Hit by downturn, tenants in Amritsar vacating commercial premises

Rental prices in market areas, property biz take a plunge

Hit by downturn, tenants in Amritsar vacating commercial premises

Pandemic effect: An under-construction building in Amritsar on Monday. Photo: Sunil Kumar

Neeraj Bagga

Tribune News Service

Amritsar, September 23

Unable to meet the fixed expenditures, many tenants have left commercial premises due to the recessionary trend spiralling out of the Covid-19 lockdown.

A majority of these tenants were fence sitters as far as liquidity was concerned. They could not absorb a lockdown-like blow and had to abandon the field. So, rental price in the commercial markets within the city plunged up to 12 per cent.

Also, they say they got no support from the government or the property owners to withstand the crisis. On the other hand, fixed expenditures like staff’’s salary, power tariff, rent, tax, loan, etc., remained unchanged.

Sanjay Vasudev, a real estate expert, said a small section of such tenants with enough savings were out in the market to buy commercial properties to get benefit from the slowdown.

He elaborated that property prices had varied segments. Commercial and residential segments within the city suffered a minor 5 per cent correction, while the demand is largely standstill. On the other hand, residential and commercial components of the localities situated out of the bypasses suffered maximum decline. Prices in the residential localities came down between 20 and 25 per cent. The rates of commercial properties plummeted between 30 and 40 per cent.

Even in this scenario, the number of customers has also halved in comparison to those available before the Covid-era in the market.

Even then, there appears to be a silver lining as far as the properties of the Amritsar Improvement Trust are concerned. It recently held an auction and elicited a handsome response from participants.

For instance, in spite of the reserve value of Rs25 lakh of a shop built on 44-square yard in New Amritsar, it was auctioned for Rs94 lakh, which after adding taxes would cost Rs1.04 crore.

Dinesh Bassi, chairman of the Amritsar Improvement Trust (AIT), said the auction belied the slowdown trend. He said people invariably repose faith in the localities set up by the Trust. He said plots in some localities got low-price bid but this could be referred to as correction.

He said preference of people to buy properties in the schemes of the Trust could be attributed to the massive maintenance facilities in terms of sewerage, potable water supply and other civic amenities being ensured.

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