The Shapoorji Pallonji
group is seeking opportunities for affordable housing projects in Kochi, Chennai, Ahmedabad, Indore, Ghaziabad and Coimbatore. It plans to develop 10-12 million sq ft in the second phase of its joint investment programme with World Bank arm IFC, Asian Development Bank and Standard Chartered Private Equity.
would, along with its partners, spend Rs 800 crore, said Venkatesh Gopalkrishnan, chief executive officer, Shapoorji Pallonji Real Estate.
The $5.5-billion group had last year tied up with investors to develop the affordable housing projects branded as Joyville. Shapoorji Pallonji
and the investors brought in Rs 1,500 crore as initial capital for buying land and other purposes.
“We are looking at tier-II cities that provide jobs and reasonable infrastructure,” Gopalkrishnan said. The group plans to launch four more affordable housing projects in Pune, Gurugram, Hyderabad and Bengaluru
in the first phase of the programme. The Pune and Gurugram projects will be launched in the next six months and the others subsequently,” Gopalkrishnan said. Shapoorji Pallonji
has launched two projects in Kolkata
and Virar near Mumbai.
In total, the projects will comprise 16-17 million sq ft and will be completed in six years.
bought a land parcel in the Hinjewadi area of Pune recently and was planning to buy two more land parcels by March, Gopalkrishnan said.
The UK-based Actis will replace Standard Chartered in the tie-up after taking over the latter’s Asian real estate
portfolio for $500 million.
Besides, Shapoorji Pallonji’s contracting arm was constructing over 30 million sq ft of affordable houses in Andhra Pradesh, Maharashtra and Uttar Pradesh, said Subodh Dixit, executive director, engineering and division at Shapoorji Pallonji
and Company. The contracting arm has a turnover of Rs 7,500 crore and 30-35 per cent of its business comes from building affordable houses.
Housing sales in the country’s top eight property
markets went up by 5 per cent from a year ago during the September quarter powered by a 24 per cent increase in affordable housing sales, according data by Liases Foras Real Estate
Rating & Research.
Buoyed by strong demand and sops for affordable housing, many big realtors are developing such housing.
Mumbai-based Hiranandani Communities is planning to build 500 affordable homes within Hiranandani Parks at Oragadam in Chennai, where it has identified 10 acres for the purpose. The houses will measure 40-60 sq m. Hiranandani Communities has pegged their cost at Rs 20 lakh each.
“We will not need to buy land specifically for affordable housing. We will develop units in the segment within our current projects. It can be as simple as a studio apartment within a township,” said Niranjan Hiranandani, chairman and managing director, Hiranandani Communities.
The Lodha group, another Mumbai-based developer, has sold more than 5,000 affordable houses worth over Rs 2,500 crore and delivered 4,700 of these to customers in 2016-17. “We expect our affordable housing segment to grow by over 20 per cent this year with sales of over Rs 3,000 crore and deliveries of more than 7,000 units,” said Abhishek Lodha, managing director, Lodha group.
Anuj Puri, chairman of property
consultancy Anarock Property
Consultants, said the recent move by the government to increase the size of MIG-I and MIG-II houses had widened the definition of affordable housing and had created a buzz among developers.
The carpet area of an MIG-I was increased from 90 sq m to 120 sq m and that of an MIG-II to 150 sq m from 110 sq m. A 4 per cent interest subsidy is provided on loans of up to Rs 9 lakh to buyers of MIG-I who have an annual income of Rs 6-12 lakh. For MIG-II, buyers with an annual income of Rs 12-18 lakh receive a 3 per cent interest subsidy on loans of up to Rs 12 lakh.
“Developers like Shapoorji Pallonji, Hiranandani, Tata Housing
and Sunteck Realty, to name a few, are launching affordable housing projects to capitalise on incentives announced by the government. The new launches in this segment will help these developers align their product portfolio to the new market scenario,” Puri said.