Mumbai Metropolitan Region has continued to one of the most favoured investment destinations globally. With an uptick in demand for luxury housing, especially during last year, it is well-positioned for exponential growth.
Bengaluru-based Puravankara has entered the plotted development segment. With this, the real estate developer is set to launch six projects spread around 5.5 million sq ft across Bengaluru, Chennai and Coimbatore. In an interview with FE’s Rishi Ranjan Kala, managing director, Ashish Puravankara said Covid-19-induced uncertainties are forcing homebuyers to explore risk-free options that offer good yields. Edited excerpts:
Q. What is the rationale behind Puravankara entering plotted development?
In the past, plotted development was a preferred asset class due to reasons like flexibility, affordability, minimal risk and high returns. In a market that is ridden with pandemic-led uncertainties, plotted developments have regained their stature for homebuyers who are exploring risk-free options with a good yield. A market that was hitherto led by smaller and unorganised players, is now a level-playing field for listed developers. Increased desire for larger spaces, high-end amenities and value-for-money, has pushed homebuyers to opt for tier-I developers.
The launch of Purva Land, our dedicated arm for plotted development, is a step to address this positive shift in customer sentiment. As part of our new segment, we are set to launch 6 projects in Bangalore, Chennai, and Coimbatore, which will attribute to nearly 5.5 million sq ft. We aim to enable customers to benefit from a fruitful investment and enjoy greater flexibility concerning the layout, design, and function of the space.
Q. Puravankara recently re-entered Mumbai after almost four decades. What are the reasons?
Mumbai Metropolitan Region has continued to one of the most favoured investment destinations globally. With an uptick in demand for luxury housing, especially during last year, it is well-positioned for exponential growth. With people being confined to their homes for most of the day, they were nudged to relook at their spaces and re-imagine how they wanted to live.
Besides encouraging initiatives from the state, like stamp duty relaxation, tax exemptions, and low-interest rates, contributed to a favourable environment. Considering these factors, we believe that it was conducive for us to re-enter the region’s exciting real estate landscape, through the launch of ‘Purva Clermont’. The location of the project, Chembur, is at the heart of the city and a highly connected hub.
Q. There has been an uptick in the sale of luxury homes. What are your plans for this segment?
The luxury housing segment has witnessed a significant shift in customer perspective. The current model of work and life has pushed several people to spend a majority of their time at home. This led to a re-evaluation of their residential property, mainly in terms of space and function. This change manifested as a surge in demand for Puravankara’s luxury and ultra-luxury projects from domestic and NRI customers. There was an approximate rise of 20% in the number of luxury units sold from April 2020 to December 2020 in comparison to 2019.
Q. Developers are complaining about rising input costs of raw materials. What is your experience?
Over the last few months, there have been constant fluctuations in the prices of two key raw materials, steel, and cement. This has led to a direct increment of input costs for all players in the sector. So far, we have constantly worked toward shielding our customers by not hiking the end price of our projects instead of increased the costs of these materials. However, as steel and cement continue to remain non-negotiable raw materials in construction, long-term price escalations could soon have an impact on the end-user. However, if this scenario continues for a longer duration, most developers will have no choice but to allow the spill-over of these costs to the customers.
Q. What are your expectations from January-March 2021 and beyond?
As the population braces itself for a potential second wave of the pandemic, homebuyers are eager to invest in homes that will positively affect their well-being and offer a sustainable living experience. As customer-centric developers, we will continue to deliver projects that echo the evolving needs of customers – be it closer access to green landscapes, larger spaces, high-end amenities, convenience-focused innovation, and infrastructure that promotes a healthy lifestyle. So, as an industry, we hope for good numbers in terms of overall sales in the next four-six months.