‘ Lod­haUKisas­Bri­tish as Cad­bury is’

HT Estates - - NEWS - Nam­rata Kohli let­ters@hin­dus­tan­times.com

LON­DON: They are do­ing only lux­ury and only Cen­tral Lon­don. Lodha has ar­rived in Lon­don. Af­ter the ac­qui­si­tion of the land­mark MacDonald House at 1 Grosvenor Square in prime Cen­tral Lon­don from the Canadian Gov­ern­ment for over GBP 300 mil­lion (₹3,100 crore), Lodha UK has launched their flag­ship devel­op­ment ‘No 1 Grosvenor Square’ in the heart of May­fair, in close prox­im­ity to the Buck­ing­ham Palace.

Lon­don is a dream des­ti­na­tion for In­dia’s af­flu­ent class. Still many were scep­ti­cal about Lodha group’s over­seas ex­pan­sion and saw this as some­thing “un­usual”, given that very few In­dian de­vel­op­ers have ven­tured abroad and sus­tained them­selves prof­itably. More­over Lon­don mar­ket is tough with the Bri­tish house­build­ing mar­ket dom­i­nated by a few de­vel­op­ers with large land­banks and con­strained by a lengthy and com­pli­cated plan­ning pro­cess – fac­tors that have stymied plans by new en­trants in re­cent years. In ad­di­tion there was Brexit and other po­lit­i­cal un­cer­tain­ties.

That doesn’t de­ter Lodha group to have a clear fo­cus on this mar­ket which they feel is un­der­served. Nam­rata Kohli caught up with the young Lodha scion, Ab­hishek Lodha, Man­ag­ing Di­rec­tor of Lodha group in Lon­don to find out the plans of Lodha UK

Is it true that your group scouted prop­er­ties at hotspots like Sin­ga­pore, Hong Kong, Dubai be­fore ze­ro­ing in on Lon­don. Why Lon­don?

We did a rea­son­able amount of ground work and yes it is true we wanted to ven­ture into one of the global cities. Lon­don was right for var­i­ous rea­sons. It’s in a good time zone from In­dia and we have a deep prox­im­ity and con­nect with the UK. Be­sides it’s a very struc­tured mar­ket and there is an un­der­sup­ply of hous­ing. Lon­don is a 200,000-apart­ment-a-year mar­ket and cen­tral Lon­don’s prop­erty mar­ket grew 6% year-on-year last year.

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The UK mar­ket has been fac­ing its own chal­lenges with Brexit, weak­en­ing of pound, po­lit­i­cal un­cer­tainty and other is­sues that it is con­tend­ing with.. Were there any kind of ap­pre­hen­sions on en­ter­ing the Lon­don mar­ket?

Th­ese global cen­ters have been through it all in last 400 years- poli­cies and gov­ern­ments come and go but mar­kets such as Lon­don have been re­silient enough. The in­ter­na­tion­al­iza­tion of things has if any­thing helped UK – if you look at a long term per­spec­tive, then a global Bri­tain is a bet­ter Bri­tain. We like this trend of UK get­ting in­te­grated with the global econ­omy. We don’t say that Europe is not im­por­tant but then Europe is not ev­ery­thing. At Lin­coln Square we have al­ready done GBP 130 mil­lion (₹1,060 crores) worth of sales af­ter Brexit. Lon­don is one of the most re­silient mar­kets in the world.

There have been re­ports in the UK me­dia that Lon­don’s real es­tate de­vel­op­ers could face ag­gres­sive com­pe­ti­tion from Lodha Group, which is plan­ning a £3­bil­lion push into prop­erty in the cap­i­tal. What are your tar­gets­ what kind of in­vest­ment, homes, time frame do you have in mind?

We are do­ing all cat­e­gories rang­ing from mid-mar­ket to su­per-prime and are here to serve mul­ti­ple price points and as­set classes. We have just launched one of the most ex­pen­sive projects in the world and in our port­fo­lio as well, 1 Grosvenor Square at the most prized ad­dress of May­fair. This place is char­ac­ter­ized by its splen­did pe­riod ar­chi­tec­ture, lead­ing art gal­leries, auc­tion houses, wine mer­chants, five star ho­tels and clubs. The small­est are stu­dios and the big­gest are 5 bed­room units, a to­tal of 42 units at a price range of GBP 7.5 mil­lion (Rs 60 crores) to GBP 68 mil­lion (Rs 554 crores) and will be com­pleted by Dec 2019. The area is one of the most cos­mopoli­tan, high net worth ar­eas in cen­tral Lon­don, at­tract­ing a good mix of UK based pur­chasers and over­seas in­vestors.

The Lin­coln Square project has a to­tal of 202 units from two bed­rooms to pent­houses start­ing from GBP 3.5 mil­lion (Rs 28 crores). This project will be de­liv­ered by 2018 end. Lin­coln Square is lo­cated in the le­gal heart­land be­tween Lin­coln’s Inn and The Royal Courts of Jus­tice and is ad­ja­cent to world class ed­u­ca­tional in­sti­tu­tions in­clud­ing the Lon­don School of Eco­nomics and King’s Col­lege Lon­don. The pro­file of Lin­coln Square cus­tomers mainly con­sist of suc­cess­ful bankers and bar­ris­ters. The project has been one of the star per­form­ers of the Lon­don res­i­den­tial mar­ket with over 78 units worth al­most GBP 130 mil­lion sold since its launch in May 2016.

The orig­i­nal plan was to in­vest close to 3 bil­lion pounds into the Lon­don but that was in 2014 that we had plans to spend £1.8bn on as­sets and a fur­ther £1.2bn on con­struc­tion but this has slowed down. Now as the mar­ket set­tles, we will de­cide fu­ture course of in­vest­ments.

What is the USP that you as an In­dian de­vel­oper bring to the UK mar­ket?

We are based in Lon­don, op­er­ated out of Lon­don, run by peo­ple who know Lon­don – ev­ery­thing is done lo­cally. We have a staff of 35 peo­ple served by lo­cal pop­u­la­tion. The ef­fort is to de­liver hi-qual­ity as qual­ity is our DNA.

You have said this be­fore that if we can keep grow­ing in Lon­don and Mum­bai, and that is enough to rein­vest our prof­its, then there is no rea­son to be else­where. Is there a broader strat­egy to cre­ate busi­ness in the two cities?

We are pretty much fo­cussed now in Mum­bai and Lon­don. Pune is an­other mar­ket but that’s it for now. Lon­don and Mum­bai are very unique and ex­cit­ing mar­kets to be in. Each has its own chal­lenges and ad­van­tages. Lon­don is a much more ma­ture mar­ket and here it’s much harder to dif­fer­en­ti­ate as even the base level is so much higher. In­dia is a much younger mar­ket and there is op­por­tu­nity for growth in ev­ery seg­ment but the is­sues are sup­ply chain and reg­u­la­tory pro­cess.

How are you far­ing with your Trump project at Mum­bai?

It’s go­ing well and in Mum­bai we have sold 60% even though we are two years away from com­ple­tion. There is in­ter­est not just from Mum­bai in­vestors, but from buy­ers from all over In­dia.

MINT/FILE

Ab­hishek Lodha

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