Mahesh Laxman, President, J.P. Infra Pvt. Ltd
With over 22 years of senior management roles and a total domain experience of around 35 years, Mahesh is a veteran in the Indian Real Estate Industry.
His tryst with Realty commenced in 1998 when he Ascendas India, bringing the first business park at Bangalore – International Tech Park. Situated 21 kms away from the city, this location was considered a peripheral area, and there was no infrastructure in the vicinity other than the Karnataka Industrial Areas Development board’s planned plotted land parcels, which were still unsold then. Today Whitefield is one of the most bustling areas in Bangalore, and almost a city in itself.
Mahesh specilizes in the Sales, Marketing, Brand building, Team development for products, Services and Concepts for new Real Estate projects and also projects that require special support and attention for the dilution of aged inventory. He works seamlessly on change management, and maintains a ‘ hands on’ work principle, which helps him in sustaining change and evolution of work processes. His forte lies in turn-around of sales volumes to allow release of uninterrupted revenue flow, product visibility, and creation of product vibrancy, and has been successful in such assignments with various projects / companies.
Team ABT captures his views on the Real Estate Industry in India and the changing dynamics, in this exclusive interview.
What is your outlook towards the growth of Indian Commercial & Residential sector for this year?
With the advent of e-Commerce, and the boom in the retail markets in India, warehousing has become a sunrise industry and today, the total absorption for this asset class is estimated anywhere between 25 to 30 million sq ft of warehousing space for the year 2018 to 19 along.
Global financial investors are today more focusing on commercial & industrial real estate assets, however, at the same time, one cannot rule out the largest real estate piece of the country which is the affordable housing development.
For the year 2018-19, Commercial, Industrial (warehousing included) and residential real estate development will definitely go North. And there will be many new launches of such assets, unlike other previous years and these new developments will abide by the RERA rules and will be positive for both buyers as well as the developers. We can expect a boost in the sales & lower retail inventory very soon.
What are the key points that any Developer should ensure in order to create more value in today’s times?
To sustain and to continue to be financially strong an ideal situation for a mid sized developer would be to create a portfolio of both commercial office, retail and residential assets, where he holds atleast 30-40 % of his commercial assets and generate annuities while he off loads the rest to ensure that he’s not burdened financially.
It is important for the developers to ensure that they don’t get into the herd mentality and flock to create any particular real estate asset, just because some of the project are doing well, one needs to identify if the location, absorption of the micro market is good enough and also conduct a thorough feasibility, before venturing. The other important thing is to ensure that one does not get bogged down by costly land purchases, today’s mantra is getting into a Joint Development and creating assets that are feasible and value for money to customers. Costly capital is another danger that a developer should be weary of.
Do you feel Real Estate Marketing has undergone drastic changes compared to a decade ago? Tell us more.
The Real Estate Marketing in India changed the day RERA enforcement came into existence. During the earlier days, real estate projects were marketed even before approvals, and sanctions were received from authorities, projects were sold just based on concepts and aggressive marketing ideas. Not all that was promised on brochures and advertisements were finally offered.
With RERA coming in, this practice of aggressive marketing and selling before all approvals were received has been totally stopped. Also, a developer cannot market or sell a real estate asset, before he has received all approvals and his project has been registered under RERA, this alone has brought about a remarkable change in the concept of Real Estate projects marketing in India. So today, what you see in brochures or advertisements is exactly what you get. If there are deviations from what is advertised to the public, then you are penalised. I think this is a strong check in place today and goes a long way in protecting retail & consumer interests.
What are some of the regulatory challenges, which if addressed could give a boost to the Industry & Business?
Regulatory challenges are very much present in Indian context and this is attributed to the time taken to get a project cleared of all the approvals and policy processes. As all real estate projects have certain percentage of funding and bank loans included, time is of the essence, and any undue delays will thin out planned profits, and revenue streams would be delayed, defeating the very reason for a developer to get into business.
It would be a good initiative for the government to stipulate the actual time frame within which they will be able to process approvals and clear documents and have a single window of clearance for a developer to initiate marketing of their projects. This could be a reality and over the next couple of years, the real estate project approvals & process could become something that could be more or less electronically cleared to some extent and the rest, through a quick well-timed process.
How do you see the next decade in Indian Realty Sector? What can we look forward to?
The government has already initiated work on creating smart cities and this is becoming a reality with infrastructure and good planning happening. Over the next 10 years, we will be able to actually see infrastructure build up, mass rapid transportation improving, more connectivity between cities and within the cities being created, alternative energy being used, green buildings becoming a norm, and so on and so forth.
Real estate and infrastructure will become more aligned and on par with the global standards, and we now have the know-how and ability. We are already constructing projects that are of world standards and in the near future most of our cities will connect and adapt to the new process of artificial intelligence and robotics in the building management systems, at par with all other countries.
What would you like to achieve in the coming years?
As a real estate professional, I would love to continue being part of a team that is responsible in creating real estate assets that blends with nature, use alternative energy, help reduce stress on people and nature, and ensure that what we leave a safe world for the younger generation to come.