Real estate firm Puravankara Ltd has planned bumper project launches this financial year, mainly from its affordable housing arm Provident Housing Ltd, as it looks to establish the brand pan India, said Puravankara managing director Ashish Puravankara.
Provident, which launched its first project in Chennai exactly a decade ago and mostly sells homes priced between ₹30 lakh and ₹70 lakh, seems to have hit the sweet spot in a tepid real estate environment, when many developers aim to launch projects in the mid-income segment.
The company plans to launch six new projects spanning more than 8.21 million sq. ft this financial year across Kochi, Mumbai, Pune, Bengaluru, and Chennai, the managing director said, as compared to Puravankara, which has premium category launches totalling 2.85 million sq. ft.
“Provident will be a game-changer for us in the next two years. Even if 60% of the planned launches happen this year, the entire company will be looked at differently. In volumes, we really believe it has the potential to be the country’s homebuilder," Puravankara said.
Puravankara and Provident projects at present have a 50:50 share in the company’s overall portfolio, but with the new launches, the latter will take up 70% share in terms of sheer project size.
Bengaluru-based Puravankara Projects was among the first to form a separate business vertical dedicated to affordable and mid-income housing projects.
Since 2009, it has launched around 16 million sq. ft under Provident and delivered nearly 12 million sq. ft and 11 million sq. ft, respectively, in the two segments.
Provident has disrupted the property market with homes that are compact and smaller than most projects in a given micro-market, said Puravankara’s chief financial officer Kuldeep Chawlla.
“It’s been a learning curve for Provident. I think we have hit the sweet spot in terms of design and ticket size. The brand has become stronger and we have tried to understand what the customer wants. We have focused on execution and standardization of quality and construction, where we offer the best value proposition in that market," Puravankara said.
The Puravankara group has also decided to develop co-living facilities and plans to launch one such project in suburban Mumbai’s Goregaon.
“There is a clear market today for co-living, which is still evolving. We are closely tracking millennial purchase behaviour and patterns. The challenge will be how attractive it is commercially, in terms of returns. Design is key and one needs to get it right. We believe in the next 5-7 years, it will be a part of the housing sector and a certain portion of our business will constitute co-living," he said.
“Developers who have the financial discipline and wherewithal, the right product and the ability to garner sales velocity are launching projects in a tough environment today. Affordable housing projects, or projects which are priced lower than the market prices are the ones which are going off the shelves," said Juggy Marwaha, executive managing director at property advisory JLL India.