Real estate firms see good traction for plotted developments in WFH world

The country’s top real estate companies are seeing good traction for plotted developments thanks to work-from-home (WFH) norms and the preference for independent houses during the Covid-19 pandemic.

Godrej Properties, part of Godrej group, last month launched plotted developments of 1 million sq ft in Faridabad on 43.61 acres of land acquired from BPTP, an NCR-based developer.

Though the company did not share any numbers, market sources said it has sold 40 per cent of the 500 plots launched. The project has 750 plots.

Its first plotted development was launched in Bengaluru in 2018, which was sold at a 50 per cent premium to market prices. The company is looking to launch many other such projects.

“We are significantly focusing on plotted development given the unique benefits that opportunity provides. We have an aggressive pipeline of term sheets already in place for plotted development,” said Mohit Malhotra, the company’s managing director, in a recent conference call with analysts.

DLF, the country’s largest developer, launched about 88 floors spread across 22 plots in DLF City Phase 3 and almost 85 per cent of that was sold, said Aakash Ohri, senior executive director, sales and marketing at DLF. Floors were priced at Rs 3.75-4.25 crore each.

The company now plans to launch a similar product in Panchkula Tricity and new Gurugram and “wherever there is an opportunity in DLF Phase 1 to 4,” Ohri said.

“We have realised there is real demand for floors. During the pandemic, people have realised the importance of owning a house and most want to live close to the ground instead of high-rises. These units are priced between Rs 3.7 crore and Rs 4.25 crore. We have so far sold almost 100 units and are now planning to roll out more,” Ohri added.

Mumbai-based Hiranandani Communities is selling plots in Chennai and looking to launch plotted developments in Alibaug near Mumbai soon.

In the last quarter, Hiranandani sold 30,000 sq ft of plots out of 100,000 sq ft it launched Chennai. Another 12,000 sq ft is booked and collections are yet to be made.

“Post Covid-19, demand for villa plots has shown good growth. Wellness and a holistic health-conscious environment where residents are safe within an environment of affordable luxury — these are the primary drivers of growing demand in this segment. The economics of plotted development, as compared to apartments, differs: Locations are usually peripheral, so the ‘extra open space’ quotient comes in — and that comes at a price,” said Niranjan Hiranandani, chairman and managing director at Hiranandani Communities.

Experts said Covid 19 has added to the demand for plots across the country.

“In India, investment in land is a time-honoured tradition and Covid-19 has further strengthened demand for land as a long-term investment. Some buyers are even considering plots in gated societies and build on and use, as standalone homes are the safest bets in a pandemic. The rise of the work-from-home culture is also closely interrelated here,” said Anuj Puri, chairman of Anarock Property Consultants.

The minimum size of marketable plots is as low as 550 sq ft, and goes up to 10,000 sq ft in select projects, larger plots are also available. Plot sizes of 1,200-2,500 sq ft are seeing maximum demand. However, in the southern cities of Bengaluru and Chennai, smaller plots of average sizes 550-750 sq ft are also generating interest, Puri said.

Several plotted development projects have also been pre-launched in distant locales of MMR over the past few months. Interestingly, these projects have larger-sized plots than in the southern cities. The minimum plot sizes start at 1,600 sq ft and goes up to 5,000 sq ft on an average, he said.