Mahindra Lifespace’s plan to venture into plot sales comes at a time when so-called branded plot sales, priced between ₹30-75 lakh and above, seem to have found favour among buyers and investors even during lockdown, prompting large developers to launch these projects.
The advantages of plotted projects are many—quick monetization of land, faster sales pace of plots than apartments, better cash flow generation, and quicker exits from investments compared to longer periods of constructing housing projects.
As larger, organized developers enter the space, they are being sold as ‘branded’ plots that offer amenities such as clubhouses, gyms, swimming pools, landscaped gardens just like large apartment enclaves.
“We can enter plotted development within large residential development like World City, Chennai and are looking at other opportunities too. Plotted makes sense because it’s a quick cycle business. The developer needs to buy land and and do basic infrastructure and one can exit the project quickly," Arvind Subramanian, managing director and CEO, Mahindra Lifespace said in an interview.
While the April-June period was a washout for most developers, there seems to have been rebound in demand in last two months and that is reflecting in home sales.
“…It is too early to say if this is pent up demand from the June quarter. We launched Happinest Palghar digitally and received 100 plus bookings in less than a week. Sales conversion digitally never happened before and we weren’t sure because home buying is a high involvement purchase. But this project was a vindication that we were right. We believe a hybrid model, including physical and digital, will work for home sales too. Post covid, we believe home buyers are paying more attention to community, wellness and sustainability aspects," Subramanian said.
Under Happinest, the affordable offering from Mahindra Lifespace, a residential project in Palghar, in peripheral Mumbai was launched in early September with a first home customer target. The project, which has homes priced between ₹9.5 lakh and ₹20 lakh, has sold 300 units so far, digitally.
According to a report by Anarock Property Consultants on Wednesday, the housing sector made a comeback in the July-September quarter, with sales and fresh launches rebounding to 65% and 79% of the pre-covid-19 levels respectively.
The top 7 cities witnessed housing sales of around 29,520 units in the September quarter compared to 45,200 units in the January-March period. Sales were higher than the June quarter, when the pandemic had brought home sales down to just 12,730 units.
Mahindra Lifespace has around five project launches planned across cities – Mumbai, Pune, Bengaluru and Chennai. Launches in Pune and Chennai would be under Happinest.
Subramanian said that they are seeing a rebound in sales of higher ticker size homes as well and has seen good sales in recent months in Gurugram, where it plays in the sub- ₹5 crore category.
“Our expansion strategy remains intact. We will continue to launch projects and look at land acquisitions.There are good opportunities to buy land now because many landowners are willing to negotiate on price and other terms," he said.
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