AHMEDABADRESIDENTIAL & OFFICEJULY TO DECEMBER 2017

KnightFrank.co.in

2

RESIDENTIAL RECAP H1 2017

Launches hit new low in H1 2017

Developers switched focus towards

affordable housing with 75% of the

launches in the under INR 50 lakh

segment

Proximity to industrial clusters made

West Ahmedabad a preferred pocket

Impact of RERA & GST

compliance

3

33,175

45,120

30,758

23,867

14,011 15,553

14,009

4,790

2010 2011 2012 2013 2014 2015 2016 2017

66% YoY

Yearly launches

Launches plummet

to decadal low

No

of

un

its

4

9,021

4,991

8,062

7,491

8,809

5,200

1,874

2,916

H1 2014 H2 2014 H1 2015 H2 2015 H1 2016 H2 2016 H1 2017 H2 2017

44% YoY

Half-yearly launches

RERA and GST

compliance holds

back launches in

H2 2017

No

of

un

its

5

INR H2 2016 H2 2017

<2.5 mn 30% 33%

2.5-5 mn 43% 45%

5-7.5 mn 18% 9%

7.5-10 mn 6% 4%

10-20 mn 3% 9%

Ticket sizes that saw

maximum change in H2 2017

Share of launches under

INR 5 mn continues to

hold steady

6

19,424

29,69430,577

25,592

18,49016,826

15,956 15,741

2010 2011 2012 2013 2014 2015 2016 2017

No

of

un

its

Yearly sales

Sales remain tepid even

on the back of sops and

discounts by developers

7

10,113

14,05114,569

11,938

8,019

9,075

7,800

H2 2010 H2 2011 H2 2012 H2 2013 H2 2014 H2 2015 H2 2016 H2 2017

No

of

un

its

Half-yearly sales

Overall on a decline

since 2011, sales pick up

5% YoY in H2 2017

7,400

Lower base effect of

demonetisation-hit H2 2016

1,899 units

-35%

EAST

NORTH

WESTCENTRAL

SOUTH

2,589 units

18%

1,876 units

18%

553 units

-17%

883 units

3%

Micro-market half-

yearly sales

Affordable home sales

lift West and North

Ahmedabad

9

2,421

2,496

2,645

2,730

2,770 2,820

2,200

2,300

2,400

2,500

2,600

2,700

2,800

2,900

Q4 2012 Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017

2%YoY

While other cities

grapple with price

issues, Ahmedabad

records 2% price growth

12-month price

change

Across the city, prices

have gone up between

1% and 4%

AMBAVADI

INR 5,700-5,826/sq ft

4%

NAVRANGPURA

INR 5,400-5,555/sq ft

3%

NIKOL

INR 2,000-2,160/sq ft

2%

VASTRAL

INR 2,000-2,132/sq ft

3%

CHANDKHEDA

INR 2,650-2,769/sq ft

1%

MOTERA

INR 3,400-3,589/sq ft

4%

ASLALI CIRCLE

INR 1,280- 1,354/sq ft

1%

BOPAL

INR 3,200-3,223/sq ft

3%

PRAHLAD NAGAR

INR 5,480-5,513/sq ft

1%

70

80

90

100

110

120

130

140

11

CPI

AHMEDABAD

Residential prices up by 2%

compared to an inflation

growth of 5.5% in 2017

Price growth evident,

albeit under retail

inflation

12

Ahmedabad an affordable market, well

within Knight Frank Affordability

Benchmark* of

4.5(*house price to income ratio)

2017

3.52010

4.3

QTS levels down to 7 from 9

quarters in H2 2017

Unsold inventory declines

29% YoY

Analysis of unsold inventory and QTS

13

44,2

45

41,2

05

41,3

68

39,7

82

40,0

35

37,8

35

32,9

34

26,8

84

7.0 7.3

8.4 8.7

8.5 8.6

7.7

7.0

-

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

- 1

0,0

00

20,0

00

30,0

00

40,0

00

50,0

00

H1 2014 H2 2014 H1 2015 H2 2015 H1 2016 H2 2016 H1 2017 H2 2017

QT

S

Un

so

ld In

ven

tory

Unsold inventory QTS

EAST

NORTH

WESTCENTRAL

SOUTH

1,882 unitsQTS: 7.2

Age: 7.6

6,452 unitsQTS: 7

Age: 9.6

7,796 unitsQTS: 7.7

Age: 9.1

6,721 unitsQTS: 8.2

Age: 12.3

4,032 unitsQTS: 8.8

Age: 11.5

Unsold inventory in

Ahmedabad is less than

two years old - sign of

healthy market

Age and QTS in quarters

KEY FINDINGS

15

01 03

02 04

Launches down 89% since

the peak of 2011

While other cities grapple with

price issues, Ahmedabad

records a price growth

• Prices up by 2% YoY in 2017

Unsold inventory in is less

than two years old - sign of

healthy market

• East Ahmedabad is one of the better performing markets with a QTS of 7 and its age of inventory is 9.6

Sales volumes in H2 2017

recorded 5% surge YoY

• Affordable housing pockets of East and North Ahmedabad attract nearly 60% of the total sales

• Developers shift focus on completing existing projects

16

OFFICE

17

1.4

1.7

2.9

0

1

2

3

4

5

2015 2016 2017

Yearly new completions

New completions more

than double over three

years75%

YoY

Mn.

Sq

. ft

.

18

0.6

0.8

0.6

1.1

2.2

0.7

H1 2015 H2 2015 H1 2016 H2 2016 H1 2017 H2 2017

Half-yearly new completions

New completions dwindle;

developers switch focus to

residential project completion

36% YoY

Mn.

Sq

. ft

.

19

0.80

0.95

1.46

2015 2016 2017

53%YoY

Mn.

Sq

. ft

. Yearly transactions

Office market on an

upward trajectory

For the first time, annual

transaction volume crosses

1 mn sq ft

20

0.30

0.20

0.30

H2 2015 H2 2016 H2 2017

Mn.

Sq

. ft

. Half-yearly transactions

Availability of quality

office space at

competitive rates coupled

with pick up in GIFT city

improves transaction

volume

21

17.5

19.6

23.6

10

15

20

25

2015 2016 2017

Vacancy

Vacancy levels

increased on account

of huge supply

•

GIFT in PBD accounted

for all office

transactions in H2 2017

CBD WEST

INR 40-43/sq ft/month

1%

PBD

INR 40-41/sq ft/month

9%

12 month change

23

Industry H2 2017 H2 2016

BANKING, FINANCIAL

SERVICES &

INSURANCE42% 35%

IT/ITES 14% 0%

MANUFACTURING 8% 26%

OTHER SERVICES 36% 39%

Significant drop in the share of the manufacturing sector

IT/ITeS makes in-roads with 14% share

KEY FINDINGS

01 03

02 04

24

Office market on an upward

trajectoryShare of manufacturing

in transactions dwindles

Vacancy levels increased on

account of huge supply

GIFT emerges as a major

office market, SG Highway

continues to be a major

market in CBD west

AHMEDABADRESIDENTIAL & OFFICE

Amidst price correction in most cities, Ahmedabad

records an appreciation in the residential segment

Relatively new office market as compared to other

metros shows robust demand momentum

KnightFrank.co.inknightfrank.india@in.knightfrank.com