M3M has launched SCO commercial plots in sector 84 and sector 113 of Gurgaon. Before talking about these in detail first let’s understand the concept of SCO plots and the type of returns delivered by them.
Concept of SCO
SCO stands for Shop-cum-Office commercial land. There is a cluster of investors who specifically looking forward to owning a commercial space along with the land to have the entire ownership of the building. SCO fulfills those requirements. If we talk about some of the examples of SCO we will get more clarity around them.
Examples of Famous SCO Markets
Sector 17 Chandigarh
The famous Sector 17 market of Chandigarh is an SCO concept market. It is the most popular market in the city. The market is supplied with several big brands, international outlets, food chains, and restaurants. You will find a whole range of fashion apparel right starting from kids’ wear and going up to bridal stores. The market gets busy with customers all throughout the day.
Khan Market Delhi
Khan market of Delhi is also one of a type of SCO market. The market stands as one of the most expensive commercial retail locations in India. The market offers a wide variety of stores, showrooms of big brands, silver jewelry stores, international prepared food stores, bookstores, etc. The market is also famous for food, you will find an array of restaurants in the market.
Sector 29 Market Gurgaon
Sector 29 market of Gurgaon is one of the most famous market places of Gurgaon. The market is also known as the food hub of the city. You will find the best restaurants of the town in this market. The market has numerous pubs and bakeries. As a customer, you will find a lot of options of food to choose from.
Now from the above discussion, we are very much clear about the concept and success of SCO markets. Moving further, we will discuss M3M SCOs in detail.
M3M SCO Plots
M3M as a brand is already well established in the market with both residential and commercial developments. Earlier SCOs were launched by HUDA in Gurgaon, this is for the first time a private developer comes with the concept of SCO. M3M SCO brings the best retail and office option here which helps you in improvising your business expectations. They are offering all resources for an international level commercial cum retail hub.
SCO Growth Story
If I talk about research in relation to SCO it has been derived that in the year 2017-18 there was a growth of 0.7% in SCO sector investments. Moreover, by the year 2021, there is an expectation of a rise of 10% to 15% in the SCO market. Furthermore, M3M has reinvented the concept of SCO entirely.
M3M SCO vs Conventional SCO
You will find a huge difference in M3M SCO in comparison to conventional SCO setups. The level of services and amenities on offer will be much higher than the regular SCO. Basis the overall structure of M3M SCO we can very well say that, if conventional is like a Nano Car, the M3M SCO will be like a Rolls Royce.
Advantages of M3M SCO
M3M SCO comes with an option of building Ground +4 floors on the plot which will be a great opportunity in offering more space in comparison to other investment options. The shop modules here offer flexibility in size which can be managed basis the requirements of a tenant. There will be more than sufficient surface car parking which will be managed by the developer itself. There will be 100% power backup on offer and you will also get provision for individual AC units. The owner will also get terrace right which will be an added advantage to the end-users. Currently, there are almost 20,000 families living in the vicinity which will act as a ready customer base for the market. Basis the success of previous SCO it is expected that in future the market will cater to approximately 5 lakh people. The location will offer future connectivity to the metro as well.
M3M is offering SCOs in two different sectors, hence we will talk about their location advantages differently. First, let’s talk about sector 84 SCO plots. The location is just zero KM from NH8 and there is just a drive of 30 mins from IGI airport. The frontage of the property falls bang on Dwarka expressway which is the new development for the connectivity to Gurgaon from Delhi. In the vicinity of the project, there is a great residential catchment. Now if we talk about Sector 113, the project is just zero KM from Delhi and there is just a 10 mins drive from IGI airport. Due to its proximity to Delhi in the future, this location is going to attract a lot of customers from the Delhi Dwarka region which is already largely occupied.
As an investor, you should be looking at the investment proposition from capital appreciation and regular returns point of view. Let’s understand this with the help of an example. We will take the example of a 100sqyd plot.
The average monthly rentals for retail are around Rs. 80/sqft. The built-up area for a 100 sq.yd is 5,000sqft, hence the monthly rental will be Rs. 4,00,000 and the annual rent will be Rs. 48,00,000. When it comes to the valuation of commercial property it depends on the rental income generated by the property. In this case, the rental income is 48 lacs and in general, the market capitalization of commercial properties stands at 6%. Basis this calculation the value of the property stands at Rs. 8 Crore (48lacs/6%). In another way, we can also understand that, Rs. 80/sqft is monthly rent, then annually it will be Rs. 960/sqft and basis the 6% capitalization the rate will be Rs. 16,000/sqft (960/6%). The value of a property will be Rs. 8 Crore (16000X5000).
|Conventional Retail||M3M SCO|
|Avg. Market Rentals||Rs. 80/Sq. Ft.|
|Avg. Price (6% Capitalization)||Rs. 16,000/Sq. Ft.)|
|Built-Up Area (100 Sq. Yard)||5,000 Sq. Ft.|
|Total Value||8 Crore||3.75 Crore (100 Sq. Yd X 3.75 Lacs)||You Save =4.25Crs.|