The document summarizes real estate trends in Pune from January to June 2016. It finds that new residential launches dropped 32% year-over-year in H1 2016 and 72% since 2012 due to uncertainty over new development regulations. However, sales volumes held steady. Unsold residential inventory declined 22% from its 2014 high to a 5-year low. In the premium market, lack of new supply maintained upward pressure on prices despite steady demand. Developers shifted focus to the more affordable budget segment, whose market share rose from 12% to 27% of launches. In the office market, transaction volumes fell 7% year-over-year due to inadequate new supply failing to meet demand, pushing vacancy rates down to a historic low

1. KNIGHTFRANK.CO.IN
JANUARY TO JUNE 2016
RESIDENTIAL & OFFICE
PUNE

2. KNIGHTFRANK.CO.IN
RESIDENTIAL
NEW LAUNCHES DROP
BY 32% YOY IN H1 2016;
DOWN BY 72% SINCE 2012

3. KNIGHTFRANK.CO.IN
Uncertainty over the new development
control norms hits supply
HALF-YEARLY NEW LAUNCHES
31,460
20,720
16,880
12,760
8,710
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
H1 2012 H1 2013 H1 2014 H1 2015 H1 2016
No.ofunits
Launches down by
72% since 2012
Launches down by
32% since H1 2015

4. KNIGHTFRANK.CO.IN
But sales volume holding steady to
previous year’s level
HALF-YEARLY SALES VOLUME
23,120
20,930
14,720
15,520
15,690
-
5,000
10,000
15,000
20,000
25,000
30,000
H1 2012 H1 2013 H1 2014 H1 2015 H1 2016
No.ofunits
Sales volume
holding steady

5. KNIGHTFRANK.CO.IN
Inventory pressure eases
off; unsold inventory at a
5-year low

6. KNIGHTFRANK.CO.IN
Unsold inventory levels fall drastically by 22%
from their high of 71,000 units just 2 years ago
UNSOLD INVENTORY AND QTS TREND
62,650
62,050
71,000
64,800
55,220
5.6
5.9
7.0 6.8
6.2
0
2
4
6
8
-
20,000
40,000
60,000
80,000
H1 2012 H1 2013 H1 2014 H1 2015 H1 2016
Numberofquarters
No.ofunits
Unsold Units QTS (Right Side Axis)

7. KNIGHTFRANK.CO.IN
Premium markets holding
strong in sales volume, but
new launches continue to be
at zero level

8. KNIGHTFRANK.CO.IN
Lack of new supply and steady demand to exert
upward pressure on prices in the premium markets
HALF-YEARLY PREMIUM MARKET TRENDS
492
255
148
76
0
0
235
225
220
181
213
187
0
100
200
300
400
500
600
H2 2013 H1 2014 H2 2014 H1 2015 H2 2015 H1 2016
No.ofunits
New Launches Sales Volume

9. KNIGHTFRANK.CO.IN
Developers shift
focus towards the
budget segment

10. KNIGHTFRANK.CO.IN
Budget segment’s share in new launches jumps
from 12% to 27% in 2 years
SHARE OF LAUNCHED UNITS BELOW ` 25 LAKH IN TOTAL LAUNCHES
12%
16%
27%
0%
5%
10%
15%
20%
25%
30%
H1 2014 H1 2015 H1 2016

11. KNIGHTFRANK.CO.IN
KEY TAKEAWAYS
UNCERTAINTY OVER
DCR NORMS HITS
SUPPLY

12. KNIGHTFRANK.CO.IN
OFFICE
LACK OF NEW SUPPLY
LEADS TO FALL IN
OFFICE TRANSACTIONS
BY 7% YoY IN H1 2016

13. KNIGHTFRANK.CO.IN
Demand continues to outstrip supply
HALF-YEARLY TREND OF NEW COMPLETIONS & TRANSACTIONS
2.0
0.5
1.5
1.1
1.3
2.1
2.4
2.2
3.3
2.0
-
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
H1 2014 H2 2014 H1 2015 H2 2015 H1 2016
mnsqft
New completions AbsorptionTransactions

14. KNIGHTFRANK.CO.IN
Vacancy levels drop to their historic low of 9.3%
VACANCY TREND
5%
10%
15%
20%
25%
30%
25%
9.3%

15. KNIGHTFRANK.CO.IN
Rents in Pune grow at one
of the fastest pace in India;
jumps by 14% YoY

16. KNIGHTFRANK.CO.IN
Rental values up by 54% since 2012
WEIGHTED AVERAGE RENTAL TREND
35
40
45
50
55
60
`/sqft/month
37
57

17. KNIGHTFRANK.CO.IN
39%
33%
9%
20%
32%
25%
17%
27%
64%
14%
9%
13%
0%
10%
20%
30%
40%
50%
60%
70%
IT/ITeS BFSI* Manufacturing Other Services
H1 2014 H1 2015 H1 2016
IT/ITES sector makes a strong comeback in the city
SECTOR WISE TRANSACTION SPLIT

18. KNIGHTFRANK.CO.IN
KEY TAKEAWAYS
SHORTAGE OF SUPPLY
LEADING TO FALL IN
TRANSACTION VOLUME

19. KNIGHTFRANK.CO.IN
JANUARY TO JUNE 2016
RESIDENTIAL & OFFICE
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