Mumbai’s new luxury flats face harsh realty
MUMBAI: Thedraginluxuryhome sales may soon leave some of southMumbai’sposhneighbourhoods with a string of almost empty skyscrapers.
In Worli and neighbouring Prabhadevi, which host the super-rich in business andBollywood, more than half of upcoming residential towers are struggling to find buyers. LowerParel, also in the vicinity, where residential high-rises have mushroomedinthemidstoflargeoffice complexes, is witnessing a similar fate. Out of the total supply of 7,292 luxuryapartmentsinWorli and Prabhadevi, 4,107 remain unsold, according to data compiled byLiases Foras Real Estate Rating and Research Pvt. Ltd. Theaveragecostofanapartment in these areas is ₹10 crore. At the current pace, it may take more than17yearstodisposeofthecurrent stock, shows the data.
Thesituationhasputpressure onpropertypricesintheseareas, withbuilders offering discounts.
AtWorli, homesarebeingsold at ₹60,987 persq. ft (oncarpetarea basis), down from ₹67,467 per sq. ft in thesecondquarterof2014-15. AtLowerParel, with1,337 unsold units, prices have dropped from ₹60,708 to ₹58,269 per sq. ft during the same period, according to Liases Foras data.
“Toomuchsupplycameatthe sametime. If the supplywasstaggered over a period of time, it would have adjusted to the demand but the challenge compounded as most of them came around the same period,” said Anuj Puri, chairman, Anarock PropertyConsultantsLtd, aproperty broking firm.
Worliisdottedwithsomeofthe most expensive upcoming housing projects: Oberoi Realty Ltd’s uber luxury project Three Sixty West, K Raheja Corp’s Artesia, OmkarRealtors’ 1973 andProvenance Land’s Four Seasons Private Residences.
“Sales have definitely been slow. Wearenowfocusedonfirst completing our project. We will openourthirdtowerforsalenext yearwhenthemarketstabilizes,” said Rahul Maroo, CEO of Omkar’s 1973 project. Between 2013 and 2017, Omkar sold over 85% of first two towers that comprised over 320 units, he said.
Lastyear, PiramalCapitaland HousingFinanceLtd, whichlent to the 1973 project, hadtobringin Anarock Property Consultants for pushing sales to expedite the recovery of its money. This year, developer Parinee Group was forced to convert its planned upscale residential project in Worli, funded by non-banking finance group ECL Finance Ltd, into office space, due to huge oversupply in the vicinity.
Cash- rich builders have, meanwhile, put up a brave face, claimingthereareenoughtakers for high- end homes. Vikas Oberoi, chairmanandmanaging director, Oberoi Realty, said Worli continues to find traction among wealthy Indians looking to shift their base from different parts of the city. “... Properties at Worli Sea Face are being sold at around ₹1.5 lakh per sq. ft. Our project is onelanebehindandwe are selling at 50% of that price. So I havecustomerslinedup, butwe are particular about the right profile,” Oberoi said.
Launched two years ago, Oberoi’sThreeSixtyWestproject hasregisteredsalesof56unitsout of around 200. Not far away is K Raheja Corp’s Artesia, where around 50 units are yet to be sold out of 100, with each apartment costing ₹35 crore andabove. “We don’t have a large inventory. We areonlycreatingexclusiveapartmentsandverychoosyaboutthe profile. Wedecidewhomwewant to sell,” said Om Ahuja, chief operating officer, residential business, K Raheja Corp.
In Worli, 2290 units launched since 2013 remain unsold