Gera Developments recently launched its sixth commercial project in Patto, Panaji called ‘Gera’s Imperium Star’. While the slowdown in real-estate sector has resulted in many builders struggling, Gera Developments has emerged as one developer, which is able to sell and is also launching new projects. The Goan Everyday in a conversation with Kumar Gera, chairman of Gera Developments.
Karan Sehgal
The Goan: Not many builders are successful with commercial real-estate in Goa. What is the mantra of your success?
Kumar Gera: One of the reasons that we have succeeded is that we created adequate parking even though rules did not require us to do so. 8-9 years ago, when I put up my first building in Patto called ‘Gera Imperium-I’, I told my architect that I wanted to have basement parking for the project. But, he said why waste money on it. I said I needed to do it because commercial buildings need proper parking.
We realized that Panaji was a nightmare for parking. We went for basement parking and it was a huge success. Today, in Patto, we have over 500 parkings in our buildings, which are all inside the building, either in the basement or in the upper level.
TG: So, providing adequate parking is one reason of your success. What are the other reasons for Gera Developments to be so successful in Goa?
KG: As a developer, you have to do a lot of research in finding out what the needs are today and what they are going to be 2-3 years hence. Research based decision making is key in this business. Many projects fail because sufficient thought is not given to make correct decision or enough research is not done.
Before we design a new project, we do a lot of home-work. For example: there are 320 offices in the just launched ‘Imperium Star’. We did in-depth survey to understand the requirements of our customers. We also found that large office spaces wouldn’t sell; so we went for smaller ones. For this office size, there is a demand in rental as well as investment space.
In fact, ‘Imperium Star’ is our sixth project in Patto. Today, we cover around 20% of the overall private development in Patto. There are 34 plots for private sector here; out of which 6 we have developed. But, the size of our plots is bigger, which means larger footprint amounting to around 20% of the overall private development in this area.
TG: Since you are the biggest private developer in Patto, what do you think of the infrastructual issues here? Roads are in bad shape and over the years, the infra has been affected.
KG: As far as Patto is concerned, EDC is the promoter builder. We are builders, who develop projects on plots allotted to us. EDC is supposed to give required infrastructure, approve plans and etc. Upkeep of that infrastructure, maintenance of it outside of our property (inside the property is the builder’s job) is definitely EDC’s responsibility. In Goa, you get heavy rainfall, so it is not easy to maintain infra. But ultimately, they have to keep it in shape.
TG: Gera Developments is doing a number of projects in Goa. Your residential project called ‘River of Joy’ is also underway at Kadamba Plateau. How are the sales for all the projects?
KG: We have 800 units currently, where we are delivering possession and completion is going on. Out of that, more than 700 units are booked. So, we are around 90% booked. The remaining 10-11%, which is pending is expected to be booked in the next few months.
TG: You have done more projects in commercial space in Goa than in residential space. What is the reason behind it?
KG: It depends upon where I get a plot. If I get a plot in a particular location, it may not be suitable for residential, it may be suitable for only commercial and therefore we will do a commercial project on that. Right now, we are aggressively searching plots for new projects. But, we need clear titles and litigation free properties and we need them at the right location.
TG: Is affordable housing something your company is interested in? Do you think it is viable for builders?
KG: The term “affordable housing” is a subjective one because what is affordable to one buyer may not be affordable to the other. Moreover, what is affordable in Karnataka may not be affordable in Goa and vice versa.
Rather than saying affordable housing, I would say – housing for middle level, low price or upper segment. Then, you can link it to price points, which in turn gets linked to your income, EMIs and other ratios. Affordable housing is such a subjective term and everyone has a different meaning for it.
TG: Policymakers are harping on affordable housing, but they haven’t defined it...
KG: I have always said that the authorities must define what they mean by affordable housing, clearly and categorically. It should not happen that affordable housing means low quality, bad standard housing, which is leaking and has cracks. Its cost may be low, you may have small units, but it should not be of low standard.
TG: Other builders are complaining about slowdown. They are saying that sales are declining, especially on the residential side...
KG: I believe that there is an inherent demand for homes. Teenagers are growing up and jobs are there. Numbers may go here and there a bit. But if builders create a mis-match, that wouldn’t sell. For example: If you have 4-bedroom houses, 250-300 square meters properties, they may not sell today. It is easy for a person looking at high price points of such properties to say that he doesn’t want to buy today and he will buy later. Today, the market is more for younger people, who are just married and they want housing in 1-2 years time. If you target them and get the product right, it will sell.
