'Real estate price will fall further'

'Real estate price will fall further'
February 17, 2009

Sameer A Nerurkar is the managing director of Samira Habitats, a Mumbai-based developer and retailer of luxury and budget villas and homes.
Samira Habitats is the pioneer of land development in the idyllic town of Alibag, a few miles from Mumbai. Among Samira's many projects in Alibag is also a plan to build a housing complex bang in the middle of lush natural beauty. People living here can commute daily to Mumbai in a ferry.
Samira Habitats is sponsoring the International Boat Show to be held in Mumbai on February 19.
In a brief interview with Contributing Senior Associate Editor A Ganesh Nadar, Nerurkar speaks about the prospects for the real estate market.
You have big projects coming up in Alibag. What prompted you to choose Alibag? What about Panvel? Has development work started there?
First of all, Alibag is very close to Mumbai, just nine nautical miles away. Secondly, Alibag is a lifestyle choice. It's like staying in Malabar Hill area in comparison to Tardeo. I would choose Malabar Hill. That's where the density would be low. There is a lot of zoning there. Most South Mumbai people have bought plots in Alibag. We are creating a niche of sorts.
Alibag has the sea on all sides. Proximity to the sea becomes a unique selling proposition. Panvel too is a good place for developers, but it's a different market all together.
We have three different projects coming up. They are huge projects. One is called Shanthi Villa and is very exclusive. We scrutinise individuals and select those we think would buy there.
The other one is Pavilion, which is actually Indian batting maestro Sachin Tendulkar's concept. Sachin has not invested as a partner, but he has bought shares in my company. He is a shareholder, a keen advisor and a very good friend.
Image: Sameer A Nerurkar, managing director, Samira Habitats. All photograph, courtesy: Samira Habitats

Is there further scope for correction in real estate prices in India? How soon do you think the sector will witness a turn around?
This is not the rock bottom. A lot of people are still holding on. I think there will be a correction and a good correction. It will take another two years to turn around.
Has the government done enough to help the real estate sector to tide over the slump?
They have brought down the interest rates. What else can the government do? When the going was good, the builders made enough money. Now because the global economy is collapsing you can't blame the government.
They could increase the liquidity. But I think if the prices were correct the demand will go up again.
Among your upcoming projects are services for special economic zones and luxury hotels. What exactly are services SEZ and where will they be developed. Also where will the luxury hotels come up?
We have land near an upcoming SEZ. Ours is a premium site near the road. We were planning to provide services that the people in the SEZ will need. But right now, we are not looking at that.
There is a property close to Mandwa, near Mumbai, where we are thinking of setting up a luxury hotel. We are talking to some big brands. The project will begin in March. We want an international brand to come in. As soon as we decide that we will start the project.