BUY sell RENT Patna

residential/commercial


Here's why now a good time to enter commercial real estate

 

in Patna, but Mall space is a NO…..

 


Commercial real estate in Patna, known to be an indicator of economy of Bihar has been in the throes of a major slowdown across Bihar and even India. Patna has been left with a glut of office spaces. Our research says prices of commercial real estate in Patna have tanked by 20-30 percent since slowdown in Patna real estate and the same is the story of commercial rentals in Patna.


If you had put Rs 100 in commercial market in Patna in 2009-10, it would have been around Rs 70-80 and in residential anywhere in Patna would have been around Rs 110-115. So, we believe commercial markets in most parts of Patna have bottomed out. And is definitely a good time for high net worth individuals in Patna to get in and invest in commercial real estate in Patna.


We advice investors in Patna real estate market to go for commercial property because annual yield in residential properties in Patna are anywhere between 2-3.5 percent maximum. In commercial property in Patna today; one can get returns anywhere between 6-8 percent. From a capital appreciation point of view, across Patna we are going to see considerable amount of capital appreciation for commercial properties in Patna mainly because it has corrected from the peak.  “Good time to go do a deal.”


 Many tenants in Patna today are using this as an opportunity to move into either cheaper locations or consolidate within one’s premises or also looking at renegotiating with existing landlords in Patna.


Many developers in Patna who used to sell and rent larger office space units, bigger floor plates, today are dividing those larger floor plates into smaller units. Today, a small investor can even look at buying 500 square feet to 1000 square feet of office space in Patna and that is bringing in a lot more new categories of buyers in Patna. So, we see professionals like chartered accountants, stock brokers, lawyers, even doctors investing in office properties across Patna. We are seeing buying trends in Patna like – one, professionals buying for their self use. Two, HNIs who would want to set up something on their own, just investing in it and third people who are looking for a steady rental inflow by making sure there is a tenant in their commercial property in Patna.

 

For investing in commercial real estate in Patna, one needs to look at the capability of the developer in Patna, the kind of projects he has done before, the kind of quality of finishes - the way he manages his property. Secondly, one needs to look at various expenses involved in a commercial property whether it is property taxes, whether it is maintenance or whether it is insurance. The investors should also look at refurbishment, refinancing, and retenanting potential of the property in Patna. Above all, the most important thing is that one needs to make sure the building is of sound quality and there are no legal issues. One should make sure that they have done their due diligence on what exactly is going to be your property tax. Property tax varies in different parts of the city. So, that due diligence has to be done before one invests in commercial real estate in Patna.


While investing in retail properties in Patna, our advice is not to look at malls in Patna because any mall which is being sold in bits and pieces has got into trouble. 

 

 


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