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Mahindra-HDFC JV to build sub-Rs10 lakh homes in Palghar under affordable housing

Mahindra Lifespace, the real estate arm of Mahindra Group, partnered with HDFC Capital last year to jointly invest Rs500 crore over the next three years to develop affordable housing projects across cities.Premium
Mahindra Lifespace, the real estate arm of Mahindra Group, partnered with HDFC Capital last year to jointly invest Rs500 crore over the next three years to develop affordable housing projects across cities.

Mahindra-HDFC JV to launch its first affordable housing project at Palghar in February; entry price for a one-room kitchen home is around Rs8 lakh, which goes up to Rs20 lakh for a two-bedroom home

Bengaluru: Mahindra Happinest Developers Ltd (MHDL), a joint venture between Mahindra Lifespace Developers Ltd and HDFC Capital Advisors Ltd, will launch its first affordable housing project at Palghar, near Mumbai in February, with homes priced at Rs8 lakh and above, a top company executive said.

In the first phase of the project, there will be 850 units across nine acres. Entry price for a one-room kitchen home is around Rs8 lakh, which goes up to Rs20 lakh for a two-bedroom home.

After half of the homes in the first phase are sold, the company will launch a second phase over another 10-11 acres.

Mahindra Lifespace, the real estate arm of Mahindra Group, partnered with HDFC Capital last year to jointly invest Rs500 crore over the next three years to develop affordable housing projects across cities.

The plan is to build a pipeline of projects of around 7-8 million sq. ft in the next couple of years under the HDFC platform.

“We want to focus on Mumbai and Pune for now, and then look at Bangalore and Haryana. We are scouting for land parcels and the biggest priority today is finding the right location, with good connectivity because we are looking at end users for our projects," Anita Arjundas, managing director and CEO, Mahindra Lifespace Developers said over the phone.

“We are building homes at sub-Rs3,000 per sq ft, but we may go up to Rs5,000 per sq ft if we find a location that is closer to town," she said.

Mahindra Lifespace ventured into the affordable housing segment in 2014, through the brand, Happinest and has since launched two projects—in Boisar near Mumbai and Avadi, Chennai.

The new Mahindra Happinest entity has also identified a second land parcel and is in talks to buy 10 acres in Mumbai Metropolitan Region (MMR) for a second project, with around 7-8 lakh sq ft of saleable area.

Once the due diligence process is over, the transaction should close in the June quarter and the project will be launched in the second half of 2018, Arjundas said.

In a further boost to affordable housing, in January, the goods and service tax (GST) council recommended rationalization of GST rates on such projects. GST would be charged at 8% on the total value of under-construction properties, which would be 4 percentage points less than the earlier effective rate of 12%.

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