Bucking the trend of lacklustre home sales, Mumbai-based real estate company Oberoi Realty has managed to sell 68% of Oberoi Sky City in Borivali within two days of launch. The company confirmed 543 apartments of the 800 units on offer had been bought, at a price starting at Rs 2.5 crore. That could be termed premium pricing given the property is located in a northern suburb of Mumbai, albeit with a fairly wealthy population.
“We hit a sweet spot with customers who wanted to upgrade from a 2 BHK (bedroom, hall, kitchen) to a 3 BHK apartment, perfect and sufficient for a nuclear family,” Vikas Oberoi, chairman and managing director, Oberoi Realty, observed. While three categories of homes were on offer, Oberoi said the three bedroom apartments of 1,029 sq ft each, comprised 80% of its sales. As such, inventory worth R1,350 crore was sold for a booking amount of R120 crore.
While the response to Sky City has been stunning, industry experts opined it may be not be right to say there was an across-the-board revival in demand. Ashutosh Limaye, associate director at JLL India, pointed out that when market conditions are as difficult as they are now, consumers will respond to projects from rusted developers. “So the response reflects trust in a brand not an improvement in housing demand,” Limaye said.
Oberoi launched the project on the land parcel it had bought from Tata Steel last year for approximately Rs 1,150 crore. It plans to develop a total 4.5 m sq ft on the plot.
A Kotak Institutional Equities report stated that top line contribution from the total project could be Rs 10,000 crore, which makes it one of Oberoi’s most ambitious projects till date. It is expected to sell out the phase (the entire 800 apartments) in the next few weeks, the report added. Analysts added that the fact that the project has witnessed robust offtake at the lower end of the ticket size reinforces the fact that even developers of calibre are not able to push sales in the luxury segment (prices of Rs 5 crore). Oberoi Realty currently has debt of Rs 600 crore whereas cash in its books stands at Rs 500 crore.
* Has sold 68% of Oberoi Sky City in Borivali within two days of launch
* Inventory worth Rs 1,350 cr was sold for a booking amount of R120 cr
* A Kotak report says top line contribution from total project could be R10,000 cr