Guide for Secunderabad Commercial Real Estate Investment
Secunderabad is a twin city of Hyderabad, the capital of Telangana. It is approximately 16 km away from Hyderabad city.
Secunderabad is the headquarter of the South Central railway zone. The city is a prominent business hub that houses various business parks. Different small-scale and large-scale tertiary industries have flourished in this locality. It is also a major Information and Technology (IT) hub.
Thus, the city is profitable for commercial real estate investments. Getting a permit to establish a business here is also relatively easy. Read on to learn about the benefits of investing in commercial real estate in Secunderabad.
Top Reasons to Invest in Secunderabad
Here are the top reasons why you should consider investing in Secunderabad’s commercial real estate:
- Business Hub
Secunderabad is an attractive destination for businesses and industries. Some of the major industries in the city are electrical goods, dairy, cement, steel, plastic, automobiles, handicrafts, leather, rubber and IT.
The region is also a major site of mining and mineral production. The mining industry has also led to the establishment of several subsidiary industries in the city.
Secunderabad also has become one of the prime centres of the IT industry. Prominent IT companies in this city are ITC, Infosys, Mahindra Satyam and Coromandel International. The Raheja Mindspace IT park is only 18 km away from Secunderabad, which has companies like IBM, Amazon, Oracle, Qualcomm, Accenture and others. This promises a high resale value on commercial property investments in the city.
- Location and Connectivity
Secunderabad is located close to the state capital of Hyderabad, separated by Hussain Sagar Lake. They are connected by Rashtrapati road and Mahatma Gandhi road via Tank Bund road.
Andhra Pradesh State Road Transport Corporation (TSRTC) provides bus services from Secunderabad to all the nearby cities like Hyderabad, Warangal and Siddipet.
Secunderabad is also well-connected to other cities by a state-of-the-art railway system. Secunderabad railway station is an important railway junction in the Wadi-Vijayawada and Nanded-Guntakal railway routes. The Secunderabad Junction received ISO- 9001 certification for the excellent services provided there. The smooth communication facilities make it one of the important hubs of business and commerce.
Commercial Real Estate Investment Opportunities in Secunderabad
Here are some top commercial locations in Secunderabad where you can invest in:
- A.S. Rao Nagar
It is a prime business location in the area. A.S. Rao Nagar’s high street area saw the steepest rental price hike in the country due to the opening of numerous clothing and accessories showrooms. Electronic goods outlets and fast food chains have also opened in large numbers in the area. This makes any investment in the area highly profitable.
- Padmarao Nagar
This is another prominent business locality in the city. It is a ten-minute walk from Secunderabad railway station. There are a large number of shopping centres here and other commercial businesses.
There are several banks like the Andhra Bank, State bank of India, State Bank of Hyderabad, ICICI Bank and HDFC Bank in this area. There are also many restaurants, hospitals, schools and colleges in close proximity.
Things to Consider Before Investing in Commercial Real Estate in Secunderabad
Here are some points that you should keep in mind before investing in a commercial property in Secunderabad:
- Budget and Resale Value
The first and foremost thing to consider before selecting a property is what you can afford for the purchase and for paying the additional charges for the property.
Another major thing is to analyse the potential resale value that one might get from the property by looking at its price appreciation rate.
- Location and Connectivity
You must also look at the locational advantages of the particular property. Furthermore, gather information on the nearest railways, airports and other connectivity features before investing in a property. Any property in a prominent location close to major transportation will have a higher resale value.
- Infrastructure and Amenities
The value of a property also depends on whether it has modern infrastructure and is close to amenities like hospitals, banks, and other essential places. So, before you purchase a property, look at whether the property has all the modern infrastructure. A property with modern features will have a higher rent potential than a property lacking such facilities.
- RERA Verification
The Real Estate Regulatory Authority Act, 2016 was enacted to set up a Real Estate Regularity Authority in every state. It is a statutory body responsible for establishing legal measures to ensure transparency and accountability in the real estate business.
Before investing in a property, make sure to check the authenticity of the seller and the property in the Telangana RERA portal.
Stamp Duty in Secunderabad, Telangana
Before investing in a commercial property in Secunderabad, check the table below to know the applicable stamp duty rates in the city:
|Document||Stamp Duty (on Market Value)|
|Sale Deed (in Gram Panchayat)||5.50%|
|Sale Deed (in other areas)||5.50%|
|Sale Agreement With Possession||5.50%|
|Sale Agreement Without Possession||0.50%|
|Agreement of Sale cum General Power of Attorney||6.50%|
Registration Charges in Secunderabad, Telangana
You also need to register the property in your name. For that, you have to pay the registration charges to the state government as given below in the table:
|Document Type||Registration Charges (on Market Value)|
|Sale Deed (in Gram Panchayat)||2.00%|
|Sale Deed (in other areas)||0.50%|
|Sale Agreement With Possession||0.50% (Minimum ₹1,000/-and Maximum ₹50,000/-)|
|Sale Agreement Without Possession||0.50% (Minimum ₹1,000/-and Maximum ₹50,000/-)|
|Agreement of Sale cum General Power of Attorney||0.5% (subject to a minimum of ₹5,000/- and maximum of ₹1,00,000/-)|
Secunderabad Real Estate Sector: What’s the Forecast?
Secunderabad continues to grow and develop into a satellite commercial hub of Hyderabad and an important business centre of Telangana. It is increasingly attracting business investments from various sectors, which include prominent IT companies.
Numerous new commercial complexes are coming up in the area to cater to the demands of new businesses. Some of them are Fairmount Square, Dr. Padmasree Business Centre and Tripura Easy Town Complex.
The state and the central governments are also developing new infrastructure, making this the ideal place for investments. The South Central Railway has already planned to allocate ₹699 crore for upgrading Secunderabad station with world-class facilities.
An increase in demand will lead to higher property prices in future. Thus, this is the right time to invest in commercial properties in Secunderabad to gain profits.
Commercial Real Estate vs Other Asset Classes
Here is a comparison of commercial real estate and other asset classes:
- Commercial real estate vs Residential real estate
Commercial real estate investments can generate higher returns than residential real estate. Furthermore, the demand for commercial properties is higher, especially in the premium category. The rental prospects are also higher and more profitable.
- Commercial real estate vs Gold
In a city like Secunderabad, commercial investments yield higher returns than gold. However, gold has a high liquidity rate. Thus, you can quickly sell your gold investments for cash. Selling commercial real estate investments takes time because it depends on finding a potential buyer.
- Commercial real estate vs Stocks and Mutual Funds
Investments in commercial real estate are more profitable as well as more secure than stocks. The commercial real estate industry is quite stable, ensuring fewer chances of incurring any losses. In comparison, although stock market investments offer high returns, the returns are volatile and fluctuate based on market conditions.
- Commercial real estate vs Bonds
Both these asset classes can be a stable source of income. However, bonds have a lower credit risk compared to commercial real estate. Profits from commercial properties often depend upon timely lease payments. Furthermore, commercial real estate has lower liquidity than bonds.
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Here’s a table comparing the different asset classes based on their returns, risk, liquidity, volatility & ticket size:
|Parameters||Commercial Real Estate||Residential Real Estate||Gold||Stocks & Mutual Funds||Bonds|
Steps to Invest in Commercial Real Estate in Secunderabad
Follow these steps to invest in commercial real estate in Secunderabad:
Step 1: Fix your investment budget.
Step 2: Do proper market research on potential sites which are developed and have the potential of a price boom in future.
Step 3: Shortlist some sites accordingly. Plan a visit to these sites and make enquiries about the infrastructure and profitability of a particular site.
Step 4: Once you finalise a property, prepare the official documents such as sales deed, title deed, encumbrance certificate, etc.
Step 5: After completing the payment process, pay the required stamp duties and registration charges to legally transfer the property in your name.
Secunderabad is a commercially developing city. Investing in commercial real estate here can prove to be highly profitable in the future. You can take the help of a real estate agent in order to make an informed choice on the property that is right for you. Lastly, it is highly advisable to insure the property that you are buying to safeguard your finances.
Frequently Asked Questions
What is the nearest airport to Secunderabad?
The nearest airport to Secunderabad is the Rajiv Gandhi International Airport. It is barely 11 km away from the city and provides easy connectivity to all parts of the country & world.
What are the types of commercial real estate?
The different types of commercial real estate are offices, malls, showrooms, workplace spaces, hospitality spaces and more.
Why should I invest in commercial real estate?
Since commercial properties are in high demand, especially in cities like Secunderabad, property prices will rapidly rise, ensuring a high resale value. Furthermore, you can generate passive income by renting the property.
What is a sales deed?
A sales deed is a legal document through which the ownership of a property is transferred to the buyer of the property. It is an important official document that you need to prepare if you plan to buy a property.