Adopting the innovation mantra, real estate developers are offering novel concepts to catch the attention of the discerning customer. They include concepts ranging from building multi-usage malls to offering flexi-homes to introducing a buy-back option. So much so that developers are actually vying with each other to introduce novel concepts.
The reason? To offset the slowdown in the real estate market as well as to stay afloat in the fiercely competitive business. Experts feel that by adopting these ways, builders are able to not only maintain their foothold in the business and rake in profits, but also manage to get investor funding.
A new idea to hit the market is to make malls multi-usage- by including business hotels and in some cases even offices with the retail mix. This helps builders in reducing tariffs of the hotel as well as becoming an economical and viable business proposition for them. The latest to join the growing tribe of builders who are resorting to such a move is Ansal API, which has tied up with Ambience Hospitality Management Pvt. Ltd. to set up 30 hotels in the country over the next 10 years. Apart from including palace hotels, golf resorts and five-star properties, the new venture will build a number of business hotels located inside malls.
These business hotels will have options for short and long stay in the form of studio apartments as well as suites respectively. ?With the mall already having beauty salons, food courts, a multiplex etc., a hotel inside a mall does not need to include such offerings. This will enable us to reduce the tariffs of the rooms which also works out to be a viable business proposition,? says Sushil Ansal, Chairman, Ansal API.
The Galaxy mall behind 32 nd milestone in Gurgaon has also decided to convert its upper floors into a hotel while keeping the mall to the ground plus first and second floors. The developer resorted to this after the mall had been fully constructed, fearing that the increase in the number of malls coming up in the township might not augur well for him. DLF is also reportedly planning to make a mall-cum-hotel in Saket, south Delhi after tying up with Hilton Hotels recently.
Similarly, a budget hotel by Accor in Gurgaon under the brand name, Ibis, is going in for a vertical split ? one half will be rented out to offices and the other will be a budget hotel. This is being done primarily because the plot on which the hotel was going to be built was large and could incorporate two developments. Says Anil Chopra, CEO, Feedback Ventures, ?Multi-utility malls are the need of the hour as the demand for retail and hospitality is growing at a fast pace in the country. However, the developer has to get separate approvals if he is including two to three different features in the mall.?
The MBD Neopolis at Ludhiana and the MBD Zephyr in Bangalore are two other prime examples of mixed-usage, wherein both the malls include luxury retail, a luxury hotel as well as entertainment. The luxury hotel will be on the likes of Regent, Ritz Carlton or Four Seasons, and the luxury retail area would target brands like Gucci, Versace, Chanel, Christian Dior, Louis Vuitton to name a few. The MSX mall coming up at Greater Noida, spread over an area of 6,00,000 sq ft. will boast of 80 service apartments with dedicated lifts, a business centre with conference rooms, secretarial facilities, a gym and even a swimming pool. Says Sandeep Goel, Managing Director, MSX Developers Pvt Ltd., ?Gone are the days when there was very less traffic flow of Indians in five star hotel and hotels had to depend mostly on foreigners. Now with the spurt in buying power about the 50% of the target customers are domestic. This has made builders sit up and think of multi-utility malls, a trend that is here to stay simply because of the growing demand for such services. For hoteliers, it serves best to be present at a premium location at relatively lower costs and have assured footfalls even on leaner days.?
Joining the trend is Zoom Developers, which is planning to build a 100-storey tower in Kochi that will be home to a mall, offices and service apartments. Says Sanjay Kackar, COO (Sales and Marketing), AEZ Group of Companies, ?There is no denying that the Indian property market is getting mature and we are building projects on the global pattern. As far as multi?utilitarian realty projects are concerned, there is a method in the madness. Most of the FDI in the realty sector is targeted towards retail and to meet the growing retail needs, you need to have such facilities in the same apartment/office complex.?
TDI also has two office-cum-retail complex projects in Delhi itself. The first is TDI Center, which is located at Jasola and is spread over 2,20,000 sq. ft. with shopping on ground and first floor and office space on upper floors. The other is TDI Southern Park? located at Saket District Centre and spread over an area of 2,60,000 sq ft. Says Kamal Taneja, MD, TDI, ?It is a proven fact that the working environment affects efficiency and productivity of an employee. These office-cum-retail complexes provide just the right mix i.e. elegance, style, entertainment, shopping and a relaxed environment that increases the overall efficiency of employees. The concept of retail-cum-office is fast catching up in India where excellent workplace can be provided along with shopping and entertainment under one roof.?
Another concept doing the rounds is that of flexi-homes, where an apartment comes with an annexe that can be used as an office. Though priced slightly higher than the other apartments, this home-cum-office concept not only benefits the self-employed, but also saves them the cost of buying/renting an office as well as on transportation.
Such projects are coming up all over India in places like Indirapuram, Gwalior, Bangalore etc. Says Sanjeev Srivastava, MD, Assotech, which is building such flexi-homes, ?It is an experiment that stems out of the premise that offering something extra to our projects can be a good value-add for the customers. It will also differentiate us from the other projects that are coming up nineteen to the dozen and set our offering apart.?
The opening up of the economy and the exposure that people have today has also prompted builders to include features like dedicated lounges, powder rooms, videophone, wi-fi connectivity etc. Says Abhay Grover, an architect who has booked a flexi-home, ?This would help professionals like me a great deal as it would give me an opportunity to operate from home. Also, getting a little extra with the apartment always helps.?
Developers have also found an innovative way to offset the ECB clampdown by making the investor a partner in a particular project. This is being done by taking money from the investor and returning double the amount to him after three years or a plot equivalent to the money invested.
Says Dr Satish Gupta, CMD, Natraj Buildwell, ?Since there is an element of risk involved in pre-launches, people have started shying away from them. So, the best way to garner funds is to invite the investor to become a partner in development. This comes out to be beneficial for an investor as compared to putting money into a project that does not take off for some time. In fact, projects crossing deadlines has become a trend these days and such a buy back option helps the investor overcome that. Basically, it is a joint partnership between the investor and the builder,? says Dr. Gupta.