Prestige group extends its expertise to the other cities

Prestige group extends its expertise to the other cities

Mr. Irfan Razack, CMD, Prestige Group

Q. Prestige Group is one of India’s leading property developers with most of its projects in South India. Any plans to move out to other parts of the country?
Headquartered in Bangalore, the Prestige Group is currently the 2nd largest developer in India. Founded in 1985, currently the market capital of the listed company is around Rupees 9000 crores. FY 2014-15 also witnessed the company recording the highest sales among the listed Real Estate companies in India. The Prestige Group is the only developer in South India to have a strong presence in the domains of residential, commercial, retail, hospitality and leisure. The company has become an integral part of people’s lives. People are living in Prestige homes, working in Prestige offices and enjoying their leisure time in Prestige malls, hotels and resorts. Being present in all sectors has been a very well thought out business strategy that has also helped the company with rentals and a strong debt equity ratio.

Over the last three decades, the company has shaped the skyline of Bangalore. With over 150 landmark developments across Bangalore, in recent years, the Prestige Group has extended its expertise to the cities of Chennai, Hyderabad, Kochi, Mangalore, Mysore and Goa - giving each city an unparalleled experience with landmark malls on the lines of ‘The Forum’, large townships, tech parks, hotels, luxury villas, and SEZs. The company has plans of expanding its footprints to other parts of the country as well, and is in the process of finalizing a piece of land in Pune for an IT Park currently.

Q. How do see Karnataka as a future destination for investment in the real estate sector?
If planned in a structured and organic manner, Karnataka has tremendous scope for growth in the real estate sector. Apart from Bangalore, the two markets that show promise in Karnataka are Mangalore and Mysore. Both cities have attracted investment from real estate majors over the last decade. To give a fillip to both these markets, investments in industry need to be drawn to these centres, coupled with  investments in infrastructure. Better connectivity between  Bangalore and Mysore is one simple initiative which has been pending for long. While we have toll roads from Bangalore to cities like Chennai, Salem and Tumkur, the stretch to Mysore still remains as is, with no outcome expected in the foreseeable future. Mangalore being chosen as one of the Smart City locations can certainly improve its infrastructure and attract investments in the industry.

Q. How are government policies on land holding and other related areas, of concern for builders and developers?
There is definite scope to rationalize regulation and to enable city development in the context of modern urban development. The difficulties faced in implementing projects by Developers can definitely be streamlined. Laws need to change with time, and facilitate creation of modern cities.

Q. Which category of housing projects will you be focusing on in the near future - premium villas, apartments or affordable range of projects?
Given the company’s presence across diverse sectors, the Prestige Group is one of the prime movers in the mid-segment to premium and luxury real estate space. 2016 will see us focusing on several new launches in different parts of Bangalore as well as in Chennai and Mangalore in these segments. Simultaneously, there will be several completions and handovers of under construction properties as well. The Group has, over the last three decades, earned its position as an industry heavyweight that dictates realty product and pricing trends for the rest of the market. A home is one of the most precious assets that a person invests in, in their lifetime. Today, homebuyers aspire to buy Prestige homes given that brand ‘Prestige’ has gained the reputation of being one of the most trusted and aspirational brands in the country. They have succeeded in consistently giving strong return on investment on all developments till date. The high market acceptance of the brand is reflected in the success story of the Prestige Group.

Q. How are you sustaining in an environment of overall slowdown in the real estate industry for the past few years. How long do you think this is going to continue?  
Despite an environment of increased supply in the real estate industry, Bengaluru has still managed to top the list of the most attractive city for investment in real estate, leaving NCR and Mumbai behind. The primary reason for this is that the supply  is demand based in Bangalore. The requirement for housing goes hand in hand with the rapid growth in the office segment. The demand for office space has been consistent with new businesses being seeded, specially in the e-commerce segment. In addition to this, the price raise in the apartment and office segments has been gradual, in line with demand unlike some other markets.

Simultaneously however, in the city, there has also been rapidly increasing distress and activism on the lack of infrastructure, in terms of traffic and the roads. I believe that the Government really needs to wake up, especially in Bangalore. They need to complete the 1st phase of the Metro and begin the construction of the 2nd phase. They also need to ensure that the infrastructure of the city is up to world standards. I understand that this may need a lot more financing and funding and for this, they need to manage existing funds better. All these are issues that will definitely affect business. Even if not immediately, we will see the effects in the next 2-3 years, which is not a good sign.

Q. How do you think “INVEST KARNATAKA 2016” will help the State in getting more investments and employment opportunities in the coming years? Is it going to have any positive impact on your business?
Karnataka is one of the fastest growing States in the country today, offering trade and investment opportunities across industry sectors. The State’s entrepreneurial spirit in innovation and R&D has been recognized globally. Karnataka has been consistently rated as “One of the best places to do business” by organizations like World Bank, FICCI and ASSOCHAM, among others. It also boasts the enviable tag of being “The most technology savvy State” in India. Today, Karnataka is home to more than 80 Fortune 500 companies and more than 700 MNCs. The Government of Karnataka is initiating a host of reforms and initiatives, including the “Ease of Doing business” initiative, to speed up industry-led growth in the State. Several multinational corporates have also made investments and capacity expansions in Karnataka in the recent past. All of them will “Make in Karnataka” – for India as well as for the international markets. All this and more should attract heavy investment in Karnataka.

From a real estate perspective, if more corporates come into Karnataka, it means that more jobs will be created, which ultimately will be a boost for the economy. This also means a higher demand for both workspace and housing.

However, having said that, the Government needs to bring in certain specific reforms and initiatives to create a healthier work environment for the real estate sector in particular. On the Government side, speedy issue of approvals for a project in totality is paramount. The ease of obtaining all permissions will go a long way in improving the overall business environment in Real Estate, which also includes benefit to the end consumer by way of lower cost and quicker delivery.

Moreover, in cases where approvals have been issued - no retrospective actions should be taken by the Government. This also includes matters such as cancellation/revocation of approvals, which have been obtained with substantial investments in time, finances and effort.

Q. Are you equipped to be one of the major players when it comes to the making of SMART CITIES in the future?
In Karnataka, Mangalore has been chosen under the Smart City plan. As we already have a well-established set up in Mangalore, we are best positioned to harvest this opportunity and further our business interest here.  

Q. Two words from you on the success of “INVEST KARNATAKA 2016” please.
Karnataka presents an excellent platform for investors from India as well as overseas. With our past achievements in such events, we are certain that the Government will do its best in a pro-industry manner to facilitate Investment proposals in Karnataka.

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