Bengaluru Realty Check
With the Young, Urban and Professional cosmopolitan population of Bengaluru, the real estate sector of this IT city is growing at a fast pace. Founded in 2016, MAIA Estates is steered by young and passionate CEO Mr. Mayank Ruia who has lived within the city to understand the needs of the market. Mr. Ruia talks to Realty Plus about his new company and various aspects of Bengaluru real estate sector.
Sharing his views on Bengaluru real estate market, Mr. Mayank Ruia said, “I personally don’t look the entire city as one market because it is a large city that grows in rings. There is ring road, peripheral ring road and the city also grow in the outer parts. I like to identify certain micro markets within Bengaluru and then evaluate that in details. The market as a whole is crowded with a lot of stock that may be not attractive for customers from design and quality standpoint. It creates stock overheads and nearly 150,000 units in Bengaluru are unsold which are pulling the prices of other units down and creates glut in the market.
There are certainly many challenges in the market because of recent happening like GST and RERA. But, there are certain micro markets like the north, west and some parts of the south east including central Bengaluru where good products with good price and location will get eyeballs and attract the customers.
Bengaluru is absorbing close to 11 to 12 million sq ft of office space every year. Further it is expected to absorb similar amount of office and commercial spaces for the next two three years. The north Bengaluru has the most amount of government spending in roads infrastructure. Therefore, a lot of new commercial complexes and beautiful Grade AA+ buildings are coming in that region. The rent there ranges around Rs. 55 per sq feet to Rs. 85 per sq feet. As you move closer to the city the rent is around Rs. 150 per sq feet. The companies are putting their front offices in northern Bengaluru and back offices in southern part of the city. This is because of the easy access to airport and other parts of the city with good basic and social infrastructure.
The other part is who is leasing. Largely it used to 70+ per cent IT and ITeS. The leasing activity is growing 12-13 million sq ft every year and now the share of IT and ITeS services in this is reducing. The banking and financial services, manufacturing and many multi-national business are finding Bengaluru very attractive due to prices of real estate, weather and socio-economic friendliness it has created being a diverse and cosmopolitan city.”
Comparing the Mumbai’s real estate market with that of Bengaluru, Mayank said, “The real estate development in India is a function of few things. One is the availability of land which makes Mumbai a very difficult market. Another is the real understanding of the culture and mindset of the people living in the city. Since 2011, I have been spending every weekdays in Bengaluru, living there with the people and becoming one of them. Many people who are far more successful and have taken the time to understand the business and markets they play in. Only then they are able to create plans, build, design, sell and market to these people. That is the second big barrier to entering other cities quickly. Lastly, it is also the awareness of the customers in the particular micro market of Bengaluru that excites me. The customer here is Young, Urban and Professional. They have a lot of exposure, both nationally and internationally with growing disposable income. Also it has become a culture of wanting to own a home so that makes purchase decision easier. Here, the ticket prices are low as compared to Mumbai. Hence, Bengaluru is a bigger market by virtue. Pune shares some of these characteristics at the middle market side of life. Bengaluru has a deeper hi-end market, a very deep middle market and now exponentially growing affordable segment.”
Mayank was previously responsible for leading Phoenix Mills’ residential assets in Bengaluru and Pune, with projects such as One Bangalore West and Kessaku in Rajajinagar, Bengaluru. Commenting on his experience with Phoenix Mills, he added, “Formerly, I was a finance guy. I have worked for 8 years with companies such as Goldman Sachs, UBS and Everstone Capital. This gave me a lot of experience in financial and fiscal discipline. I learnt where to spend and how to spend. My working experience at Phoenix was the most enriching. It gave me very well established platform to harness and utilize while setting up this company. It allowed me to take good decisions with my knowledge and resources. They also gave me the confidence and encouragement to go ahead and do what I have planned and visualised. It taught me how to build a team and learn from my mistakes. When you translate all of that forward to MAIA Estates, it came after fourteen years of hard-core finance and five years of hard-core real estate experience. We have a really good team picked member by member, hand by hand; a culture that reflects who we are as a combined team and individuals. There are 25 to 30 individual minds learning how to operate with each other and help each other in various aspects of life. My general mantra is to let every team feel that they running their own business because that is when they will provide value to the overall business.
We would like to be the representative of future values of development of India. We would be honest with the customers we serve – pre sales, during sales and most importantly post sales. We will build what we show with detailed accuracy and preciseness and value engineered construction methods.”
Talking about the marketing strategies of his new company MAIA Estates, he said, “We are in Post RERA era. Everything we do already encompasses all the RERA compliances. We market and show the products exactly what we are trying to build and sell.”
MAIA Estates has recently launched its first luxury residential project in Bengaluru. Informing about the project, Mayank mentioned, “Our first project which we have launched in the market recently is Pelican Grove, located on the banks of Jakkur Lake, near Hebbal, Bangalore. Spread over two acres of land, over 90 percent will remain usable landscape, a rarity in urban development.
The tower has 34 apartments and 2 pent houses over 20 floors, with airy spaces flowing into expansive decks with private jacuzzis, large bedrooms and luxurious furnishings, amongst several other amenities that encourage a modern, active lifestyle. The project offers an abundance of space and tranquillity in the heart of an Indian metropolis, keeps its environmentally conscious promise with several measures – intelligent waste management systems, along with zero water and sewage discharge. The price range for these apartments is Rs. 4 crore.
Our starting project is a residential project. We will evaluate every parcel of the land as it deserves to be developed. We will also go into commercial projects. With this project we are serving the top of the market at middle level prices. We will play in middle market and above.”
As of now, Mayank denied expanding in any other city. Sharing his company’s plans he commented, “MAIA Estate is born in Bengaluru. For the next 24 months we will stay focused and explore several new opportunities in Bengaluru as we are a new company. We are planning to launch 2 million sq ft in next 24 months.”
Pointing out the equity investment made by Mr. T.V. Mohandas Pai, Chairman of Manipal Global Education Services Pvt. Ltd and Mr. Ranjan Pai, CEO, Manipal Education and Medical Group (MEMG) in MAIA Estates, Mayank said, “They are long term equity minority partners in the company and they have also committed a good amount of capital which will help us in project development. They are sizeable minority stakeholders in the company”