CBRE’s Anshuman Magazine on the Future of Real Estate

In an interview with Business Standard’s Nivedita Mookerji, CB Richard Ellis South Asia’s Anshuman Magazine explains why he sees robust growth for the sector which has been hit hard by the pandemic

Topics
Real Estate | CBRE | Immovable

Q: I will start by asking you for the history of Covid. What really happened to the Indian real estate sector at that time?
Response :
>The first impact of the Covid containment was on the constructions in progress

>Another impact on the sector has been slow decision-making by investors, due to uncertainties
Q: But, you know, they say there was a bit of a hit in the real estate industry and it wasn’t really a hit. Is this a correct assessment?
Response :
>The impact of the prolonged confinement could have been much worse for the real estate sector
> Recovery was substantial in a short time
Q: When you say salvage, are you talking about residential or commercial space?
Response :
>Recovery noted in all real estate segments
>The recovery in the residential sector started to accelerate first, due to pent-up demand
>Low interest rates have also boosted demand in the residential sector
>The office market in India is mainly driven by technology companies
Q: In your recent outlook report, you charted a growth path for Indian real estate in 2022. Are you betting more on ads or residential space this year?
Response :
>Expects the residential sector to thrive as people increasingly seek a better quality of life
>Office space should do better than last year
>Real estate in India expanding on the logistics side
>Data centers, co-living spaces and student accommodation come back to life after Covid restrictions
Q: Isn’t office space the trickiest? Because you don’t know if it will be a hybrid model or if it will be a return to the office. There are always mixed signals. So many companies gave up office space during the pandemic. So how is it going ?
Response :
>The hybrid working model is here to stay
>Tech companies in India are growing
> Young people want to go to work
>Tech companies, BPOs and software development companies can take advantage of many facilities when employees work from their desks
Q: There was an interesting survey recently in which around 50% of the samples said they would prefer real estate to any other asset class like gold or stocks. Do you think trust is real?
Response :
>Confidence is real especially in Asia, where the state of mind is a physical asset that gives maximum comfort to most investors
>Real estate is an essential part of diversified investing
> Historically, returns on investment in real estate have been unprecedented in India
>Since this is a globally undersupplied market, real estate investment will continue to generate returns
> Anyone investing in real estate must make an informed decision
Q: It’s interesting that you talk about informed decisions. Recently, there was a case of Supertech, which went bankrupt. There are other bad stories in real estate. So where is the control and is there any cleaning going on in the area?
Response :
>Too much regulation slows down development, but RERA regulations must be followed
>Investors and homebuyers should do their due diligence before investing in real estate
Q: Finally, a question about pricing. There has been a buzz that building material prices are on the rise. Do you see real estate prices increasing in the short term?
Response :
>Prices are expected to increase, but it is difficult to calculate how much
>The reason for rising prices, besides demand, is inflation
> The cost of inputs has increased
> Abnormal price increases are not likely to occur