Long Wait For Tenants

April 21st, 2009

“How much longer sir?” my neighbour, who always seemed to have the Midas touch, asked my father. This neighbour, I have always believed, has the knack of sniffing out business opportunities. He and his wife must have half a dozen streams of income.

He was enquiring about the economic slowdown that has seen everyone tightening their purse strings, and has left him holding his head in his hand and wondering how he would be able to pay his Rs 40,000 EMI on a loan he had raised to build his four storeyed building with five flats. He had hoped to rent them out, preferably to vegetarian IT professionals.

He has waited, waited and waited. His query on the slowdown came in utter frustration over the disappointment that few IT professionals were interested in renting his house or none were ready to pay the rent he wanted. “I have custom-built the house for an IT professional” was his argument. It suits them best. I had heard of custom-built office spaces, but this was the first custom-built house for an IT professional.

What about someone else who may be ready to shell out an amount acceptable to him? No sir, he said, “Others cannot understand how to use the electrical fittings I have spent so much on. Many of the fittings are those you find in the US and many of the IT professionals travel abroad and understand their use.”

“I will wait for a month and visit Tirupathi to ask for the lord’s help.”

Now, he is ready for a compromise it seems. Do people from any other industry have such spending power is what he wants to know now. I have been asked to find out who else could afford the rent and of course still are vegetarians.

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Houses Crash

April 19th, 2009

It was some crash about which I heard today. A friend, I have known since the early ’80s, is in a state of near-shock and, now laughs and cries at the same time, by merely thinking of what’s happened to their investment.

Imagine in investment of yours crashing about 60 per cent in just over an year. She had bought a flat for Rs 75 lakh. It was meant to be an investment. Everything was rosy with the real estate then.

The ‘experts’ in real estate always say “location, location, location” when you consider buying a property. That is precisely what she thought when buying the flat. After-all it was barely 10 or 12 km from the international airport, which is very near to the airport for someone familiar with Bangalore.

About a month or two ago, she tried to find out what’s happened to her investment now that there are frequent news reports about the property market bouncing back. She had missed the opportunity to sell when the market had peaked, she thought. On trying to sell their property. instead of earning a profit, the highest price being quoted was Rs 30 lakh. They had rented out the flat and are now happy with whatever rent they are getting.

That left me wondering what must happened to the ‘investments’ at the other end of the city where there is not even water. The borewells have dried up. Many of them are high-end flats going up to Rs 1 crore or more. Today they got no water and any water they get is supplied on water tankers.

OK, back to my friend. She’s now praying that the hopes of a ‘V’ shaped recovery happens in the property market as many hope will happen with the general economy. But, that could take time in case of the real estate sector.

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Real Estate on a Rise… but…

April 14th, 2009

Bangalore’s real estate sector had practically crashed over the past few months. But, now there is talk of a revival, by the experts. They seem to have the most unbelievable of reasons, at least from the point of view of a student of Economics. Hoardings have been put up by real estate brokers, including the biggest one in the city, and builders practically chiding Bangalore’s denizens to buy and screaming “Don’t miss this opportunity. Buy now”. Hence, it is not rare to find many people asking: “Will I miss out on the opportunity, again?”
Then, there is a trend to the real estate sector in Bangalore which has been seen and can be traced back to the last few elections that we have seen. Politics seems inextricably inter-twined with the real estate sector in the sector.
Those in the know of the working of the real estate sector say it can be understood better if we understand how much of a role real estate money plays in politics. Those in the real estate business, say some, end up having to pay the political leaders, moreover, to protect the interests of the real estate sector.

The interest in the real estate sector of the city has been party agnostic. No matter which party, everyone is interested.

This is not necessarily at the time of the Lok Sabha polls alone. Even civic polls have the knack of pushing up the prices, though to a lesser extent. It is just that the incidence of the burden borne by the builder is wholly transferred to the buyer. The realtors just pass on the burden of higher costs brought on by the election.

To know the actual situation in the market perhaps a serious buyer needs to wait a few more months till the elected leaders begin to take their seat in the Parliament.

How it came to this is probably because whenever a sector has seen very high rates of return, political interests try to make the best of it. They feel why not share a part of the big fat profits. Many a time, this takes on the avatar of protection money.

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Where’s the Poll Fever?

April 14th, 2009

I will be voting on the 23rd of April. It’s April 14 and strangely, there are no posters or banners or canvassing of any sort happening across most of the IT capital, at least in most places. Looks like the political leaders have taken it for granted that they only need to be on the ballot papers and on air on FM radio, and/or canvass through mobile phones by sending an SMS. No banners, no posters, hand bills or any such classical means of canvassing.

Perhaps, Bangalore which is India’s IT capital, has gone the US way. Fr Jose Joseph, a lecturer who had taught me the US Constitution in college, had said: “Politics in the US is seen only on TV and on the radio. There’s nothing happening on the streets. It is so lifeless, the elections.” But, the words were spoken way back in 1994. Have we also taken to that culture is what one may think by what’s happening in the city. Is it that people are so inspired by the Obama election that they are yearning for the US style of politics and the candidates advertise themselves on the FM radio stations just as it happens in the developed part of the world.

Life is being sucked out of the liveliest part of democracy. No noise on the streets, no noisy canvassing. Or, are they cutting costs, with donations too probably having dipped thanks to the recession. The ‘other cash’ flow too would have definitely dipped.

But then, this could also have a positive environmental impact. Perhaps the parties feel that the paper handbills and some plastic canvassing materials would have a negative environmental impact. Also think of the amount of water and energy that would have gone into the manufacture of all that paper and plastic.

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The Coffee Gone Cold

April 10th, 2009

Bangalore’s M G Road is changing, from the most happening place, the Metro, ironically meant to take the city to the next level in urbanisation, has taken the road down into a status of being not-so-happening place. The work on it has been going on for a couple of years or more and taken almost all businesses of yesteryears down with its fate. 

Now, in an unkindest of cuts for the road, the India Coffee House has shut shop. It has been forced to down its shutters, after serving everyone walking in to a piping hot cup of coffee or a masala dosa or a chicken/veg culet or scrambled eggs.
The turbaned waiters gave me a sense of nostalgia, everytime, of those weekends in the mid-’80s when I visited it with my parents, on our fortnightly day out, to the city (which meant M G Road).

No visit to M G Road was complete without a visit to the first floor of the India Coffee House for the customary cutlets while my parents had their piping hot cups of coffee. Alas, those days will now remain only in memories of those fortunate enough to visit the place where one could sit for hours in a quiet corner enjoying a book while the bustling road went about its business.

Coffee House has fallen to greed fed by real estate boom. Coffee House gave in to the landlord’s pressures to vacate.
The Coffee House probably did not give enough returns to the landlord, relatively speaking. He can’t be blamed. After all during the past decade and so, he has seen his building grow relatively smaller and smaller, what with all those multi-storeyed buildings starting to grow taller than his building.

The landlord may have seen his bank balance growing not so fast, and while he saw the real estate boom come and go, the Coffee House kept him from profiteering from the boom which every other landlord owning even a few square feet on the road.

This is a common story now on the road, with nearly every one of the old business falling to upstarts that very often seem to have only profiteering as their primary objective.

While the Coffee House is relegated to the pages of history, a colleague and I shed a tear or two in memory of hours spent there.

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Will My Shoe Hibernate?

April 9th, 2009

Whenever I visit a temple, I wear my chappels so that I can take them off easily, which is never the case with shoes. There’s one more reason, that is if your footwear looks not so exotic, no one will steal them when you have taken them off and left it outside. I mean, the hallowed halls that may the venue of a press conference. 
I am giving up all my shoes. They are the only footwear I wear to work and also to press conferences I occasionally attend.
The venues of press conferences will have the status equivalent to the temple perhaps.
Soon, we may not be allowed to wear shoes to press conferences. No one would want a journalist to do a copycat act of Muntadar al-Zaidi and Jarnail Singh. Not the well-heeled, who would under no circumstance want to smell the shoes of the lesser mortals or get hit by the heels of an angry/irritated journalist’s shoe.
Many of the press conferences at star hotels may soon start to see people walking in perhaps even barefoot or in the hawai chappals. It would be easier to take them off before entering the hall where press conference are scheduled to be held. Remember, M F Hussain was once not allowed entry into a star hotel because he was barefoot.
Journalists will be able to boast they believe in simple living and high thinking.

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An idea for recession

April 4th, 2009

My friend Puja’s mail on April 1 at first perturbed me, but I tried to relax thinking it was probably an April Fool’s Day joke. The long mail was disturbing because it sounded like an SOS (the subject line did indeed say that) asking me if she could become a freelance writer/journalist, to earn her livelihood. And, she wanted to quit her present job as a HR manager that got her a salary most journalists can only dream of.

The long-winding mail described all that is wrong with her job and the global economy. Sounded like a practical example proving the Chaos Theory. She described how the Anglo-Saxon banking system had sent the global economy into a spiral and her employer, an MNC firm skate on thin ice. She is now left insecure about the job.

Caught in the trough of a business cycle, she believes it is difficult to get out of the trough in her career too and every time she tried climbing up to the crest she slipped and fell back into the trough, both financially and emotionally.

On calling her, my heart which had sunk on seeing the SOS, settled in. Being a HR manager, on the job she has to help people leave the firm without making a fuss and without feeling too depressed.

But, “I may have finally found a way out of the trough I am stuck in,” to put it in her words. She believes it is the right time to tie the knot,”to a guy with an MBA from a top B-school.” (It is the safest option financially, to quote her.) It was the right time because she would be able to save at least half a million rupees in wedding expenses. And, she thought it would then not disappoint anyone. At the same time, she would not “lose face” among her friends and relatives who she has seen organising grandiose weddings. She wanted to make things simple, “after all it’s an economic slowdown and everything is gloomy”.

Her tongue-in-cheek query: “How can I squander away money when people all around me are losing jobs or are having their salaries cut?”

Puja now wants to quit her job, that is, if she is “not laid off”. But, only if she can zero in on her right ‘MBA’. More risk means better returns is her argument. “I will wait till there is a turnaround in the economy, so that I have better opportunities.”

Yes, she is having her cake and hopes to eat it too.

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