Tata Realty and Infrastructure is investing around ₹2,000 crore each into residential and commercial projects over the next two years, including re-launching the stalled Mulund project in Mumbai, on the back of significant growth in sales last year and the steady pick-up in demand, a top company official has said.
The Tata Group firm, which focuses on residential, commercial and retail properties in the realty space and large infrastructure projects, is witnessing higher demand, especially for ready-to-move-in residential units now.
It has added over 1,500 construction workers during the pandemic, taking its overall headcount to over 5,000 now. Before the coronavirus pandemic, it had only 3,500 workers and over 670 employees.
“We had the best sales in 2020-21, with a revenue of over ₹1,500 crore, which is 120 per cent more than what we had targeted for the year given the pandemic.
“On an annualised basis, revenue grew 15 per cent over 2019-20; and in volume terms, we sold 1,300 units,” Sanjay Dutt, managing director and chief executive of Tata Realty, told PTI.
Dutt added that the company had the best-ever sales in the fourth quarter of 2020.
On the current demand scenario, he said that from July onwards, they have been witnessing steep recovery. “Whatever we lost in Q1 has already been recovered in Q2 and expect to cross last year numbers in Q4 and to close the full year with a revenue growth of over 20 per cent,” he said.
The company nets around 70 per cent of its sales from the affordable and premium units and the remainder comes from luxury projects, Dutt added.
“We’ve equal focus on residential and commercial segments when it comes to capex (capital expenditure). Accordingly, we have lined up ₹2,000 crore each for residential and commercial projects over the next 24 months,” he said.
He said the company has four residential projects under construction now — the Serein in Mumbai, the Eureka Park and La Vida in NCR-Delhi, and the 88 East in Kolkata with over 2,500 units.
Dutt did not disclose the potential revenue from them or the investments.
“We have a diversified portfolio of 40-45 million sq ft under-construction, which are a mix of luxury and premium projects with the Serein, the Eureka Park and La Vida in the premium category and the 88 East in the luxury segment,” he added.
On Mulund project
The company is also in the process of re-launching the stalled Mulund (east) project, which on completion, will have a three million sq ft saleable area and will be the single-largest project in value terms in Mumbai and hope to re-launch it by March.
It was stalled for a strategic reason. “We are waiting for clarity on the design now and it will have many 50-storey towers,” he said.
Indicating better than the industry sales, he said they have only around 5,300 ready inventory spread across affordable, premium, luxury and second homes category, and around 1,100 units nearing completion, Dutt said.
The company has 17 residential and three commercial projects under-construction with over 3,000 units, and even amid the pandemic, it has completed four residential projects last year and will complete six this year.
Pandemic and employee welfare
Dutt attributed the better-than-industry performance to three things they did during the pandemic.
Firstly, the company motivated the team by taking care of the entire staff, including contract workers; did not cut salaries; and gave medical insurance to all. Secondly, in the last three years, the company has invested substantially in the digital platform. Thirdly, he added the company has slashed its marketing budget by 50 per cent but compensated with a digital push.
On the large Bengaluru project near the airport, he said it is being built as a joint venture (JV). It’s a 140-acre township with plotted units, villas, and high-rises along with commercial development. The first phase will begin in October.
Similarly, the second phase of the under-construction Nodia project will begin in the first quarter of 2022. That apart, it has three affordable projects coming up on the Sona road in Haryana, which is yet to get approvals.
On the commercial realty, which will also get around ₹2,000 crore investment over the next two years, Dutt said the company has seven million sq ft of leased and owned space in association with a partner now.
On the occupancy level, he said it is 92-95 per cent, and the company is collecting 100 per cent rent as well. “Our rentals moved up by 8 per cent this year.” It is three million sq ft of under-construction commercial space and will be launching 23 million sq ft over the next three years.
Over the past 35 years, Tata Realty has completed 31 residential projects across Bengaluru, Bhubaneswar, Chennai, Delhi-NCR, Goa, Gurugram, Kasauli, Kochi, Kolkata, Lonavala, Nagpur, Noida, Mumbai and Pune.
On the commercials side, it has Mumbai, Gurugram and Chennai.