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MUMBAIRESIDENTIAL
JANUARY TO JUNE 2015
RESIDENTIAL MARKET IN DOLDRUMSDid freebies and easy financing schemes prop up demand?
Will developers cope up?
Is property price correction in Mumbai imminent?
INVESTORS AND END-USERS CONCERNED;DEVELOPERS RESPOND, PRICE GROWTH SLOWS
H1 20
13
H2 20
13
H1 20
14
H2 20
14
H1 20
15 -
10,000
20,000
30,000
40,000
50,000
60,000
57
,00
7
52
,22
2
35
,51
2
26
,83
3
18
,88
7
41
,37
7
32
,71
7
31
,21
0
36
,50
5
28
,44
6
Launches Absorption
No
. o
f u
nit
s
NEW LAUNCHES DROP BY 47% Y-O-Y; DEMAND BY 9%H1 2015 - THE WORST HALF YEARLY PERIOD POST GLOBAL FINANCIAL CRISIS
H1 20
13
H2 20
13
H1 20
14
H2 20
14
H1 20
15 4,000
4,500
5,000
5,500
6,000
6,500
7,000
7,500
8,000
6,818 7,085
7,382
7,796 7,994
Wt. Avg. Price (RHS)
No
. o
f u
nit
s
PRICES STAGNANT
PERIPHERAL WESTERN SUBURBS
Dadar, Lower Parel, Mahalakshmi, Worli, Prabhadevi
CENTRAL MUMBAI
Sion, Chembur, Wadala,
Kurla, Ghatkopar, Vikhroli, Bhandup, Mulund
CENTRAL SUBURBS
Vashi, Nerul, Belapur
Kharghar, Airoli, Panvel, Ulwe, Sanpada
NAVI MUMBAI
Kalyan, Kalwa, Dombivili,
Ambernath, Bhiwandi, Mumbra, Karjat
PERIPHERAL CENTRAL SUBURBSVasai, Virar, Boisar, Palghar, Bhayandar, Nalasopara
Malabar Hill, Napean Sea Road, Walkeshwar, Altamount Road, Colaba
SOUTH MUMBAI
Ghodbunder Road, Pokhran Road, Majiwada, Khopat, Panchpakhadi
THANE
Bandra, Andheri, Goregaon,
Kandivali, Borivali, Santa Cruz, Vile Parle
WESTERN SUBURBS
40%
127% 1%
(6%)
33%
51%
7%
20%
97%
30% (3%)
(20%)
8%
(7%)
(32%)
(20%)
H2 2014
H1 2015
Proposed International Airport
ñ
HOWEVER, CENTRAL SUBURBS AND CENTRAL MUMBAI HAVE SEEN SUBSTANTIAL GROWTH Y-O-Y
DEVELOPERS FORAYING INTO LOCATIONS BEYOND THANE FOR AFFORDABLE HOUSING
<2.5 mn 2.5-5 mn 5-7.5 mn 7.5-10 mn 10-20 mn >20 mn0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%Central Mumbai Central Suburbs Navi Mumbai Peripheral Central Suburbs
Peripheral Western Suburbs South Mumbai Thane Western Suburbs
59% OF NEW LAUNCHES BELOW INR 2.5 MN IN KALWA, KALYAN, DOMBIVALI, AMBARNATH
INR
CENTRAL SUBURBS TAKES LEAD IN LAUNCHES IN THE LAST 6 MONTHS
MULUND, KANJURMARG, CHEMBUR SEE BIG LAUNCHES; CONTRIBUTES 28% OF NEW LAUNCHES IN JAN – JUN 2015
Central Mumbai
Central Suburbs
Navi Mumbai Peripheral Central Suburbs
Peripheral Western Suburbs
South Mumbai Thane Western Suburbs
0%
5%
10%
15%
20%
25%
30%
35%
40%
3%
15%13%
26%
19%
0%
10%
15%
0%
20%
25%
36%
2%0%
5%
12%
0%
28%
12%
23%
10%
0%
13% 14%
H1 2014 H2 2014 H1 2015
892
5,15
2
5,1
945,
240
4,44
5
2,2
246,
630
9,12
9
4,3
259,
780
6,64
1
1,9
35
560
3,69
4
2,4
86
1,39
0
5,40
0
2,6
863,
133
NO NEW LAUNCHES IN PREMIUM MARKET WITH HOMES MORE THAN INR 5 CRORE
H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 -
200
400
600
800
1,000
1,200
1,400
1,600
1,800
25,000
26,000
27,000
28,000
29,000
30,000
31,000
32,000
33,000
34,000
35,000 1
,53
2
1,5
83
1,1
40
12
1
1,3
55
87
7
54
0
65
0
79
5
30,012
31,182
32,197 32,469
33,025
Launches Absorption Wt. Avg. Price (RHS)
No
. o
f u
nit
s
INR
/sq
ft
SUPPLY IN PREMIUM MARKET CONTRACTS FASTER THAN DEMAND
IT WILL TAKE AROUND 3.5 YEARS TO OFFLOAD UNSOLD INVENTORY IN PREMIUM MARKETS; MMR TO TAKE 3 YEARS
Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 -
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
No
. o
f Q
uar
ters
SALES IN PREMIUM MARKETS IN TANDEM WITH CITY SALES
PREMIUM MARKETS
MMR
SOUTH MUMBAI CONTINUES TO SUFFER; 5 YEARS TO OFFLOAD CURRENT INVENTORY
8 11 14 17 20 237
10
13
16
19
QTS
Age
of I
nven
tory
in q
uart
ers
CENTRAL MUMBAI
SOUTH MUMBAI
CENTRAL SUBURBS
WESTERN SUBURBS
PERIPHERAL WESTERN SUBURBS
NAVI MUMBAI
PERIPHERAL CENTRAL SUBURBS THANE
CONSUMER INTEREST TO REMAIN TEPID IN H2 2015
OUTLOOK FOR THE NEXT 6 MONTHS
LAUNCHES (UNITS)
SALES(UNITS)
WEIGHTED AVERAGE PRICE
(INR/SQ FT)
H2 2014 26,833 36,505 7,796
H1 2015 18,887 28,446 7,994
H2 2015 E 20,776 34,135 7,994
HOW DOES MUMBAI STAND COMPARED TO OTHER CITIES
LAUNCHES- ALL MAJOR CITIES
H1 2015
BENGALURU 21,400
MUMBAI 18,887
PUNE 12,762
NCR 11,360
CHENNAI 9,102
KOLKATA 8,372
AHMEDABAD 8,062
HYDERABAD 5,457
H1 2014
BENGALURU 35,545
MUMBAI 35,512
NCR 35,500
PUNE 16,883
CHENNAI 11,377
AHMEDABAD 9,021
KOLKATA 8,444
HYDERABAD 7,899
INCLUDING MUMBAI WITNESS DRASTIC FALL
SALES
H1 2015
MUMBAI 28,446
BENGALURU 22,234
PUNE 15,524
NCR 14,250
CHENNAI 9,091
AHMEDABAD 7,751
HYDERABAD 7,123
KOLKATA 5,883
H1 2014 H2 2014
MUMBAI 31,210 36,505
NCR 28,500 12,075
BENGALURU 27,256 28,445
PUNE 14,719 20,150
CHENNAI 10,315 10,643
AHMEDABAD 10,472 8,019
HYDERABAD 7,282 7,829
KOLKATA 6,390 6,245
- SIMILAR TREND IN SALES
HEALTH OF MUMBAI RESIDENTIAL MARKET A BIG CHALLENGE
5 7 9 11 13 15 17 195
7
9
11
13
15
QTS
Age
of
unso
ld in
vent
ory
in q
uart
ers
MUMBAI
PUNE
AHMEDABAD
HYDERABAD
KOLKATA
NCR
BENGALURU
CHENNAI
MUMBAIOFFICEMARKET
JANUARY TO JUNE 2015
OFFICE MARKET SLOW AND STEADY
DEMAND HOLDS, PROJECT COMPLETIONS DELAYED
H1 20
13
H2 20
13
H1 20
14
H2 20
14
H1 20
15 -
1.0
2.0
3.0
4.0
5.0
6.0
7.0
3.8 3.8 2.9
6.4
2.3
3.8
2.4 2.5
4.8
2.5
New completions Absorption
mn
sq
ft
ALL NUMBERS IN MN SQ FT
MARGINAL DECREASE IN VACANCY; DEARTH OF LARGE SIZED QUALITY OFFICE SPACE
H1 20
13
H2 20
13
H1 20
14
H2 20
14
H1 20
150
20
40
60
80
100
120
15.0%
18.0%
21.0%
24.0%
99 103 106 112 114
77 79 82 87 89
22.3%22.8% 22.5% 22.6%
21.9%
Stock Occupied Stock Vacancy (RHS)
mn
sq
ft
ALL NUMBERS IN MN SQ FT
VACANCY
CUFFE PARADE
NARIMAN POINT
WORLILOWER PAREL
DADAR
VASHI
GHANSOLI
AIROLI
BELAPUR
VIKHROLI
KURLA
BHANDUP
ANDHERI
GOREGAON
MALAD
BALLARD ESTATE
THANE
POWAI
BKC
KALINA
CBD & OFF-CBD
PBD
SBD WEST
CENTRAL MUMBAI
BKC & OFF BKC
Proposed International Airport
ñ
9%
17%
10%
33%17%
26%
SBD CENTRAL
VACANCY ACROSS BUSINESS DISTRICTS
OVERALL 22%
DIVERSIFIED OCCUPIER BASE; BANKING & FINANCIAL SERVICES AN ANCHOR
MEDIA, CONSULTING, E-COMMERCE INCREASED THEIR TALLY
BFSI IT/ITES Manufacturing Other services0%
10%
20%
30%
40%
50%
60%
15%12%
48%
25%
40%
26%
10%
24%26%
16% 17%
40%
H1 2014 H2 2014 H1 2015
0.3
7
1.9
4
0.6
7
0.3
1
1.2
3
0.4
1
1.2
1
0.4
6
0.4
3
0.6
4
1.1
8
1.0
2
ALL NUMBERS IN MN SQ FT
COMPETITIVE RENTS, IMPROVED EAST-WEST CONNECTIVITY GIVE AN EDGE TO POWAI, VIKHROLI, ANDHERI, GOREGAON
BKC & Off-BKC CBD & Off-CBD Central Mumbai PBD SBD Central SBD West0%
5%
10%
15%
20%
25%
30%
35%
40%
14%
2%
14%
31%
11%
27%
17%
2%
7%
21%19%
34%
H1 2014 H1 2015
SBD CENTRAL AND SBD WEST TOGETHER ACCOUNT FOR HALF THE MARKET
0.3
6
0.4
4
0.0
5
0.0
5
0.3
6
0.1
8
0.7
8
0.5
2
0.2
8
0.4
8
0.6
9
0.8
7
MUMBAI TO RETAIN ITS DIVERSIFIED OCCUPIER BASE; NEW ‘IT’ POLICY UNLIKELY TO BE A GAME CHANGER
OUTLOOK FOR THE NEXT 6 MONTHS
NEW
COMPLETIONS (MN SQ FT)
ABSORPTION (MN SQ FT)
VACANCYWEIGHTED AVERAGE
RENT (INR/SQ FT/MONTH)
H2 2014 6.4 4.8 22.6% 118
H2 2015E 4.3 5.2 20.4% 123
GROWTH (32%) 8% 4%
HOW DOES MUMBAI STAND COMPARED TO OTHER CITIES
VACANCY LEVELS HIGHEST IN THE COUNTRY
Mumbai NCR Bengaluru Pune Chennai Hyderabad -
1
2
3
4
5
6
7
0%
5%
10%
15%
20%
25%22%
21%
8%
15%
18%16%
New completions Absorption Vacancy (RHS)
mn
sq
ft
H1 2015
KEY TAKEAWAYSRESIDENTIALMUMBAIRECORDS THE WORST HALF YEARLY PERIOD POST THE GLOBAL FINANCIAL CRISIS
OFFICEMUMBAIVACANCY HIGHEST IN INDIA ALTHOUGH OCCUPIERS UNABLE TO FIND THEIR PREFERRED SPACES DUE TO LIMITED SUPPLY
MUMBAIREAL ESTATE
JANUARY TO JUNE 2015