Variable type

Variable name

Description

Project location

Classifies the projects based on geographcal location Classifies the projects based on the Tier of the city in which the project is located Classifies the projects in two categories - those in metros and those in non-metros Measures the total built up area of the projetct Classifies projects based on the type of development viz. townships, apartments etc. Classifies residential projects based on amenities, pricing and other facilities

Project city tier

Project characteristics

Project city - metro status

Project built up area

Project end use type

Project segment

Investment mode

Classifies private equity investment into two categories depending on the mode of investing Classifies the investor into two categories depending on their origin Classifies the investor into two categories depending on the fund type Measures the net amount of money invested by the private equity investor

Investment and Investor characteristics

Investor origin

Investor fund type

Net investment

Developer characteristics

Years of experience

Measures the expertize level of the developer based on the number of years it has spent in the real estate industry

Corruption index Other characteristics City competitiveness score

Measures the level of corruption in the city Measures the competitiveness score of cities based on Porter criteria

Purchasing

Type

Hypothesis

The location preferences may Dummy variable. Takes values 1 through 5 or may not exist, depending for the five regions - North, East, West, on the type of promoter and South, Central respectively investor

Dummy variable. Takes values 1 through 3 for three types of cities - Tier -1, 2 and 3 Dummy variable. Takes values 1 or 0 depending on whether the project city is a metro or not Continuous variable measured in square meters Dummy variable. Takes values 1 through 7 depending on the type of end use Dummy variable. Takes values 1 through 3 depending on the project segment - Luxury, Mid-segment and low-budget

Dummy variable. Takes values 1 or O depending on whether the mode of investment is project or entity Dummy variable. Takes values 1 or O depending on whether the investor is of foreign origin or domestic Dummy variable. Takes values 1 or O depending on whether the fund is dedicated or general purpose Continuous variable measured in US $ million. All values are adjusted for the 2012 as the base year.

Continuous variable measured years

Continuous variable based on the index scores developed as a part of corruption perception index Continuous variable based on the index scores developed in India competitiveness report 2012

Feature Mean investment (US $ M) - investment mode Project mode Med Count Entity mode Med Count Mean investment (US $ M) - Geographical location North Med Count East Med Count West Med Count South Med Count Central Med Count Mean investment (US $ M) - Tier of city Tier - 1 Med Count Tier - 2 Med Count Tier - 3 Med Count Mean investment (US $ M) - Metro status Metro Med Count

Domestic

Foreign

47.3 25 141 38 25 40

84 50 65 110 74 47

40.1 32.7 35 18.1 17.6 4 60.4 25.3 49 43.5 22.7 47 14.7 14.7 2

64.9 32 17 110.7 110.7 1 88.7 35.4 21 80.0 51.2 23

43.2 25 93 56.4 23 42 60.9 60.9 2

80.2 44 40 63.7 57 19 166.1 166.1 2

42.5 25.3 91

79.3 39 36

Non - metro Med Count Mean competitiveness score of city Mean corruption perception index Mean Purchasing power of the city Mean experience of developer (yrs) Mean built up area of project ( in 1000 sqm) Mean built up area to land area ratio

57.5 27.2 46 61.9 3.3 50.2 26.8 303.1 70 1.93 68

75.9 63.1 25 61.1 3.3 50.8 24.6 409.8 24 1.42 24

Mean investment (US $ M) - Project segment Luxury Med Count Mid-segment Med Count Low-budget Med Count 14.4 11 7 50.6 24 52 32.7 36.4 3 36.9 18 37 99.1 38 21 49.5 36 15

Mean comparison

-4 0.0001

3.33 0.0009

-0.92 0.357 -2.47 0.01 -2.05 0.04 -

-3.02 0.0025 -2.13 0.033 -

-2.69 0.007

-2.7 0.007

-1.27 0.204 -18.93 0 1.87 0.037

-1.34 0.18 -2.62 0.008 -

Feature Mean investment (US $ M) - investment mode Project mode Med Count Entity mode Med Count Mean investment (US $ M) - Geographical location North Med Count East Med Count West Med Count South Med Count Central Med Count Mean investment (US $ M) - Tier of city Tier - 1 Med Count Tier - 2 Med Count Tier - 3 Med Count Mean investment (US $ M) - Tier of city Metro Med Count

Dedicated

Diversified

57.2 33 118 56.4 36 35

61.6 36 87 90.7 50 52

49.6 34.8 34 15.3 11 3 78.5 35 38 48.8 27 38 14.7 13.7 2

45.6 30 18 68.6 68.7 2 59.1 33.3 31 63.4 41.7 32

52.5 29 77 60.2 35 34 114.4 68 3

57.8 31 55 56.7 33 27 110.7 110.7 1

53.4 34.7 74

53 36 52

Non - metro Med Count Mean competitiveness score of city Average corruption perception index Mean Purchasing power of the city Average experience of developer (yrs) Mean built up area of project (10000 sqm) Mean built up area to land area ratio

62 36 40 61.8 3.28 50.1 24.3 360.5 65 1.9 64

66.6 44.3 31 61.5 3.33 50.9 26.9 431.8 29 1.57 28

Mean investment (US $ M) - Project segment Luxury Med Count Mid-segment Med Count Low-budget Med Count 15.0 11.8 4 62.4 33.7 23 27.2 26 6 47.4 18.5 21 71.6 30.6 49 30.5 18 31

Mean comparison

-1.26 0.207

0.71 0.477

-0.3 0.779 -0.01 0.992 -0.94 0.347 -

-1.17 0.242 -0.73 0.465 -

-0.63 0.529

-1.33 0.183

-1.24 0.215 -16.29 0 0.84 0.2

0.8 0.42 -0.83 0.406 -

Feature Mean investment (US $ M) across project segment Med Count Net Average experience of developer (yrs) Count

Luxury 40.6 18.5 52 2110.8 21.6 65

Mid - segment 64.6 30 73 4713.2 23.1 98

Mean competitiveness score of city Count

62.3 60

61 94

Location of projects across cities Based on Tier of the city % of projects in Tier - 1 % of projects in Tier - 2 % of projects in Tier - 3 Based on metro status % of projects in metros % of projects in non-metros Mean built up area (1000 sqm) Mean built up / land area ratio Luxury 75% 23% 2% Mid - segment 55% 43% 2%

68% 32% 279 2.02

54% 46% 472 1.66

Total number of projects

60

94

Low budget 19.9 17.3 10 198.2 17.5 19

Mean comparison - Low budget and mid-segment

1.37 0.17

0.07 0.944

61.7 13

-0.92 0.357

Low budget 69% 23% 8%

69% 31% 213 1.66

13

Feature Mean investment (US $ M) across project end-use type Med Count Net Average experience of developer (yrs) Count

Townships 92.1 57.9 36 3315 26.6 45

Apartment 37 18.9 95 3516 19.4 132

Mean competitiveness score of city Count

59.5 46

62.4 114

Location of projects across cities Based on Tier of the city % of projects in Tier - 1 % of projects in Tier - 2 % of projects in Tier - 3 Based on metro status % of projects in metros % of projects in non-metros Mean built up area (1000 sqm) Mean built up / land area ratio

39% 59% 2%

72% 27% 1%

43% 57% 759.2 0.94

67% 33% 206.4 2.19

Total number of projects

46

114

Mean comparison Townships and Apartments

-4.52 0

-3.18 0.001

3.09 0.002

Feature Mean investment (US $ M) - investment mode Project mode Med Count Entity mode Med Count Z score P value Mean investment (US $ M) - Tier of city Tier - 1 Med Count Tier - 2 Med Count Z score P value Mean investment (US $ M) - Metro status Metro Med Count Non - metro Med Count Z score P value Mean investment (US $ M) - Project segment Luxury Med Count Mid-segment Med Count

Domestic

Foreign

47.3 25 141 38 25 40 0.76 0.447

84 50 65 110 74 47 -0.66 0.509

43.2 25 93 56.4 23 42 0.13 0.896

80.2 44 40 63.7 57 19 -0.39 0.696

42.5 25.3 91 57.5 27.2 46 -0.14 0.888

79.3 39 36 75.9 63.1 25 -1.16 0.246

36.9 18 37 50.6 24 52

49.5 36 15 99.1 38 21

Z score P value

0.81 0.417

1.35 0.177

Feature Mean investment (US $ M) - investment mode Project mode Med Count Entity mode Med Count Z score P value Mean investment (US $ M) - Tier of city Tier - 1 Med Count Tier - 2 Med Count Z score P value Mean investment (US $ M) - Tier of city Metro Med Count Non - metro Med Count Z score P value Mean investment (US $ M) - Project segment Luxury Med Count Mid-segment Med Count

Dedicated

57.2 33 118 56.4 36 35 -0.54 0.589

52.5 29 77 60.2 35 34 -0.05 0.96

53.4 34.7 74 62.0 36 40 -0.31 0.756

47.4 18.5 31 62.4 33.7 49

Z score P value

0.64 0.522

Diversified

61.6 36 87 90.7 50 52 -0.51 0.61

57.8 31 55 56.7 33 27 -0.08 0.936

53.0 36 52 66.6 44.3 31 -1.13 0.258

30.5 18 21 71.6 30.6 23

1.8 0.071

Investor origin [D= 1 for domestic and 0 otherwise] Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value -33.23 -2.307 0.022 -36.52 -2.910 0.005 -32.4 -2.27 0.024

Mode of investment [ D = 1 for project, 0 otherwise]

1.34 0.077 0.938 6.96 0.404 0.687 -22.13 -0.987 0.326

Investor origin [D= 1 for dedicated and 0 otherwise] Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value 4.16 0.306 0.760 4.07 0.297 0.767 1.44 0.116 0.908

Mode of investment [ D = 1 for project, 0 otherwise]

1.21 0.069 0.945 -24.69 -1.054 0.295

Ratio of the projects built-up to land area Net PE Investment (US $ M) -10.94

Investor origin [D= 1 for domestic and 0 otherwise]

t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value -10.08

-2.363 0.020 -29.68 -2.218 0.029 -4.92 -1.058 0.293 -9.15 -2.018 0.047 -25.88 -1.922 0.058 -25.62 -1.993 0.049 -2.217 0.029

MULTIVARIATE REGRESSION Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations 0.54 0.29 0.18 52.82 92

Coefficients Intercept FOR/DOM (Inv origin) ENT/PRO (Inv mode) DED/DIV Built up area Dummy N Dummy E Dummy W Dummy S Metro status Project end use Dummy Luxury Dummy Mid-Segmet 30.0 -40.0 -27.0 24.5 2.4E-05 48.6 38.7 59.6 47.2 3.3 -35.5 13.0 18.3

Standard Error 46.2 14.7 23.7 14.0 0.0 34.9 52.4 36.2 35.5 14.1 15.9 25.9 26.6

Built up area (in sqm) Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value 3.86E-05 3.837 0.000 Net PE Investment (US $ M) t - stat p value

Built up area (in sqm) Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value 3.63E-05 3.455 0.001 Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value

Project end use type [D=1 for townships and 0 for apartments]

Project metro status

40.17 3.086 0.003 -11.76 -0.989 0.325

t Stat 0.7 -2.7 -1.1 1.7 1.9 1.4 0.7 1.6 1.3 0.2 -2.2 0.5 0.7

P-value 0.517 0.008 0.258 0.085 0.056 0.168 0.462 0.103 0.188 0.814 0.028 0.617 0.493

City competitiveness score -0.29 -0.177 0.860

Corruption index

PPI

-8.91 -0.487 0.627 -1.04 -1.847 0.067 -0.99 -2.024 0.047

Project end use type [D=1 for townships and 0 for apartments] 57.17 4.239 0.000

Investor origin [D= 1 for domestic and 0 otherwise]

Built up area (in sqm)

55.96 4.200 0.000 28.49 2.153 0.034

-30.11 -2.229 0.027 -32.00 -2.557 0.012 2.58E-05 2.294 0.024

Land area (sqm) Net PE Investment (US $ M) 7.35E-06

Project end use type [D=1 for townships and 0 for apartments]

t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value Net PE Investment (US $ M) t - stat p value 6.13E-06

4.219 0.000 49.08 3.583 0.000 4.16E-06 2.525 0.013 4.82E-06 3.045 0.003 42.42 3.189 0.002 3.402 0.001

Built up area (in sqm)

3.49E-05 2.817 0.006

Project segment [ D 1 = 1 for luxury, 0 otherwise and D 2 = 1 for mid segemt and 0 otherwise]

0.46 0.021 0.983

11.00 0.531 0.597

Built up area (sqm)

1.29E-05 0.958 0.341 -8.02E-06 -0.559 0.578

Feature Geographical location North Count East Count West Count South Count Central Count City tier Tier - 1 Count Tier - 2 Count Tier - 3 Count Metro status Metro Count Non - metro Count Project segment Luxury Count Mid-segment Count Low-budget Count Project end use type Township Count Apartments Count

Project costs (US $ Million)

130.0 33 182.0 11 291.0 41 101.0 64 30.6 3

182 83 160.0 59 31.8 10

196.7 85 121.5 67

251.5 51 165.4 40 47.6 21

254.9 106 137.7 28

Mean comparison Project location Based on Tier of the city % of projects in Tier - 1 % of projects in Tier - 2 % of projects in Tier - 3 Based on metro status % of projects in metros % of projects in non-metros Total projects Average built up area (sqm) Average land area (sqm) 0.952 Average Built up area / Land area

Luxury

54% 42% 4%

55% 45% 89 97691 365371 3.33

0.06

Apartments Project location 0.99 0.322 Based on Tier of the city % of projects in Tier - 1 % of projects in Tier - 2 % of projects in Tier - 3 Based on metro status % of projects in metros % of projects in non-metros Based on geographical location % of projects North % of projects East % of projects West % of projects South % of projects Central Total projects Average built up area (sqm) Average land area (sqm) Average Built up area / Land area 81405 113923 2.71 62% 34% 4%

0.6 0.548

38% 62%

-3.25 0.002

15% 14% 25% 45% 1% 180

Mid - Budget

Low-budget

Feature Geographical location North

58% 37% 5%

70% 9% 22%

Count East Count West Count

58% 42% 99 86871 150836 1.80

70% 30% 23 712775 221520

South Count Central Count City tier Tier - 1 Count 2.42 Count Tier - 3 Count Tier - 2

Townships Metro status Metro 43% 42% 15% Count Non - metro Count

57% 43%

23% 6% 23% 47% 2% 53 353188 645531 1.43

Built up area (sqm)

Land area (sqm)

Average Built up area / Land area

153116 18 34542 21 256267 41 98841 79 47012 2

518055 32 289206 26 266508 47 154229 87 83550 3

1.4 27 1.8 23 4.2 52 1.9 100 0.9 3

172028 93 91770 57 60124 11

190567 107 306537 74 548745 13

2.8 123 2.0 69 1.1 13

Gives an idea the land acqu wehre the FA

172028 93 86651 68

190566 107 342728 87

2.77 125 1.83 80

High rise apartments

Gives an idea of the real option in the project. Since not all PE deal are at the land acquistion level, an investor may be inclined to invest in projects wehre the FAR is higher since the total saleable area goes up. Explored some papers which have used this.

Without PE investment Mean project cost (Rs. Crore) Built-up to land-area ratio Construction cost to land cost ratio Land acquistion cost (Crore Rs. Per acre) Non-metro Metro Overall Total projects 951 1.35 1.78

With PE investment 1651 7 1.86

11.47 19.44 15.39 59

27.46 91.54 64.08 42

Probit model - 1

Variable B_L PROJECT_COST__RS__CRORE_ METRO_STATUS CC_LC C McFadden R-squared S.D. dependent var Akaike info criterion Schwarz criterion Hannan-Quinn criter. Restr. deviance LR statistic Prob(LR statistic) Obs with Dep=0 Obs with Dep=1 Probit model - 2 Variable

Coefficient 0.3531800 0.0000238 0.0504130 -0.0909970 -0.8528140 0.181 0.495 1.212 1.341 1.264 137.141 24.760 0.000 59 42

Std. Error 0.10 0.00 0.28 0.08 0.28 Mean dependent var S.E. of regression Sum squared resid Log likelihood Deviance Restr. log likelihood Avg. log likelihood

Total obs

Coefficient

Std. Error

METRO_STATUS B_L C R-squared Adjusted R-squared S.E. of regression Sum squared resid Log likelihood F-statistic Prob(F-statistic) Probit model - 3 Variable B_L END_USE C R-squared Adjusted R-squared S.E. of regression Sum squared resid Log likelihood F-statistic Prob(F-statistic) Coefficient

0.041572 0.010113 0.356547 0.060432 0.041257 0.484999 23.05198 -68.70567 3.151616 0.047151

0.097833 0.004253 0.070432 Mean dependent var S.D. dependent var Akaike info criterion Schwarz criterion Hannan-Quinn criter. Durbin-Watson stat

Std. Error 0.01016 0.049557 0.342369 0.061 0.042 0.485 23.045 -68.691 3.166 0.047 0.004 0.109 0.092 Mean dependent var S.D. dependent var Akaike info criterion Schwarz criterion Hannan-Quinn criter. Durbin-Watson stat

Project cost
-2.29 0.011 -4.05 0.001 -1.37 0.085 -2.16 0.0154 -1.13 0.129 -2.48 0.006
2000 1500 1000 500 0 Without PE investment With PE investment

Land usage and cost structure

Built-up to land-area ratio Construction cost to land cost ratio 7

z-Statistic 3.45 0.28 0.18 -1.18 -3.01

Prob. 0.001 0.777 0.855 0.240 0.003 0.416 0.448 19.302 -56.190 112.380 -68.570 -0.556

1.35

1.78

Without PE investment

With PE investment

100.00 90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00

101

t-Statistic

Prob.

10.00 0.00 Without PE investment With PE investment

0.00

0.424926 2.377937 5.062263

0.6718 0.0193 0 0.415842 0.495325 1.419914 1.497591 1.45136 1.860698

Without PE investment

With PE investment

t-Statistic 2.401 0.456 3.727

Prob. 0.018 0.649 0.000 0.416 0.495 1.420 1.497 1.451 1.828

Project cost

t structure

ction cost to land cost ratio

1.86

With PE investment

Land acquistion cost (Crore Rs. Per acre) Tier - 1 only Land acq. cost Tier 2 & 3 Land acq. costs

PE investment

PE investment