Dwarka Expressway, once tipped as a promising realty market, faces the risk of a price crash if infrastructure development doesn’t pick up, say experts.
Once completed, the Dwarka Expressway (Northern Peripheral Road) would be an alternative link from Delhi to Gurgaon. The expressway is expected to be much wider than the Delhi-Gurgaon Expressway (NH 8).
In the last five years, this market has seen price appreciation of about 206 per cent —from Rs 2,329 a sq ft at the end of March 2009 to Rs 7,121 a sq ft at the end of March 2013, according to data by research firm PropEquity. Though the area has been attracting a higher premium because of speculative buying, hardly any project has been executed yet. Builders and analysts said a stretch of about four km in the 18-km long expressway was under litigation for the last few years, as residents had moved court and secured a stay order.
On condition of anonymity, those tracking the sector said if the slowdown in the realty market continued for about a year, investor interest in Dwarka Expressway would decline.
A Gurgaon-based broker said property prices in Dwarka Expressway had risen very fast, primarily due to speculations. But now, owing to infrastructure hurdles, the prices are expected to fall, unless an improvement is seen soon. “Many have invested in the projects, but there are hardly any signs of a resolution to the issues related to litigation around the area. The matter might drag on for years, forcing investors to shift to other areas such as New Gurgaon, which is better in terms of infrastructure development,” the broker said.
Many developers, including Tata Housing, Raheja Group, Godrej Properties, Ramprastha, BPTP and M3M, have lined up projects in this area. Navin Raheja, chairman and managing director, Raheja Builders, and president of the National Real Estate Development Council, said, “It is unfortunate that the expressway has not been fully completed yet. If that was the case, the scenario would have been completely different. However, it will be functional soon.” The Raheja group has three projects in this area.
Raheja said projects surrounding the expressway were among the best for real estate investment, given their proximity to the international airport, the diplomatic enclave and Dwarka. “The area is poised for stupendous growth, with the best names in the realty industry already having launched ultra-luxury projects in the area,” he said, adding this was the right time to invest, as prices were stable.
Samir Jasuja, founder and chief executive, PropEquity, says, “Dwarka Expressway has primarily been an investor-led market. While the location carries good long-term potential, given the overall market condition and infrastructure issues, there are short-term challenges.” He admitted prices had risen significantly and infrastructure development was yet to pick up.
Developers such as Tata Housing, which has the Getaway Capital project in this area, and Ramprastha Group, which has a 500-acre township along the stretch, are upbeat. Brotin Banerjee, managing director and chief executive of Tata Housing, said, “Dwarka Expressway offers scope for proper planned development and has great potential for aspiring real estate developers. The development of this stretch will not only reduce travel time between Delhi and Haryana, it will also open avenues for planned commercial and urban development in the region.”
He added Dwarka Expressway was recognised for its affordable rates — the primary reason why professionals from Gurgaon were buying houses in this market — not for investment, but for end-use.
Nikhil Jain, chief executive of Ramprastha, said, “There are no signs of any bubble. Challenges are there, but we have not seen any withdrawals from the Dwarka Expressway market.”
