Luxury real estate developers rely on consultants as sales hit due to Covid

New Delhi: India Sotheby’s International Realty, which lists prime residential property, has started listing luxury apartments as sale of independent bungalows and villas has slowed down due to the COVID19 pandemic. Developers, who are unable to find buyer in Indian market, are also looking for international tie ups to market globally.
Although, many businessmen are looking to monetise the real estate assets by listing bungalows ranging from Rs 50 crore to Rs 300 crore, but there are not enough takers and deal usually takes a year to conclude.

Sotheby’s International Realty’s 'Keystone offering' for marketing new developments has taken on board three luxury projects post lockdown, to keep the fund flow going. Since 2018, when it started the program in India, it has listed apartments from only four projects.

“We have recently tied up with The Leela Sky Villas and Raheja Revanta. Keystone has 200 developments across 30 countries and inventory of over $20 billion. We will be leveraging our marketing platforms, team of local and international sales professionals and the entire network of Sotheby's International Realty,” said Amit Goyal, CEO, India Sotheby’s International Realty.

With pressure on margins and no visible upside on residential property prices, a rising number of real estate developers are outsourcing their sales and marketing duties to IPCs (International Property Consultancies), to cut recurring costs and link their outflows to sales inflows.

Sotheby’s existing four projects are in Delhi, Mumbai, Kolkata, Colombo and Bengaluru with a total inventory of over $1 billion.

“The tie up will help us in reaching out to the Ultra HNI customers who value the finesse, pathbreaking quality and detailed craftsmanship that we are offering,” said Nayan Raheja of Raheja Developers.

Raheja is executing Leela SkyVillas, which is the tallest planned tower of Delhi at (190 m).

Raheja Revanta is also one of the tallest towers (199m) in Gurugram and is surrounded by luxury hotels, golf courses, shopping malls and office developments.

Sales in luxury housing segment declined by more than 90 per cent, with all the listed players except Godrej reported decline in sales, according to an analysis by Investec, an international banking and wealth management group.

Last month, Sotheby had tied up with Krisumi Waterfall Residences, the first Indo-Japanese Mega Real Estate Project in India.

The downturn in the real estate market and slump in demand over the recent years has forced many developers to deliver the responsibilities of their sales and marketing for projects to strategic consultants.

According to a report by report by Motilal Oswal Financial Services Limited (MOFSL), sales have picked up to 50 per cent of pre-COVID levels and is driven by affordable and mass hosuing, while the luxury segment remains a concern.