Lodha to launch `14,000 crore township project in Mumbai2 min read . Updated: 10 Jan 2014, 12:32 AM IST
The real estate project is part of Lodha's plan to develop 'Palava' project spread over 4,000 acres of land between Navi Mumbai and Dombivali
Mumbai: After investing at least ₹ 3,000 crore in a London property last year, real estate firm Lodha Group is starting the year with yet another big project. It is launching an 800-acre township in Mumbai suburbs with an investment of close to ₹ 14,000 crore, as part of its plan to develop the “Palava" project spread over 4,000 acres of land between Navi Mumbai and Dombivali.
The company has already invested ₹ 4,800 crore in acquiring the land and building the first phase. Launched in 2009, the first phase consists of 20,000 residential units spread over 250 acres, and the company claims to have sold all the units and given possession of 2,000 of them.
Lodha is launching the second phase which consists of residential, commercial and other social infrastructure projects such as schools, hospitals, sports facilities, etc. to support the township. Eight hundred acres of land will have 800 residential towers of 7-14 stories on completion.
“Palava is designed to be among the world’s top 50 most liveable cities, with every aspect of it being benchmarked against global criteria," said Abhinandan Lodha, deputy managing director, Lodha Group. “We will be launching two more such phases" he said.
With huge delays, real estate experts have been apprehensive about the execution of the large townships which will take longer time to deliver. “There is risk as developers do not have full control over large townships, considering regulatory delays and infrastructural requirements. But Lodha is known for its scale and execution. Besides price per units are attractive for a middle-class buyer," said Sanjay Dutt, executive managing director (South Asia) at real estate consultancy Cushman & Wakefield.
Lodha sold the phase I at ₹ 20-50 lakh per residential units and the price will be ₹ 36-65 lakh for the phase II. “As the city development progresses, we will able to bring in more premium projects," said Lodha.
Lodha is planning to construct two million sq ft of commercial space. “Unlike phase I, there will be a lot of commercial developments also. Walk to work culture is being encouraged by many corporates and we have received interest from companies in the IT/ITeS, financial and pharma sectors," he added.
“It takes time for offices to take up office spaces in far flung locations. But residential catchment may appeal companies like small and medium industries, IT, etc. looking to tap talent from different parts of the city," said Dutt of Cushman & Wakefield. It takes close to one hour by suburban train from central business district of Nariman Point to reach Palava.
Lodha has used the brand powers of Bollywood actress Aishwarya Rai Bachchan and US-based The Trump Organization for its project called “The Park" in the island city. For Palava, the company has got Amitabh Bachchan as its “first citizen". “A first citizen is like a mayor of the city. Our target customers which is the middle class look up to Amitabh Bachchan for aspirational value," said Lodha.
“In a market like Mumbai, low price band means huge demand and quick cash flow generation. So it makes sense for Lodha." Dutt said. Lodha claims to have sold ₹ 8,700 crore worth of projects in the last fiscal while India’s largest listed real estate company DLF Ltd did sales of ₹ 7,772 crore. It expects to touch the ₹ 10,000 crore mark this fiscal with the physical delivery of 5.6 million sq ft.
In November 2013, the Lodha group acquired a property in Central London from the Canadian government for over £300 million.