The Maharashtra Real Estate Regulatory Authority (MahaRERA) has taken a significant step towards promoting transparency in the real estate sector. From August 1, developers in the state will be required to prominently display QR codes in all advertisements and promotions related to their projects. Failure to comply with this directive could result in penalties ranging from Rs 10,000 to Rs 50,000.

Introduced on March 27, MahaRERA assigned a unique QR code to each new real estate project alongside its registration certificate. This measure aims to assist potential homebuyers in accessing vital information about a project before making a purchase decision. So far, over 40,000 real estate projects have been registered with MahaRERA since its establishment in May 2017, with around 5,700 projects lapsing.

The square black and white QR codes will be easily scannable by smartphones, providing homebuyers with essential project details such as the developer’s name, registration date, expected completion timeline, received approvals, post-construction status, and available complaints. The QR codes also facilitate easy access to information about any changes made to the approved plan and the renewal status of a project’s registration.

By making this information readily available through QR codes, MahaRERA aims to empower homebuyers with convenient and comprehensive insights into real estate projects, promoting transparency and accountability in the sector. Developers must ensure strict compliance with the new requirement to avoid penalties, and any failure to rectify violations promptly will be subject to further action by the regulatory authority.

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Leading real estate firm DLF is optimistic about achieving “surplus cash generation” by the end of the fiscal year, propelled by improved collections and strong demand in the market. The company maintains its pre-sales guidance in the range of Rs 12,000–13,000 crore.

In the first quarter of FY24 (April to June), DLF significantly reduced its net debt level to a remarkable Rs 57 crore, marking one of its lowest figures ever. Collections during this period showed an impressive 47 percent year-on-year growth, reaching Rs 1,580 crore.

After accounting for construction costs and overheads, the company realized a surplus of Rs 670 crore, leading to a cash balance of Rs 2,960 crore, even as it held a gross debt of Rs 3,010 crore.

Anand Mathur, CFO of DLF, highlighted the company’s continuous efforts to strengthen its balance sheet and emphasized the impact of strong collections in reducing net debt. He expressed confidence in achieving their commitment of being net zero and is hopeful about ending the year with a surplus cash position. These positive outcomes were discussed during an investor call.

During Q1FY24, DLF recorded bookings of Rs 2,040 crore, remaining flat compared to the previous year. However, due to the absence of new launches in the current quarter, bookings declined by 76 percent on a sequential basis. The company’s sales were predominantly driven by ongoing and completed inventory.

DLF now holds pending inventory worth Rs 5,600 crore from ongoing and completed projects and has ambitious plans to launch projects spanning 10 million square feet, with a potential revenue of Rs 19,000 crore.

Analyst firm Motilal Oswal noted that there is potential for upside risk depending on the response to the upcoming launch of Crest II, a residential complex in Gurugram.

DLF is preparing to launch a significant portion of its 10 million square feet projects in H2FY24.

Among the launches, approximately 3.5 million square feet falls under the super-luxury high-rise category in DLF 5, Gurugram. Additionally, 1.2 million square feet belongs to the high-rise luxury category, spread across projects in Chennai, mid- to high-rise category in Gurugram, and a low-rise project in Chandigarh.

By the end of Q2FY24 (September-end), DLF plans to unveil Tower D at its One Midtown property in Delhi, for which 80 percent of the inventory is already booked, signaling strong demand and traction.

DLF has joined hands with Trident for a for-sale component of 0.9 million square feet in a Slum Rehabilitation Authority (SRA) project in Andheri, Mumbai. This marks the company’s entry into the Mumbai real estate market. The larger SRA project has a development potential of 3-3.5 million square feet for sale.

DLF will invest Rs 400 crore in equity for a 51 percent stake in a Special Purpose Vehicle (SPV) and may consider taking up equity in the main company at a later stage. The successful completion of this pilot project will pave the way for long-term plans, including potential commercial projects, as stated by Ashok Tyagi, CEO of DLF.

Under the partnership with Trident, DLF will oversee construction, sales, and financial closure of the Mumbai project, marking a significant milestone in the company’s expansion into one of India’s most dynamic real estate markets.

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The real estate developers in Hyderabad are facing significant challenges in acquiring land and constructing affordable housing projects due to the soaring land rates. As a result, sales in the affordable housing category have been severely hampered, with both supply and sales declining by 50% in just one year.

Anarock Property Consultants reported that during the first half of the fiscal year (H1) 2022, 1,460 affordable houses were sold in Hyderabad. However, this number dropped significantly to 720 in H1 2023. The new supply of affordable housing units also witnessed a sharp decline from 1,220 to 685 during the same period.

Just a few years ago, purchasing a 2 BHK property in Hyderabad was attainable for middle-class buyers at a cost of less than Rs 50 lakh in most areas. However, the scenario has drastically changed, and the cost of a 2 BHK property within the city limits now ranges from Rs 70 lakh to Rs 90 lakh, making it increasingly difficult for salaried employees to afford a home. Even a 3 BHK property in prime areas now costs no less than Rs 1 crore.

Real estate developers in the city point out that various factors, including land rates, registration charges, construction materials, and labor costs, have all increased since the Covid-19 pandemic began, contributing to the surge in flat rates across the State. Earlier, the cost per square foot for flats ranged from Rs 3,500 to Rs 4,000, but completing a project for less than Rs 6,000 per square foot has now become nearly impossible.

The rise in real estate prices has led to a significant decrease in demand for affordable housing, with many potential buyers postponing their purchase decisions. Developers are now shifting their focus to mid-range, premium, and luxury projects, which are more financially viable in the current market.

The challenges faced by both buyers and developers in the affordable housing category extend beyond the impact of the pandemic, making the road to affordable homeownership increasingly difficult for many in Hyderabad.

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AHMEDABAD: The Covid-19 pandemic has proven to be a catalyst for the rapid adoption of the green building concept in Gujarat. According to the Indian Green Building Council (IGBC), the state witnessed an impressive surge of 91 green building registrations between January and March this year, compared to 93 registrations in the entirety of 2022.

This significant increase is credited to developers increasingly recognizing the cost competitiveness of green buildings and buyers acknowledging the multiple advantages they offer.

Sameer Sinha, former chairman of IGBC Ahmedabad, expressed, “For a decade, we have been promoting green buildings and now witness a growing interest among developers to embrace green building practices. They have realized that green buildings not only offer environmental benefits but also economic advantages. The construction cost of green buildings is comparable to traditional buildings, while operational costs are around 40% lower due to energy and water savings.”

In the aftermath of the Covid pandemic, Gujarat has seen a remarkable surge in green building registrations. In 2019, the state had a total of 51 registered green buildings, which substantially increased to 93 in 2022. Jayesh Hariyani, the chairman of IGBC Ahmedabad, highlighted the decreasing construction cost of green buildings as a driving factor attracting more developers to embrace sustainability practices.

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In the face of challenging economic conditions, real estate firms have demonstrated remarkable resilience during the March quarter of FY23. Despite rising interest rates, listed companies in the industry have recorded bumper bookings in the residential segment, ending the year on a strong note.

The residential real estate sector proved to be a beacon of hope during the financial year’s final quarter, providing a significant boost to developers. Despite concerns over the impact of increasing interest rates, buyers showed unwavering enthusiasm, contributing to the stellar performance witnessed in pre-sales across the board.

The robust performance of the real estate industry during the final quarter is particularly noteworthy, considering the headwinds it faced. Rising interest rates have traditionally been seen as a deterrent for potential homebuyers, as borrowing costs tend to increase. However, contrary to expectations, the demand for residential properties remained resilient.

Experts attribute this strong performance to several factors. Firstly, developers keenly adapted to changing market dynamics by offering attractive incentives and flexible payment schemes to potential buyers. By easing financial burdens and creating favorable buying conditions, developers successfully attracted a broader customer base.

Additionally, the real estate industry’s pivot towards the digital realm played a pivotal role in driving sales. Virtual property tours, online consultations, and digital marketing campaigns became the new norm, making it easier for buyers to explore properties from the comfort of their homes. This digital transformation not only expanded the reach of developers but also expedited the sales process.

Furthermore, government initiatives supporting the real estate sector, such as reduced stamp duty rates and housing loan subsidies, provided a much-needed impetus to the market. These measures encouraged fence-sitters to take the leap into property ownership, further fueling the demand for residential spaces.

The quarterly performance of listed real estate companies was a clear indication of the industry’s strong foundations. Despite uncertainties in the broader economic landscape, these firms demonstrated their ability to navigate challenges adeptly, ensuring consistent growth and profitability.

Industry analysts anticipate that the positive momentum witnessed during the March quarter will likely carry forward into the new financial year. The combination of a growing economy, continued government support, and developers’ proactive strategies is expected to sustain the upward trajectory of the residential segment.

However, experts caution that challenges remain on the horizon. With interest rates anticipated to remain a concern, developers must stay vigilant and continue to innovate to maintain the current momentum.

In conclusion, the strong performance of the real estate industry during the March quarter of FY23 is a testament to its resilience and adaptability. The remarkable growth in residential segment bookings, even in the face of rising interest rates, bodes well for the sector’s future prospects. As the industry continues to evolve, its ability to weather uncertainties and provide attractive opportunities to buyers will be key to its sustained success.

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I understand that you’re providing information about a recent development involving Rashmi Housing, a realty developer in Mumbai. The company was undergoing the Corporate Insolvency Resolution Process (CIRP) when its promoters illegally sold 82 apartments in violation of the law. As a result, the National Company Law Tribunal (NCLT) has invalidated the sale of these flats and imposed a fine of Rs 3 lakh on each of the promoters.

Finance Advisors & Managers and Vista ITCL, formerly an IL&FS trust company, had taken Rashmi Housing to the NCLT after the company defaulted on payments. The NCLT admitted the company under insolvency and appointed OP Agrawal as the interim resolution professional to oversee its operations. The directors of the company were suspended, and they were informed about the implications of the moratorium under the insolvency code.

In February 2019, an employee of the company requested the resolution professional to authorize the suspended directors to sign pre-CIRP sale agreements. However, the resolution professional stated that permission for such agreements would need to be presented before the committee of creditors (COC). The resolution professional argued that no permission was granted for signing sales agreements during the CIRP or even for pre-CIRP.

The suspended directors initially submitted a resolution plan in November 2019, which was rejected. They later submitted a revised resolution plan in March 2020, which was also rejected. In June 2020, the resolution professional filed an application for liquidation, which is still pending and sub-judice.

To maintain the company as a going concern, the resolution professional retained some employees who were instructed to act only on the resolution professional’s instructions and not on the instructions of the suspended directors. These employees were aware of the unsold inventories of the company, which were spread across 17 projects in 73 buildings located in various parts of Mumbai, including Ghatkopar, Vasai, and Naigaon.

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The Dharavi Redevelopment Project in Mumbai, eagerly awaited by many, is encountering further delays as the Maharashtra government has yet to issue the work order required to initiate the project. Despite Adani Realty being declared the highest bidder eight months ago, there has been no progress in granting the necessary authorization to commence the work.

Officials from various State government departments acknowledge their lack of knowledge regarding the approval process for the project developer, which will precede the issuance of the letter of intent by the Dharavi Redevelopment Project. Senior officials in the State government have indicated that due to the magnitude of this project, a decision will be made at the highest level.

In November 2022, the Adani group emerged as the top bidder for the redevelopment of Dharavi, one of India’s largest slum clusters, pledging an initial investment of ₹5,069 crore against a base price of ₹1,600 crore. However, the State government must issue a formal notification approving the bid made by the Adani group.

Sources suggest that the government may be waiting for the Securities and Exchange Board of India (SEBI) to conclude its investigation into the allegations made by Hindenburg Research against the Adani group. The SEBI probe is expected to be completed by August 14.

Adani Group sources have expressed their anticipation for communication from the Dharavi Redevelopment Project to initiate the project. Once the Letter of Authorization (LoA) is issued, the developer will establish a special-purpose vehicle and contribute 80% of the equity, with the remaining 20% provided by the State government.

Company officials have stated that a few months of delay will not significantly impact the project, as it has a long gestation period, and they are committed to the long haul. Previously, the Adani group had indicated its readiness to secure the necessary funds through a Middle Eastern financier upon being declared the highest bidder.

The Dharavi redevelopment project, upon completion, will be one of the largest redevelopment initiatives in the country, encompassing an area of 2.8 sq. km. Approximately 68,000 slum dwellers and commercial enterprises will be relocated. As per the tender terms, the proposed timeline for completing the rehabilitation facilities, renewal, amenities, and infrastructure construction is seven years from the commencement certificate for the first phase of the project.

The estimated cost of the entire project is around ₹20,000 crore, but it could potentially exceed that amount. SVR Srinivas, CEO, and Officer on Special Duty at the Dharavi Redevelopment Project, mentioned that while awaiting clearance from the government, extensive internal work is being carried out, including securing stakeholders’ consent and recruiting staff required for the project’s commencement.

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