Find your next Office Space in Gurgaon

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta
 

Find your next Office Space in Gurgaon

Over the past one month, we have analyzed the market for Office Space in Gurgaon. And having done that and understanding the intricacies of commercial real estate, we have now launched the new feature “Office Space Search” on www.nirrtigo.com. While we’re not the first to ever show office space listings on the web, we do believe we bring a new obsessive focus to how we present a simple listing. We assure that, whichever office space we list on our portal, we have been there, we collect information at ground zero including the picture, lease term, lease rate, facilities, etc. We care about delighting our users in the same ways a building developer cares about the feel of new lobby, the way an architect cares about the materials of a new project.

Currently, we are sourcing office space listings directly from landlords, however, as we move along we will bring in brokers to list the office space in order to free the unorganized yet useful Office Space in Gurgaon and bring it online on the portal. The objective is to help start-ups, companies find their office space.

Why this now?
We have been there and faced the similar situation as any of the other start-up. Despite being in the real estate domain, we found it difficult to find office space within our budget. With this in mind and keeping the requirements of start-ups, we launched “Office Space Search”. We understand how difficult it is to get authentic information on office spaces for rent or sale. We have an in-house data-collection team which physically goes and verifies every detail of the office space and the locality before uploading it on the Web site. We’re constantly refreshing our data, so you have the most updated information.

How it works?
1. Visit Office Space in Gurgaon. You can also filter the listings based on micro markets such as Cyber city, MG Road, Sohna Road, etc.

2. Click on any of the listings and it takes you to the details of that listing including the real photo, summary, size, and other important details.

3. Get all the details regarding the office space including the lease rate, floor number, facilities, rent, extra charges, brochure, floor plan, map, and even read and write reviews.

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How well do you know Indian Real Estate? Crossword - 1

IntriguingRealEstate

nirrtigo

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IntriguingRealEstate

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1 S 2                                   F R A U D A N D C O R R U P T I O N   A 3   T B   4   H I I     5         O L L E A S E   6     M D L I         A R E Z 7         8 H S G G I A             O J I A N D             U B R L G V             S A I S R E             E R J A U R 9                                   B H A R T I Y A J A N T A P A R T Y             O A V D E I             L T Y M E S           D T A I E       S N M     I E 10             T E N A N T N     G T

Across The World Bank has debarred CES (India) for five years on charges of a contractual arrangement calling for the lessee (user) to pay the lessor (owner) for use of an asset party that promises flat for every slum deweller in delhi(if comes to power) An occupier of a leasehold estate

Down RBI policy considers this the main immediate macroeconomic task the father of modern advertising Durga Shakti Nagpal was suspended for taking action against Hon’ble Minister of Housing and Urban Poverty Alleviation, Govt of India The occupants of a residence constitute a paid classified messages in newspapers, magazines,etc. to sell a product, item or service

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Basics of office Space leasing and what’s in it for the tenant (companies) and the developer/landlord who is offering the space to lease.

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta
 

Office Spaces are leased to tenants for a specified period of time. The lease document assigns rights, duties, and responsibilities between the lessor (owner) and lessee (tenant) for the duration of the lease. The terms of the lease include legal considerations that are designed to protect the interests of both the lessor and lessee and specify how rents and expenses are to be paid.


General contents of a lease: 

1. Parties to the lease, namely, lessor and lessee
2. The date of lease agreement
3. Occupancy date (move-in date)
4. Identification of area to be leased
5. Duration of the lease term
6. The base or minimum rent
7. Method to calculate the future rent
8. Description of any concessions and other inducements to be provided to the tenant by the landlord
9. Deposits and any indemnities
10. Guarantees from third parties or co-signers
11. Condition of the leased premises to be provided to the occupant on the move-in date, including any tenant improvements
12. Allowable uses of the property, restrictions on occupancy, and prohibitions regarding future changes in the use of the property
13. Any restrictions on assignment or subletting of any of the leased space by the tenant
14. Use of common areas and facilities such as lobbies, rest rooms, and parking lots
15. Responsibility for maintenance and repair of the tenant’s space and of general premises
16. Any restrictions on alteration or improvements to the property by the tenant
17. Construction of any expansion in the future by the owner and provisions for affected tenants
18. The responsibility for payment of specific expenses by the lessee and/or the lessor
19. The extent to which the lessor and/or the lessee must provide for fire and casualty insurance
20. Any lease renewal options
21. Estoppels

For large corporate users who may be leasing large amount of space and who plan to move many employees and equipment to the space being leased, many conditions are negotiated in the lease agreements.

Leases and Responsibility for expenses (recoveries):

Owners of office space property incur many operating expenses. Some expenses such as electricity, water usage, and gas are paid by tenants individually. However, expenses related to the areas of the property (common area) used by all tenants, the normal way is to recover those expenses by prorating them among all tenants.

Typical operating expenses for office space properties:

1. Cleaning: Housekeeping
2. Repairs
3. Maintenance
4. Landscaping
5. Electricity
6. Water/Sewer
7. Security
8. Management
9. Real estate taxes
10. Insurance

Different combinations of rent and of operating expense recoveries are possible:

1. Gross (full service leases): tenant pay only rent and owner provides all services and pays for all operating expenses.
2. Modified (full service leases): tenant pays rent and pays for individual, specified expenses identified in the lease such as electricity, gas, water and the like. Such expenses are usually linked to tenant by sub metering. Tenant also pays pro rata share of certain operating expenses (known as CAM Charges) incurred by the property owner.  This is the most preferred lease mechanism in India.
3. Leases with expense recoveries in excess of an expense stop: tenant pays rent plus a pro rata share of certain operating expenses incurred by the property owner. Here stop is usually calculated as the total operating expenses per square foot of rent-able area in the building that is incurred by the owner during the specified base year. The tenant agrees to pay only for expenses per square foot in excess of this stop. This way, the owner hedges its risk of increasing operating expenses and passes it on to the tenants.
4. Pass through leases: these leases are made when a few tenants lease very large amount of space in a property. When fewer tenants lease large amounts of space, operating expenses tend to be identified and linked more directly to those tenants. In this case, base rents tend to be lower than for full service, and modified full services lease.

Some Important terms:

Rent-able area in a building:

Total area on all floors + lobby – thickness of exterior walls – any columns or protrusions through the floors – mechanical equipment closets – basements and any area needed by owner to maintain or operate the building + elevator landings + reception areas + restrooms + any other area that could be used by tenants

Multiple tenants – Rental area per floor:

When there are many tenants in a building, each tenant will occupy its usable area on a floor. However, there would be some common area used by all the tenants. In that case, the common area will be prorated among the multiple tenants in order to determine the actual rent-able area. 

Load factor: 

Total rent-able area/total usable area. Load factor is seen as “efficiency measures”. High load factors generally mean a large number of common areas and therefore lower building efficiency. For example, load factor for Office Space in Gurgaon varies from 1.25 to 1.67. Generally, tenants occupying larger office space has lower load factor relative to the tenants occupying smaller office space.

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Why don't we Rate and Review Real Estate Projects?

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta
 

Create your free online surveys with SurveyMonkey , the world's leading questionnaire tool.

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Pre Launch Property - Shall I go for it or not?

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta

• What is a pre-launch offer?

These days, we are all accustomed to getting pesky SMS and emails about pre-launch offers of builder projects in India. What are pre-launches? Well, as the name suggests, these are projects launched by builders before the official launch of a realty project. Pre-Launch projects are usually launched by the builders to generate demand and assess market acceptability of their project.

• What allures customers to pre-launches?

As explained earlier, pre-launch projects are launched by builders to see market reaction for their project and therefore are priced below the launch price and also below the current price prevailing in the market for other similar projects. That’s the catch, this only attracts buyers (should we just say investors or flippers) to pre-launches wherein buyer/investor hopes to make decent amount when the project is launched officially at a higher price point.

• What are the risks attached with pre-launches?

Some of the risks attached with pre-launches are:

1. The builder may back out of the project due to financial constraints.
2. For pre-launch projects, the approvals from relevant authorities have yet not been obtained and therefore there is a risk of official launch getting delayed or in some cases the competent authority may altogether reject the project proposal.
3. The market may not value the project as expected by the developer and therefore the project launch price may not be as high as expected by the investor. In that scenario, relatively lower gains are offset by the selling costs, transfer charges, etc.
4. Pre-launches are illegal in nature. As per the norms in certain states, a builder is not authorized to sell any part of the project before officially getting all approvals.

• Why do builders go for pre-launch of a project?

Well, there are in-numerous reasons for builders to go for the illegal yet prevalent practice of pre-launching of their projects. Real estate is a capital intensive and risky business and regardless of the state of the economy, inflation, prevailing interest rates in the market, market pulse, and funding trends, real estate developers need to generate initial capital to successfully launch and complete a project. And as we see these days, lending to real estate sector by formal financial channels such as banks, private equity, and bond market is in decline and therefore developers need to raise initial corpus of money and they do so by pre-launching their project to their cozy circle of brokers and investors. And in most cases, this cozy circle fall prey to these offers in order to realize quick returns. Needless to say, the returns realized are in form of cash and those cash returns are again ploughed back into other real estate projects or pre-launches and the whole circle keeps on turning.

• Are all builders pre-launching their projects or there are some exceptions to the rule?

Recently, a reputed developer with interest in other consumer businesses such as body care, furniture, consumer electronics, etc, declared in the media that they have been able to sell all of about 600 housing units of their new project in Gurgaon in a single day. Interacting with service professionals gives one the feeling that they could have done so because of their brand and perceived ability to deliver what is being promised. However, the truth lies elsewhere; the very same project was being promoted by this reputed developer within their cozy circle of brokers and investors for about 5-6 months before the official launch. The developer himself did not put anything related to the project on website or in any other marketing media. The project was promoted by this cozy circle of brokers and investors by word of mouth and email medium. And needless to say, our press covered it as a success story.

• In a nutshell, is this a good or bad practice?

For investors or flippers, with high risk appetite, it gives them the opportunity to realize substantial returns on relatively small portion of their equity (after all, they book the property with about 10% of the total property value).

For end-users, the pre-launches are highly risky and they need to conduct the property due diligence and verify lots of things such as IOD, CC, and Clear land title before going in with the flow.

As far as, the practice of pre-launch is concerned, the big developers with their previous track record and reputation in the market can successfully bring in necessary approvals and not default on their promise of officially launching the project. However, some of the other developers may not be able to do the same. Therefore, it puts the onus on big developers to lead the way with fair processes and practices for the entire industry and safeguard the consumer interest first.

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Group Buying for Real Estate

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta
 

Group Buying has emerged as a latest fad dominating the e-commerce industry all over the globe with sites such as Groupon leading the way. Group Buying as a concept is not a new thing for Indian mindset…we have seen in our childhood days when our elders would talk about buying certain consumables in thok (bulk) as opposed to buying in retail. The idea in its original sense, however, is believed to be China’s export to whole world. Even though, I always thought, China’s export to the world is cheap (I mean, not sasta) manufactured goods:).

Buying property, primarily homes in bulk has been prevalent in Indian market for decades when certain powerful individuals (underwriters) with access to funds would buy residential dwellings in bulk at a discounted price from the builder and sell it to retailers at less than the builder quoted MRP. The process is a win-win-win situation for all stakeholders in favorable economic conditions. Builders are happy because their inventory of residential dwellings moves fast, consumers are happy because they got the housing unit at relatively discounted price, and underwriter is happy to have made money by buying at lower cost and selling it at relatively higher price.

In certain parts of India, mainly Gujrati and Marwari communities have had a long tradition of buying property in group….thereby eliminating the underwriter from the chain of Builder – Underwriter – Consumer. By doing so, the group of people would act as underwriter even though each member of the group is buying a single unit for himself individually. This whole process shortens the chain and eliminates the profits shared by an underwriter.





Buying homes in a group has clear benefits to consumers and some of them are listed below:

1. Cost reduction due to higher discounts on residential properties
2. Assessment of builders’ track record
3. Due – diligence of residential project including legal, construction, and delivery schedule

Some of these benefits, primarily due – diligence is an expensive process and can only be conducted when enough buyers are buying the apartment in same project to offset the cost of conducting due – diligence. Moreover, an underwriter may not conduct the due – diligence of the project because of his vested interest.

However, forming a group of like-minded people from faraway places has been a major challenge to adopt this form of group buying in real estate in other parts of the country. More and more families are going nuclear and buying property at a given point of time by forming a group has rendered to be a distant reality.

This is where the latest fad of buying property in group can make sense and could be possible for dispersed customers through group buying web portals dedicated mainly to real estate and run by real estate professionals. These professionals, in addition to aggregating the demand can also conduct comprehensive due – diligence of the project, assess builders’ track record, and talk to banks that have approved the residential project for financing.

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Valuation of properties

Coming soon....

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