Surekha Bhihani, Managing Director, East India JLL setting the context said, “We have been seeing a huge surge in the warehousing segment with an absorption of almost 4 million square feet in West Bengal alone last year. Taking in account states of Odisha, Guwahati, Patna and Jharkhand we will have another 2-3 million square feet of demand absorption. There is also a rising demand for student housing, senior living and data centres.”
Yashashvi Shroff, Executive Director, Alcove Realty was of the view that going forward, the bread and butter will still remain residential sector for most developers. “Within residential, there are now new segments of ultra-luxury to mass housing. I strongly believe that residential sector is going to propel this industry forward.”
Rahul Todi, Managing Director, Shrachi Group added, “Residential and office space will remain the largest segment for developers, but I think a lot of opportunities are coming in other segments as well. Warehousing, Logistic parks and industrial parks have become important for the MSME sector as they want plug and play infrastructure. Smaller cities like Durgapur, Haldia, Jamshedpur will become the growth hub for real estate.”
Kumar Satyaki, Jt. Managing Director, Eden Realty Group stated, “We build affordable housing in areas where the infrastructure, connectivity and basic amenities are all present nearby. Places like Rajarhat, Joka and Howrah are popular affordable housing destinations. In areas where the basic infrastructure is missing, the township development that contains school, shopping, hospital etc. works. One of the benefits of doing affordable housing is that the sales velocity is good that helps with the cash flow.”
Rishi Jain, Managing Director, Jain Group shared, “Data Centre, Warehouses etc. are still a minuscule portion of the Indian real estate market. The four key pillars or drivers of real estate are, residential, offices, service establishments like retail, healthcare and lastly the hospitality. There is a huge pent up demand for hospitality real estate in Kolkata which has less five-star deluxe rooms than Delhi AeroCity. It’s not just about building the product, but understanding the need of the particular micro market.”
THE NEW MODELS
Surekha Bihani, “There are limited land parcels with clear titles and landowners today are open to collaborate with developers. This has led to some innovative ways of doing real estate business.”
Yashaswi Shroff agreed, “We have now progressed to JV with landowners to minimize capital outlay and be able to do multiple projects. JV could be on area sharing or revenue sharing basis or a deferred payment model.”
Rishi Jain expressed that while, the asset light model is good but in case of a title issue later it can become a big headache for the developer risking the project.
Rahul Todi, “In a city development, a JV is a more viable option than outright. Additionally, there is the land pooling model where the landlord comes in as an equity partner in the project. National developers like the Tata, Godrej and Mahindra and a few other developers are working on this model.”
Kumar Satyaki briefed, “Working with the West Bengal government on rehabilitation project gave us a scope to do something similar in private development. The Development management (DM) model of managing real estate development does not include risk for the developer though the profit is less but it’s a win-win deal for everybody.”
A DEVELOPER IS NOT SPECIALISED IN SCHOOLS OR HOSPITALS OR MALLS. FOR A TOWNSHIP DEVELOPMENT, THE SOCIAL INFRASTRUCTURE WILL HAVE TO BE DEVELOPED BY THE NICHE SPECIALISTS. YASHASHVI SHROFF
THERE ARE LIMITED LAND PARCELS AVAILABLE IN CONGESTED CITIES, SO, REHABILITATION IS A MODEL THAT WE CAN LOOK INTO. KUMAR SATYAKI
GOVERNMENT SHOULD BUILD THE INFRASTRUCTURE, SO THE PRIVATE DEVELOPERS CAN BUILD DEVELOPMENTS IN UNTAPPED PERIPHERAL AREAS. RAHUL TODI
THE INSTITUTIONAL CAPITAL IS AVAILABLE, BUT FOR KOLKATA THE PROBLEM LIES IN SCALE OF PROJECTS AND THAT THE DEVELOPERS HERE ARE VERY MINDFUL OF TAKING DEBT. SUREKHA BHIHANI
RAJARHAT ECO PARK CENTRE IS AN EXAMPLE OF OUTSTANDING FACILITY THAT HAS BEEN CREATED. SURELY, THE BENGAL REAL ESTATE HAS BEEN VERY PESSIMISTIC IN ITS APPROACH TO DEBT. RISHI JAIN
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