Luxury housing projects return to Mumbai, spurred by rising demand
Piramal Realty starts work on Mafatlal land acquired in 2011; Godrej sells 348 flats priced upwards of Rs1.6 crore
Bengaluru: After a lull of almost two years in the luxury residential sector, high-end developments are making a comeback in Mumbai, India’s most valuable property market, spurred by rising demand.
More than four years after buying a seven-acre land parcel in Mumbai’s Byculla area from textile firm Mafatlal Industries for Rs.605 crore, Piramal Realty, part of the Ajay Piramal Group, has now launched the project.
Piramal Realty will invest Rs.4,300 crore over the next five years or so in its signature project.
Last year, Piramal Realty raised close to Rs.2,700 crore—Rs.1,800 crore from marquee private equity investor Warburg Pincus LLC and Rs.900 crore from investment bank Goldman Sachs.
In September, it launched its first project, a 32-acre predominantly residential development in Thane, near Mumbai, called Piramal Vaikunth.
Piramal Aranya in Byculla, which will have mainly three- and four-bedroom homes, has been pre-launched at a special price for the first 25 units that will be priced at Rs.8-12 crore.
“Piramal Aranya will be our company’s most significant residential development. We would have liked to launch the project a bit earlier, but the development permissions took longer. The real estate market looks better than it was a year ago, and since we received a very good response for our Thane project, we are expecting the same in this project as well,” said Anand Piramal, executive director, Piramal Group.
In a slightly slow market, both the pricing of the product and the project itself matter to end-users.
Home sales rose about 15% in the October-December quarter to 78 million sq.ft from the preceding quarter across India’s top eight property markets, with Mumbai Metropolitan Region (MMR) clocking the best performance, according to a February report by Liases Foras Real Estate Rating and Research Pvt. Ltd.
MMR was the highest contributor to home sales both in the ultra-luxury and luxury categories, the latter being in the price range of Rs.1-2 crore.
Mumbai-based developer Godrej Properties Ltd launched Godrej Sky in Byculla, with apartments priced at Rs.4 crore upwards, and received a good response. Godrej also sold 348 apartments in its flagship project The Trees in suburban Vikhroli for Rs.862 crore; apartments are priced upwards of Rs.1.6 crore.
Lodha Developers Ltd recently launched The Luxury Collection, a separate business vertical to develop so-called super-luxury projects, starting with Mumbai and London.
Based in London, it will have a portfolio of residential projects. The first project was launched in Altamount Road in south Mumbai and apartments in it are being sold by invitation.
“Sales have been good in Mumbai in the last six months, and luxury projects particularly have done well. Prices have stabilized and the profile of customers are mainly end-users and long-term investors. There is a reasonably robust pipeline of project launches planned this year and we expect sales to pick up further,” said Mudassir Zaidi, national director, residential, Knight Frank India.