Which is better for investment, a virtual office space or a shop/office in a mall ? Where do I get better returns?

Do not invest in virtual spaces at all. ..

One of my friend (Manish)  have been looking at noida real estate for 10yrs now first as a house owner (flat) and then recently mostly in commercial. 

"My advice virtual space, lease guarantee is all a joke. I have seen so many reputed builders in noida having there cheque bounced etc etc just don’t trust any builder." -Manish

In virtual space, there is no registry at all. One space i.e actually 100sqft can be sold to 10 different people and you won’t even come to know about it.

Virtual space concept means let’s say there is a total of 10,000/- sqft then any “virtual space” of 100sqft or 50sqft you can buy. And when this entire space of 10,000/—sqft goes on lease you will get the rent portion of the amount of you have bought.

There are like so many problems and fraud which can be done in this.

1. Since no actual space you are buying, just “virtual”. The same 50sqft can be sold to 10 different people. You only have to trust the build the builder that he doesn’t sell it. And you cannot trust a builder at all period.
2. There is no guarantee that space will be leased out. I have seen primary IT parks in Noida not getting lease out and are empty mainly. So how can builder give a guarantee on returns.
3. So many more issues, the entire concept is flawed.

Why this concept works, for builders is because the ticket size is low. Smaller investment of 5lc, 10lc, etc and you know a space in a big IT part. This is the biggest catch and why small investors get stuck into this.

Also this is space where so much black money goes into. Brokers and other people like this a lot, invest money and sell in a small period and get returns. This is not at all for long term, this just short term and get your money out with quick return.

For an average investor a BIG NO NO. Stay away or else 5years you will be facing the same problem which house owner are facing today. NCLT, protests etc etc but no actual return.

As per me, if you have money

10–30lc: just don’t go into commercial. put in mutual fund and get normal 8% be happy! at least your money is safe.

30–50l; you can go for commercial shops. don’t think you will get ground floor at all. But in new under constructions you can get 1st or 2nd or 3rd floor etc. If location is good, you can get at-least rental income in future. Again only if you want to go into commercial. Or else MF is a good option. Peace of mind, you will get some return atleast. Most people underestimate this a lot!

50–1cr: you can get a shop in good location.

When buy commercial shops, make sure of these things

1. if its a market in society
1. then see how much is maintenance first. See if you can manage the costs if property doesn’t go on rent.
2. make sure its not restricted to one society. it should be open market.
3. see what is rent existing people are getting or in nearly place. generally in commercial priority rent is 5% average. So if you are getting rent of 20k per month means 1.2lc per year. So property value should be close to 60l. Make sure your buying property at good value. Don’t buy over-valued i.e buying property for 1cr and getting rent of 30k doesn’t make sense at all! 5% of property value should be annual rent. its a good indicator.
4. there should’t be things like centralized AC etc and there should be good visibility of shop.
2. if it’s in part
1. again, see maintenance costs. property doesn’t go on rent always. people leave. make sure u can manage
2. the builder should have 60% of the IT part on this name. i.e that portion is not sold small investor. big companies don’t deal with small investors only big builder. So if maximum portion is sold to small investors very less changes of big companies coming and success of IT park
3. if your buying in IT part, usually buy only if you have contact to get good brands to open shops. else don’t buy. In IT part small time people don’t open shops.

1cr+: see if you can buy plots (commercial plots) else buy shops only. plots is better but see if you can manage it.

In real estimate commercial is a good investment but there are many things to consider and manage....

-Manish Prakash

Let us Jump !!! while we st!ll have the strength!!!

Human Beings and frogs are the two creatures in nature who have tremendous power to adjust...

Put a frog in a vessel of water and start heating the water...

As the temperature of the water rises, the frog is able to adjust its body temperature accordingly...

The frog keeps on adjusting with increase in temperature...

Just when the water is about to reach boiling point, the frog is not able to adjust anymore...

At that point the frog decides to jump out...

The frog tries to jump but is unable to do so, because it lost all its strength in adjusting with the water temperature...

Very soon the frog dies. What killed the frog?

Many of us would say the boiling water...

But the truth is what killed the frog was its own inability to decide when it had to jump out...

We all need to adjust with people and situations, but we need to be sure when we need to adjust and when we need to confront / face...

There are times when we need to face the situation and take the appropriate action...

If we allow people to exploit us physically, mentally, emotionally or financially, they will continue to do so...

We have to decide when to jump...

Let us jump while we still have the strength 

A Tough Decision

A tough decision:    Work commitment or family responsibilities?

It was a usual Monday morning.The household chores on Sunday made Priya more tired and she closed her eyes for a short nap. There were more than 52 unread e-mails over the weekend which she had to attend in office. The pending files at her office desk were giving her nightmares. Priya would be travelling to New York next week, for the second time in this year to attend a training programme. 

It was then she received a phone call from her father in India. He had called to inform that her mother was unwell and she was hospitalised since last week. Her mother did not want to tell this to her as she knew that her daughter was already preoccupied with family and work responsibilities. But today she wanted to speak to her daughter as she was quite unwell and sad. 

Priya informed her father that she will call them in the evening and that she will be travelling soon for a training programme. Though she wanted to see her mother, Priya could make it possible only after a month. She informed him that she would transfer $5,000 to his account that evening to bear the expenses. Priya advised her father to appoint a full time maid and that she would bear the expenses. She told him to text her or call her in case of any emergencies and that her mobile would be reachable.

Priya returned from New York after a week and she could not attend any calls owing to her tight schedules and travel commitments. As usual, she logged on to her PC and she saw an e-mail from her mother which read as follows:

"Dear Daughter, 
By the time you receive this e-mail I will no longer be in this world as I have informed your father to send this mail after my departure. I know how much you love your mother and I surely understand your commitments. We have always taught you from childhood to be responsible towards your duty and we are happy that you have reached great heights in your career.

I have already deposited a good sum of money in an old age home for your father as he has to spend the rest of his life alone. They have agreed to take good care of him and his health. So please don't worry about him. Convey my special love and regards to my son-in-law and grand children. Also take care of your health. Do eat food on time.

With blessings and love, 
Your loving Mom."

Was Priya at a fault? She could not travel owing to her work commitments and family responsibilities. She could never foresee that such a mishap was lying ahead of her. Either could she postpone her work commitments and travel to India leaving her family and work. While children should be aware of their responsibilities towards their parents, parents should be reasonable in their expectations. It's a tough choice indeed...


source:TIO-Thursday Magazine