Branded residency is in fashion

As new luxury-branded properties are set to adorn the city’s skyline, the old ones continue to charm those smitten by Mumbai’s real estate. But it’s the branded residency which is brazing itself for stiff competition. Vikas Oberoi-promoted realty company is in talks with Ritz Carlton to put up its hotel and branded residency at its Worli plot near the passport office.

“We are doing a branded residency and once the operator is in place, we are envisaging a project launch in February-April next year. Branded residency’s like Madarin in Hyde Park, Ritz Carlton, St. Ridges, put up and adhere to them and provide you with services,” said Vikas Oberoi, managing director, Oberoi Group.

The tallest residential tower being built by Lodha Group is set to bring Armani Residences to India, says a banker close to the project, “Armani is definitely coming for the project.” The old property, like the NCPA, and other old towers aren’t far from offering themselves.

The Swiss cement major-controlled Ambuja Cements, which owns an apartment at NCPA, has recently put it on block after being vacant for eight months. The 3,475 sq ft, third floor apartment overlooking the Arabian sea, has a reserve price of Rs30 crore and a ticket now of Rs35 crore. It means the buyer can own the property immediately. It will be auctioned off on January 7.

The property is commanding Rs 86,000 per sq ft. Eight months back, when the market was buoyant, a buyer had bought a property in NCPA for Rs98,700 sq ft.

“The seller doesn’t want the buyer to run away just by hearing the prices. The carpet area is around 70-80% of the property than the new ones, where the loading is as high as 40%,” a realty consultant said.

Competing with this old apartment is a new one, which will be formally launched in January — the Trump Towers, a joint venture between American realtor Donald Trump and Rohan Lifescapes.

The project priced at minimum Rs40 crore per apartment will command an area of 5,800 sq ft with a useable area of 1,800 sq ft. The per floor rise is an astounding Rs35 lakh. The 60-storey tower will come up on Hughes Road.

Even industrialist Adi Godrej’s wife Parmeshwar Godrej has designed a residency on Planet Godrej called Terra, on the 44th floor. It has a reserve price of Rs15 crore. The property will be auctioned off on January 15 or 17. The CEO of a top realty private equity fund in Mumbai says, “Branded residency adds another 30-40% to the project. Also the subsequent recurring cost is very high. If as a buyer, my monthly outgo is very high, then it hurts me even more. It is going to be more expensive than a one-time loan. Brands, when they come, will make sure they get the recurring amount. It will all be very expensive; some provide concierge service, an array of other services like common maintenance.

Somebody will have to pay the cost and I don’t think we are ready for it in India. Most of the people buying are investors. So they will be hurt with the haziness around in the realty market.”

These kind of residencies come with an added monthly maintenance. Anuj Puri, India Head, Jones Lang LaSalle India, says, “There is a select market for brands in India, but the supply should not overpower the demand. These residences command around 20% more pricing as one-time cost. This will not be a service apartment, but you will own the property and it will have an ala-carte menu-like serviced apartments. The common areas will be managed by them.”