Premium Player Lodha Developers To Now Focus On Affordable Housing

Lodha Developers
Lodha Developers

Mumbai-based developer Lodha Developer is seemingly shifting gears towards cheaper apartments and offices. Macrotech Developers, earlier known as Lodha Developers, is going to cut the share of premium housing from its portfolio.

The share of premium housing will go down from 17 percent to 30 percent, said the company MD Abhishek Lodha, ET Realty reported. The firm is looking to increase the revenues from lower-ticket sized units from 40 percent to 50 percent over next three to four years.

In fact, all the new launches by Lodha Developers in the coming times is supposed to be in affordable and office segment.

We are managing our liquidity very, very carefully. It is something which we need to watch more carefully now than we would even 18 months ago,” Lodha said in a recent interview at the company’s premium World Towers residential project in Mumbai.

The move comes amidst times when premium and luxury homes inventory is on the rise in Indian real estate. As per ANAROCK, for homes priced above 40 million rupees, the so-called premium segment, about half have been unsold since 2013 in the Mumbai metropolitan region.

On the other hand, maximum sales has been happening in affordable and mid-income segment. Builders as well as buyers are seemingly aligning to Modi’s home-for-all push to keep demand for budget apartments robust even as the broader economy decelerates.

The shift of gears by Lodha Developers comes at the time of cash crunch. Macrotech is reportedly due to repay a $325 million U.S. dollar-denominated bond it had raised to develop two premium residential properties in London, one of which is now complete. Rating companies downgraded the company’s ratings twice this year citing weak sales and liquidity crunch. The other London project will be completed in the next six months and cash inflow will once again resume which will help to repay the bond.

Closer home, almost 80% of the apartments in the 78-story Trump Tower that it is developing in south Mumbai. The homes are priced at Rs. 7.5 core and more and will be handed over to buyers in December.

We are well on track to make the arrangements to make the payment in March 2020,” Lodha said.

The MD also declared that he is looking to boost Macrotech’s rent-yielding portfolio and list it as a real estate investment trust in the next two to three years.

Click to know the residential real estate market sentiment for Q3 2019.

LEAVE A REPLY

Please enter your comment!
Please enter your name here