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Thursday, June 12, 2008

Ashok Piramal's Peninsula Land Ltd to launch an integrated township in this August

Dear Pune property buyers, as you always do, you must book 50% flats on the 'day of launch' and ensure cash flow for the construction of the project!

Pooja Sarkar has written story "Peninsula widens portfolio with IT parks, townships" in today's DNA Money. There is hardly any new information about Peninsula's upcoming townships in Pune, Nashik and Hydrabad. I had already blogged this in October 2007. So, i thought, what would be the reason behind recycling the old story?

Congrats! Pune real estate investors and end users - means 'home buyers', you have become world famous for your property booking habits. Now, every builder in India is banking on you. See your recent achievements -

1) Nanded City Pune - without any floor plans or without any papers, out of 18,000 flats you booked 50% on the day of the launch at Rs. 3,200 per sq.ft. and at Rs. 2750 per sq.ft. in pre-launch offer.

2) Kumar Properties' Park Infinia at Fursungi all 3 buildings opened for bookings were booked by the weekend at Rs. 2,500 per sq.ft.

3) Kumar Properties' Megapolis at Hinjewadi - out of 330 flats opened for bookings 270 flats are already booked!

4) Mont Vert Seville at Wakad - you booked 251 affordable 2 bhk and 3 bhk flats in 2.5 days!

5) SRK Developers' OvalNest at Warje- you booked all 350 flats at Rs.3,500 per sq.ft. by Sunday evening.

6) At Chakan you gave overwhelming response to Eiffel City and proved that Yes, Chakan is really, 'the hot real estate investment destination!'

Pune! Only hope in real estate slow down?

Pooja quotes an analyst from a foreign brokerage, who did not wish to be named-
"The company is taking a very risky decision by putting up five huge projects during the same time, because looking at the present conditions it is unsure whether it will be able to sell the residential units."
Why Peninsula is so confident about it's success? Because -

1) Peninsula has signed a memorandum of understanding with Lehman Brothers whereby the US-based investment bank will invest $125 million in Peninsula’s projects and hold minority stake in them.

2) Indigo, Peninsula's domestic fund, which recently collected Rs 2,000 crore.

No! The truth is, we, the Pune property buyers! Congrats, once again! Please, subscribe to my "Ravi Karandeekar's Pune real estate market news blog" and do not miss a single real estate investment opportunity. For example, Rohan Mithila!


  1. Pune, is not any realtors hope because the market has already seen a fall of 15-20%,
    and people are already aware of the projects the peg was Lehman's bailing peninsula, which got lost somewhere.
    Pooja Sarkar

  2. I hope your information is right. you are saying peole booked 50% of the 18000 flats. Does that mean 9000 got booked?, I dont think so.

    Most of the examples you are giving are low cost flats. Even oval nest the flat area was less and hence the cost. Thats why the booking is high. Megapolis has to sell 5500 fltas more, so its not boom for them yet.

    Overall property market is good only if the flat rates are around 30 lakhs.

  3. Which world are you raregenome? 15-20% fall in pune :-) :-) wake up .......I would agree that prices has stablized and are appreciating with slow rate...not going down

  4. Ravi, Are you being sarcastic and telling that Pune-ites are being taken for a ride by these builders? 50% Nanded booked without any papers and floor plans! Did people really bet their money in such a scheme!! I think 2500 per sq feet is the higher side as of today and rates may stabilize at 1800-2000 per square feet in the coming 2 years for fringe areas like Kharadi, Baner, Wakad, etc. Do you agree?

  5. # ref: "Ravi, Are you being sarcastic and telling that Pune-ites are being taken for a ride by these builders?"
    ...! I am real estate salesman. I have a great respect for my customers. How can i say they can be taken for ride?

    # ref: "50% Nanded booked without any papers and floor plans! Did people really bet their money in such a scheme!!"

    Money: 6,000 bookings x Rs. 1,00,000 per bookings = we have lot of money to bet!

    # ref: "rates may stabilize at 1800-2000 per square feet in the coming 2 years for fringe areas like Kharadi, Baner, Wakad, etc. Do you agree?"

    Valuation of land in these areas is Rs. 1 CR + for 1 Acre ( 40,000 sq.ft.)

    In Pune district average rate is Rs. 1100 per sq.ft. - at far away places like Daund!

    Add to it cost of fiance and cost of construction.

    100 kml away from Pune and Mumbai, TMC - Tanaji Malusare City at Karjat was booked at the lowest rate of Rs. 999 per sq.ft.

    Still , if rates come down to 1800-2000 per square feet in the coming 2 years as per your expectations:

    1) Those who have booked will be in trouble - only on the paper or if they go for selling their flats.

    2) Projects under construction or on the planning table will switch for high end products like row houses, twin bungalows, bungalows with swimming pools!

    In real estate market "Rates coming down (without construction cost and land cost coming down) " is not always beneficial for those who have small budgets.

  6. Hi Ravi ,
    you said "In real estate market "Rates coming down (without construction cost and land cost coming down) " is not always beneficial for those who have small budgets."

    I found this statement very fascinating.

    Could you kindly eloborate its meaning.

  7. # ref: ""Rates coming down (without construction cost and land cost coming down) " is not always beneficial for those who have small budgets.""

    Low rates means less profit for the builder! Builders are in this industry because of the profit margins, not to fulfill the housing needs. If rates come down, builders always go for high budget luxurious product mix like row houses, bungalows or specious flats - condos - to maintain the profitability. Fortunately, in towns like Pune or Metros like Mumbai and New Delhi there are enough people who have big budgets but do not find the suitable property!

  8. Ravi,
    you said, if rates come down, builder will go for, "luxurious products". I have few questions on this...
    1. Will "luxurious products" rates not come down? and hence, profit margin..

    2. Can all existing builders go for luxurious products? are there so many buyers including delhi, mumbai big budget people?

    3. Will all these luxurious products, accomodate whole of the existing land, which would have been used for so called non-luxurious products? If answer is NO, then we have available unused land, which will in effect reduce the land prices. Is it true?

  9. HI,
    I think Ravi is misleadning people who read his blogs. As a Estate Agent all he is interested is convince people that the rates are not going to come down etc.... I am sure he must have convinved many to buy flats.

    As was thought of US Real estate that "prices will always go up and never go down", but now all of us know what has happened.

    Do you really think that peoplce can and will purchase house of 30+ lacs..

    Don't mislead people..

  10. I don't think Ravi is misleading people. But, tell me, suppose you are doing some business for so many years, then you will always tend to see the positives in that. Even some negative fact are coming out. Its same with Ravi or any other guy like me. And, if he was misleading, then he would not have posted the negative comments about him or real esate business.

    Only thing, he is more inclined towards the real estate growth (and hence builders). Because he is in that business. But, I think he acknowledge/reads/posts comments and more importantly keeps this blog active.

    Also, we get lots of information..
    So, lets not critisise people but, have some good dicussion, so that everybody is benifited.

  11. Hello Sir,

    I have booked a flat with Eiffel City, chakan in July this year ( 910 sq feet @ 2200 psf (after negotiations with builder) and the agreement is been done this August, now i need your valuable comments as i am real confusion in these days whether, i should continue with it or should i drop this, reason for this dilemma is :

    When I visited the site this month, there is no progress at all .The commitment and the possession time from builders side is Nov'2010, but due to severe hit on real estate in this recession i still have doubt on this also as I saw there booking charts etc i got clue, that most of the buyers have jus booked the property but are not getting in to any legal documentation so far.

    Now Can you comment or suggest something, as in how should i start perceiving the things and but actions do i need to plan (just like what could be a wise decision at this point of downturn).

  12. @ Neha!
    Difficult question!
    Difficult times.
    1) First, find out what the builder says - officially - on paper.
    2) Ask for "commitment of possession with penalty for the delay" on the stamp paper as a part of agreement.
    3) Take a stock - what would be your loss if the project is delayed? Most of the ongoing projects would be delayed, for sure!
    4) Pay as per the schedule after the confirmation of the works.
    5) Renegotiate the payment schedule- include the infrastructure development, amenities and the completion certificate - amend the agreement. 6) Get in touch with other property buyers, form a group and take collective action
    7) Cancellation is easy but what next? Who is going to compensate for the missed opportunities?