Real Estate seems to grow fast after allowing FDI in the Industry, Says Mr Owais Usmani, MD, Presidency Infraheights Pvt Ltd
Presidency Infraheights Pvt. Ltd. is a dynamic and innovative brand with a passionate commitment to excellence in real estate development. The company stand for an uncompromising belief in quality and perfection, and promotion of global lifestyle in India. At the launch event of their new project “ Presidency Heights”, Makaan.com editorial team got an opportunity to chat with Mr Owais Usmani, MD, Presidency Infraheights. He talked about his belief in professionalism and giving value for money for our customers by providing them world class amenities which will raise the bar and set a new benchmark for the sector.
1. What is your medium term (9-12 months) outlook for the real estate market in India in general and North India in particular?
The journey of the real estate industry sounds a phenomenal story. In the past few years, not only in North India but also in whole country it grew rapidly and created an enormous opportunity for real estate developers. The NCR residential market is full with a variety of housing options. Credit goes to the industrial and economic growth of the country, because of the real estate industry has moved to a more grown-up phase. And it seems growing fast after allowing FDI in the industry. India will have approximately 27 to 30 million shortages of housing units by 2013. This amount is required to carry huge development. Amongst the metro cities in India, the NCR is one of the biggest real estate market of the country covering nearly 27% of the overall retail stock. The Union government has ease the sector’s activities by approving amended Land Acquisition bill. All these clauses pointing out towards a long term growth boom in the industry as well as Presidency Infraheights as an individual.
2. How is real estate in North India different from rest of the regions in the country?
Real Estate sector is believe as second largest employment generator after agriculture in India and could be influential in growth of cement, steel and other connected industries. South Indian real estate market is a price-sensitive market with buyers focused on affordability. Developers can adopt a strategy to ensnare potential buyers by offering right products at the right price band. Instead of, Delhi/NCR manages to offer quality flats within city limits thereby meeting the objective of the buyer, unlike Mumbai where affordability and inconvenience come hand in hand. In the second hand Delhi/NCR is the hub for Commercial, Corporate and real estate industry movements. This region has ample of developers with enormous project offers like, low budget flats, mid budget flats, high class duplexes, villas & form houses to all segments of the society. In which the price range offer by developers in Delhi/NCR region is starts from Rs. 2500/ sq. ft. to Rs.14-15,000/ sq. ft. In North India real estate has much bright options because of National Capital situated in this region. As National Capital attracting people from across India for employment that enhance housing requirement and generate more opportunities to real estate sector to fulfill their shelter needs.
3. Please tell us about the project “Presidency Heights” that you launched?
Presidency Infraheights Pvt. Ltd. one of the promising real estate player of Delhi / NCR. We announced our first residential project ‘Presidency Heights’ in Sector – 25, Yamuna Express Way. ‘Presidency Heights’ provides an experiential living space designed to inspire an active lifestyle amidst luxury and serenity away from the clutter and hustle bustle of the city. This is our first flagship project in India with 100% FDI funding. The project will be spread in 5.5 acres (approx) of land containing 629 units with per unit sizes ranging from 1270 sq. ft. for 2BHK, 1405 sq. ft. for 2BHK with study, 1615sq. ft. for 3BHK and 1850 sq. ft. for 3BHK with servent high-rise residential apartments. The entire project shall be delivered in less than 48 months. The project is just 20 minute highway drive from Noida Expressway; it is strategically located on one of the fastest-growing professional hubs of India and is adjacent to the Buddh International Circuit (BIC), 40 minute drive from Delhi.
4. What is your opinion on Luxury or Public Housing? As a developer, which is more sustainable?
Luxury and ultra-luxury projects give up much higher returns to developers than projects towards the affordable and mid-income housing segments. Because of the affinity of ultra-luxury projects to obtain extremely good pre-sale volumes, the developers are generally able to secure significant fund flows to capitalize the completion of their projects. However the market’s strength is also reflected the fact that nearly 90% of surveyed real estate market quoted ‘generous demand’ as a motivation for entering into the low-income housing. If a developer positions himself on the basis of quality luxury projects, it automatically recognized developer for their mid-income housing projects as well. Low cost housing has been the focus area for the government also. In the past three decades, government has adopted several policies assisting the delivery of affordable housing and persisting to go on the same track. In the same line the affordable housing projects launched by private developers have significantly contributed to the 25% in the last five years. As a developer we are focusing on both segments and would work according the buyers/investors demand.
5. Having so many projects completed in Delhi NCR, which of the other cities do you think home buyers should opt for a property purely from Investment purpose?
The new infrastructure initiatives taken up by the government has boosted the real estate market Yamuna Expressway and facilitated new areas of growth. Delhi, Gurgaon and Noida are some of the North Indian cities that will have the highest potential for residential growth in the next year.
6. The number of unsold inventory is increasing in NCR, what could be the reason behind this? Just the soaring property prices or any other factor attributing to it?
Home sales was very slow across the country for last few years and in the first quarter of this year because of the hesitated economy and unstable government in centre. Not only price hike in sector but few other factors like, high cost of loans, probable imminent of new policies also pushed away the potential home buyers and investors from the real estate market. Due to in entire NCR, developers were facing huge mass of inventory and faced running money crisis for various projects. However after formation of stable government and unveiling of union budget 2014, real estate sector seem fixing their tools. RBI also played significant role by not changing repo rate from 8%.
7. What policies you look forward to from the Government and RBI that will be a relief to home buyers across India?
Being the new player in Indian real estate market we are appreciating RBI to kept key interest rates unchanged. The real estate sector has dragged a sign of relief with this move of RBI and is expecting more economic reforms. FDI and single window Clarence is also essential to run smooth transactions in the sector. It would also help to shape more transparency in future acts between developer and buyers. The union budget 2014-15 presented by center government shows a new glare with its policies for the sector. The latest decision by SBI to cut home loan rates by 0.15% and offer uniform interest rates on home loans wef 26th August’14 will tremendously helpful to breed positive market sentiments. With all these steps by government bodies will seems to bring a new flair in the market and help to increase money liquidity and boost the investors and buyers footfall toward real estate.
8. What is the current trend in the Residential Real Estate Market? How are developers meeting the increasing demand of the sector?
Real estate sector saw 39% jump in 2013 in addition of mall spaces over the last year and 2014 is expected to see a lot of action on the retails front due to possible entry of multi-brand retailers and allowance of FDI norm. As a developer this a good sign for us that market is going upward in terms of both residential and commercial spaces as well as increased leasing activities in the freshly-launched malls. In the modern industrialized world we are focusing towards architectural tradition and classical design to give smart growth to residential and commercial development. NCR regions like, Noida, Greater Noida, Ghaziabad, Faridabad are the hot spot in development of SEZs in various segments of MNCs/corporate/real estate developers. Few other factors are Liberalization of FDI norms, Indian securities market regulator SEBI & real estate mutual funds (REMFs) all factors will contribute in making the Indian real estate market more organized and structured.
9. What can the buyer’s expect from Presidency Infraheights over next 1-2 years?
Past few years were the year of endurance for the real estate sector, but expectations are now high among developers and analysts. However as Presidency Infraheights, we owe to deliver our buyers expectations within devoted time frame in such competitive market. As a developer we can committed to our customers / investors that we are bound to deliver that trust without breaking the succession in future. Hence not only in coming 1-2 years, Presidency Infraheights is determined to carry the quality and transparent policies on the top of the real estate industry. And in shaping the dreams of our customers we would come up with a number of new projects further in NCR with approximately investment of 2,000crore in FY 2014-15.