Businessmen, flush with funds from stock market gains, are picking up luxury homes in the range of Rs 50 crore to Rs 100 crore in New Delhi’s poshest locales as they upgrade to bigger and better living spaces.
Ever since the property registration office reopened in New Delhi after pandemic restrictions were lifted, there’s been a flurry of real estate deals in prime residential areas such as Prithviraj Road, Vasant Vihar, West End and Panchsheel Park.
A large part of the wealth created in the stock markets from stake sales by company promoters and from startups getting funding at valuations exceeding $1 billion is finding its way into the national capital’s prime properties, real estate experts said.
On February 2, a bungalow spread over 1,205 square metres (12,970 sq. feet) located in south Delhi’s West End area was sold for Rs 91.5 crore, according to documents shared by Zapkey.com. The property was bought by Vikram Ahuja of Ahuja Radios, the documents showed. Ahuja did not respond to queries from Moneycontrol.
A property on Prithviraj Road spread over 3,750 square yards with a built-up area of about 16,000 square feet was transacted at about Rs 250 crore, local brokers told Moneycontrol. The buyer is a director in JK Paper, they said.
Pandemic waves
A property in Panchsheel Park spread over 1,200 sq. yards was sold to a Kolkata-based buyer for Rs 85 crore. Another property in Vasant Vihar was picked up by a local developer for about Rs 60 crore, while a bungalow with two units in Jor Bagh located on a 600 sq. yard plot was sold to two buyers for about Rs 28 crore each, local brokers said.
Demand for larger plots in central and south Delhi has gone up after three waves of Covid-19, Yovesh Suri, a luxe realty expert, told Moneycontrol. Huge gains made in the stock markets are being deployed in these high-end properties.
Many people who have made money by selling their farmland assets located near South Delhi are buying bungalows in the city.
“We have also witnessed an increase in property deals wherein several second-generation non-resident Indians are liquidating their parental assets in Delhi,” Suri said.
“Posh colonies of Delhi have witnessed several property transactions being concluded, particularly in the range of Rs 50-100 crore, in recent days ever since the sub-registrar’s offices reopened after being shut for several weeks on account of Omicron restrictions,” said Amit Goyal, CEO of India Sotheby’s International Realty.
Goyal is bullish about demand for luxury homes. Substantial wealth is being created through fundraising in the stock markets and from private equity firms and “is finding its way into Delhi’s prime properties located in top colonies such as Sunder Nagar, Golf Links, Jor Bagh, West End and Panchsheel Park,” he told Moneycontrol.
The primary reasons for the rise in this buying trend are lifestyle upgrades and the requirement for bigger spaces after three waves of Covid-19.
“Demand for such high-end properties will remain robust as the home has become an all-in-one for most families. While prices have not moved up substantially in any market as yet, we do witness a shrinkage of ready inventory in the luxury segment and strongly believe that we are at the start of a secular, multi-year price rise,” Goyal said.
Last year, JC Chaudhary, founder of tutorial chain Aakash Educational Services, bought a 2,000 sq. yard property in south Delhi’s Vasant Vihar for over Rs 100 crore and later purchased a 5-acre farmhouse in south Bijwasan for about Rs 96 crore. The transactions took place soon after Byju’s, India’s biggest online-education startup, signed a deal to acquire Aakash for $1 billion in April.
Trophy properties
Rohit Chopra of Southdelhiprime.com told Moneycontrol that following wave after wave of the pandemic, buyer behaviour has changed.
“Both sellers and buyers want to close a deal faster – they want to live for the present moment – that is what has contributed to the momentum in the market,” Chopra said, adding that those who made money in the stock markets or through stake sales aspire for trophy properties in the heart of New Delhi. Several properties are being sold as part of succession planning, he said.
Additional luxury properties are set to become available in the market. Godrej Properties and Tata Realty and Infrastructure said they intend to launch projects in the luxury segment in the national capital.
Godrej Properties said it plans to form a joint venture with the TDI Group to construct a luxury housing project in the Connaught Place area. The project is estimated to have a developable potential of about 130,000 sq. ft. of saleable area comprising primarily of residential apartments of various configurations.
The expected revenue potential from the project is Rs 650 crore.
Tata Realty plans to develop an ultra-luxury residential apartment project near Hailey Road and is expected to invest almost Rs 200 crore by 2023. The project, which is likely to be launched in 2023, will comprise about 40 luxury apartments spread over 100,000 sq. ft of built-up area across a 0.9 acre plot.
Last year, Anil Gupta, promoter of KEI Industries, a housing wire and cable maker, bought a property spread over 2,000 sq. yards in Delhi’s posh Shanti Niketan area for Rs 140 crore.
The owner of a leading electronics contract manufacturer bought a house in New Delhi’s Lutyens Bungalow Zone (LBZ) for Rs 170 crore, in what is believed to be the priciest residential transaction in the city after the lockdown. LBZ is located in central Delhi and consists mainly of buildings to house government offices and residences.
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