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The 2008 meltdown not only caused slowdown in financial market but it also affected the growth in property sector. The property market was jolted with the recession .The prices went down as demand headed south due to people shying away from making investments in properties. At the same time it was difficult for the builders to maintain the profit margins as demand went down. It was indeed a very difficult phase for the buyers as well for the sellers.

Now nearly after four years, things have improved a lot. Market sentiments are high, property sector is booming again. From outside things are looking very rosy. But scratch the surface and reality will hit you hard on your face.

According to leading business newspaper, some of the India's leading private equity firms which had previously invested much in big level combined township developments across the country are now backing out from the projects either because of the less demand from the buyers end or uncertainty in getting government approvals for the desired projects .

Integrated townships are complete self-sustain town were the first segment in real estate where foreign players were allowed to venture into project funding. Year 2007 noted a new trend of integrated townships. This concept of township was fast catching up, as this would mean a new lifestyle for lakhs of people who can afford to buy these spacious living spaces. The emergence of townships was visible in almost all the major cities and metros across India. Apart from giving living spaces for people, it would have generated revenue for the government and various job opportunities. On the other hand government has also planned to give them various benefits .But the recession changed the pace of creations of townships. People have become more money sensitive and want to spend carefully only on necessities and not on luxury.

As stated by property consultancy firm DTZ, private equity funds have put 1.5 billion dollars in various township projects in the last 6 years. But despite such a big volume investment involved, many projects got shelved due to delay in commencing of projects which resulted in cost escalation and hence resulted in losses for the companies.

Private equity firms like Kotak realty fund, Red fort capital and IL&FS who were actively funding big townships are now focusing more on projects which require less capital and will be able to deliver the project in 3-4 years’ time frame. Considering the fact that township projects requires a large capital investment, these private equity firms are not comfortable taking so much risk and wants to play safe with going with small scale projects where initial investment is less as compare to big township projects.

Latest to shelve its township project is London based Trinity Capital. They have ended their involvements with Rustomjee Evershine Global city township by putting its stake for 48 crores on sale. They have also abandoned Rustomjee Group's 127 acre township in Thane, Maharashtra by giving away 16% stake to keystone realtors.

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