REALTORS RE-TRAIN STAFF TO IMPROVE PRODUCTIVITY

Faced with prolonged slow down in residential sales, property developers are doing everything possible to improve productivity. RAGHAVENDRA KAMATH writes

Faced with prolonged slowdown in residential sales and rising costs, property developers are doing everything possible -- from outsourcing and skilling their staff to laying off mediocre performers -- to improve productivity.

For instance, DLF, the country's largest developer, has outsourced functions like design, project management and architecture to external professionals. It is also getting its senior staff to work as co-ordinators to deal with various outsourced work.

It has hired proof consultants in areas such as mechanical, structural, electrical and other areas who work on optimisation and higher efficiencies.

“By doing this, we get time to focus on honouring commitment to our customers. We can do efficient planning and execution now,” says Rajeev Talwar, chief executive officer at DLF. Talwar says many of those who quit in the last couple of years have done so to set up their own ventures.

Down South, Bengalurubased Prestige, the country’s third-largest developer, is focused on hiring more skilled staff and training existing staff to work more efficiently. “We always believe in having one skilled person than employing four unskilled people to work on something. Duplication of efforts leads to more wastage and adds to costs,” says Irfan Razack, chairman and managing director of Prestige Estates. According to Razack, hiring will reduce as the new regulatory regime, the Real Estate (Regulation and Development) Act 2016, coming into force from May 1. He says the new law may lead to reduction in new launches in the short term.

Developers have been battling tough times for a while now. Residential sales have been down for the last three-four years and prices have remained stagnant or moved marginally in cities such as Mumbai and the National Capital Region (NCR).

The hardest hit were the mid-level and below staff and those involved in the sales and marketing of residential properties.

Job losses have happened in Mumbai and NCR as sales nosedived in the last couple of years. A Mumbai-based developer recently retrenched about 100, largely those involved in slum redevelopment projects.

Though the exact number of job losses in the industry is not known, almost 80 per cent developers in Mumbai and NCR have cut jobs, people in the know say. In the first three months of 2017, residential sales have halved in Noida, Gurgaon, Mumbai and Bengaluru, according to data analytics firm PropEquity. And launches are down by 90-95 per cent in the NCR and about 45 per cent lower in Mumbai and Pune, compared to the same period last year.

According to Gulam Zia, executive director at Knight Frank, a UK- based property consultant, the job scenario in real estate is likely to remain grim for some time. Supply is going to be curtailed due to the new regulations, he adds.

“It is a worst time for weak developers and good one for the strong companies,” says Vijay Wadhwa, chairman of Wadhwa group, one of the largest developers in Mumbai. Wadhwa says prudent companies have removed mediocre talent while hiring performers. The group itself has removed 40-odd people but hired 20-25. “Our HR team and staff know that it is the time to be more efficient and productive,” says Wadhwa.

A senior executive of a Mumbai-based housing finance company says those who have been asked to go have not been replaced. The consolidation among real estate brokerages, both offline and online, is also leading to layoffs. For instance, after Housing.com merged with News Corp- backed PropTiger, the latter had to let go of 200 people. “When mergers happen there will be overlaps across the functions and the buyers normally lay off people to avoid overlaps,” says a senior executive with a Mumbaibased brokerage. Next: Sales, service network to spur job growth in auto sector