Good morning, one of the world's leading proptech companies just found out that scaling up is not a function of technology alone.
There's still no machine out there that can replace our gut feel and instinct. 💪
And just like reading this newsletter, that's a good feeling.
Hot As Warehousing
If you need instant cheer, just do an internet search for 'News on Indian warehousing'.
Pages of positive news articles on increasing demand, transactions, and investment in warehousing is a good recipe for cheer any day.
What's Adding To The Cheer?
First, a lockdown-driven e-commerce boom has triggered a rush for warehouse space as players want to move more and more goods closer to buyers, to speed up deliveries.
Second, global logistics players have recently spotted the widening gap between the demands of ecommerce and the absence of the kind of futuristic logistics centres needed to bridge that divide.
Here's A Big Deal
Asia's biggest warehouse operator, GLP, said on Tuesday that it raised 311 billion yen ($2.73 billion) for its largest Japan-focused private real estate fund.
Per Reuters, the fund, GLP Japan Development Partners IV, is expected to reach over 1 trillion yen of assets under management when fully deployed.
The new fund's core focus will be on developing logistics facilities in Japan, in particular large-scale projects in the greater Tokyo and Osaka regions.
Back home, warehouse operators across Northeast India are witnessing an exponential surge in demand too.
Out Of The Red
In Scotland, painting your door red whenever you pay off your mortgage entirely, is a common custom.
📝 So, next time you’re in Edinburgh, be on the lookout for homes that have reached this important milestone.
Puran Poli From Pune
Pune's housing market is on a recovery path. Plus it's a fast one too.
Let's See Some Numbers
Per PropTiger, compared to 2,495 homes sold in Q1, 2021, a total of 10,128 homes were sold in Pune in Q3, 2021. Looking back a year, 7,107 homes were sold in Q3, 2020.
Experts opine that numerous factors like a significant number of vaccinations, low mortgage rates, stamp duty benefits for women buyers, and lucrative offers from developers in the festive season are all tailwinds for the home buyer.
Supply Follows Demand
Per Real Insight, 10,015 new homes were launched in Pune in Q3, 2021 vis-à-vis 2,810 new home launches in Q2, 2021 and 4,635 in Q3, 2020.
This upward sales graph has been facilitated by improving demand due to a rise in the overall economic activity post the second wave lockdown.
Will It Sustain?
🎙 Here's Pune based Pride Group MD's statement to the press, "We could sense the positivity in home buying with a good number of genuine inquiries coming and getting converted into a buying decision."
He also added that home buyers today are looking for larger apartments, even if that implies buying a home further than desired before.
Half A Cup Extra
- Flexible workspace provider IndiQube has set up a coworking centre spanning 1.5 lakh sq. ft. in Pune's Yerwada locality.
- The western corridor areas ranging from Kukatpally to Kondapur and Manikonda to Gachibowli remain the growth engines for Hyderabad’s real estate market.
- Housing prices to firm up in 12-18 months, says Motilal Oswal study.
The Tech Stops Here
Proptech innovations may have started in basements but today, they sure are up to the penthouses of the real estate sector.
But despite the leap, there are some things only a human can be trusted with - home valuations.
Context, Please
Real estate giant Zillow recently announced that it would stop flipping houses for the remainder of 2021.
🍳 FYI, flipping, akin to turning over an omelette in the pan, refers to buying a house for X, doing some repairs or changes if needed and on a better day, selling it at a higher price, say 1.25X, turning a quick profit.
For the past 3 years, Zillow has been flipping houses using an automated process known as iBuying.
In iBuying, you can enter all the needed information about your property online, then a proprietary algorithm chews through the property data and makes a financial offer to you in as less as 24 hours.
Can't See The Problem
Actually, there is one. iBuying, with all the tech and big data powering it, is still not a fully automated process, and that’s where Zillow is in a soup.
The firms that do the iBuying engage a representative to physically inspect the property and do a gut check on the offer.
But Zillow says it doesn’t have enough manpower and thus can’t add any new houses on top of its current backlog.
For perspective, Zillow’s house-flipping unit accounted for more than half of it’s revenue last year and it bought 3,805 homes in Q2, 2021, the highest till date.
That's A Big Loss
Not for the competition though. Opendoor, another such company is grinning like a race car driver whose opponent's engine failed on the start line.
Now under which tag should we file this blurb? Proptech? 😶
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May there be more cheer in tomorrow's edition.
💚
☕ The Crew@Ginger Chai