Half of calendar year 2023 is over. Unfortunately, there isn’t much ‘feel good’ news in the world, except in India, Middle East & few countries in Southeast Asia.
The mindless war between Russia & Ukraine continues. Other than helping clear the stockpile of weapons in few western economies & securing billions of dollars of fresh orders for manufacture of weapons, it has only resulted in destroying large areas in Ukraine & displacing millions of its citizens. The war resulted in much of Europe to go into recession. From a unipolar world with United States ruling the roost since the disintegration of USSR during 1991-92, the world is getting back to a bipolar world with the 2nd largest economy of the world, the communist China supporting Russia.
While politically the world has become bipolar again, economically countries have become more interdependent than ever before due to globalisation & WTO policies. This is posing a huge challenge to different economies, particularly to the United States and to the countries in Europe.
The Indian Government has played its cards smartly. Our country is beginning to see the benefit of China+1 strategy of the developed economies, not only for sourcing their product requirements, but also because they see India as a good investment destination. This has greatly helped the Indian economy to become resilient and not be affected so far by the war in Ukraine. The best indicator is the stupendous increase in Sensex & Nifty indices and Indian foreign exchange reserves crossing US$ 600 billion again. Many senior bankers feel that for the 1st time after many many years, all sectors of business are doing well. One can only hope this good show sustains for a longer time thereby helping Indian GDP reach US$ 5 trillion, sooner than later. The spoil sport can be poor monsoon, interest rate increase and unexpected events like political turmoil.
The ruling party at the centre got the shock of its life by badly losing State Elections in Karnataka. The smart electorate of Karnataka has punished the unexpected poor performance of the previous Government, apart from succumbing to the lure of multiple freebies offered by the winning party. While this has invigorated the opposition parties against the ruling party at the centre, it has also made the 2024 parliamentary elections more unpredictable. Anything can happen. What India requires is political stability and retaining its position in the world order & the goodwill generated during the past few years. What all this means to the business is the question? Uncertainty to a great extent. One never knows when the current positive sentiments will start turning negative, though there is absolutely no indication at present.
The Residential Real Estate sector is continuing to grow in a healthy way. Financial year 2023 is the best so far for the sector. The WFH/ A (work from home/ anywhere) culture continuing in a big way in USA & Europe has created millions of square feet of vacant office space in those countries, which has resulted in cautious approach by Indian & MNC companies in the tech sector to sign up new office space. Most experts feel this could be a cyclical and temporary phenomena. The good news is many MNC companies are increasing the size of their GCCs (Global Capability Centres) in India as a way to cut costs by offshoring work thereby helping to retain/ improve their profitability. This is the saving grace for the Indian Office Real Estate sector. The data localisation policy of the Indian Government has also resulted in increased demand for Data Centres. So also, the growing organised retail business has increased the demand for Fulfilment Centres/ Warehouses.
In such a macro environment, Brigade is trying to play its cards well but carefully. We have made headway in increasing our presence in Chennai significantly. We are trying to do the same in the highly competitive real estate market of Hyderabad.
While a number of new launches are slated in this financial year, obtaining civic authorities approvals is becoming more challenging than ever before, for a variety of reasons. By adhering to the multiple rules, administrative procedures and after overcoming red tape, if one succeeds in real estate business in India, they deserve to receive accolades and a pat on their back.
Rightly, the new Congress Government in Karnataka is talking of ‘Brand Bengaluru’ – to improve the image of the city which has taken a beating due to severe traffic congestion, insufficient infrastructure planning & implementation. Bengaluru deserves much better treatment by the State Govt.
Bengaluru, which contributes more than 50% of the tax revenue of the State; should receive similar share in the expenditure budget of the State to improve its infrastructure. Bengaluru is not just a city of Karnataka, it is now a Global City, known for innovation and home to 100s of MNCs.
Hyderabad with its superior infrastructure is already breathing down Bengaluru‘s neck and sure to overtake Bengaluru as an attractive investment destination, if the Karnataka Government continues to be complacent.
The advent of ChatGPT & AI (Artificial Intelligence) into our lives, slowly but surely, will have a profound effect, not fathomed by us so far. It will become a necessary evil in the years ahead. While there would be demand for people with new skills, it may also lead to thousands of job losses. So, it is very important for people and businesses to gear up the skills to keep pace with the ever changing technological advancements.
The festival season is approaching. My warm season's greeting to all our readers.
—Jaishankar CMD, Brigade.
It is a fantastic feeling to be adjudged as ‘The Best Place to Work’ among all the Real Estate Companies in the country. We sincerely thank the Economic Times & the internationally acclaimed The Great Place to Work Institute for this recognition. It will certainly motivate us to continue to adopt & innovate, when it comes to people friendly HR policies. It is heartening to note our Group received a number of Awards during the last few months; be it ‘Hotel Owner of the Year’ at the Hospitality Leaders Industry Choice Awards, or the Best Luxury Residential project for Brigade Caladium and even those awarded to individual Brigadiers.
The Indian economy is just chugging along. Unfortunately, the new Government has not been able to meet the high expectations of the people & the industry. Probably they promised too much in a short span of time. All said & done, ours is a complicated economy with too many pulls & pressures from all directions, apart from multiple vested interests. One can only wish & pray that our dynamic Prime Minister will ultimately succeed in his efforts to improve the growth rate and put the Indian economy on the right track. For too long we have been a third world country.
While the government understands the importance of Tourism, too little is done to improve the inflow of foreign tourists with high spending power. With a population in excess of 1200 million, we have tourist inflows of only 6 million. That hardly works out to 0.5% of the population. A not so prominent country like Croatia, has a tourist inflow of 12 million with a population of just 4 million. The impact of tourism on Croatia’s economy & job creation for ordinary citizens is huge.
Bangalore Citizens will elect new representatives (Corporators) to the City Council in BBMP (Bruhat Bangalore Mahanagara Palike). Hopefully, the representatives who get elected will actively work towards improved Urban Infrastructure like better quality roads, traffic management, waste management & related issues.
Recently, Sheraton Bangalore Hotel at Brigade Gateway was rebranded as Sheraton Grand at Brigade Gateway. It is one of the only 10 hotels in the world to be rebranded amongst all Sheraton Hotels, based on parameters such as superior product, service & customer satisfaction.
We recently concluded Brigade Showcase, our annual property exhibition. The event witnessed robust support in an otherwise subdued market environment, thanks to a good choice of product offerings in different locations, apart from the Group’s brand strength.
The Festival season is around the corner - Onam, Ganesh Chaturthi, Eid Ul-Adha, Dussehra, Diwali & Christmas - Seasons Greetings and best wishes to each and everyone.