REAL ESTATE PLANNING

Importance of real estate in urban planning

Real estate is one of the

largest contributors to GDP
(~7% in India, projected 13%
by 2030).

Provides housing,
employment, commercial
growth, and infrastructure.

Acts as a catalyst for urban

development.

Bangalore Example:
Expansion of Whitefield &
Electronic City due to IT
sector → created demand for
housing, retail, hospitality.
 REAL ESTATE PLANNING
• Real estate planning refers to the process of strategically
managing and arranging real property assets to meet
specific financial and personal objectives.
• Systematic process of managing land resources,
development, and investment for sustainable growth.

CORE ELEMENTS

•Land allocation

•Infrastructure provision

•Environmental balance

•Economic viability

Objectives – Optimum land use, economic growth, housing, sustainability

 BASIS OF REAL ESTATE PLANNING

• The basis of real estate planning can vary depending on

individual goals and circumstances, but some common
principles include:

• Goal Setting
• Financial Assessment
• Risk Management
• Tax Planning
• Estate Planning
• Legal and Regulatory
Compliance
• Professional Guidance
• Financing Strategies
• Market Analysis
BASIS OF REAL ESTATE PLANNING
Goal Setting: The first step in real
estate planning is to define clear
and achievable goals. These goals
may include wealth accumulation,
tax minimization, asset protection,
retirement planning, legacy
creation, or any combination of
these.

•Example: A developer sets a

goal to build 2,000 affordable
housing units under PMAY in
North Bangalore within 5 years.
•For investors: Buying a property
in Whitefield with the goal of
earning 6% rental yield.
BASIS OF REAL ESTATE PLANNING
Financial Assessment: A thorough
assessment of one's financial
situation is essential. This involves
evaluating current assets,
liabilities, income, expenses, and
cash flow to understand how real
estate fits into the overall financial
picture.
•Before launching a new IT park in Hebbal,
the developer conducts a financial feasibility
study (land cost, construction, expected
rental income, IRR).

A buyer evaluates whether they can afford a

₹1.5 Cr apartment based on EMI and other
expenses.
 BASIS OF REAL ESTATE PLANNING

Risk Management:
Identifying and
managing potential
risks associated with
real estate holdings is
crucial. This includes
considering insurance
coverage, liability
protection, and risk
diversification to
A builder takes insurance against project delays safeguard against
and fluctuating material prices.
unexpected events.
Investors diversify by holding properties in both
residential (Whitefield) and commercial (MG
Road) sectors to reduce market risk.
 BASIS OF REAL ESTATE PLANNING
Tax Planning: Real estate
transactions can have
significant tax implications.
Effective tax planning
involves understanding tax
laws, deductions,
exemptions, and utilizing
strategies to minimize tax
burdens.

Example: A homeowner in Bangalore claims Section

24(b) deduction on home loan interest and Section 80C
benefits on principal repayment.

Developers structure projects under REITs (Real Estate

Investment Trusts) for tax efficiency.
 BASIS OF REAL ESTATE PLANNING
Estate Planning: For long-term
real estate planning,
considering how real property
assets will be transferred to
heirs or beneficiaries upon
death is important. Estate
planning tools such as wills,
trusts, and gifting strategies
may be utilized.
A family with multiple properties in Jayanagar creates a
will to avoid disputes in inheritance.

Using trusts to transfer real estate assets smoothly to the

next generation.
 BASIS OF REAL ESTATE PLANNING
Legal and Regulatory Compliance: Real estate planning must
adhere to various local, state, and federal laws and regulations. It
is essential to stay informed about zoning laws, building codes,
environmental regulations, and any other legal requirements that
impact property ownership.

A project in Sarjapur Road

must comply with RERA
Karnataka, BBMP
approvals, and
environmental clearances
before launch.

Avoiding illegal constructions

in lake buffer zones (as seen
in Bellandur demolitions).
 BASIS OF REAL ESTATE PLANNING
Professional Guidance:
Engaging with financial
advisors, real estate
professionals, attorneys,
and tax experts can
provide valuable insights
and expertise to navigate
the complexities of real
estate planning.

•Investors hire real estate consultants (like JLL or Knight Frank) to identify profitable
commercial property deals in Bangalore.

•Architects and urban planners guide developers in designing mixed-use projects like
Brigade Gateway.
 BASIS OF REAL ESTATE PLANNING
Financing Strategies: Involve
determining how to fund and
acquire real estate properties or
projects.
Crucial for developers, investors,
and property owners to ensure
that they have the necessary
funds to acquire, develop, or
maintain properties while
optimizing financial returns.
A developer finances a luxury project in
Careful consideration of
Koramangala through a mix of bank loans, financing options, such as
private equity, and customer advances. mortgages or loans, is necessary
•An individual uses a home loan with floating to maintain financial stability.
interest rate to buy a flat in Devanahalli near
the airport.
 BASIS OF REAL ESTATE PLANNING
Market Analysis: Conducting market research and analysis is
essential to identify investment opportunities, determine property
values, and make informed decisions about buying or selling real
estate.
•A developer
studies office
demand along
Outer Ring Road
before planning a
new IT park.

•A retail investor
checks rental
yields in
Whitefield (3-4%)
vs. Hebbal (5-6%)
before purchasing
an apartment.
REAL ESTATE SECTORS
REAL ESTATE SECTORS
 REAL ESTATE SECTORS
Residential Real Estate

• This sector focuses on properties used for living purposes,

such as single-family homes, condominiums, townhouses,
apartments, and vacation homes.

• Drivers: Urbanization, IT jobs, migration, lifestyle

preferences.

Sarjapur Road → High-rise apartments (IT corridor demand).

Hebbal → Luxury villas & waterfront apartments.

REAL ESTATE SECTORS
Residential Real Estate
 REAL ESTATE SECTORS
Commercial Real Estate

• Involves properties used for business purposes, including

office buildings, retail centers, hotels, hospitals, parking
facilities, restaurants etc.
• It encompasses both leasing and selling of commercial
spaces.
office

retail

hospitality
 REAL ESTATE SECTORS
Commercial Real Estate

Office Real Estate: Specializes in office buildings and spaces used for
professional and administrative purposes. This includes corporate offices,
coworking spaces, and shared office spaces, SEZs,
 REAL ESTATE SECTORS
Commercial Real Estate

Retail Real Estate: This sector deals with properties used for retail businesses,
including shopping malls, strip malls, standalone retail stores, and outlets.
 REAL ESTATE SECTORS
Commercial Real Estate

Hospitality Real Estate: This sector focuses on properties used for

accommodation and hospitality services, such as hotels, motels, resorts, and
bed and breakfast establishments.
 REAL ESTATE SECTORS
Industrial Real Estate

• This sector is concerned with properties used for

manufacturing, distribution, storage, and logistics
purposes.
• Industrial real estate includes facilities like factories,
distribution centers, and warehouses.
Peenya Industrial Area →
Oldest & largest manufacturing
hub.

Bidadi → Automobile &

manufacturing clusters
(Toyota, Bosch).

Hoskote → Warehousing for

Amazon, Flipkart.
REAL ESTATE SECTORS
Industrial Real Estate
 REAL ESTATE SECTORS
Land
• Includes undeveloped property, vacant land, and
agricultural lands such as farms, orchards, ranches,
and timberland.
REAL ESTATE SECTORS
Land
 REAL ESTATE SECTORS
Mixed use Real Estate

• Mixed-use property is a type of real estate property

that combines commercial, residential and sometimes
even industrial units.
• This allows investors to take advantage of different
types of property in a single investment.
REAL ESTATE SECTORS
Mixed use Real Estate
 REAL ESTATE SECTORS
Special purpose

Property used by the public, such as cemeteries,

government buildings, libraries, parks, places of worship
etc.
REAL ESTATE SECTORS
Special purpose
REAL ESTATE SECTORS
Special purpose
 Micro Factors Affecting Real Estate Markets
•Site Location:
Proximity to IT
parks, CBD, or
airport.
•Accessibility:
Roads, metro
stations, bus
corridors.
•Amenities:
Schools, malls,
hospitals,
recreational
spaces.
•Neighborhood
Profile: Safety,
social
infrastructure,
branding of locality.
 Sarjapur Road (South-East
Parameter Hebbal (North Bangalore) Whitefield (East Bangalore)
Bangalore)

Close to Airport, NH-44, Metro Phase Connected by Metro (Purple Line), ORR access, Metro under
Connectivity
2B planned ORR access construction, congested roads

ORR IT Corridor (RMZ Ecospace,

Major Job Hubs Manyata Tech Park, Airport SEZs ITPL, EPIP Zone, GR Tech Park
Embassy Tech Village)

Residential Pricing (avg.) ₹7,000–9,500/[Link]. ₹5,500–7,000/[Link]. ₹6,000–7,500/[Link].

Target Buyers HNIs, NRIs, Airport professionals Mid-income IT workforce, families Mid-to-high income IT professionals

Luxury apartments, villas, gated Affordable & mid-segment Apartments, row houses, emerging
Residential Typology
townships apartments, co-living luxury

Low vacancy, premium rental Absorption driven by IT corridor

Vacancy / Absorption Higher supply, vacancy ~12–15%
demand demand

Rental Yields 3–4% 2.5–3% 2.5–3%

Strong: Columbia Asia, Aster CMI, Strong: Phoenix Marketcity, Vydehi Good: Decathlon, international
Social Infra
RMZ Galleria Hospital schools, malls coming up

Metro (Phase 2), STRR, IT corridor

Future Growth Drivers Airport line metro, PRR, airport city Metro completion, IT expansion
demand