Venue—Hotel Kohinoor Continental, Mumbai
Moderator—Pranay Vakil—Chairman Praron Consultancy
Atul Modak—Head-Kohinoor City
Gaurav Gupta—Director, Omkar Realtors & Developers
Jhumur Ghosh— National Feature Editor, Times of India
Ravi Sinha—CEO & Managing Editor, Track2Realty
Pranay Vakil: No but the same developer used to rent out commercial office space, but he won’t rent out the residence because of the return. So, according to Gaurav funding is the issue and according to Atul return on investment is the issue.
Gaurav Gupta: What I meant to say is that the total cost is more important but we are so far away from it. We are thinking of return that is stretched and that kind of capital is not there to support because when you look at the opportunity cost, then it has to be incentivized.
Pranay Vakil: I want to add one more dimension to this and that is the legal dimension. If you do make a place for renting, and you don’t have laws in the country that is strong enough to give you re-possession, not after five years or 15 years but now if the tenant misbehaves or defaults.
Ravi Sinha: There is a social angle as well, since we Indians have emotional connect with the property and want to own and inherit it. So, that is also a disconnect.
Pranay Vakil: It is a disconnect except for the floating population who is not interested in buying. But the three aspects that we are talking about—funding the project, ROI and the legal aspect of getting re-possession are all issues which can be resolved. If leasing model can work successfully in office and retail space, why can’t it work successfully in housing?
Thank you very much all the panelists. It has indeed been a very productive discussion and we got an opportunity to understand cross section of views.
Ends…..
