Salil Kumar, Associate Director, Assotech Realty
Assotech Realty has created a range of commercial, residential and hospitality projects in the Delhi-NCR region. The company is now planning to explore new markets by introducing the concept of serviced apartments. Salil Kumar, Associate Director, Assotech Realty, highlights the benefits of this untapped segment and opportunities for the construction industry in an interview with CW.
What is the rationale for launching serviced apartments?
India is a developing country. So far, we have stuck to the beaten track which is the residential, commercial and retail model. However, now with the emergence of a new concept of serviced residences, we have introduced a new lifestyle in India but it is yet to be tapped. We think it will be a successful model in the near future as there is a great need for serviced residences across the country.
Kindly elaborate on the concept of serviced residences?
A serviced residence is a studio apartment cum hotel. The location for these apartments is a little offbeat and inexpensive. In these residences, the size of the room is generally bigger and is typically one and a half to two times larger than the size of an average hotel room. Hotels are expensive and the rooms are also small. If one has to stay for a long period of time, serviced apartment is the best solution as they are convenient and economical.
Which cities are you are targeting to develop these high-end apartments?
We are planning to develop high end serviced residences in over 25 major cities across India. To explore this idea, we've divided our plan into three segments. The first one includes the business segment in which cities such as Mumbai, Bengaluru, Hyderabad, Indore, Chennai, Ahmedabad and Noida have been shortlisted to construct serviced residences. The second is the pilgrimage segment. We have already invested Rs 100 crore in Shirdi and are planning to invest in Katra and Tirupathi and around Rs 250 crore in Ahmedabad. Our last segment comprises the leisure division for which we have shortlisted Goa and Kochi.
Tell us about Assotech Realty's plan for Shirdi. What is the potential of this region?
Almost 30,000-35,000 visitors tour Shirdi every day. The region witnesses the same kind of potential around the year and has also become a popular destination amongst all types of people including NRIs. Due to the ever increasing crowd, there is a need for high end accommodation in the area. Currently, there are only two five-star level accommodations available in Shirdi. So we thought of developing an alternate and high end stay solution in the form of serviced apartments.
What is the total investment for these projects? Where are you sourcing the revenue from?
The total investment for serviced residences is in the range of Rs 2,000 crore. Currently, we are a zero debt company and the finance is being arranged with the assistance of our pre-sale and sale funding model.
For which segments will these projects benefit?Are any tenders likely to be introduced?
This is an opportunity for everyone in the construction industry. As these projects are coming up across India, I see it as an emerging prospect for service consultants, contractors, etc. We are yet to shortlist contractors for our Shirdi and Ahmedabad project and the tenders for these projects are likely to be introduced after two months.
What are the marketing strategies to attract buyers?
The best marketing strategy is to deliver better than promised. Our project, Assotech Business Cresterra is one such example where customers were satisfied with the project and the sale took place without any difficulty.
According to Cushman & Wakefield (C&W), NCR has witnessed a 39 per cent decline in residential unit launches. Highlight the problem area.
The NCR real estate market heavily depends on investors. You will witness a 30-40 per cent fall in new launches as developers look out for new buyers to purchase their projects. It is an ongoing process, every four-five years, you will face this cycle. The region is influenced by investor purchases unlike Mumbai and Bengaluru, which are user driven markets.
The real estate regulatory bill has been recently introduced. What are your views on the same?
The real estate regulatory bill is a welcome move and is in the interest of customers. Now, only bonafide developers will occupy a place in the real estate market. Builders will have to obtain all sanctions to develop projects after which they can launch the project and sell it accordingly. I believe only players with real potential will enter the market due to which customers will be benefitted.
The real estate sector has been demanding 'industry status' for a long time. What are the consequent problems?
Once the real estate industry is given an industry status, it will have access to well-structured loans from different banking institutions. However, as we do not depend on loans, we do not face such problems. Such a status will also lead to an increase in the number of infrastructure projects. So, we hope that with time the sector will be granted this status, following which everything will be streamlined.
Project details:
Year of Establishment: 2004
Top Management (Promoters): Neeraj Gulati, Mahendra Goel, Vikas Aggarwal, Salil Kumar
No of Employees: 500
Centre of Operations: Indirapuram, Delhi NCR/ Janpath, Connaught Place
Ongoing Projects: Assotech Business Cresterra
Upcoming Projects: Chain of serviced residences at 25 destinations across India including Ahmedabad, Shirdi, Goa and Katra
Completed Projects: Windsor Park, Elegante, Springfields, Windsor Street, Cabana Serviced Residences, Trade Tower I and II, Aspen Heights, Windsor Greens.
Turnover: Over Rs 300 crore
If you know of any builder of repute, write in at [email protected]
Salil Kumar, Associate Director, Assotech Realty
Assotech Realty has created a range of commercial, residential and hospitality projects in the Delhi-NCR region. The company is now planning to explore new markets by introducing the concept of serviced apartments. Salil Kumar, Associate Director, Assotech Realty, highlights the benefits of this untapped segment and opportunities for the construction industry in an interview with CW.
What is the rationale for launching serviced apartments?
India is a developing country. So far, we have stuck to the beaten track which is the residential, commercial and retail model. However, now with the emergence of a new concept of serviced residences, we have introduced a new lifestyle in India but it is yet to be tapped. We think it will be a successful model in the near future as there is a great need for serviced residences across the country.
Kindly elaborate on the concept of serviced residences?
A serviced residence is a studio apartment cum hotel. The location for these apartments is a little offbeat and inexpensive. In these residences, the size of the room is generally bigger and is typically one and a half to two times larger than the size of an average hotel room. Hotels are expensive and the rooms are also small. If one has to stay for a long period of time, serviced apartment is the best solution as they are convenient and economical.
Which cities are you are targeting to develop these high-end apartments?
We are planning to develop high end serviced residences in over 25 major cities across India. To explore this idea, we've divided our plan into three segments. The first one includes the business segment in which cities such as Mumbai, Bengaluru, Hyderabad, Indore, Chennai, Ahmedabad and Noida have been shortlisted to construct serviced residences. The second is the pilgrimage segment. We have already invested Rs 100 crore in Shirdi and are planning to invest in Katra and Tirupathi and around Rs 250 crore in Ahmedabad. Our last segment comprises the leisure division for which we have shortlisted Goa and Kochi.
Tell us about Assotech Realty's plan for Shirdi. What is the potential of this region?
Almost 30,000-35,000 visitors tour Shirdi every day. The region witnesses the same kind of potential around the year and has also become a popular destination amongst all types of people including NRIs. Due to the ever increasing crowd, there is a need for high end accommodation in the area. Currently, there are only two five-star level accommodations available in Shirdi. So we thought of developing an alternate and high end stay solution in the form of serviced apartments.
What is the total investment for these projects? Where are you sourcing the revenue from?
The total investment for serviced residences is in the range of Rs 2,000 crore. Currently, we are a zero debt company and the finance is being arranged with the assistance of our pre-sale and sale funding model.
For which segments will these projects benefit?Are any tenders likely to be introduced?
This is an opportunity for everyone in the construction industry. As these projects are coming up across India, I see it as an emerging prospect for service consultants, contractors, etc. We are yet to shortlist contractors for our Shirdi and Ahmedabad project and the tenders for these projects are likely to be introduced after two months.
What are the marketing strategies to attract buyers?
The best marketing strategy is to deliver better than promised. Our project, Assotech Business Cresterra is one such example where customers were satisfied with the project and the sale took place without any difficulty.
According to Cushman & Wakefield (C&W), NCR has witnessed a 39 per cent decline in residential unit launches. Highlight the problem area.
The NCR real estate market heavily depends on investors. You will witness a 30-40 per cent fall in new launches as developers look out for new buyers to purchase their projects. It is an ongoing process, every four-five years, you will face this cycle. The region is influenced by investor purchases unlike Mumbai and Bengaluru, which are user driven markets.
The real estate regulatory bill has been recently introduced. What are your views on the same?
The real estate regulatory bill is a welcome move and is in the interest of customers. Now, only bonafide developers will occupy a place in the real estate market. Builders will have to obtain all sanctions to develop projects after which they can launch the project and sell it accordingly. I believe only players with real potential will enter the market due to which customers will be benefitted.
The real estate sector has been demanding 'industry status' for a long time. What are the consequent problems?
Once the real estate industry is given an industry status, it will have access to well-structured loans from different banking institutions. However, as we do not depend on loans, we do not face such problems. Such a status will also lead to an increase in the number of infrastructure projects. So, we hope that with time the sector will be granted this status, following which everything will be streamlined.
Project details:
Year of Establishment: 2004
Top Management (Promoters): Neeraj Gulati, Mahendra Goel, Vikas Aggarwal, Salil Kumar
No of Employees: 500
Centre of Operations: Indirapuram, Delhi NCR/ Janpath, Connaught Place
Ongoing Projects: Assotech Business Cresterra
Upcoming Projects: Chain of serviced residences at 25 destinations across India including Ahmedabad, Shirdi, Goa and Katra
Completed Projects: Windsor Park, Elegante, Springfields, Windsor Street, Cabana Serviced Residences, Trade Tower I and II, Aspen Heights, Windsor Greens.
Turnover: Over Rs 300 crore
If you know of any builder of repute, write in at [email protected]
