A plethora of factors such as strong and pro business government coupled with ambitious programs such as Make in India is driving the Indian commercial realty market. An anticipated high GDP growth for the given financial year will further add to the positive sentiments.
According to Square Yards Global Intelligence Centre (GIC) the overall absorption of office space in 2014 has been over 30 million sq. ft., indicating a double digit growth.
On the backdrop of high demand and policy change roughly 40 million sq. ft. of office space is expected to enter in the year 2015. Out of this, it is estimated around 33 million sq. ft. will be absorbed indicative of a 10% annual growth.
However, searching and selection of a commercial property comes with its own list of challenges, comprising of location, surrounding and financing etc. Not to mention the property status and condition of property.
In order to cut through the various challenges that commercial property offers, Square Yards offers 3 broad phases incorporating of premarket, market and negotiation stages that can ensure the client take the most suitable decision against all the available alternatives.
Pre Market phase consists of
- Initial investigation to understand the clients business objectives.
- Conduct an in-depth market study to analyze and understand the office market trends
- Based on the market study along with the clients business objective, identify the key parameters and generate a weighted criteria matrix.
- Prepare a realistic implementation timetable.
Market Phase Explanation
- Prepare a list of prospective properties.
- Identify potential properties through on ground physical inspection.
- Discuss and brainstorm on each of the shortlisted potential properties.
- Issuance of Request for Proposal (RFP) to all potential landlords.
- Conduct technical due diligence consisting of building test fits and buildings service audits of the potential properties.
- Develop and implement financial models to evaluate the options.
- Post evaluation the best option/ options (generally one or two backups are also selected) is/are selected based on the weighted financial and non-financial criteria evaluated in the initial phase.
- Refine and negotiate final specification of the buildings services, fit out and design.
- Seek initial leasing proposals for the shortlisted properties from the respective landlords
- Negotiate improvement upon the leasing proposals with more emphasis on the most preferred option.
- Post review of the overall negotiations and conclusions, freeze on the most favourable property.
- Produce our recommendation report backed up with our data analysis and findings to the board and seek a mandate to conclude the transaction on the preferred property.
- Express and confirm our intention to lease the property by signing a LOI/ EOI.
- Work with the nominated legal advisor to finalize the most favourable lease terms and conditions
- Signing and handover the agreement.