ADVANCE RESEARCH IN REFORMING REAL-ESTATE &

CONSTRUCTION BUSINESS IN CHENNAI

SYNOPSIS:

The real estate sector is one of the most globally recognized sectors. In India, real estate is the
second largest employer after agriculture and is slated to grow at 30 per cent over the next
decade. The real estate sector comprises four sub sectors - housing, retail, hospitality, and
commercial. The growth of this sector is well complemented by the growth of the corporate
environment and the demand for office space as well as urban and semi-urban accommodations.
The construction industry ranks third among the 14 major sectors in terms of direct, indirect and
induced effects in all sectors of the economy. It is also expected that this sector will incur more
non-resident Indian (NRI) investments in both the short term and the long term.

Real Estate Industry in chennai witnessed a historic boom during 2007 to 2013. Record number
of projects were launched and sold during this period. Real Estate Developers in chennai grew
multifold very fast. Land and property prices skyrocketed. Many developers went for public
issue of shares at very high valuations. Attracted by liberalization of foreign investment
regulations, International investors invested billions of dollars in Indian real estate sector. The
global economic boom, easy availability of money, crazy jumps in asset valuation and mad rush
to go for the IPOs and desire to claim very high company valuation typically characterized real
estate industry at that time.

Now in 2017 realestate and construction business were slowly falling down to the average
of 50% compare to 2012 strategy, in this study we are going to analyze the problem why
its goes down and how to reform it.
OUTLINE:

India is a large and diverse country with more than 1.2 billion people spread across a
geographical area roughly one-third the size of the USA. As in other emerging markets,
urbanisation is taking place at a rapid pace as a young (median 26.9 years) and growing
population moves to cities in search of jobs and better opportunities. Chennai, Bangalore, Delhi
and Mumbai are just four of an estimated 58 cities with a population of one million or greater. A
rising population is projected to see the country surpass China as the worlds most populous
within the next two decades.

Commercial real estate activity in India is heavily focused in the Tier 1 cities of Bangalore,
Chennai, Delhi and Mumbai due to more mature local economies and better infrastructure.
Software and IT services firms have been major drivers of office demand in the past decade and
are now the largest occupiers of prime space. Although foreign occupiers have been a large part
of the office leasing market, foreign developer/investor participation in the industry has been
more limited. Nonetheless, a growing economy and rising wealth levels are necessitating the
need for high quality buildings in all real estate sectors and management that meets international
standards.

Although Indias economy is ranked the third largest in Asia and seventh largest globally,
agriculture remains a key sector and employs roughly half of the total labour force. However, the
services sector has witnessed robust growth in the past decade in industries such as finance, IT
and communication, and its total share of the economy (over 55%) continues to grow. With
forecasts for growth over the next few years to exceed 7% per annum, the size of Indias
economy is expected to surpass that of Japan by 2022.
 Figure 1.1 Indian Real Estate Eco System

Types of properties we are focusing on:

Real estate property comes in various types with each having its own distinctive structure. There are
three major property types in the real estate business.

1.Vacant Land Property

Vacant land is popular with ranchers and cultivators. The extent of property is considerable and the
price high.

2.Residential Properties

Residential property types include:

2.1Single Family Residence Property

Single-family residences are single units, typically with a front and back yard, a driveway and an
attached garage.

2.2.Duplex Property
A duplex is a structure designed for residential use and contains two living blocks sharing a common
wall. Duplex properties may be listed residential or commercial, depending on the purposes they serve.

2.3.Condominiums Property

Condominiums, or condos, are apartments that are independently owned minus a yard and with
common parking facilities and offer many amenities.

2.4.Town House Property

Classic townhouses are doubled storied row of homes, with common sidewalls. The living room is
situated below with the bedrooms above and there is a little fenced in yard.

2.5.Manufactured Home Property

Manufactured homes are erected in a factory and set up on the dwelling site. They must conform to the
federal construction regulations.

2.6.Patio Home

A patio home is a single story home with one joint sidewall and a patio towards the back facing the
common area. Patio homes normally contain 2-4 homes in each structure and may have a backyard.

2.7.Loft Property

Lofts are usually found downtown and have high roofs, huge wide windows, metal staircase and cement
floors, but no yard.

3.Commercial Properties

Commercial property can refer to vacant land developed for commercial use, or an
already existing commercial structure(s).
Specifics about certain commercial property types:

3.1.Multi-Family Property

Multi-family property comprises of buildings meant for numerous family groups, leased on a
permanent basis. They typically contain five or more living units with shared amenities, such as
doorways, foyers, lifts, staircases and walkabouts.

3.2.Rooming House

Rooming house properties usually have no more than 20 furnished units with common
bathroom and kitchen facilities given out on a temporary basis.

3.3.Mobile Home Parks Property

Mobile park homes are a blend of single and double spacious homes, sited in decent
neighborhoods and with at least three-fourth occupancy. Depending on the surroundings and
facilities provided mobile home parks are given star ratings.

3.4.Retail Space

Retail space comprises of single construction taken by single or multiple tenants and exclusively
meant for retail use such as sales and display of garments and electronics.

3.5.Office Buildings & Complexes

This type refers to a single structure intended for office use, or a set of offices in one structure
or a group of buildings and are ideally located on the main road.

3.6.Mixed-Use Properties

Mixed-use properties are a blend of residential and commercial units such as a retail store and a
multi-family home in the same structure.

3.7. Healthcare Properties

This property type includes hospitals and nursing homes, health care centers and assisted living
facilities. A license is mandatory to run the facility.

3.8.Bed & Breakfast Properties

 Bed and Breakfast inns are normally single buildings family units meant for temporary boarding.

3.9.Restaurant Property

Restaurants are built for the making and selling of food and drinks, and include canteens, pubs,
and inns.

3.10.Hotel Properties

Hotel properties are constructions that provide a suite of facilities and services, typical of the
hospitality industry. Hotels are classified as either Complete Service or Restricted Service. Hotels
can also be affiliated to a national franchise chain.

3.11.Day Care Centers

Day Care centers provide childcare, disabled, and elderly care services; or are learning centers,
such as kindergartens and nurseries. They have playrooms, rest rooms, and simple kitchen
amenities.

4.Industrial Property

Industrial property types are designed for industrial commercial functions. They include:

4.1. Self-Storage Properties

These are mini-warehouses and comprise of tiny compartments that are rented for private
storage.

4.2. Warehouse Properties

Warehouses are commercial buildings built for holding goods and consist of massive open inner
sections.

4.3.Flex Space Properties

Flex space is a blend of industrial and office property. It is an arrangement that has a workplace
and display area together with the industrial area.

5. Manufacturing Property
 Manufacturing property is designed for producing goods for sale or lease like factories.

5.1.Cold Storage Property

Cold storage property is a specialized structure that makes available storage in a chilled or icy
setting.

5.2.Automotive Property

Automotive structures are built specifically for the automobile industry and usually have a small
office cubicle, car lifts, and overhead doors. They include repair units, used car hubs, and tier
fixing facilities. Detailed study of property types and their comparative values is crucial in
deciding the best option to work with and the possible monetary benefits accruing from each.

NEED OF STUDY:

The study required for builder and promoters for following reasons,

Ideas to Reforming the industry back

Methods and recommendations should follow in future
Advertising Methods which create trust
How to make people trust investing with builders
Safety methods must consider in construction
Pricing and Financing Strategies

SCOPE AND SIGNIFICANCE:

The major scope of the project to Study and analyze how the industry get failure and what are all
it reasons even the population was keep on increasing in Chennai. But why the real-estate sector
getting down day by day. Based on several case study we are going to conclude with the
recommendation how to fix it.
PROBLEM DEFINITION:

Problem which will cause the major impact for failure:

1. Land Registration Rules followed by the Govt.of Tamil Nadu from the period of 2013 to
till now.
2. Demand of raw materials and its increasing cost.
3. Banking Problems and
4. Some other local issues

PURPOSE OF THE PROJECT:

On considering the case study which recently collapse at Moulivakkam, Porur. One
building collapsed on its own during construction itself and the other building, semi built, was
demolished by imploding. Could a thunder bolt cause such a devastation pulling down 11 storey
building the first one? Was that the actual cause at all for the collapse of the building? The
study revealed that the poor quality of construction and the negligence of soil condition are the
prime causes of the collapse.

The main purpose of the project to identify the problems why the industry get failure and make a
survey how people are reacting. And what people are expecting from the real-estate company
with pricing strategy. And providing conclusion and suggestion to reform it.

OBJECTIVE:

Primary Objective:
Our primary objective of the project to analyze why in Chennai the real estate sector was failure
at present and analyze why lot of completed apartments are not sold.

Secondary Objective:

Secondary objective will be finding up solution for the problems found out from the primary
objective by doing some surveys

RESEARCH METHODOLOGY:

Definition: The process used to collect information and data for the purpose of making business
decisions. The methodology may include publication research, interviews, surveys and other
research techniques, and could include both present and historical information.

Description:

The purpose of research is to discover answers to questions through the application of scientific
procedures. The main aim of research is to find out the truth which is hidden and which has not
been discovered as yet. Though each research study has its own specific purpose, we may think
of research objectives as falling into a number of following broad groupings:

1. To gain familiarity with a phenomenon or to achieve new insights into it

2. To portray accurately the characteristics of a particular individual, situation or a group

3. To determine the frequency with which something occurs or with which it is associated with
something else

4. To test a hypothesis of a causal relationship between variables

SOURCE OF DATA:

Primary:
Data collected by taking survey among the people and agents

Secondary:

Data collected from news and existing case studies

RESEARCH DESIGN:

Population: 300

Sample size: 300

Sources of data:

Primary source: Visiting Customers Method

Target audience: Small Agents and Builders

Data Collecting Procedure:

Taking sample from areas such as: Tambaram , Avadi and Outer citys

Tools used for Data Collection: Questioner