Commercial Real Estate Investment in Kukatpally
Kukatpally is a suburb situated in Telangana. It is quite close and located in the North-Western part of Hyderabad. Kukatpally is really close to the Information Technology Hub of Hitech City. Being in proximity to Mumbai National Highway and leading as a commercial hub is affecting the land prices here if we compare it with Hyderabad.
Kukatpally houses several small and medium-sized enterprises like Nosch Labs, IELTS and LIC. There are even IT and ITeS companies situated here like Dell, Microsoft, Google and Deloitte. According to a report in The Hindu 10% to 20% of leasing in Hyderabad is a contribution of Kukatpally and areas in its vicinity.
Keep reading to understand more about how investing in commercial real estate in Kukatpally might turn out to be a profitable venture:
Top Reasons to Invest in Kukatpally Real Estate
Here are some of the reasons that might make you want to invest in commercial real estate in Kukatpally:
Kukatpally is really well-connected by roads and elevated expressways that help you to travel from one location to the other quickly and without any inconvenience. There are a number of intercity state transport buses passing through Kukatpally. Other than that, it has good connectivity to National Highway 9 which connects Hyderabad to Mumbai.
Kukatpally offers great infrastructure whether it’s Kukatpally metro or highways. There are a large number of infrastructural developments that have been done in recent years in the area like the construction of two flyovers near Biodiversity Junction and another one at Rajiv Gandhi Statue. Apart from these, GHMC has constructed an underpass at MindSpace Junction under SRDP. New reservoirs have also been built to tackle the water issues. All these prove that Kukatpally might be a great choice when it comes to investing in commercial real estate.
Commercial Real Estate Investment Opportunities in Kukatpally
Let us take a look at a few locations that might be apt for investing in commercial real estate in Kukatpally:
It is one of the prime localities and is in the vicinity of Ring Road. Gachibowli has impressive cab services and the availability of public transport is also commendable. Even one can find metro connectivity here.
Markets and all other basic facilities are available within walking distance. Rate of commercial property in this locality ranges from around ₹9,500 per square foot to ₹32,828 per square foot.
- Financial District
This locality is home to a large number of Software companies. Apart from that there are multiple 5-star hotels present here like Hyatt, Lemon Tree and Sheraton hotel. A huge number of IT companies are present here.
Infrastructure wise roads are really well-maintained here. All basic amenities like shops and markets are also present in abundance here. Rates of commercial property in the Financial District range from around ₹10,000 per square foot to ₹17,000 per square foot.
Things to Consider Before Buying a Commercial Property in Kukatpally
Here are some of the points that you might want to keep in mind if you are interested to invest in commercial real estate in Kukatpally:
- Scope of Marketability
Marketability is a considerable feature when it comes to commercial real estate. In order to make the property more attractive and enticing to big companies you need to take care of features like security features, parking spaces and high tech. Commercial properties in Kukatpally might surely fulfil all these requirements.
- Tenant Profile
Before opting for a commercial real estate property, you need to get a proper understanding of different types of tenants. Understanding your rights as a landlord is of utmost importance when you are leasing your property to any company only then should you invest in commercial real estate.
- RERA Authentication
Before buying a commercial property, it is of utmost importance to check whether the builder who has constructed the property and the property itself is authentic. In order to check the authenticity of your property you can log in to the official website of RERA Telangana.
The Real Estate Regulatory Authority is a body that looks into taking care of accountability and transparency in the real estate sector in India. This body came into action after the enactment of the Real Estate Regulatory Authority Act of 2016.
Stamp Duty in Kukatpally
When you purchase a property in Kukatpally you need to mandatorily pay stamp duty so as to legally own it. The rate of stamp duty applicable to people purchasing property in Kukatpally is as follows:
|Transaction Type||Stamp Duty Rates|
|Sale of immovable property||5%|
|Agreement of sale||5%|
|Development agreement cum GPA||5%|
|Lease agreements of less than 10 years||0.4%|
|Lease agreements of more than ten years but less than 20 years||0.6%|
|Construction agreement cum GPA||5%|
Registration Charges in Kukatpally
At the time of registration, buyers need to pay a registration charge in Telangana. The rate of registration charges levied on buyers of Kukatpally, Telangana is as follows:
|Description of Instrument||Registration Charges|
|Settlement||0.5 % (Subject to a minimum of Rs.1000/-and maximum of Rs.10,000/-)|
|Agreement of Sale cum General Power of Attorney||INR 2000/-|
|Development Agreement cum General Power of Attorney||0.5 % (Subject to a maximum of Rs.20,000/-)|
|Power of Attorney for Consideration||0.5% (subject to a minimum of Rs.1,000/-and maximum of Rs.20,000/-)|
|Certificate of sale||0.5%|
Kukatpally Commercial Real Estate Sector: What’s the Forecast?
Kukatpally a suburb near Hyderabad, is witnessing a major demand drive from the finance, banking, engineering and manufacturing industries. These sectors make for 10 to 20% shares in overall leasing. Gachibowli is a major contributor to the leasing activity of co-working spaces.
It is estimated by the end of 2023 approximately 11 million square feet of space will be available in Gachibowli. Brands like Westside, Max and Zudios have been active space-takers here. All this will surely attract more big companies to set up their branches here. In terms of connectivity, transportation, infrastructure development, shops, and restaurants as well Kukatpally is a great place. Therefore, if you invest in commercial real estate, you are sure to get huge returns in the near future.
Commercial Real Estate vs Other Asset Classes
Below is the comparison between commercial real estate versus other asset classes on the basis of returns each asset generate:
Commercial Real Estate vs Residential Real Estate
Commercial real estate offers much more security in comparison to residential real estate as lease agreements are for a longer tenure in comparison to the latter. In terms of returns, commercial real estate offers much higher returns in comparison to residential real estate. In terms of tax benefits however residential real estate is better in case you purchase it on a home loan.
Commercial Real Estate vs Gold
Gold is much more volatile and riskier in comparison to real estate. In terms of returns as well real estate lets you earn every month while this is practically not possible in the case of gold. However, this quantum of investment is lower in the case of gold in comparison to real estate. Also, gold is much more liquid in comparison to real estate.
Commercial Real Estate vs Bond
Bond offers much more risk-free and fixed returns in comparison to real estate. In the case of returns however real estate is much better if compared to bonds. Real estate investment offers higher tax benefits than bonds as well.
Want to invest in an asset that is stable and risk-free? If yes then you can register yourself today on our website and start investing from the wide range of options available.
Commercial Real Estate vs Stocks & Mutual Funds
Stocks and mutual funds are far better in comparison to real estate in terms of returns. However, stocks and mutual funds are much more volatile and riskier than real estate. In terms of consistency as well real estate is much better in comparison to stocks and mutual funds. When speaking of stable returns, again commercial real estate will be a better option.
Let us check out the tabular representation of comparison between different asset classes as per their returns, liquidity, risk, volatility and ticket size:
|Parameters||Residential Real Estate||Stocks & Mutual Funds||Gold||Commercial Real Estate||Bonds|
Steps to Invest in Commercial Real Estate in Kukatpally
Mentioned below are the steps that you can follow if you wish to start investing in commercial real estate in Kukatpally, Telangana:
Step 1: Prepare a budget according to your financial condition and try to stick to it while purchasing the property.
Step 2: Make a list of all the locations that might be apt for investing in commercial property.
Step 3: Hire a broker and along with them visit every location on your list to confirm whether their legal documents are authentic.
Step 4: Confirm a location only after checking whether it is RERA approved or not.
Step 5: Make arrangements in order to pay for the property.
Step 6: Hire a lawyer and with their help prepare all legal documents.
Step 7: Complete payment of stamp duty and registration charges.
Step 8: Pay for the services taken from a broker and lawyer.
Step 9: In order to safeguard your property from any type of damage you can opt for an insurance policy to remain financially prepared to deal with any sort of damage.
All in all, Kukatpally is a great destination to invest in commercial real estate. Ranging from offering good connectivity, and well-developed infrastructure, or being a commercial hub, it has all the reasons to invest. This not only attracts commercial real estate investors but also forces big companies to set up their branches here.
The state government is taking a number of steps by constructing flyovers and improving drainage that will bring not only commercial but also residential property investors.
Frequently Asked Questions
Are there any specific rules as to the number of properties that we can own at one time?
No, there are no specific guidelines or rules regarding the number of properties that you can own at one time. You can own as many properties as you can depending on your financial capacity to own.
Do you get any tax benefits for paying stamp duty?
Yes, after payment of stamp duty as well as registration charges for a new property you are eligible to claim a tax incentive of up to ₹1.5 lakh. This benefit is however applicable to one self-occupied property.
What are the documents that are required at the time of possession?
At the time of property possession, you need an original registration charge and stamp duty payment receipt, proof of payment of all types of dues up to the date when you are taking possession and a possession letter.
Before purchasing a new property what are the documents that you need to check?
Documents that you need to check before purchasing a new property are title deed, sale deed, completion certificate, approved building plan, conversion certificate (if required), encumbrance certificate, commencement certificate, latest tax receipt and occupancy certificate.