The palatial 15,000 sq ft duplexes in the under-construction 55-storey Sasen building on tony Napean Sea Road offers the country’s costliest residences at Rs 100-120 crore each. But for six years now, the project, earlier known as Lotus Villa, has not sold a single unit.
Since the 2006 boom, similar islands of super-luxury residences carrying price tags of over Rs 20 crore each have come up in the city. However, almost half of these remain unsold, reducing new launches to a trickle, according to data compiled by real estate research firm Liases Foras.
The city has a total marketable supply of 1,000-odd apartments spread across 27 premium residential projects priced at Rs 20-100 crore each. According to the available data, 85 per cent of such projects were launched between 2006 and 2010. Over the last two years, just one new project — 1972 Omkar in Worli — has been launched in the Rs 20 crore-plus segment.
The pattern of unsold stock repeats itself across big ticket projects that are on offer from listed players like Indiabulls Bleu in Worli, D B Realty’s Orchid Heights and Orchid Turf view in Mahalaxmi and Razzak Heavens by Orbit group on Napean Sea Road.
Pankaj Kapoor, MD of Liases Foras, said at today’s rate of absorption, it will take another 100 months (over eight years) for the existing stock to be sold. “The ideal rate of absorption in a healthy market should not be more than 20 months. In fact, our data on unsold super-luxury houses is an underestimation. If the stock being held by investors rolls back into the market, the inventory pile-up will be much higher,” he said.
The offer of sky villas with sundecks, terraces, private elevators, pools, gyms, walk-in closets, spas and concierge services, with some projects throwing in an unhindered sea view, has failed to generate even a fraction of the budget housing segment demand.
“Affordable housing always has genuine takers whereas super-luxury projects are purely hype created during the boom period,” said Ashok Narang, real estate consultant dealing in premium South Mumbai properties.
Sarjan Shah, MD of Satellite Group, admitted that the overall slump in the economy has hit the super-luxury segment the hardest. Kapoor said the slump lays bare the fact that creation of real estate in Mumbai is linked to capital flow, not to demand and actual sales. According to Department of Industrial Policy and Promotion data, FDI in the realty sector peaked at Rs 14,027 crore in 2010. The year saw the maximum number of super-luxury projects in Mumbai.