16 January,2009 07:09 AM IST | | Savie Karnel
GUT feeling: Prestige Group chairman and managing director Irfan Razack says 2009 will be a stable yet cautious year for real estate Pic\Vinod Kumar T
Real estate king Irfan Razack talks about his company's growth and his foray into retail and hospitality
The falcon, which the Prestige Group has adopted as its symbol, is known to soar high. So does the company, which delivers quality to its customers, says its chairman and managing director Irfan Razack.
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In an interview with MiD DAY, the real estate king talks about the company's growth, its foray into retail and hospitality, and the accident at its ongoing project Shantiniketan.
Let's begin with what is now on everyone's mind. Is this the right time to buy? Should we wait? Will there be a further slump in prices?
Year 2008 began on a good note. But in the last quarter we saw the global meltdown. With the downfall of banks like Lehman Brothers, sentiments started to change, making people cautious. Even now there is pent-up demand, but there is uncertainty to buy property or not. Other things like high interest rates added to the problems.u00a0 I believe there is a strong demand for property; it is just temporary hiccups that we are facing.
Every business has a cycle. It goes down and comes back again. Unlike the stock market, you will never lose money invested in real estate. It is an all-time safe investment and your property always appreciates in value, you only need the patience and holding capacity! There can be a 50 per cent increase, 100 per cent increase or even a 500 per cent increase over a period of time. The price of the property, which I bought in 1990 is at least 100 times higher even now when the market is low. If you have some savings and can afford to invest in property, go ahead. It is never a bad investment. The returns will always be more.
How will real estate fare in 2009?
Year 2009 will be a stable yet cautious year. This will be a year when genuine buyers will come. I must say that the last quarter of 2008 saw all speculators out of the market. The prices quoted now are genuine or real prices. Whatever is offered now is reasonable. Customers will have a better deal. I would ask buyers to look at the location, type of development, and then the ultimate quality of the product.
In this slump, what are your plans?
As a company, we will not announce new projects at least till the second half of 2009. Our focus will be just on delivery and completing the projects we have on hand such as Prestige Wellington Park, Prestige Shantiniketan and Prestige Kensington Park.
Has the accident at your ongoing project Shantiniketan affected your business?
Developing 15 million sq ft at one time is quite an effort. We have employed the best of consultants, engineers and contractors. We have completed almost 80 per cent of the development, including commercial and residential. Shantiniketan will shape up as the one of the best integrated townships in the country. It is unfortunate that towards the end of October, while we were completing Tower C of the commercial building wet concrete collapsed and one of the portions of the tower gave way. Because of the shuttering, this had a cascading effect. It is just one corner of the building that gave way. The entire tower is still standing. It simply got hyped up. We got too much negative publicity. Maybe this was because we are a brand. The nature of development is iconic in itself. Maybe that is why it got publicised so much. We are in control of things now.
The work is on full swing and over 4,000 workers are employed there. Maybe because of the humungous size of the development, the time line will exceed our forecast. Our focus is on giving the best to our customers by delivering the best developments and our customers will be the winners as they will be the envy of others.
Has the company taken care of the victims?
We had hoped no lives were lost during the accident but it is unfortunate that three workers died. Everyone's life is important. We have paid compensation to the next of kin. Almost every large development project, across the country, has suffered some mishaps. We take all safety precautions, we have safety engineers and a safety manual. We insist that our workers wear proper helmets and safety shoes. It is just that some things are beyond control.u00a0 Now we have taken care that such mishaps don't happen in future. The safety of our workers is paramount.
Have any investors backed out from Shantiniketan?
It is false. I have clearly said that we had not sold property to investors as bulk bookings. Individual flats are being bought by individual buyers. Maybe one buyer has bought two flats, but there are no bulk buyers. All our buyers are with us. Their support and good wishes are with us. The only thing they are asking for is that we give delivery soon, and we will deliver this year.
Forum was the first mall in Bangalore. Do you have any other such project in store?
When we built Forum, people thought we were crazy as they said no one would ever come to a mall in Koramangala. I had to coax retailers to open shops here.u00a0 And give them a lot of incentives. Now there are so many malls in the city but Forum still remains exclusive. More avatars of Forum are on the anvil. We are planning seven more malls, two in Bangalore Prestige Shantiniketan and Forum Value Mall in Whitefield, and in Chennai, Cochin, Hyderabad, Mangalore and Mysore.
The Forum Value Mall is a new concept in Whitefield, as it brings together best-known factory outlets under one roof. It will become a one-stop shop for companies that either have factory outlets in the city or are moving in that direction. We have also come up with Cessna Business Park. It houses Cisco's East globalisation centre and is their largest campus outside the US.
The company has diversified into other areas...
We have ventured into retail and hospitality. With the UB Group, we built the UB City and launched The Collection, India's first luxury destination. We have launched 23 Carat to support international luxury brands that choose to enter India by investing as their local retailing partner.u00a0
As for hospitality, we have Oakwood Premier Prestige Serviced Residences at UB City. We also have Angsana Oasis Spa and Resort at Doddaballapur, UB City, and Whitefield. We have tied up with The Marriot to open a resort hotel at Prestige Golfshire, set against the backdrop of Nandi Hills.
Most of our projects, built over the years, are maintained and nurtured by Prestige Property Management Services.
