Last year, GST and RERA played a very significant role in redefining real estate in India. Both Bills were introduced in 2017, which resulted in the modification of several rules/ regulations related to the real estate and construction industries.
After GST was implemented, we also had to realign the financial structure and understand how to execute new launches, keeping in line with the new laws. Hence, a lot of time was spent in understanding the legal implications of all these changes. As a result, no new products came into the market in terms of new launches, but we had satisfactory sales from our existing inventory. From that aspect, I think we have done very well as a company. While the market as a whole witnessed some turmoil with several developers extending offers and schemes to ensure sales, at Prestige, without launching any new properties, we managed to meet our sales targets by selling from the current inventory that was under production. Looking back, 2017, I feel, turned out to be a brilliant year for the company.
In April 2017, we restructured the company by segregating the retail, residential, office and hospitality portfolios into four separate segments. This helped us look at the business from a different perspective. We intend to scale these segments over time. We are also exploring new cities and hope to be in the West and North by the end of 2018.
The residential real estate market has picked up pace. The demand is growing steadily. I feel that the long-term impact of the recent economic reforms will only add to the growing enthusiasm and positive outlook for real estate in India. With rapid urbanization, the demand for housing in the affordable and mid-income group segments has always seen an upward growth trajectory. As long as developers are able to produce homes between 25 lakhs to 100 lakhs, there will always be a constant demand.
Going forward, factors like rapid urbanization, increased migration to cosmopolitan and Tier 1 cities, and the Government’s focus on infrastructure and affordable housing will give the required impetus and push to the real estate sector.
In fact, the demand for commercial space is seen as a litmus test for the overall health of the economy. With businesses flourishing globally and several processes getting outsourced to India, the absorption of commercial space is on the rise. We have near zero vacancy in our office developments. We are launching 2-3 large-scale IT developments in Bangalore. Simultaneously, we will be developing an IT Park in Pune and an office building in Gift City.
Retail malls have been doing extremely good business. In the retail space, we will be opening the Mysore Centre City Mall in January. Forum Prestige Shantiniketan, Whitefield is expected to be ready in the second quarter of 2018. Both our hospitality projects, The Sheraton Grand and The Conrad will start operations from February.
Progress is impossible without change. It is up to each one of us how we choose to evolve as individuals in this ever-changing world.