases of the already existing projects. The first half of year 2015 has not yet witnessed any major launches in the suburb.

Major Developers and Projects

The following table gives some of the major developers in the area and their project details.

Table 2: Major builders and projects in Powai

Developer Name Project Name Approx. BHK Project Expected Yr. Total Availability Status of Completion No. of Units Hiranandani Hiranandani 4,000 1 and 2BHK Ongoing Dec 2018 Builders Gardens Nahar Group Nahar Burberry 76 3BHK Completed Jun 2014 And Bryony L&T Realty Limited L&T Emerald Isle 760 3BHK Ongoing Mar 2017 Dhanista Group Dhanista Gardenia 120 3BHK Ongoing Mar 2018 Apartments Balaji Trinity Group Balaji Trinity 88 1BHK Ongoing Dec 2015 Royale GHP Group GHP Trinity 280 3BHK Ongoing Sep 2017 Jaycee Homes Serenity 798 1 and 2BHK Ongoing Dec 2018 Limited

Source: Real Insights by CommonFloor.com

BHK-wise and segmentation split in 2013-14

As per CommonFloor data, maximum available projects in the locality are apartments.

The following graph shows the BHK-wise availability of apartments in the locality.

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Figure 1: BHK wise availability in Powai Figure 2: Classification of housing segments Source: Real Insights by CommonFloor.com Source: Real Insights by CommonFloor.com

Powai offers property in varied configurations ranging from1-3BHK. The approximate built area of a 1BHK unit is in the range of 620-780 sq. ft. while that of a 2BHK unit is about 630-1,250 sq. ft. The approximate built area of 3BHK unit is usually about 1,160-2,500 sq. ft.

As per Figure 1, out of these, 2BHK units have maximum availability, followed by 1 and 3BHK units in Powai. The demand for 2BHK units usually comes from small families and workforce working in and around Powai.

Figure 2 shows that almost 60 per cent of the apartments available in the suburb were in the ultra-luxury segment, while approximately 40 per cent were in the mid segment and luxury segment. This substantiates the fact that most people buying here are usually upper middle class or higher income group.

Price Trends Weighted Average Price (WAP) and resale values

Figure 3 shows the weighted average launch prices in Powai in the last three years.

Figure 3: Weighted Average Price (WAP) in Powai, 2013 - 15

Source: Real Insights by CommonFloor.com

From figure 3, it may be seen that the WAP in Powai witnessed a continuous growth up to the first half of 2014. The prices rose to the peak during this time (H1 2014). The commissioning of the Eastern Freeway acted as a catalyst in this regard. Subsequently, the supply of units in the area soon stagnated the market and the prices took a temporary downtrend during the second half of 2014. However, the prices have again started picking up in 2015 as Powai witnessed heightened commercial activity, which in turn increased the residential demand. The WAP in the area during the first quarter of 2015 was about Rs 21,800 per sq. ft.

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Powai is already home to many start-ups in Mumbai and many more are preferring this area above the conventional business districts in South Mumbai as it offers better connectivity and infrastructure at relatively less price. As the commercial absorption is growing in this region, the residential demand is also anticipated to grow at a steady pace in the near future.

Resale trends from 2013-2015

Powai is one of the old suburbs of Mumbai along with several other areas such as Andheri and . As such, it offers several residential units for resale apart from new projects in Powai. These residential units are attractive to several end-users. The following figures provide a few resale trends.

Figures 4 and 5 give an idea about the type of residential units available for resale.

Figure 5: Configuration of units available for resale

Figure 4: Type of residential units available for (Source: Real Insights by CommonFloor.com) resale (Source: Real Insights by CommonFloor.com)

One may see from figure 4 that most of the units available for resale are multi-storeyed apartments and builder floor apartments with a few houses. The most common units available for resale are 2 and 3BHK units followed by 1BHK units (from fig 5).

Table 3 gives the characteristics of different types of residential units available for resale.

Table 3: Characteristics of different BHK types for resale

BHK Avg. age of Max age of Avg built area Type Property Property (sq. ft) 1 11 30 590 2 9 20 1,040 3 6 14 1,860 4 7 12 2,950

(Source: Real Insights by CommonFloor.com)

As one may see from table 3, Powai offers resale properties within the average age of 7-11 years, though the area has witnessed several old residential units, as old as 30 years. It may also be seen that though Powai has a few old 3 and 4BHK units, the phenomenon has increased only within the last decade.

Some of the hotspots for finding resale properties are Orchard Avenue, Raheja Vihar and Hiranandani Gardens.

The following figure gives the average resale property prices in Powai.

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Figure 6: Resale prices in Powai, 2014 - 15

Source: Real Insights by CommonFloor.com

As seen from figure 6, the approximate market price in the suburb, which can be identified by the resale price, has continuously seen an upward trend since 2014. This continuous upward trend shows that while new launches have taken an occasional hit, resale of properties in the suburb continues to witness a good demand. The approximate market price in the area is about Rs 22,500 per sq. ft.

Housing Rentals from 2014-2015

Powai is a suburb which is popular more as a rental destination than a destination for house purchase due to the immigrating population and the younger population studying and working in the nearby educational and IT establishments. The following figure shows the average monthly rentals in Powai.

Table 4: BHK wise average rentals, 2014 - 15

Source: Real Insights by CommonFloor.com Figure 7: Average Rentals in Powai, 2014 -15

Source: Real Insights by CommonFloor.com

From table 4 and figure 6, one may see that Powai commands high rentals, primarily due to the demand coupled with infrastructure and amenities. The high rentals show that the areas witnesses demand from affluent population. The approximate rental price in the area is about Rs 50-55 per sq. ft (from fig 7).

Rental Yield

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The following graph (fig 5) gives the rental yield trend since 2014.

Figure 8 Average Rental Yield in Powai, 2014 – 15

Source: Real Insights by CommonFloor.com

From figure 8, one may see that the average rental yield in Powai is in the range of 2.5-3 per cent, which is a decent value considering the average rental yield for residential buildings in is about 3-4 per cent. Hence, if you want to buy an apartment with the purpose of letting it out, Powai proves to be a good area. SWOT analysis

The following table gives the SWOT analysis of Powai.

Strengths Weakness - Excellent connectivity to various parts of - High property prices and rental prices is the Mumbai major drawback in the suburb - Well-developed physical, civic and social infrastructure - Presence of Kensington SEZ housing IT/ITeS companies, and IIT-Bombay. Proximity to SEEPZ SEZ Opportunities Threats - If the proposed increase in FSI up to 2-3.5 as - The high property prices may prove a threat per draft DP is implemented, this could as there is an increasing demand for prove a boon to real estate growth here affordable housing. But Powai will remain - Beautification of Powai Lake as well as attractive only to the affluent segment of the addressing civic issues will increase the population. attractiveness of the locality.

Key points

The following key points are obtained from the report

- Powai is one of the posh suburbs situated in the north-eastern part of Mumbai. - Major drivers of Powai’s growth are its great connectivity to prime suburbs, proximity to important business hubs and IIT-Mumbai, focused development, established social amenities and its clean environment. - The suburb faces few civic issues of which, traffic congestion and pollution of the Powai Lake are the key ones. - The opening of the Eastern Freeway in phased manner in the last two years has catapulted the real estate growth in the suburb.

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- Powai doesn’t witness mass project launches unlike several other suburbs. However, the last couple of years have witnessed launch of several phases of existing projects. - Powai offers several 2BHK apartments, followed by 1 and 3BHK apartments. Almost 60 per cent of the properties in Powai are in the ultra-luxury segment (beyond Rs 2 crore). Only about 40 per cent of properties are in luxury segment (Rs 1.2 – 2 crore) and mid-segment (Rs 60 lakh – 1.2 crore). Hence, Powai mainly caters to the upper-middle and higher income groups. - The WAP of new projects in the area is about Rs 21,800 per sq. ft. The approximate market price in the area is about Rs 22,500 per sq. ft. in the suburb. - Powai, being an old area, offers several 1, 2, 3 and 4BHK apartments for resale. The average age of resale properties in the area is about 6-11 years. - Powai is more sought after for rentals than property purchase. The suburb offers several options for rental housing. The approximate rental price in the suburb is about Rs 50-55 per sq. ft. - Powai offers an average rental yield of 2.5-3 per cent. This proves good for people who want to buy an apartment for the purpose of letting it out for rent.

CommonFloor.com, Bangalore maxHeap Technologies Pvt Ltd Tower B, 4th Floor, Diamond District, #150, Old Airport Road, Kodihalli, Bangalore – 560 008

Authors

Karthik Kashyap Shankhadeep Chaudhuri Priyanka Kapoor Meha Singla Senior Research Associate Senior Research Associate Sr. Research Analyst Associate Director -Domain [email protected] shankhadeep.chaudhuri@commonfloor. [email protected] Research (Real Estate) m com om [email protected] Bangalore Bangalore Bangalore Bangalore

Disclaimer: The document above is written by the Domain Research Team at Commonfloor.com, India’s fastest growing real estate website known for its unbiased prognosis in Real Estate sector. The information provided in this report is based on CommonFloor data which is collected from various publicly known sources viz, websites, documents and maps. It should be considered as a guideline and not in absolute certainty. While care has been taken for groundwork, no responsibility is accepted for the accuracy of whole or any part. This information is confidential and the sole property of CommonFloor.com. It should not be reproduced in any form, in part or whole, without prior permission.

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