HDFC Realty takes broker aggregation route to boost sales

The company will engage 2,500 brokers in Mumbai and Pune. Currently, over 25,000 brokers are associated with it all over India

HDFC Realty, the real estate advisory arm of Housing Development Finance Corporation (HDFC), is planning to take its business to smaller cities via the broker aggregator route.

The company offers real estate solutions across verticals such as residential, commercial, retail, valuation, land, and consultancy. The company will engage 2,500 brokers in Mumbai and Pune alone as part of its new model.

It currently has more than 25,000 brokers associated with it all nationwide.

"If we set up a large distribution network, with brokers in multiple cities, developers can market their projects in many cities, instead of restricting it to their home markets," said said Vikram Goel, CEO, HDFC Realty. "As this will be a success-fee based engagement, and the broker gets the majority of the success fee for closing a property deal, it will also benefit the company which will not have to pay too much to acquire a lead and servicing it in an industry where conversion rate stands at 2%."

He added that the brokers will keep 70-80% of the brokerage, while the company will only take a minor share.

"We are planning to scale up by tapping into the network of brokers across the country and using them to interface with buyers. With this, brokers will also get more opportunities to sell various projects across different cities and get consistent supply of projects to sell beyond their micro markets," Goel added.

The company has been in the real estate advisory business for the last 16 years and has for the past four years been reinventing itself as a tech-enabled marketing company. Currently, nearly 60% of HDFC Realty's revenues come from the residential space, while the commercial space accounts for the rest.

It has ventured into the office space using an innoative approach: it wants to establish a dominant position in selling and leasing small offices of 800-2,000 sq ft each and be an 'active player' in larger spaces. The company has also ventured into land deals, which will be more of a B2B business, linking up developers and JV partners for developing properties.

In the second phase of reinvention, the company plans to rope in independent financial agents like housewives and retired servicemen on a success-fee basis.