Real Insights: Real Estate Overview
Andheri West May-2015
Executive Summary Andheri, a western suburb in Mumbai, has metamorphosed over the last several years to become one of the most sought-after regions in the city. It has transformed into being one of the posh localities in the financial capital, largely in demand by Bollywood stars and TV personalities and other high net worth individuals. The suburb is essentially divided into East and West regions. The following report tries to identify the various factors that led to realty growth in Andheri West. Since inception, the region has essentially developed as a residential area and, as a result, has witnessed rapid growth in its social and physical infrastructure. Further, the report identifies the present real estate market scenario in terms of housing sale and rent, the key real estate trends, the top builders and projects available, the civic issues, the opportunities available for area’s future growth, amongst others. To summarize it all, Andheri West continues to grow as a real estate hub with increasing demand by high net worth individuals. Offering properties for both sale and rentals, the area is witnessing continued growth in infrastructure and appreciating property prices over the years. Moreover, considering the various parameters, one can expect a positive real estate growth in the area in the near future.
Index Executive Summary ................................................................................................................................................................................. i Index ............................................................................................................................................................................................................. ii List of Maps ............................................................................................................................................................................................... iii List of Figures ........................................................................................................................................................................................... iii List of Tables ............................................................................................................................................................................................ iii Introduction ............................................................................................................................................................................................... 1 Connectivity and Infrastructure .................................................................................................................................................. 1 Major landmarks ................................................................................................................................................................................. 2 Civic issues ............................................................................................................................................................................................ 2 Latest Updates .......................................................................................................................................................................................... 2 Regulatory updates............................................................................................................................................................................ 2 Commercial updates ......................................................................................................................................................................... 2 Market Outlook ........................................................................................................................................................................................ 3 Residential launches ......................................................................................................................................................................... 3 Major Builders and projects .......................................................................................................................................................... 3 BHK-wise and segmentation split ............................................................................................................................................... 4 Weighted Average Price (WAP) ................................................................................................................................................... 4 Resale trends from 2013-2015 .................................................................................................................................................... 5 Housing rentals ................................................................................................................................................................................... 6 Rental Yield ........................................................................................................................................................................................... 7 SWOT analysis .......................................................................................................................................................................................... 8 Key points ................................................................................................................................................................................................... 8
List of Maps Map 1: Andheri West location and context .................................................................................................................................. 1
List of Figures Figure 1: Units launched in Andheri West, 2012 - 14 ............................................................................................................. 3 Figure 2: BHK wise unit availability................................................................................................................................................ 4 Figure 3: Classification of housing segments .............................................................................................................................. 4 Figure 4: Weighted average price (WAP) in Andheri West .................................................................................................. 4 Figure 5: Type of residential units available for resale .......................................................................................................... 5 Figure 6: Configuration of units available for resale ............................................................................................................... 5 Figure 7: Average resale prices in Andheri West, 2014 - 15................................................................................................ 6 Figure 8: BHK wise availability for rent ........................................................................................................................................ 6 Figure 9: Average rentals per sq. ft. in Andheri West ............................................................................................................. 7 Figure 10: Avg. Rental Yield in Andheri West since 2014 ..................................................................................................... 7
List of Tables Table 1: Important infrastructure projects in Andheri West .............................................................................................. 2 Table 2: Major developers and projects in Andheri West ..................................................................................................... 3 Table 3: Characteristics of different BHK types for resale .................................................................................................... 5 Table 4: Average rentals of residential units in Andheri (W).............................................................................................. 6 Table 5: SWOT analysis of Andheri West real estate market .............................................................................................. 8
Introduction
Map 1: Andheri West location and context
(Source: Google Maps) Andheri has come a long way from being just another western suburb in Mumbai to being a populous and one of the most popular suburbs in recent times. Today, it is one of the most sought-after western suburb for rentals and ready-to-occupy properties due to its bustling commercial and residential activities. Andheri is essentially divided into western and eastern zones similar to other suburbs. Of these two zones, Andheri West has outpaced its eastern counterpart in terms of property values. Primarily a residential area, Andheri West boasts of myriad amenities that cater to the residents’ needs. Unlike its eastern counterpart, Andheri West boasts of solid basic structure and organisation. Situated close to the beach are prime residential complexes with state-of-the-art amenities such as swimming pool, jogging track, sports centre, departmental stores, and multiplexes. The western zone revels in its green landscapes and calm environment, making it a preferred destination for many.
Connectivity and Infrastructure Andheri West has several roads passing through it, providing excellent connectivity with the rest of Mumbai. Some of the major roads include the Jogeshwari Vikhroli Link Road (JVLR), Western Express Highway (WEH), Swami Vivekanand Road and Jai Prakash Road. The western line of Mumbai suburban railway and the metro station near Azad Nagar also connect the area by rail. Mumbai International Airport is also close to the area. The development of infrastructure, better connectivity and lower rentals than the prime locations of South Mumbai is gradually pushing the business districts towards Andheri West and Bandra. Andheri West is close to several business, commercial and industrial establishments. SEEPZ SEZ is just about 4 km away while Bandra Kurla Complex (BKC) is about 10-11 km away. According to the latest draft of the Mumbai development plan (DP), about 80,000 people in Mumbai travel to SEEPZ for work. Being in close proximity to SEEPZ, there is high residential demand in the region. The area also has good social infrastructure with several educational, healthcare, business and commercial establishments, thus, making it an upscale residential area. Some of the important infrastructure in and around the area are as follows.
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Table 1: Important infrastructure projects in Andheri West
Current infrastructure WEH passes close to Andheri (W). Sion-Panvel Expressway passes close to the area. Other important roads are JVLR, Jai Prakash Road and Swami Vivekanand Road First line of Mumbai metro between Versova and Ghatkopar passes through it. Nearest metro stations are Azad Nagar and Andheri metro station Lies on the western line of Mumbai suburban railway Mumbai International Airport is very close to the area. Also close to Versova and Juhu Beaches SEEPZ, housing the electronic hardware manufacturing companies and software companies is in the area. Also close to Bandra Kurla Complex (BKC)
Planned/Upcoming infrastructure Brihanmumbai Municipal Coporation (BMC) is planning to construct a corridor around the Andheri railway station to reduce congestion. It has already identified important arterial and subarterial roads for this purpose. The Maharashtra government will be granting clearances for three flyovers: Yari Road to Lokhandwala Junction, DP Road to Lokhandwala Lake and Fisheries Institute to Link Road
Major landmarks Four Care Hospital, Parle Hospital, Grace Plaza, McDonalds, CafĂŠ Coffee Day, ISCKON Temple, Infinity and Mega Mall on Link Road, Cinemax Cinema Versova, 4 bungalow and 7 bungalow, Apna Bazar, Star Bazar and Andheri Sports Complex
Civic issues There have been increasing reports of drainage and solid waste management related issues in the locality. Poor street lighting on certain local roads is an issue in the locality. Encroachment of footpaths close to the railway station by unauthorised construction and hawkers Incidents of chain-snatching have been reported here. Peak hour traffic causes lots of congestions in the primary access roads.
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Latest Updates Regulatory updates -
The Bombay HC cleared the way for Rustomjee Realty to execute the redevelopment of the New D N Nagar Society in Andheri West. The 5-acre plot has eight buildings and about 480 families. The families were languished in an alternative accommodation for about eight years due to disputes over their society’s redevelopment.
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The new Mumbai Development Plan (DP) 2034 drafted by BMC has suggested granting an FSI of up to 8 in parts of Mumbai. According to the plan, highly crowded areas in suburbs such as Andheri and Bandra, where there are multiple modes of mass transport coverage, will also have an FSI of 8.
Commercial updates -
Volvo Auto India expanded its presence by opening a dealership on Link Road, Andheri West. The showroom is called KIFS Motors and is spread over 2,000 sq. ft.
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Market Outlook Andheri West is home to some posh townships and residential complexes including the popular Lokhandwala Complex. This is one of the most preferred destination for Bollywood celebrities and several TV artists. It also has other famous complexes as its neighbours such as Four bungalows and Seven bungalows. Property prices in these localities may go up to almost Rs 30,000 per sq. ft. Initially, the area was a marshland called Oshiwara, but now it has been metamorphosed and houses several branded showrooms, classy restaurants and lounges, and many clubs in the surroundings.
Residential launches Andheri West hasn’t seen as many new launches as few other suburbs over the last three years. This is mainly due to limited availability of land in the area. However, the area witnessed few project launches over the last three years and property values have skyrocketed over the years.
Figure 1: Units launched in Andheri West, 2012 - 14 (Source: Real Insights by commonfloor.com)
Fig. 1 indicates that Andheri West witnessed growth in apartment units that were launched in the last three years. This implies that the area still holds demand for properties despite high prices. Interestingly, most of the new launches were re-development projects with big bungalows being towed down to be developed as high-rise apartments. Some of the major projects launched in 2014 were Shreedham Splendour, Enchante, 69 SVP and The Lumiere.
Major Builders and projects The following table gives some of the major builders and projects in Andheri West. Table 2: Major developers and projects in Andheri West
Developers
Projects
V Raheja Lashkaria Group
V Raheja Varuna Lashkaria Green Woods Shreedham Splendour SD 69 SVP
Shreedham Group SD Corporation Pvt. Ltd. SD Corporation Pvt. Ltd. BBJ Worldwide
Total Units 70 17
BHK availability 2 and 3BHK 2BHK
Project status Ongoing Ongoing
Expected Yr. of completion Sep 2016 Jun 2015
90
1 and 2BHK
Ongoing
Dec 2016
64
2 and 3BHK
Ongoing
Jun 2017
SD The Lumiere
64
2 and 3BHK
Ongoing
Dec 2017
BBJ Verona
280
2BHK
Ongoing
Jul 2017
(Source: Real Insights by commonfloor.com)
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BHK-wise and segmentation split As expected, CommonFloor data indicates that maximum project launches during 2014 in Andheri West were apartments. Figures 2 and 3 show the available housing configurations (BHK-wise units) and housing segments (affordable, luxury, ultra-luxury).
Figure 2: BHK wise unit availability
Figure 3: Classification of housing segments
(Source: Real Insights by commonfloor.com)
(Source: Real Insights by commonfloor.com)
One may see from fig 2 that out of all the BHK configurations available in the area (1, 2 and 3BHK units), the most available are 2BHK units, followed by 3 and 1BHK units respectively. From figure 3 it may be seen that maximum residential units are available in the luxury category (Rs 1.2 – 2 crore), followed equally by mid (Rs 60 lakh – 1.2 crore) and ultra-luxury segments (Beyond Rs 2 crore).
Weighted Average Price (WAP) Figure 3 shows the current weighted average price in Andheri West.
Figure 4: Weighted average price (WAP) in Andheri West (Source: Real Insights by commonfloor.com)
The weighted average price in Andheri West is currently about Rs 19,000 per sq. ft. One may see that the WAP has grown in the locality during the first three quarters of 2014, from about Rs 17,000 to about 19,000 per sq. ft., marking an appreciation of more than 10 per cent within a year. This is essentially due to the increasing demand for residential real estate. Increased connectivity via the metro has also been one of the factors for the growth in demand.
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Resale trends from 2013-2015 Andheri is an old suburb with some residential units even as old as 30-40 years. As such, it offers several residential units for resale apart from new projects. Most of the units available for second sales are apartments, though a few independent houses too are available for resale. The following figures give an idea about the types of residential units available for resale.
Figure 5: Type of residential units available for resale
Figure 6: Configuration of units available for resale (Source: Real Insights by commonfloor.com)
(Source: Real Insights by commonfloor.com)
One may see from figure 5 that though the major percentage of units available for resale are apartments, a few houses, builder floor apartments and independent houses are also available for resale. The most commonly available housing configurations are 2BHK units followed by 1 and 3BHK units respectively. Table 3 gives the characteristics of different types of residential units available for resale. Table 3: Characteristics of different BHK types for resale
BHK Type 1 2 3 4
Avg. age of Property 19 16 10 7
Max age of Property 40 30 30 15
Avg built area (sq. ft) 530 960 1600 2250 (Source: Real Insights by commonfloor.com)
As one may see from table 3, the area offers several old residential units for resale, some as old as 30-40 years. It is also visible from the table that the area has been witnessing the development of higher configuration units such as 3 and 4BHK units for more than a decade. Some of the hotspots for finding resale properties are Four Bungalows and Lokhandwala Complex Road. The following figure gives the average resale prices in the area.
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Figure 7: Average resale prices in Andheri West, 2014 - 15 (Source: Real Insights by commonfloor.com)
The resale prices give an idea about the actual market prices in the area whereas the project launch prices give an idea about the prices of the projects being launched in the area. As seen from figure 7, the resale price is about Rs 23,200 per sq. ft, which has been on a continuous rise over the last one and half year.
Housing rentals Andheri West attracts not just property buyers, but also people who want to rent a property. These are usually higher income level professionals working in nearby business establishments. The following figure and table give an idea of the availability of houses and average rentals in the area.
Figure 8: BHK wise availability for rent
Table 4: Average rentals of residential units in Andheri (W)
(Source: Real Insights by commonfloor.com)
(Source: Real Insights by commonfloor.com)
From figure 8, it may be seen that apartment units up to 4BHK are available for rent in Andheri West. However, the availability of higher configuration units (4-6BHK) is almost negligible. The most available units for rent are 2BHK units followed by 1 and 3BHK units respectively. Table 3 shows the average rentals in the area. In comparison to few other localities such as Andheri East, Goregaon and Malad, the rentals here are relatively higher. The following graph gives the average rentals per sq. ft. in Andheri West during 2014.
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Figure 9: Average rentals per sq. ft. in Andheri West (Source: Real Insights by commonfloor.com)
One may see from figure 9 that the average rentals have remained above Rs 45 per sq. ft. during 2014, and have continuously witnessed an increase. Due to the metro rail in the area, there has been an increasing demand for rentals here. As per data, the average rentals per sq. ft. have gone up from Rs 45 (in Q1, 2014) to about Rs 54 (in Q1, 2015).
Rental Yield The following graph (fig 9) gives the rental yield trend since 2014
Figure 10: Avg. Rental Yield in Andheri West since 2014 (Source: Real Insights by commonfloor.com)
As it can be seen from figure 10, the average rental yield in Andheri West has been in the range of 3.1 – 3.4 per cent for the last one year. Considering the fact that the best average rental yield in the country are anywhere between 3 – 4 per cent, the rental yield in Andheri West can be considered a good one.
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SWOT analysis The following table gives the SWOT analysis of Andheri West. Table 5: SWOT analysis of Andheri West real estate market
Strengths Essentially a residential area, Andheri West has a good physical, civic and social infrastructure Good connectivity and proximity to business areas like SEEPZ & BKC. Hence, besides sales, it has good demand for rentals Opportunities
Weaknesses
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Has high property prices
Threats
Infrastructure continues to grow and improve in the area. The recent Mumbai metro is an example The growing demand for luxury and ultraluxury projects is a good opportunity for builders and developers catering to that segment
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High prices are a threat to the area’s realty growth as demand for affordable housing is growing Limited land availability is another threat that may hamper further growth of the area
Key points The following key points are obtained from the report -
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Key drivers of Andheri West’s realty growth is its focused development as a residential area, proximity to posh areas such as Bandra, Juhu and Khar, and presence of premier social amenities. All these factors give the area a posh quotient. Its proximity and great connectivity to other areas and key business locations such as SEEPZ SEZ and BKC via road and rail networks also drive its realty. Andheri West is a posh residential locality witnessing demand from middle and higher income groups. Some of the key localities in Andheri West are Lokhandwala Complex, Four Bungalows and Seven Bungalows. Andheri West has witnessed a growing number of project launches in the last couple of years owing to growing demand by the upper middle and high income groups. Andheri West offers several 1, 2 and 3BHK properties in the mid-segment (Rs 60 lakh – 1.2 crore) as well as luxury (Rs 1.2 – 2 crore) and ultra-luxury (beyond Rs 2 crore) segments. Weighted average property price (WAP) of new projects in the area is about Rs 19,000 per sq. ft, which is continuously growing. Andheri West is an old area and as such, it offers plenty of old units for resale. Most of the units available for resale are 1, 2, 3 and 4BHK units. It is also seen that there are several higher configuration properties (3 and 4BHK) as old as 15-20 years in the area. The market price, usually indicated by the resale price is about Rs 23,200 per sq. ft. Apart from property purchase, the area also has a good rental demand. Rentals prices are high in the area owing to the posh quotient, its proximity to key business areas and the airport. The average rental price in the area is about Rs 45-50 per sq. ft. One may see a growth in rental prices over the last five quarters, which indicates a healthy supplydemand ratio of rental properties. The area offers a good rental yield of about 3.1-3.4 per cent. Hence, it offers good investment opportunities for people who want to buy an apartment with the purpose of letting it out for rent. Thus, like most of the other markets of the Mumbai area, Andheri West also doesn’t have properties in affordable ranges and caters to upper middle class and higher class people only.
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CommonFloor.com, Bangalore maxHeap Technologies Pvt Ltd Tower B, 4th Floor, Diamond District, #150, Old Airport Road, Kodihalli, Bangalore – 560 008 Authors Karthik Kashyap Senior Research Associate karthik.k@commonfloor.com Bangalore
Shankhadeep Chaudhuri Senior Research Associate shankhadeep.chaudhuri@commonfloor. com Bangalore
Priyanka Kapoor Sr. Research Analyst priyanka.kapoor@commonfloor.c om Bangalore
Meha Singla Associate Director -Domain Research (Real Estate) meha.s@commonfloor.com Bangalore
Disclaimer: The document above is written by the Domain Research Team at commonfloor.com, India’s fastest growing real estate website known for its unbiased prognosis in Real Estate sector. The information provided in this report is based on CommonFloor data which is collected from various publicly known sources viz, websites, documents and maps. It should be considered as a guideline and not in absolute certainty. While care has been taken for groundwork, no responsibility is accepted for the accuracy of whole or any part. This information is confidential and the sole property of CommonFloor.com. It should not be reproduced in any form, in part or whole, without prior permission.
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