Hyderabad has grown by leaps and bounds over the past 2+ decades and more specifically in the last 7 years. The recent RBI report showing Telangana as the 4th largest contributor to the national GDP is a fantastic vindication of the state government's focus and efforts. Telangana is possibly the 11th largest state in area and 12th largest in terms of population. Inspite of this what the state has pulled off in GDP numbers is absolutely phenomenal. The agricultural sector followed by the real estate sector are the main engines of this growth. For the real estate sector the city of Hyderabad would be the chief contributor.

The year 2013-14 was possibly the worst year for Hyderabad in terms of power cuts and water shortage. It was common to have power cuts for 3-4 hours everyday. Factories would operate only at odd timings as per electricity availability. Water scarcity and bad rains compounded the city's problems. Basically all economic activities were a mess. Amongst the first things that the new government addressed when they came to power in 2014 was electricity and water.

Electricity has ceased to be a problem for most of the city nowadays. Incase of a complex that has power backup system, then they may not even notice the negligible electricity cuts nowadays. Water situation has also considerably improved and when we drive around the villages we can spot tanks and irrigation pipes running parallel to the main roads. The phenomenal performance of the state in agriculture especially rice cultivation is testimony to the irrigation plan working and benefitting this sector. All this seems the result of a well thought out long term plan and implementation, that the government had for the betterment of the new state. We can always argue semantics but nobody can deny that these critical infrastructures have improved quality of life in our city.

Covid hit and a lot of things turned topsy and turvy for our state's economy and the city's real estate market. A renewed and planned focus on the city's infrastructure and real estate sector is only what will allow the city see the next round of tangible growth and benefit the state. Some thoughts are as follows:

• Lack of development of Secunderabad: We proudly call Hyderabad and Secunderabad as twin cities but one has to just drive around to figure out that Secunderabad not only lacks development but is neglected thoroughly. Secunderabad still lacks a masterplan and it is a pity that various arms of the government are not able to resolve their differences for the common good. Any long term plan for Hyderabad will remain half baked without developing Secunderabad properly. 30-40% of the Hyderabad's population lives this side and the North eastern side of the city cannot be taken for granted anymore. A proper masterplan with a long term vision integrating the requirements of all segments operational here is the need of the hour.
• RERA & Compliance: RERA implementation in Telangana remains quite disappointing. We are given to understand that getting this approval is a long and time consuming process with RERA. The authority itself is sparsely manned possibly leaving post approval on-site checks and balances much wanting. It is no surprise that we have not come across any news reports of the RERA authority taking action against errant projects. Intentions remain good only on paper. If the city's real estate market needs to the taken more seriously by buyers, investors and funds in future, then far better compliance is the need of the hour. It has remained only a pipe dream to see only RERA approved projects and brokers operate in this market. Lack of compliance leads directly to losing the buyers trust and once that is lost then gaining it back is a big task.
• Just browsing the RERA website of Maharashtra, Karnataka and Tamil Nadu gives one an idea of how RERA needs to be implemented. Information provided includes list of projects on notice for not taking RERA approval, list of projects whose RERA application has been rejected, list of complaints and resolution, status reports, annual reports, reporting option for non-compliant projects etc.
• Ending pre-sales / UDS sales / assured income schemes: These kind of deals, mostly pre-RERA, are a stigma to the real estate sector. The government has enacted laws to curb these activities but a lot more information dissemination and far stricter compliance implementation is required to end this menace to protect our future.
• City's road infrastructure: With more people opting for self-transport and ever growing demand for vehicles the city's already congested roads will come under further stress once offices and schools open up completely. The city needs a comprehensive plan to handle this surge in traffic. The long, medium and short haul traffic need to be separated and directed separately. Proper bus lanes, lane discipline, series of road expansions, bridges, underpasses, foot over bridges etc need to be properly planned and implemented with a view to handle the traffic a few decades from today.
• We aspire to be a city like Singapore / New York but on-ground situation is completely different. Basic stuff like wearing helmets, seat belts, replacing fused head lights or fused brake lights etc are not being implemented strictly. Hopefully better policing through camera surveillance will help but these basic do's and don'ts for a metro like Hyderabad should be non-negotiable.
• Basic city infrastructure in terms of drainage, garbage collection, cleaning of roads, street lights etc need to be re-looked with a new plan. The current reactionary approach will not work in the long term. This is an ever growing city and various departments should be able to coordinate and work together for the betterment of the city. Wasting public money with repeated road cutting needs to be curtailed.
• The government has made a great move but appointing a special commissioner for water bodies / resources and allied work. A similar sole focus is required for each facet of the city's infrastructure. Senior resources could bring in the missing urgency and continuity to planning the city's infra.
• Office real estate market: Reading some of the recent press coverage about upcoming supply numbers was least to say scary. Some reports predict approx. 150 mn sft of Grade A office supply likely to delivered in the next 3-4 years timeframe. These were pre-Kokapet / Khanamet land auction numbers. Looking at the auction results it is a likely scenario that many of the bidders might opt for commercial projects to compensate the very high bid price.
• The government is further auctioning another 100 acres of land in Poppulguda and Khanamet. Again the high bidding might necessitate that only commercial projects get developed. This could further add to the already large supply number.
• Whether our market's office absorption remains 5mn sft or 20mn sft per year, this unchecked construction would leave us with supply worth couple of decades. This is a serious imbalance which needs to be addressed at the earliest. From the government's side more land auctions should be avoided for the next decade or so. We are still not in a post covid scenario and occupiers at the most will take baby steps with regard to coming back to offices.
• For a market like Hyderabad, post covid, dissemination of office space across the city especially East and North would be a realty. Work near home is something which will become a norm with a healthy number continuing the work from home option. Gone are the days where employees travelled huddled in taxi's for couple of hours twice a day. Even sensible employers may not want that risk or the escalated transport cost at current fuel prices.
• Residential real estate market: This segment also seems to be in the throngs of an over-supply situation. The resale market in locations like Hitec city is increasingly becoming non-existent. A quick look at resale numbers would show a dip in quoted values and transactions taking months to get a serious buyer. It is not uncommon in Hitec for owners to sell at a loss to their landed cost just keep financial pressures under control. If you are buyer in Hitec city today then there is a plethora of new options to choose from and seldom would you consider an older property for your investment requirements. Overall sales continue to be in low numbers. Considering the overall volume of construction coming up the market is likely to have an over supply hang for a few years. Buyers are better off buying ready to move in units as taking on the development risk in a market where RERA implementation is not great, is avoidable.
• Developers or the government need to eventually agree to a mechanism of self-regulation or proper regulation of the supply that is being pumped into the market. Maximum supply continues to chase a price range where buyers are less. Unlimited FSI and unlimited supply might prove to the ultimate bane of this market. The earlier this gets checked would be better for the city and its development.
• Retail real estate market: This segment has been suffering from overall supply for many years now. Few malls continue to remain empty especially in Hitec city and CBD. The government should not allow any further development of malls in the already over supplied locations. May be before sanctioning further real estate projects the approving authority needs to do a due diligence on the demand and supply situation. The retail segment is a model of allowing private parties to keep developing as per their choice and this has resulted in supply excess many times over. If projects keep getting sanctioned without any on-ground homework then we would be stuck with oversupply in all segments for many years. This unproductive activity could be curtailed with some amount of planning.
• Land investment: Our impression is that land prices remain artificially high without any financial viability logic. We remember when the Raidurg auctions were conducted no developer bid for those lands. The general perception was that land prices of Rs. 30 cr per acre and rentals of Rs. 50-55/- did not make financial sense. It was thought better to do joint ventures with the eventual buyers who were mostly pharma giants and that is what actually happened. Since this point what has changed in terms of financial viability expectations we are not sure. Rental returns do not justify a lot of land valuations being quoted. Current astronomical land valuations are being played like a baton race. The last person left holding the baton will pay a heavy price for neglecting financial prudence.

The city needs a practical and proactive approach to planning for our constantly growing population. All stake holders need to be involved in this plan so that Hyderabad continues its leadership position else we risk losing the sheen of Brand Hyderabad.