“From the strength of construction, structural stability and quality of finish that match global standards, the luxury housing projects has to spell class”, says Dr. Niranjan Hiranandani, Co-Founder and MD, Hiranandani Group; President (Nation), National Real Estate Development Council (NAREDCO). Kick-starting its journey in the year 1978, Hiranandani group is a leading real estate group in its flagship business of construction with a pan–india as well as international presence. Dr. Hiranandani talks about the luxury segment in real estate segment and how the segment will continue to grow in the future. Excerpts: Q:What are the challenges that face the luxury segment in the real estate sector? One challenge is the customer in this segment – well aware of global trends and the latest innovations in design and architecture as also looking for smart homes – with automation and artificial intelligence powered systems. This segment expects best global practices from the developer, and skilled manpower, to provide the required quality of finish which is not easily available. So, the primary challenge is that the customer is not just discerning, but also expects the very best. From amenities and common facilities that are top of the line to a product that spells ‘class’. Secondly, it is difficult to gauge while commencing the project what this segment of customers will want in terms of the product by the time the product is ready for handover. Q:Which cities in India lead the demand for luxury housing? How is the demand in Tier II and III cities? In regard to cities in India that lead the demand for luxury housing – Mumbai and the Mumbai Metropolitan Region; Delhi and the National Capital Region, Bengaluru, Hyderabad, Chennai, Pune, and Ahmedabad are the obvious names that come to mind. Having said that, I would say that almost all state capital cities as also cities which are commercial/ business hubs, these are all markets where luxury real estate demand exists in large quantum. When it comes to Tier II and III cities, we face a peculiar problem. The customers who live in those cities definitely have the capacity to buy and live in luxury homes, sadly the social scenario seems to suggest that ostensible display of wealth does not go down well with the citizens in those locations. In Maharashtra, the city of Kolhapur used to hold the record for largest number of Mercedes Benz cars owned in one city; then one day in Aurangabad, another city in Maharashtra, a larger number of businessmen and traders got together and bought 100-plus Mercedes Benz cars on the same day. So, like luxury cars, there are large numbers of such potential buyers of luxury housing across India’s Tier II and III cities, it is a matter of waiting for them to come out and ask for their own luxury homes. Q:What are the key demands of consumers who invest and the key features? The very best is what they demand. From the strength of construction, structural stability and quality of finish that match global standards, it has to spell ‘class’. Adhering to time schedules is very important. The luxury housing product may not be located at a premium pin code, but it must end up upgrading the existing pin code to a premium one – these are among the key demands of consumers who invest in this segment. Q: How do you target consumers for your high end properties? What are the key marketing strategies adopted by Hiranandani? We ensure that the product is planned to be designed in architecture that spells excellence, is made with quality material following global best practices– planned properly, constructed right and maintained the right way, that is our ‘Magic Mantra’. Q: What is the future of luxury high-end premium properties in the country? Currently, what is the size of the segment and what is the growth that you foresee? Either it is aspiration-based or the discerning buyer who wants the best – over the past few years, despite challenges that the real estate industry faced, the luxury real estate has been witnessing high demand and a gradual increase in prices. It is for this reason that the segment of buyers has continued to grow in this space - even in tough times. So, the future is good – so long as we provide the buyers with the type of luxury homes they desire. Across the residential real estate segment, luxury has a low percentage. It differs across locations and micro-markets. It is not a large volume segment – that would take away the exclusivity which is so necessary for luxury in the first place! It will keep growing but will increase in terms of numbers at a low rate. Q: What are the trends in luxury in the real estate sector? Global best practices in local micro-markets plus a demanding customer profile who knows what is latest in global markets – and wants it here, in India. So, the trends are in sync with those in global luxury real estate markets. Q: What are the new/on-going projects of Hiranandani in this segment? This would include practically all locations where we have on-going projects – Powai, Thane, Panvel, Chennai. Also, locations where we are starting new projects, like Alibaug and Khandala. Published in the November-December 2018 issue of Pitch Magazine