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Nilanjan Dey

KOLKATA, July 26

IT'S the silly season for Kolkata's commercial real estate market. Consider the following: Prime properties that have been put on the block are lying unsold for months, rates are falling all around and corporates are pulling out of deals.

All of a sudden, the market seems to be facing a glut, a situation that is being widely talked about in real estate circles. What has been particularly disturbing for agents and brokers is an unexpected drop in prices.

While big-time transactions have not stopped altogether (one has just taken place, courtesy a deal involving the India Steamship building in the city's top business district, Dalhousie Square), the oversupply situation is said to have taken a heavy toll on what broking sources generally refer to as the "middle market.'' The latter is currently in the thick of its worst decline in years.

Real estate sources partly attribute the latest trend to recent developments in their sector. The market, they say, has turned weak because there is a major surplus in most commercial segments.

A whole lot of buying and selling was taking place till some time ago, and big spenders are taking a breather after having made their investments. There is little scope for these parties to enter the market again at this stage.

It is, however, being pointed out that low prices should ideally attract more and more prospective takers. However, as property owners are not ready to part with their holdings in a hurry, the situation is expected to continue for some more time, at least till a correction sets in.

Certain top-quality properties are on sale in the city, their sellers currently looking around for suitable patrons. The local American Consulate, for instance, has offered to dispose of a set of 14 apartments comprising three blocks and occupying an area of over three bighas.

On the non-commercial side, too, it is felt that the rush for major projects has somewhat ebbed. In the last couple of years, Kolkata had seen a boom of sorts -- a number of large residential ventures were flagged off (some of them on the eastern and southern fringes of the city), backed by big advertisement budgets and spending on promotional activities.

Sources also pointed out that the local market is failing to attract new-age buyers in the desired manner. Recent times have seen a number of technology companies, call centres and private banks come into the market as lease-holders and buyers. That flow seems to have tapered off completely.

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