1.
H1 2016, a recap
- A recovery predicted
INDIA
REAL ESTATE
JULY – DECEMBER 2016
MUMBAI

2.
MUMBAI
REAL ESTATE

3.
H1 residential market recap
H1 2016 RAISED HOPES

4.
23% and 29% increase
in sales and launches in H1 2016
Half yearly trend in launches and sales
57,007
35,512
18,887
24,450
41,377
31,210
28,446
34,971
-
10,000
20,000
30,000
40,000
50,000
60,000
H1 2013 H1 2014 H1 2015 H1 2016
Noofunits
Launches Sales
29%
23%

5.
…But H2 2016 suffers
a setback

6.
H2 2016 launches and sales skid
by 53% and 26% YoY respectively
Half yearly trend in launches and sales
52,222
26,833
20,776
9,740
32,717
36,505
34,135
25,403
-
10,000
20,000
30,000
40,000
50,000
60,000
H2 2013 H2 2014 H2 2015 H2 2016
Noofunits
Launches Sales
-53%
-26%

7.
No pick up in premium markets
Micro-market trend in launches
-
1,000
2,000
3,000
4,000
5,000
6,000
Central
Mumbai
Central
Suburbs
Navi
Mumbai
Peripheral
Central
Suburbs
Peripheral
Western
Suburbs
South
Mumbai
Thane Western
Suburbs
Noofunits
H2 2015 H2 2016
-74%
-72% -68%
-28%
-54%
-100%
-37%
-78%
YoY change

8.
Markets like Thane, Mulund, Vikhroli,
Badlapur, Karjat less hit
Micro-market trend in sales
-
2,000
4,000
6,000
8,000
10,000
12,000
Central
Mumbai
Central
Suburbs
Navi
Mumbai
Peripheral
Central
Suburbs
Peripheral
Western
Suburbs
South
Mumbai
Thane Western
Suburbs
Nofounits
H2 2015 H2 2016 YoY change
-41%
-20%
-26%
-13%
-37%
-20%
-37%
-54%

9.
Weakest annual performance in
the last seven years
138,613
114,710
121,615
109,229
62,345
39,663
34,190
108,680
96,226
85,978
74,094
67,715
62,581
60,374
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2010 2011 2012 2013 2014 2015 2016
Noofunits
Launches Sales
Yearly trend in launches and sales
44%
75%

10.
QTS has increased despite reduction in
unsold inventory from 1,60,000 to 1,54,000
QTS trend
11.5
11.7
12.1
11.5
11.1
10.4
10.2
9.5
10.1
8.0
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12.0
12.5
Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16
No.ofQuarters

11.
Impact of
Demonetisation

12.
Demonetisation - A huge dent
Launches at 16% and sales at 39% of Q4 2014
15,512
20,000
10,733
16,100
11,110
7,777
9,326
11,450
13,849
10,601
7,123
2,617
14,210
17,000
14,602
21,903
16,733
11,713
16,953 17,182
18,807
16,164
16,786
8,617
-
5,000
10,000
15,000
20,000
25,000
Q1
2014
Q2
2014
Q3
2014
Q4
2014
Q1
2015
Q2
2015
Q3
2015
Q4
2015
Q1
2016
Q2
2016
Q3
2016
Q4
2016
Noofunits
Launches Sales
Quarterly trend of new launches and sales

13.
Q4 revenue loss for both
State exchequer and industry
Average # units sold in
Q4 2014 & Q4 2015 19,543
# Units sold in Q4 2016 8,617
56% fall
in sales
Notional REVENUE LOSS
to real estate industry
INR 9,100 cr
State government notional
LOSS ON STAMP DUTY
INR 460 cr

14.
Key takeaways
MMR residential sales at its worst in the last 7 years
Sales in Thane and Central Suburbs relatively resilient -
down by 20% in H2 2016 compared to 26% for the city
Demonetization brings residential market to a standstill
Uncertainty likely to continue for the next quarter
Reduction in home loan interest rates, RERA, GST and ‘possible’ tax
benefits in the upcoming budget likely to bring in a ‘feel good factor’
among buyers

15.
Office market
MUMBAI OFFICE MARKET SEES
A MARGINAL SLIDE IN 2016

16.
Transactions dipped by 6% - putting brakes on the
growth momentum of last three years
Yearly transactions & new completion
12.4
14.5
12.0
7.6
9.2
5.8 5.9
9.6
8.0
6.0 6.2
7.3 7.5 7.1
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
2010 2011 2012 2013 2014 2015 2016
Mnsqft
New completion Transactions

17.
In H2 2016, new completions were lower by 73%;
Transactions dipped by 34% primarily
on account of base effect
Half yearly trend of new completions and transactions
6.0
3.8
6.4
3.5
1.0
2.6 2.4
4.8 5.0
3.3
-
1.0
2.0
3.0
4.0
5.0
6.0
7.0
H2 2012 H2 2013 H2 2014 H2 2015 H2 2016
Mnsqft
New completions Transactions
34%
73%

18.
Vacancy on a steady decline;
BKC and Central Mumbai see high occupier
interest with vacancy level less than 2%
Half yearly trend of vacancy
22.8% 22.6%
21.6%
19.6%
17.0%
18.0%
19.0%
20.0%
21.0%
22.0%
23.0%
24.0%
H2 2013 H2 2014 H2 2015 H2 2016

19.
Rentals jump by 16% as majority of transactions
happened in costlier business districts
Half yearly weighted average rental trend of MMR
114
118
104
121
95
100
105
110
115
120
125
H2 2013 H2 2014 H2 2015 H2 2016
INR/sqft/mth

20.
BFSI and manufacturing sectors
lead the office demand in H2 2016

21.
BFSI and manufacturing sectors takes up large
office spaces in PBD and SBD West
Sector wise transactions
15%
46%
22%
17%
31%
16%
33%
20%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
BFSI IT/ITES Manufacturing Other services
H2 2015 H2 2016
5.0 mn sq ft 3.3 mn sq ft

22.
Central Mumbai and BKC face supply shortage;
office demand moves north
Micro-market wise transactions
16%
2%
7%
53%
7%
14%
11% 9%
6%
24% 23%
27%
0%
10%
20%
30%
40%
50%
60%
BKC & Off-BKC CBD & Off-CBD Central Mumbai PBD SBD Central SBD West
H2 2015 H2 2016
5.0 mn sq ft 3.3 mn sq ft

23.
Key takeaways
Vacancy level has come down -
Lower Parel and BKC in single digit
For 2016, dip in transactions put brakes on the
growth momentum of last three years
BFSI and Manufacturing led the office transaction
in H2 2016

24.
Download the complete report from the link below:
bit.ly/IREH216-SS