Recently I attended a webinar session by Mr Praveen Subhramanya, Governing Council Member of Royal Institution of Chartered Surveyors (RICS) on “Valuation of Insolvency and Distressed Assets on account of COVID-19”. These are some of the key learnings from the session, which I would like to share with you.
On account of COVID-19, valuations have come down marginally for businesses which are stressed.
Transaction in Real Estate Business has been on a decline in the last 2-3 years. The real estate market is experiencing a lot more changes these days.
The pattern seen is the shift from Studio Flats to Warehousing space/ Industrial Lands/Commercial Lands. Office space requirements are likely to come down because of Work From Home concept being adopted and this is likely to gain popularity in future.
Warehousing space is more in demand due to the emerging popularity of e-commerce. With the Government focusing more on digitalization, e-commerce businesses, which require warehousing space, are likely to become the norm. Also, retail independent stores are likely to experience to a rise in popularity.
Migration of workers from semi-urban areas to rural areas could also bring a lot of changes in the real estate sector in the rural areas. Rates could go up in rural areas.
As the Government’s structural reforms emphasize on Rural Area Development, we are likely to see more industries/factories coming up in rural areas and increase in farming also. Demand for Industrial lands/commercial lands/agricultural lands could go up.
Post the pandemic, with certain norms like social distancing, there will be lesser demand for affordable housing or buildings with small spaces. Instead, demand could go up for independent houses/small plots.
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