MUMBAI: From outside, the metal and glass facade of Lodha’s new residential project, The Park in Pandurang Budhkar Marg in Mumbai’s office hub Worli, looks like a corporate headquarter. The 10,000-sq-ft sales office inside, with quotes by renowned poets on glass walls, is equally striking.
Almost every table in the office has a copy of The Economist on it, which carries the advertisement of The Park. This weekly newspaper, as it calls itself, seldom carries Indian real estate advertisements.
After buying a 17-acre plot from DLF, the country’s largest developer, for Rs 2,727 crore in August 2012, Lodha has done everything to woo customers to the project in a rather slow property market in Mumbai. DLF had bought the land from National Textiles Corp for Rs 702 crore in 2005.
In all, the developer is building six towers of 75 storeys each and 12 villas around a six-acre park on the 70 feet high elevated plot. Lodha says it has got booking for all 1,350 apartments in three towers, which were released in the market in the last seven-and-a-half months. Total applications received were 2,300.
This, of course, excludes 225 applications in the recently announced Trump Tower, where the apartments are likely to be over Rs 8 crore for a three-bedroom home and Rs 10 crore for four-bedroom ones.
How it managed
Lodha has spent nearly three times more money on marketing and advertisement compared to any of its project including the World Towers, one of the tallest residential projects it is building in the vicinity, says its chief marketing officer R Karthik. Besides The Economist, the group also advertised in Fortune and GQ.
The Park has many firsts in the Central Mumbai market. To begin with, two towers in the project were pre-launced in January this year, on first-come, first-served basis, wherein buyers needed to submit application in two weeks’ time with a price quotation.
The company got 1,300 applications for 750 apartments under the project code-named as Blue Moon. The towers carried two, three and four bedroom apartments ranging from 1,300 sq ft to 2,000 sq ft and apartments were priced around Rs 23,700 a sq ft or Rs 3.2 crore.
This configuration was a masterstroke by Lodha in the South Mumbai market, which lacked affordable two-bedroom apartments, realty consultants said. Prices for ready to move in apartments in the area hover around Rs 30,000 a sq ft.
“In today’s environment, you cannot get a two-bedroom apartment for Rs 3 crore in south Mumbai and prices have reached Rs 2.5 crore for two-bedroom flats in Goregaon and Jogeshwari (on Mumbai’s western suburbs),” said the chief executive of a property consultancy, requesting anonymity. “You should also remember that very few developers are building two-bedroom apartments in South Mumbai.”
The developer also roped in Bollywood celebrity Aishwarya Rai Bachchan as brand ambassador for the project during its launch. Aishwarya is believed to have been paid over Rs 5 crore.
Lodha also did a multi-city launch in August for the project in Mumbai, Delhi, Surat, Kolkata, Ahmedabad, and Dubai. It got over 1,000 applications for 600 apartments for a tower codenamed as ‘Full Moon’ and is in the process of allocating apartments.
The tower had two bed-room apartments starting at 1,305 sq ft with a price of Rs 24,471 or Rs 3.33 crore and three BHKs starting at 1,539 sq ft with a price of Rs 3.39 crore. The latest attraction in the project was Lodha’s tie-up with US-based realty tycoon Donald Trump, known for high-rise buildings in Manhattan, for an 800-foot tall Trump Tower inside the Park. The tower is codenamed as Gold Moon. For the Trump Towers, the company has already received 225 applications during the pre-launch. The construction for 77-storey Trump Tower is expected to be completed by 2018. The tower is likely to get launched January next year in the presence of US realty tycoon Donald Trump himself..
The developer is yet to launch two more towers and 12 villa project on the plot.
The six acre park is core of the project, says Lodha’s Karthik, adding “Worldover, the buildings surrounding parks have maximum value. We conceptualized six acre park and building towers around that.”
The developer says the project will have six swimming pools including a 30 meter swimming pool( touted the biggest in Mumbai), covered pool for women among others; a full fledged cricket ground, a 50,000 sq ft club house, tennis court and other sports facilities. Boxing ring by boxing icon Evander Holyfield’s boxing ring and dancing academy by dancing star Sandip Soparkar are added attractions, says the developer.
The quick project launches under The Park are significant from Lodha’s strategy of ‘buy-sell-build’ and overall slowdown in Mumbai property market, say the company insiders and property consultants.
Lodha bought the land from DLF in August 2012 and launched in January 2013, which explains the speed with which the developer moved, said a consultant.
Karthik says the company does not believe in land banking.
“We do not sit on land. We buy land, launch projects and move on. That’s why we could achieve sales of Rs 10,000 crore from sub Rs 1000 crore six years ago,” Karthik said.
Sanjay Dutt, managing director of global property consultant Cushman & Wakefield believes that the apartment specifications such as unit sizes, pricing were aligned with current market conditions.
“The project is perceived when the market was soft. So apartment sizes and pricing were in tune with the current market conditions,” Dutt said.
“Secondly, it is one of the few land parcels in Mumbai which is more than 15 acres. Any project where land is this big is differentiated from other developments,” Dutt said.
Developers and investors Business Standard spoke to, raised concerns about the density of apartments in the project given that it is 17 acre development.
“If you have six to seven towers and thousands of apartments, there will be so much density in the project which might lead to congestion,” said a director of a realty company building project in the South Mumbai.
“The entire Pandurang Budhkar Marg stretch is already congested. How will they make so many cars enter and exit,” he said.
Abhisheck Lodha, managing director of the group, in an earlier interview said the company is working with the government to decongest the road.
A Lodha executive said the project is designed in such a way that the towers are located within sufficient distance between two and a lot of amenities and green patches in between.
A chief executive officer of a private equity fund said if the developer is selling Rs 3.25 crore apartment and a Rs 9 crore crore apartment in the same complex, there will be issues with buyer profile in the project.
“You can not target a middle class, lower middle class and upper class buyer in the same complex,” the CEO said.
But Karthik says that the developer is doing a lot of work in buyer profiling. “We are targeting fairly homogeneous set of customers who can live together. They are in SEC A plus category.”