For ul­tra lux­ury homes in In­dia, lo­ca­tion does mat­ter

Prom­i­nent ad­dresses or ‘pin code value’ still mat­ter, and the ul­tra-rich are will­ing to pay those extra pre­mi­ums to pos­sess them

HT Estates - - FRONT PAGE - Om Ahuja

Many de­vel­op­ers are try­ing their best to cre­ate new zones and ad­dresses across In­dia that can ap­peal to HNI (high net worth in­di­vid­ual) prop­erty buy­ers. This en­deav­our has met with vary­ing de­grees of suc­cess on the ground when it comes to sway­ing the ul­tra-rich clien­tele. Bar­ring up­grades in de­sign con­cepts and the ad­di­tion of some new ac­cou­trements to am­plify a lux­ury life­style, the base­line con­cept of lux­ury homes has not ma­te­ri­ally changed in many cities. Prom­i­nent ad­dresses or ‘pin code value’ still mat­ter, and the ul­tra-rich are will­ing to pay extra pre­mi­ums to get them.

That said, cities like Delhi, Gur­gaon, Ben­galuru and Pune have by now seen a high in­ci­dence of de­vel­op­ers of­fer­ing branded res­i­dences as al­ter­na­tives to pre­mium homes at the most sought-after lo­ca­tions within th­ese cities. The suc­cess in swing­ing in­ter­est lev­els of the tar­get clien­tele has var­ied markedly in tan­dem with the ac­tual fea­tures be­ing of­fered.

While there is ev­i­dence of first-gen­er­a­tion wealthy buy­ers eval­u­at­ing and con­sid­er­ing such op­tions in th­ese cities, the con­ver­sion rate among the his­tor­i­cally rich has been neg­li­gi­ble. The con­sen­sus among this seg­ment is that branded res­i­dences of­fer very lit­tle value ad­di­tion, and that the pre­mi­ums charged on them are based on ar­ti­fi­cial fac­tors that do not pro­vide true value.

De­mand con­tin­ues t o be ro­bust for op­tions in bona fide pre­mium lo­ca­tions of the key In­dian cities, but newly tailored lux­ury ad­dresses are also see­ing their share of ac­tion as long as the projects on of­fer meet cer­tain pa­ram­e­ters. To be­gin with, deals con­clude rap- idly in sellers’ mar­kets where de­mand ex­ceeds sup­ply. An­nual re­turns in such pock­ets are in the neigh­bour­hood of 25%, and this fig­ure will con­tinue to see north­ward move­ment over the com­ing years as sup­ply con­straints drive prices up fur­ther.


In Delhi, the pref­er­ence of HNIs when it comes to es­tab­lished and high-value lo­ca­tions is more or less in­flex­i­ble. South Delhi is still the mi­cro-mar­ket of choice for ul­tra-rich clients from Delhi, Pun­jab and Ut­tar Pradesh with bud­gets rang­ing from ₹ 50 to 300 crore. Golf Links in Delhi is a more vi­brant mar­ket in terms of de­mand when com­pared even to Lu­tyens Zone. Shanti Nike­tan and Vas­ant Vi­har are two other key HNI des­ti­na­tions where de­mand ex­ceeds sup­ply. Golf Links is ac­tu­ally the most sought-after lo­ca­tion in south Delhi. Most other cities have sim­i­lar pock­ets, but also show ev­i­dence of a cer­tain de­gree of de­mand di­ver­sion to newer lo­ca­tions and con­cepts, which is not the case in Delhi.


In Mum­bai, with the Cen­tral Business Dis­trict (CBD) shift­ing to BKC for all prac­ti­cal pur­poses, clients who would pre­vi­ously not have con­sid­ered any op­tions other than Mal­abar Hill or Ne­pean Sea Road zone are now eval­u­at­ing newer ar­eas like Worli, Ban­dra-BKC and Ma­ha­laxmi as al­ter­na­tives. Con­sid­er­ing the lim­ited sup­ply in the his­tor­i­cally prized lo­ca­tions, HNI buy­ers are look­ing for pre­mium op­tions that pro­vide 24x7 se­cu­rity, a gated com­mu­nity ex­pe­ri­ence and pre­mium club houses as an am­pli­fi­ca­tion on their experiences in stand-alone build­ings in the tra­di­tional pre­mium ar­eas. The ar­rival of K Ra­heja Corp’s ul­tra- lux­ury gated com­mu­nity Vi­varea in Ma­ha­laxmi, Mum­bai, has seen many wealthy south Mum­bai res­i­dents ac­cept­ing this as a lux­ury ad­dress in all re­spects.


Sim­i­larly in Ben­galuru, de­vel­op­ers such as To­tal En­vi­ron­ment and Chai­tanya have pro­vided the city with gen­uine lux­ury projects in brand-new pre­mium lo­ca­tions. Th­ese de­vel­op­ers have been in­stru­men­tal in turn­ing White­field into a high- value ad­dress and their com­pleted projects com­mand steep pre­mi­ums. The of­fer­ing, spec­i­fi­ca­tions and buyer pro­file are re­mark­able enough to make a dif­fer­ence. To­tal En­vi­ron­ment’s pro­ject in one of the best lux­ury of­fer­ings in In­dia, and de­mand for such projects in White­field ex­ceeds sup­ply.

The au­thor is CEO - Res­i­den­tial Ser­vices, JLL In­dia


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