Single-Owned Commercial Properties in High Demand in India's Realty Market
Investors in India's commercial real estate market are favoring single-owned and managed properties for higher returns, operational efficiency, and greater attractiveness.
Commercial RealtySingle Owned PropertiesStrata Owned PropertiesIndia Real Estate MarketOperational EfficiencyReal Estate MumbaiJun 16, 2024
One of the primary advantages of single-owned properties is operational efficiency, which allows for centralized management, quicker decision-making, and more effective property maintenance. This is in contrast to strata-owned properties, which often face management challenges due to multiple owners, leading to delays in maintenance and decision-making processes.
Moreover, single-owned buildings are relatively younger in age, with institutional investment in real estate starting around 20 years ago. As a result, single-owned buildings are 20% younger than strata-owned buildings at a pan-India level, with this difference getting even bigger in micro-markets where the delta in rentals is higher.
Grade A commercial assets, managed through proactive asset management, attract top tenants who prioritize reliability in services, utilities, and overall experience. This distinction ensures that single-owned assets attract top-tier occupiers, who are willing to pay a premium for quality office assets.
K Raheja Corp, a leading real estate developer, emphasizes the importance of single-owned properties in today's business landscape. According to Vinod Rohira, MD & CEO of commercial real estate at K Raheja Corp, single-owned assets demonstrate a better understanding of customer needs, ensuring that tenants receive the best possible services and experience.
CRE Matrix, a real estate data analytics firm, has also highlighted the advantages of single-owned properties. Abhishek Kiran Gupta, CEO and co-founder of CRE Matrix, notes that single-owned buildings are better perceived than strata-owned buildings, due to the developer's focus on building and maintaining the property for a perpetual revenue stream.
In conclusion, the demand for single-owned commercial properties is on the rise in India's real estate market, driven by their ability to offer higher returns, operational efficiency, and greater attractiveness. As the market continues to evolve, it is likely that single-owned properties will remain a preferred choice for investors and tenants alike.
Frequently Asked Questions
What is driving the demand for single-owned commercial properties in India?
The demand for single-owned commercial properties is driven by their ability to offer higher returns, operational efficiency, and greater attractiveness.
How do single-owned properties differ from strata-owned properties?
Single-owned properties have centralized management, which facilitates quicker decision-making and more effective property maintenance, whereas strata-owned properties often face management challenges due to multiple owners.
What is the average age of single-owned buildings in India?
Single-owned buildings are relatively younger in age, with an average age 20% lower than strata-owned buildings at a pan-India level.
Who is more likely to invest in single-owned commercial properties?
Investors and tenants who prioritize reliability in services, utilities, and overall experience are more likely to invest in single-owned commercial properties.
What is the rental yield advantage of single-owned commercial properties over strata-owned properties?
Single-owned commercial properties offer rental yield advantages of up to 32% over strata-owned properties in key regions such as Mumbai, Bengaluru, Pune, Gurugram, and Chennai.
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