PUNE RESIDENTIAL REAL ESTATE OVERVIEW

OVERVIEW

MARCH 2015

TABLE OF CONTENTS

1.

Executive Summary

2.

City Fact File

3.

Real Estate Overview

5.

Central Pune

12

4.

North Pune

14

5.

East Pune

16

6.

West Pune

19

7.

South Pune

22

8.

Location Attractiveness Index

24

9.

Disclaimer

25

EXECUTIVE SUMMARY

The Pune Real Estate Overview March 2015 takes a look at the key micro-markets and the growth
stimulators from a residential perspective. The report highlights the key findings of a week long
survey of the residential market conducted by the ICICI PSG Team.

Residential real estate prices in Pune are expected to see a 10 - 12% appreciation in the
long run owing to increasing input costs to the developers, coupled with increased
demand from cities nearby Pune and NRIs.
Growth in real estate prices in Pune is expected to be positive as it continues to be an IT,
education and manufacturing hub, which will offer significant employment opportunities
and keep the end user demand ticking in this city.
During the current survey, real estate prices emerging in Pune residential markets
showcased that the markets are at over-bought levels. The prices have gone past the
affordability levels of end-users in the city. The major factors being increase in cost of land
and construction for the developers.
Pune real estate market witnesses an end user to investor ratio of 60:40. The market sees
a considerable demand from Mumbai, NRIs and buyers from cities nearby Pune such as
Ahmednagar, Nashik, Kolhapur, Solapur, Satara and Karad.
Apartments in Pune have witnessed a contraction in the configuration sizes, to match the
budget of end-users.
East and West Pune continue to be the investor favorite destinations. East Pune is being
driven by a mix of BFSI, IT and BPO industries in Kharadi, Viman Nagar, Magarpatta Cyber
City and Kalyani Nagar and manufacturing hub of Ranjangaon, while West Pune is being
largely driven by the demand emerging from the IT hub and SEZs concentrated in
Hinjewadi.
Developers have increasingly started tapping the investor demand from NRI buyers and
are running road shows and marketing campaigns in countries like Singapore, Australia,
Hong Kong, Middle East and as far as the United States. Developers are exploring
innovative digital marketing platforms such as designing apps while also focusing on their
product strategy to offer right-sized and right-priced products.
The government has taken numerous initiatives with respect to infrastructure
development to decongest Pune traffic and provide easy accessibility to various areas and
cities. Plans are underway for construction of Punes Ring Road, Pune Metro, new airport,
numerous subways and flyovers.
Overall, the sector is expected to register a positive growth over the long run driven by
favorable reforms by the new single majority government at the Centre and commercial
growth potential of this city into an IT, education, automobile and manufacturing hub.

CITY FACT FILE

Overview:
Pune has been known by a plethora of sobriquets. Popular among them: Queen of the Deccan,
cultural capital of Maharashtra, pensioner's paradise and Oxford of the East. Pune is one of the
historical cities of India with a glorious past, an innovative present and a promising future.
Human civilisations have prospered on the banks of rivers; Pune city too has flowered on the
banks of the Mutha river originating from the Sahyadri range of mountains. Researchers have
found evidence of human civilisations that existed 100,000 years ago along the Mutha river.
Down the centuries, Pune has been ruled by several dynasties. The earliest evidence found
(copper plates of 758 A. D. and of 768 A. D.) reveals that the Rashtrakootas ruled this region then.
At that time, Pune was referred to as Punaka Vishaya and Punya Vishaya. Copper plates of 960 A.
D. and 963 A. D. refer to it as Punaka Wadi and Punaka Desha. Here Vishaya means region. Later
on, the city has been mentioned as Kasabe Pune. The Pune Gazetteer explains the term Pune as
Punya - a holy place. In Hindu tradition, a confluence of two rivers is sacred. Hence, this city,
where there is a confluence of two rivers (Mula & Mutha), is Punyanagari. After the Rashtrakootas,
Pune was ruled by the Yadava dynasty. After the fall of this dynasty, it came under Muslim
dominance till the middle of the seventeenth century. The great Maratha leader Shivaji later made
Pune the capital of the Maratha Empire - he established in the 17th century. After Shivajis death,
his heirs could not hold his empire together and so their dynasty declined and power passed to
the Peshwa, the first of a long line of professional administrators. Under the Peshwas, Pune
acquired great political importance and became well known as a centre of learning and culture.
Pune remained the seat of the Maratha fiefdom till the British ousted them in 1817 after the
historic third battle of Panipat.
Over the years, Pune developed into a major industrial centre with defence, automobile and
engineering giants and other factories and corporations making it their base. Pune is also among
the greenest urban areas in the country with more than 40 per cent of its area under green cover.
`Oxford of the East
East to `Detroit of India
Known as the Oxford of the East, Pune is home to a large number of well-known educational
institutes, among them are the prestigious Pune University with its affiliated colleges such as
Fergusson College and College of Engineering. In recent years several deemed universities have
also come up, and the number of colleges continues to grow. The SNDT University for Women
was established in 1916. The Bhandarkar Oriental Research Institute, established in 1917, is now
famous for its research on the Prakrit and Sanskrit languages; over 20,000 ancient manuscripts
are housed at this institute. In the latter half of the 20th century, the National Defence Academy
and the National Chemical Laboratory were established in the city.
Over the years, the automobile industry has gained prominence in Pune, giving it the title of the
`Detroit of India. Among the automobile companies that operate out of Pune are Bajaj Auto, Tata
Motors, Daimler Chrysler (Mercedes Benz), Kinetic Engineering and Force Motors Ltd. In addition
the city witnesses a dominant presence of IT and software companies, primarily operating out of
Hinjewadi.

CITY FACT FILE

Administration:
The administration of Pune is divided into 14 talukas or territories. Except for the Pune city, the
other 13 talukas are under 11 Nagarpalikas or Municipal Corporations and 13 Panchayat
Samitis. Pune is divided into two Mahanagarpalikas, viz Pimpri-Chinchwad Municipal
Corporation, and Pune Municipal Corporation; and three cantonment boards, viz Pune
Cantonment Board, Khadki Cantonment Board and the Dehu Road Cantonment Board.
Census 2011 Key Highlights
Description

2011

2001

Actual Population

9,426,959

7,232,555

Male

4,936,362

3,769,128

Female

4,490,597

3,463,427

Population Growth

30.34%

30.73%

Area Square Km

15,643

15,643

Density/Square Km

603

462

Proportion to Maharashtra Population

8.39%

7.47%

Sex Ratio (females per 1000 males)

910

919

Average Literacy Rate

87.19%

80.45%

Male Literacy Rate

92.72%

88.34%

Female Literacy Rate

81.13%

71.89%

Source: Census 2011

PUNE
PUNE REAL ESTATE

Short Term
Long Term

1010-12
months

5-7% appreciation in capital value with steady absorption of units

5050-60
months

1010-12% YY-o-Y appreciation in capital

capital value with an upward bias on a
conservative note

Punes residential real estate market showed strong signs of revival post the slowdown period of
2008 - 10 and the total absorption has remained steady over 2011 - 2014 with highest absorption
in the mid end segment. However, new supply addition decreased significantly (~60%) in Q4 of
CY2014 as compared to Q4 of CY2013 as inventory overhang increased during this period.
(Source: PropEquity)
Residential real estate prices in Pune are expected to see a 10 - 12% appreciation in the long run
owing to increasing input costs to the developers, coupled with increased demand from the
peripheral cities of Pune and from the NRIs. Average capital values in the city (on basis of
weighted average of new launch prices) increased by 10% y-o-y in December 2014 (Source:
PropEquity). However, the prices have gone past the affordability levels of the Pune end-users.
This is expected to have a softening impact on the upward momentum in prices. In the long run,
growth in real estate prices in Pune is likely to be positive as it continues to be an IT, education
and manufacturing hub, which will offer huge employment opportunities and keep the end user
demand ticking in this city.
Demand demographics in the Pune real estate market
market
The Pune real estate market witnesses an end user to investor ratio of 60:40. This market has
huge retail investor presence and lacks the presence of underwriters, as is the case of certain
other markets such as Noida. Moreover, an interesting observation, which emerged in our
survey, was that in the buyer space, 50% of the participants were from Pune, 30% from Mumbai
and 20% comprised of the demand emerging from NRIs and from cities within the radius of
approximately 300 - 350 kms from Pune. The reason for such significant presence of investors
from Mumbai is that Pune is in close vicinity to this region, holds a high employment growth
potential and demands lower capital requirements relative to Mumbai.
Demand and Supply of Units (Based on Ticket Size)
Absorption (as a % of
total sales)
New Launches (as a %
of total supply)

INR 1.5 4.5 mn

INR 4.5 7.5 mn

INR 7.5 10 mn

INR >10 mn

54%

31%

8%

7%

49%

31%

10%

10%

Source: PropEquity
Note: Sales and supply figures are for CY2014
The above table indicates that maximum demand was for up to INR 4.5 mn category homes in
Pune. While the demand for >10 million homes has not increased significantly over the years,
the market is witnessing a trend of increasing supply in this category.
6

PUNE REAL ESTATE

2 BHKs remain a popular

popular buy over other configurations
As Pune is emerging as an IT hub, most of the working crowd is predominantly in the age group
of 25 - 35 years. 2 BHKs are being preferred by working professionals supported by the double
family income of the husband and wife employed in these IT-BPO companies; thus making this
configuration affordable. Approximately 52% of total residential sales in CY2014 comprised of
2 BHK units. (Source: PropEquity)
Pune continues to appeal as a weekend getaway for Mumbaikars owing to the pleasant climate
Pune scores over Mumbai, as the climate in the former is more pleasant, as it is situated on the
leeward side of the Western Ghats. The climate in Mumbai is humid throughout the year, as it
rests in the tropical zone and is closer to the sea. Owing to the above two factors, Pune has
famously become a `weekend getaway for Mumbaikars who want to retire over the weekend in
spacious homes and enjoy a cool, pleasant climate. Moreover, Pune is just 3 - 4 hour drive away
from Mumbai and is connected by the NH 4 highway.
Many developers are taking a note of this trend and introducing projects at the foothills, in
vicinity of a forest land and natural water bodies. Developers such as Paranjpe Schemes, Skyi,
Marvel Group, Gera are building such landmark properties and villas to attract the above
customer segment.
Apartments in Pune continue to be more spacious relative to Mumbai
Pune offers more spacious apartment configurations relative to Mumbai, at much affordable
prices. Pune has abundant land thus making it possible for developers to offer bigger apartments
and more open spaces at attractive ticket sizes. These factors are attracting a lot of investor
interest from Mumbai and cities nearby Pune.
Chakan on the PunePune-Nasik highway and Talegaon
Talegaon on the PunePune-Mumbai highway contributing
towards Pune emerging as the `Detroit of India
Chakan and Talegaon have emerged as the new auto hubs with presence of global automobile
companies like General Motors, Mercedes Benz and Volkswagen. Companies already present in
Pimpri-Chinchwad are also looking to expand operations in Chakan and Talegaon; as land rates
in Pimpri - Chinchwad belt have gone up considerably. Thus, residential development in Chakan
predominantly attracts the LIG segment employed in the nearby industrial zone. Whereas,
Talegaon has recently attracted a mix of LIG and MIG segment as it boasts of a very pleasant
climate, proximity to Mumbai Pune Expressway and themed residential developments such as
the Esapana Sojourn by TATA Housing.
A high level of employment due to ever increasing number of auto companies in the vicinity has
pushed residential development in nearby areas of Moshi and Chikli which are fast getting
transformed from a LIG segment market to MIG segment. Of late, many category A developers
have entered Moshi and Chikli. These areas have improved infrastructure and are strategically
located between Bhosari MIDC, Chakan MIDC and PCMC MIDC; thus, enabling better
connectivity to PCMC and Bhosari.
7

East and West Pune continue to be favorites

favorites amongst investors
Currently, East and West Pune are proving to be the major investor crowd pullers.
East Pune remains the most developed area of Pune and is being largely driven by the CBDs in
Kharadi, Viman Nagar, Magarpatta Cyber City and Kalyani Nagar. A mix of BFSI, IT and BPO
companies is present in this section of the city in addition to major retail stores, all leading malls
and hospitals. East Pune is currently seeing a demand flowing in from the nearby manufacturing
hubs like Shikrapur and Ranjangaon which houses companies such as LG, Whirlpool, 3M, etc.
Hence, this manufacturing hub has generated investor interest in nearby Wagholi area which also
has an added advantage of being connected to the proposed new Pune Airport.
West Pune is being largely driven by demand emerging from the IT hub and SEZs concentrated
in Hinjewadi. Six townships are under construction in and around this area; namely, Megapolis
(150 acre township), KUL Ecoloch (110 acres township), Kolte Patil Life Republic (421 acres
township), Paranjape Blue Ridge (140 acres township), Lodha Belmondo (108 acre township) and
Xrbia (200 acres township). Investors from Mumbai and peripheral cities are attracted to West
Pune primarily due to higher probability of good capital gains, easy rental yields, and easy access
from Mumbai-Pune Expressway for personal weekend getaway use. These factors have led to a
higher residential uptake in West Pune (Hinjewadi/Wakad/Pimple-Saudagar/Ravet) as compared
to East Pune (Kharadi, Wagholi, Hadapsar, etc).
Pune developers trying to tap demand from nearby cities and NRIs
During the current survey, the real estate prices emerging in the Pune residential markets
showcase that the markets are at over-bought levels. The prices have gone past the affordability
levels of the end-users in the city. The predominant reasons are the increase in the land costs
and construction cost to the developers (cost push factor) coupled with the investor demand
emerging from Mumbai and other nearby cities within approximately 300-350 kms radius of Pune
namely Ahmednagar, Nashik, Kolhapur, Solapur, Satara and Karad (demand pull factor). This has
led to higher residential prices in Pune.
Developers have increasingly started tapping the investor demand from NRI investors and have
launched road shows and marketing campaigns in countries such as Singapore, Australia, Hong
Kong, Middle East and as far as the United States. In addition, developers have realized the
importance of channel partners and web presence to boost their sales. Developers in Pune are
exploring innovative digital marketing platforms such as designing apps that enable a live chat
with the sales team without having a customer to be physically present to see/book a property.
Further, some developers in Pune are offering branded properties (first Trump Tower and Yoo
residences of India were introduced in Pune) that have an aspirational value which attract the
whos who of the industry. Thus, developers in Pune are experimenting with their offerings to
test customer preferences and cater to a wider range of customers.
All the above factors are contributing to an increased investor demand from outside Pune while
demand from Pune end users has stagnated owing to a price demand mismatch (investor
demand pull factor). This is reflected in the conversion-inquiry ratio, which has dipped as an
increase in inquiries was eclipsed by a dip in conversions over the last year. Thus to be able to
8

PUNE REAL ESTATE

match the budget of end-users and maintain sales, Pune residential apartments have witnessed a
contraction in the configuration sizes.
Short term speculation is discouraged in the real estate projects
Developers in Pune tend to discourage any short-term speculation in real estate projects. Buyers
are requested to register their units within 15 - 60 days of making a payment towards the token
amount. Investors are generally allowed to exit their units, only after the builder has transferred
the possession. The pre-dominant reason is to avoid unwanted confusion in the real estate
market with regards to prices.
Planned Infrastructure development in Pune
The government has taken numerous initiatives with respect to infrastructure development to
decongest Pune traffic and provide easy accessibility to various areas and cities.
Ring Road: Pune Ring Road is a circular road for Pune city proposed by Chief Minister of
Maharashtra in 2007 to avoid traffic congestion in the city of Pune. The PCMC and PMC are
responsible to make necessary provisions for this plan. This proposed Ring Road is ~170 Km
road long and is divided in 4 parts to divert ehicular traffic from Mumbai-Pune-Solapur highway
and roads like Pune-Nashik, Pune-Ahmednagar and Pune-Satara otherwise passing through the
city. This project is currently facing major land acquisition issues.
Pune
Pune Metro Project: Pune Municipal Corporation (PMC) has submitted the proposal to the Union
government to make provisions in the annual budget for the Metro project under which a special
purpose vehicle (SPV) - Pune Metro Rail Corporation (PMRC) will be formed, to execute the
project. It will be executed in form of 4 lines running across north-south and east-west of the city.
New Proposed Airport: Pune airport has seen ~50% increase in the number of passengers as
well as air traffic movement in the past five years. The state government allocated Rs. 2 billion
(US $31 million) in August 2012 to acquire 1,800 hectares of land for the airport. The proposed
airport will be located near Rajgurunagar, in Khed District and will be accessible from Chakan.
PCMC Infrast
Infrastructure:
nfrastructure: Pimpri-Chinchwad area is already known to have world-class infrastructure
with respect to the road network which provides uninhibited access to various areas in this
region. Efforts are in place to replicate this model in the upcoming areas of Pune.
Connectivity to Hinjewadi: Plans are upbeat to connect Hinjewadi via Baner-Balewadi road and
from Sus to improve the existing accessibility to Hinjewadi which will benefit all those who travel
to the three phases of the IT Park.
In addition to above developments, real estate dynamics of the city have improved owing to
numerous flyovers and subways being constructed in different parts of the city such as
Shivajinagar and PCMC. Widening of roads particularly around Wakad, Pimple Saudagar
Hinjewadi and other prime locations has been taken up to rid the city of all possible bottlenecks.
With the above initiatives to improve external accessibility, each micro-market in Pune is also in
the process of becoming self-sufficient internally too. All the micro-markets are witnessing set up
of all major retail outlets, entertainment destinations, restaurants, etc. which is likely to eliminate
9

PUNE REAL ESTATE

the need to move to the CBDs in the long run.

Pune remains a robust real estate market
The real estate market in Pune has matured post the slow-down of 2008 - 10 and has become
more robust in the recent past. Real estate prices have recovered and prices of new launches
increased by 10% y-o-y in December 2014. During our survey, one of the key points observed
was that of a cautionary stance on part of both buyers and developers to avoid any hasty
decisions. Developers are trying to venture into projects only after factoring in their capacity to
deliver. Also, they are releasing supply into the market after gauging the demand for units; thus,
building a higher holding capacity. Likewise, buyers have resorted to doing a detailed research of
available options, due diligence of the builder and the project, before booking any property.
Therefore, absorption of units was seen at average levels.
A new noticeable feature of the market is that of developers launching products of right-size and
right-price to maintain sustained cash-flows by focusing on volume sales. At the same time,
developers have introduced many offers in conjunction with home finance companies and banks
to cater to the customer who wants a flexible payment scheme to buy a property with minimum
or maximum own contribution. These strategies are aimed at boosting the sales volume.
Overall, the sector is expected to register a positive growth over the long run driven by favorable
reforms by the new single majority government at the Centre and commercial growth potential of
this city. This is because the industry is expected to be fuelled by the growth momentum in the IT
industry supported by the automobile industry also as they look to expand their manufacturing
operations in Chakan and Talegaon and the city grows into an IT, automobile and manufacturing
hub. In addition, demand from Mumbai, NRIs and nearby cities of Pune is expected to keep the
demand buoyant in this market.

10

MAJOR LOCATIONS IN PUNE

Major Locations within Pune

We have classified the real estate space in Pune into five distinct zones Central Pune, North
Pune, East Pune, West Pune and South Pune.

11

Central Pune:

Apte Road, Bhosale Nagar, Deccan, Model Colony, Prabhat Road, Shivaji
Shivaji Nagar

North Pune:

Akurdi, Bhosari, Chakan, Chinchwad, Moshi, Pimpri, Pradhikaran, Talegaon

East Pune:

Hadapsar, Kalyani Nagar, Kharadi, Koregaon Park, Manjri, Wagholi, Viman

Nagar

West Pune:

Aundh, Balewadi, Baner, Bavdhan, Hinjewadi, Kothrud, Pashan, PimpleSaudagar, Wakad

South Pune:

Ambegaon, Katraj, Kondhwa Budruk, Mohammadwadi Road, NIBM, Parvati,

Salisbury Park, Sinhagad Road, Warje, Wanowrie

CENTRAL PUNE

Major Locations: Apte Road, Bhosale Nagar,

Nagar, Deccan, Model Colony, Prabhat Road,
Road, Shivaji Nagar
Key Highlights:

Central Pune is classified as the Central Business District of the city having a presence of number
of offices and traditional residential areas such as Prabhat Road and Bhandarkar Road.

The area is one of the prime residential locations of Pune and is home to the famous Pune Law
College and Fergusson College (FC), Sancheti Hospital and many Government offices and courts.

Land availability in the central city is limited and there are no major residential developments
taking place in this part of Pune.

The area, however, continues to witness some redevelopment projects at Prabhat Road and
Model Colony and commands a premium over other residential locations in Pune.

Redevelopment projects by Paranjpe Schemes, Amar Developers and Nimhan Group are some
of the residential projects coming up in the area while Pinnacle Group, Alliance Group, Rachana
developers, Javadekar developers and Oxford Properties are some of the prominent developers
in Central Pune.

Growth Stimulators:

Deccan is a cultural district and houses many art galleries, theaters and cinema halls. Deccan also
an educational hub of Pune, comprises of the areas of J.M. Road, F.C.Road, University Road, Law
College Road and Senapati Bapat Road.

Shivaji Nagar is close to Pune Railway Station and houses corporates like L & T Infotech and
institutes like Indian Institute of Planning and Management, FC & Modern College, etc.

J.M. Road and F.C. Road are the most prominent high streets of Pune having all major retail
outlets. Prominent retail players such as Central and Shoppers Stop are also located here.

Residential areas in Central Pune still attract a premium as the location has an age old charm and
has always remained the most desirable residential address.

Price Trends in Central Pune

Source: PropEquity
Note: Graph represents weighted average price of residential units available in the primary market.
Missing line segments indicate unavailability of residential units in the primary markets during the
specified time frame.
12

CENTRAL PUNE

Property rates of 'ready

'readyready-toto-move in' in prime residential markets of Central Pune**
Location
Model Colony
Prabhat Road, Deccan
Area, Apte Road
Bhosale Nagar

Average Capital Values

(Rs./sq.ft)
17,000 20,000

13

(Rs./month)

25,000 - 30,000

17,000 20,000

25,000 - 30,000

12,000 15,000

20,000 - 25,000

Source: ICICI Property Services Group

Fergusson College

Rentals for 2 BHK

NORTH PUNE

Major Locations: Akurdi, Bhosari, Chakan,

Chakan, Chinchwad, Moshi, Pimpri, Pradhikaran, Talegaon
Key Highlights:

North Pune lies on the Pune Mumbai highway (NH-4) and Nashik Highway. It is one of the
biggest industrial zones in Asia.

The main localities in this micro-market are Pimpri, Chinchwad, Akurdi, Nigdi, Pradhikaran and
Bhosari.

Pimpri Chinchwad houses many auto, food & pharma machinery manufacturing and
engineering companies in addition to a number of SMEs while Chakan & Talegaon are home to
global automotive and construction equipment manufacturers. The development of Chakan and
Talegaon is promoted by the Maharashtra Industrial Development Corporation (MIDC).

Talegaon & Chakan have evolved into a major automobile & manufacturing hub and host
production plants for General Motors, JCB, John Deere and the Volkswagen Group, Mercedes,
Mahindra & Mahindra, Bajaj Auto, Bridgestone respectively. Over 750 large and small industries,
including a number of automobile component manufacturers are based in this area.

Residential development in Chakan predominantly attracts the LIG segment employed in the
nearby industrial zone. Whereas, Talegaon houses a mix of LIG and MIG segment as it boasts of
a very pleasant climate, proximity to Mumbai Pune Expressway and themed residential
developments.

A high level of employment due to ever increasing number of auto companies in the vicinity has
pushed residential development in nearby areas of Moshi and Chikli which are fast getting
transformed from a LIG segment market to MIG segment. Of late, many category A developers
have entered Moshi and Chikli. These areas have excellent infrastructure and are strategically
located between Bhosari MIDC, Chakan MIDC and PCMC MIDC; thus, enabling excellent
connectivity to PCMC and Bhosari.

Pradhikaran in Nigdi suburb of Pune is a planned township mostly comprising of luxury

residential projects, bungalows and plots. Pradhikaran comes under the P.C.N.T.D.A. (Pimpri
Chinchwad New Township Development Area) and is divided into several sectors. This area
attracts interest from the HIG segment particularly from those people having businesses in
nearby vicinity of Pimpri Chinchwad.

Nigdi is well connected to rest of Pune via Akurdi and Chinchwad railway station of Pune
Suburban Railway and PMPML bus services plying across Pune.

Contributing to the residential supply on the other side of North Pune are the Charoli and Dhanori
areas which are witnessing a number of township projects by Category A developers. The
development in this area is trying to bank on the locations excellent connectivity to Central and
West Pune and proposed Pune Ring Road.

Some of the new projects in North Pune are being built by Nyati Group, Pharande Spaces,
Kohinoor Group and Kumar Properties while Mindspace Realty, Naiknavare, Namrata Group and
Goel Ganga are some of the prominent developers in this micromaket.

14

NORTH PUNE

Growth Stimulators:

Nearby industrial zone and automobile hub in Chakan and Talegaon is expected to raise the
employment levels in this region further boosting the residential demand.

Excellent infrastructure and connectivity to Central and West Pune are the key positives of this
area.

Accessibility to the Technology Park (Talawade), IT sector (Hinjewadi) and other industrial areas
(Talegaon, PCMC) is likely to propel the real estate growth in Pimpri-Chinchwad and nearby
areas.

Proposed international airport near Chakan is expected to be a major driving factor for industry /
real estate market in the coming years.

Talawade has IT companies like Syntel, Canbay Software which is recently connected to Chakan.

Bhosari and Moshi are likely to benefit from the demand flowing in from the working population
in Chakan and Talegon. The region is further expected to develop due the improved North
West connectivity due to a direct flyover connecting Bhosari to Pimple Nilakh in West Pune.

Price Trends in North Pune *

Source: PropEquity
Note: Graph represents weighted average price of residential units available in the primary market.
Property rates of 'ready
'readyready-toto-move in' in
in prime residential markets of North Pune**
Location
Pimpri Chinchwad
Bhosari
Moshi
Talegaon

Average Capital Values (Rs./sq.

ft)
5,500-5,800
4,500
3,800-4,500
3,500-5,000

Source: ICICI Property Services Group

**indicative mid market segment

15

Rentals for 2 BHK

(Rs./month)

12,000 - 15,000
8,000 - 10,000
8,000
8,000 - 10,000

EAST PUNE

Major Locations: Boat Club, Bund Garden Road, Hadapsar, Kalyani Nagar, Kharadi, Koregaon Park,
Manjri, Wagholi, Viman Nagar
Key Highlights:

East Pune is one of the most developed and sought after micro-markets of Pune having a good
blend of residential, commercial and retail real estate segments.

This part of city is home to many exclusive and luxurious residential projects, IT Parks, Pune
airport, 5-Star hotels and all leading malls.

Koregaon Park along with Boat Club Road and Bund Garden, are considered to be the most upmarket residential areas of Pune.

Kalyaninagar, near Koregaon Park is another important locality in East Pune providing
commercial spaces to Major IT companies such as TCS and HSBC, some major retail outlets
(Shoppers Stop), hotels (The Westin) and restaurants. The first Trump Tower of India in
association with Panchshil Developers in also being developed at Kalyaninagar.

Over the last few years Viman Nagar has become a prominent location in Pune with many
exclusive and luxurious residential projects (such as the upcoming Lunkad Group and Phoenix
Groups Fountainhead), commercial spaces & IT parks (Mantri Commercial and Panchshil
Chambers), hotels (Novotel, The Hyatt), leading malls (Phoenix Market City, In Orbit Mall) and
educational institutes. It is well connected to the central area of Pune and the airport.

In recent years, Hadapsar and Kharadi have emerged as preferred locations for the IT/ITES
sector. These locations serve not only as hubs for IT activities but are also preferred residential
destinations promoting the 'walk to work' culture which is fast becoming popular.

Hadapsar area has Cyber City IT Park and SEZ in Magarpatta City which has companies like
Accenture, Amdcos, Mphasis, Red Hat, John Deere, Etc and commercial office space Pentagon
while Kharadi boasts of EON Free Zone a large commercial IT SEZ and World Trade Center.
Hadapsar has also witnessed major retail development with presence of landmark malls such as
Amanora and Magarpatta Seasons Mall.

Wagholi is witnessing a spurt in development of new residential zones owing to availability of

large land parcels and affordable housing. The uptake in this region is driven by employees
working in the nearby warehousing and industrial hub of Ranjangaon which houses reputed
companies like LG, Whirlpool, Tata Fiat, 3M, etc as well as the IT crowd from Kharadi IT hub.

Due to its proximity to Koregaon Park, Kalyani Nagar and Hadapsar, Mundhwa and Manjri have
also experienced development in the last few years and with expected conversion of large parcel
into non agricultural land, this area will witness further development in real estate in years to
come.

Prominent developers in this region include Marvel, Kolte Patil, Goel Ganga, Kumar Builders,
Panchshil, Nyati, Vascon and Brahma while category A developers such as Godrej and
Purvankara are close to launching their products soon. DSK Group has launched the DSK Dream
City in Phursungi which promises to offer the most exclusive features in a single township.

Growth Stimulators:

16

The major stimulus for growth in East Pune is on account of penetrating IT/ITeS sector and
burgeoning industrial sector on the outskirts of Pune.

EAST PUNE

Widening of Nagar Road has improved the connectivity and led to higher office space demand in
the Eastern Corridor.

Presence of major IT companies such as TCS (Hadapsar, Kalyani Nagar), Zensar (Kharadi), HSBC
Software (Kalyani Nagar) etc has increased demand for residential real estate in these areas.

Kharadi is already witnessing an increased demand from mid to high end segments due to its
proximity to Koregaon Park and Kalyani Nagar.
-

This area is experiencing major IT & Non IT development with EON Free Zone IT SEZ
and World Trade Center which would add to the employment in this area. Eon Free Zone
is also adding more IT space to cater to IT firms expansion plans. Currently, ~25000
employees are working in EON IT SEZ.

HSBC Software and Deutsche Bank are expanding in Pune with Panchshil developers
project (Business Bay) in Yerwada which has added to the inflow of manpower and is
expected to further fuel growth in Kharadi.

In addition, Kharadi and Hadapsar, are strategically located towards the east of the city close to
the airport and railway station, are also a gateway to Pune via the Nagar Road and Solapur Road
respectively.

Proximity to Kharadi and the industrial hub at Ranjangaon, clubbed with the unaffordability factor
at Kharadi is driving end-user demand in Wagholi. Wagholi is connected to Viman Nagar and
Kalyani Nagar via Lohegaon making it accessible from different parts of the city.

Demand in Mundhwa is being driven by its proximity to Hadapsar, Koregaon park and M G Road
in Camp.

Price Trends in East Pune

Source: PropEquity
Note: Graph represents weighted average price of residential units available in the primary market.
Missing line segments indicate unavailability of residential units in the primary markets during the
specified time frame.
17

EAST PUNE

Property rates of 'ready

'readyready-toto-move in' in prime residential markets of East Pune**
Location
Koregaon Park
Boat Club
Kalyani Nagar
Viman Nagar
Vishrantwadi
Kharadi
Hadapsar
Phursungi
Handewadi
Wagholi

Average Capital Values (Rs./sq.

ft)
15,000 - 20,000
17,000 - 20,000
9,000 - 12,000
7,500 - 10,000
5,500 - 6,000
5,500 - 7,000
5,000 - 7,000
4,000 - 4,500
3,800 - 4,200
3,600 - 4,300

Source: ICICI Property Services Group

**indicative mid market and new supply segment

Phoenix Market City - Pune

18

Rentals for 2 BHK

(Rs./month)

30,000 - 40,000
20,000 - 30,000
20,000 - 25,000
18,000 - 22,000
14,000 - 17,000
14,000 - 15,000
12,000 - 15,000
10,000
10,000
10,000

WEST PUNE

Major Locations: Aundh, Balewadi, Baner, Bavdhan, Hinjewadi, Kothrud, Pashan, PimplePimple- Saudagar,
Wakad
Key Highlights:
Aundh, Baner and Kothrud on one side of Mumbai-Pune Expressway and Hinjewadi on the
other side of the highway are the most popular areas in West Pune.
Aundh with its famous localities such as Sindh Society, National Society, Parihar Chowk, Anand
Park, Ashiyana Park, etc. is a bustling location and is one of Punes up-market areas. The area is
a well-developed residential location dotted with bungalows; and most sought after location of
the affluent but has limited space for further development.
Space limitation in Aundh led to its extension into Baner which is now a popular destination
amongst those who desire to be near Aundh. Baner now boasts of some premium projects by
developers such as Supreme Universal, Kalpataru, Kasturi Housing, Amar Builders, etc. It also
has an added advantage of being nearer to Mumbai Pune Highway and having access to
Hinjewadi on the other side of the highway.
Originally a small village, Hinjewadi, has ushered the IT growth and is now known as the IT
village of Pune and it is this region of West Pune that draws tremendous investor interest. Home
to Rajiv Gandhi Infotech Park and prominent IT players like Infosys, TCS, Wipro, IBM, Tech
Mahindra, Cognizant; it is one of the growth corridors of the west region of Pune.
-

Hinjewadi, aided by MIDC, is being developed in phases and has successfully completed
development of 1st and 2nd phases with 3rd phase under speedy development.
Development of Phase 4 and 5 of Hinjewadi is expected to commence soon.

It houses four prominent private SEZs namely Ascendas, Blue Ridge, Embassy and
Quadron which are already partially occupied by some IT players while some part of
these SEZs is under construction.

To keep pace with the growing commercial real estate in Hinjewadi, a number of
residential projects have also been launched by Category A developers such as Kumar
Properties (Megapolis), Kolte-Patil (Life Republic), etc. thus making the walk-to-work
culture possible.

Hinjewadi is witnessing quick retail growth with D Mart, Reliance Digital etc. already
operational while planned infrastructure development in this region is underway. Further
plans to enhance this regions connectivity with rest of Pune are likely to boost the real
estate market in Hinjewadi.

Enormous employment and growth opportunites at Hinjewadi has also provided a stimulus to
areas such as Chandni Chowk in Paud Road, Warje, Wakad, Ravet and Pimple-Saudagar.
Gera, Kumar Properties, Kolte Patil, Aditya Builders, GK Developers, Nyati, Paranjpe, Pride
Purple, Supreme, Kalapatru, Marvel Group and Wadhwani Constructions are some of the
prominent developers in West Pune.
Growth Stimulators:
Proximity to Rajiv Gandhi Infotech Park in Hinjewadi and the Mumbai Pune bypass has
boosted real estate activity in this area, seen by many as one of the future key growth areas.
19

WEST PUNE

Over 2 lakh employees working in Hinjewadi area are propelling growth in outskirt areas like
Wakad, Tathawade, Ravet, Pimple-Saudagar, etc. while some IT majors such as Tech Mahindra,
TCS and Congnizant continues to add office space to increase employment.
In addition, Pune - Mumbai Highway houses almost all the car showrooms/service centers
(Nissan, Audi, Mercedes-Benz, etc.) and many leading educational institutes (Indira Institute,
Symbiosis, NICMAR, etc). Employees and students, working and studying here are one of the
major factors of real estate absorption.
A huge proportion of absorption of real estate in West Pune (Hinjewadi/Wakad/Ravet) can be
attributed to investors from Mumbai on account of easy access from the Mumbai-Pune
Expressway. Investors and some end-users from nearby cities of Kolhapur, Solapur,
Ahmednagar also add to the figures.
Likewise, Baner and Aundh, being easily accessible from industrial areas in Pimpri Chinchwad,
are getting developed as preferred residential location for senior executives of these industries.
-

Real Estate growth in Baner has been positive on the back of recent development of its
neigbourhood Aundh which now has large number of shopping centers and supermarkets
like Ozone Reliance Mart, Croma etc. Baner also boasts of famous restaurants and lounges.

The locality is well serviced and connected by public transport and has all the necessary
amenities such as banks, shopping centers and schools.
Kothrud and its neighbouring areas of Paud Road, Warje, Bhugaon collectively being termed as
New Kothrud are seeing a rising demand spilling from Kothrud, good infrastructure and
proximity to Deccan.

Kothrud has always seen a favorable demand with small projects that primarily attract the
local community.

Bhugaon is gaining popularity for residential development due its scenic appeal.

Price Trends in West Pune

Source: PropEquity
Note: Graph represents weighted average price of residential units available in the primary market.

20

WEST PUNE

Property rates of 'ready

'readyready-toto-move in' in prime residential markets of West Pune**
Location

Capital Values (INR/sq.ft.)

Aundh
Kothrud
Baner*
Pashan
Bavdhan
Pimple Saudagar
Pimple Nilakh
Balewadi
Warje
Wakad
Hinjewadi

9,000 - 12,000
8,500 - 11,000
6,800 - 9,000
6,000 - 7,000
6,000 - 6,500
6,000 - 6,300
5,500 - 7,000
5,800 - 6,500
5,500 - 6,200
5,500 - 6,000
4,800 - 6,200

Source: ICICI Property Services Group

*Price range is for all premium properties in Baner
**Indicative mid market segment

Infosys Campus, Hinjewadi

21

Rental Values for 2 BHK

(INR/sq.ft./month)
20,000 - 22,000
14,000 - 20,000
15,000 - 20,000
14,000 - 16,000
14,000 - 16,000
14,000 - 16,000
14,000 - 15,000
14,000
12,000 - 14,000
14,000
11,000 - 14,000

SOUTH PUNE

Major Locations: Ambegaon, Katraj, Kondhwa Budruk, Mohammadwadi Road, NIBM, Parvati,
Salisbury Park, Sinhagad Road, Warje, Wanowrie
Key Highlights:

South Pune is being characterized as a pure residential area. Proximity to Magarpatta IT Hub,
Camp, MG Road and Pune Railway Station make Undri, Pisoli, Mohammadwadi very convenient
residing locations having access to all important areas in Pune. While, Warje and Ambegaon offer
affordable housing options and excellent connectivity to Mumbai-Pune expressway and
Hinjwadi.

Undri, Pisoli, Mohammadwadi and Katraj Kondhwa Road have been witnessing major real
estate activity owing to availability of large land parcels, nearby reputed schools and International
Institutions (DPS, Vibgyor, Bishops, RIMs etc), Corinthians Club and hospitals (Inamdar Hospital ,
Ruby Hall).

Mohammadwadi, surrounded by hills with scenic beauty, has beautiful bungalows.

Warje and Ambegaon offer an affordable option to home buyers interested in Kothrud and
Sinhagad Road areas though in the recent past capital values in this area have appreciated
considerably. These locations also offer excellent connectivity to Mumbai Expressway and IT hub
at Hinjewadi.

Kondhwa has evolved as an important residential area in the recent past. The area towards
Wanowrie and NIBM is a preferred location for premium housing whereas, the area away from
Wanowrie and NIBM, has more budget housing development.

Nanded City, a township project on 700 acre land close to Khadakwasla dam has fueled the
growth in terms of transactions as well as capital appreciation in Sinhagad Road/Ambegaon area.

D.S.K, Nyati, Kumar Properties, Clover, Marvel, Kolte Patil, Amit Enterprises, Goel Ganga and
Mittal Group are some of the prominent developers in South Pune. Godrej Properties and TATA
Housing have also forayed into this micromarket.

Growth Stimulators:

The real estate market in this region is being driven primarily by the end-user demand.

Sinhagad Road, Warje and Ambegaon, have been witnessing an increasing end-user demand
spilling from Kothrud which is a premium location and has scarcity of land parcels. Thus, these
locations are expected to see a positive residential uptake being strategically located and having
excellent accessibility from the Mumbai Pune Expressway, Katraj and Kothrud.

The real estate demand in Undri, Pisoli, Mohammadwadi and Katraj Kondhwa Road is expected
to continue to see a surge due to availability of affordable housing alternatives to home seekers
as compared to NIBM, Wanowrie.
-

22

Planned development by category A developers, availability of open land, excellent

connectivity to MG Road and Magarpatta City and reputed educational institutions in the
vicinity are attracting end-users to this micro- market.

SOUTH PUNE

Price Trends
Trends in South Pune

Source: PropEquity
Note: Graph represents weighted average price of residential units available in the primary market.
Missing line segments indicate unavailability of residential units in the primary markets during the
specified time frame.
Property rates of 'ready
'readyready-toto-move in' in prime residential markets of South Pune**
Location
Salisbury Park
Wanowrie
Sinhagad Road (Close to
Karvenagar, Kothrud)
Kondhwa NIBM
Katraj
Ambegaon
Kondhwa Khurd
Undri

Average Capital Values (Rs./sq.

ft)
12,000-15,000
7,000-9,000

Source: ICICI Property Services Group

**indicative mid market segment

23

Rentals for 2 BHK

(Rs./month)

20,000 - 25,000
15,000 - 17,000

7,000-8,000

14,000

5,500-7,000
5,500-6,500
5,500-6,500
4,500-5,500
4,200-5,000

14,000
12,000 - 14,000
10,000 - 12,000
10,000
10,000

LOCATION
LOCATION ATTRACTIVENESS INDEX - PUNE

Location Attractiveness Index - Pune

A comparative study of different locations within Pune shows Hinjewadi as having an edge over
other locations. With Phase 2 and 3 of Hinjewadi already complete and plans for its future
infrastructure development along with commercial and residential development; Hinjewadi is
expected to see a surge in employment generation. Its proximity to Mumbai-Pune expressway
also makes it a very good investment option. Thus, Hinjewadi ranks the highest in Location
Attractiveness Index.

Aundh

Baner

Katraj Kondhwa
Hinjewadi Kalyaninagar Road

Infrastructure
(connectivity, roads,
schools, markets)
Residential Cost
Proximity to Organised
Retail
Proximity to
Commercial
Development
Future Infrastructure
Development
Future Employment
Generation

Good / Low cost

Above Average
Average / Medium cost
Below Average
Bad / High cost

Source: ICICI Property Services Group

24

Kharadi

Moshi

Undri

Wagholi

ANALYSTS
Sachin Bhandari
Regional Head (West)
ICICI Home Finance Company Ltd.
sachin.bhandari@icicihfc.com
Priya Bhatia
Manager, Structured Finance Group
ICICI Home Finance Company Ltd.
priya.bhatia@icicihfc.com
We acknowledge Mr. Gaurav Maheshwari, Manager, ICICI Bank for his contribution towards
this report.
For any further queries, please email us at psgresearch@icicihfc.com
or
For more on our research reports & periodicals please log on to www.icicihomesearch.com
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