The Banyan Tree Group is fast emerging as an important player in the real estate sector of Kolkata. Presently, they are working simultaneously on seven projects, mostly on the eastern fringes of the city.
BE’s Anustup Roy Barman spoke to Prabir Roy Chowdhury, Director, The Banyan Tree Group, about the problems and prospects of the real estate sector and the possible impact of The Real Estate (Regulation and Development) Act (RERA) and the Goods and Services Tax (GST) on the sector.
Q. How do you perceive the changing customer preferences related to the sector?
A. Today most of our buyers are asking for housing complexes with modern facilities like gym, children’s play area, swimming pool, library, and especially, a community hall. The customers’ preference is gradually shifting from standalone projects. This has made it difficult for small players, who are unable to garner the capital needed for large scale projects.
Q. What do you think is the future of the small players in this sector?
A. Small players will definitely face a hard time, especially after the GST. They will find it increasingly difficult to provide the amenities that are being demanded by the market. The small players mainly build standalone buildings, which do not have any additional space to provide any kind of recreational opportunity.
Q. Which is the most asked price bracket in the market that you are catering to?
A. The market is presently tilted towards 2BHK flats with two toilets, which are between 900 and 1100 square feet. For the Kolkata market, that puts the price bracket between 35 and 45 lakhs. Since space is an issue in a densely populated city like Kolkata, acquiring land for large projects is an issue. Therefore, projects for the segment that we cater to, are more likely to come up in the city’s fringes and in and around the planned township of Rajarhat. The northern suburbs of the city like Dumdum, Lake Town, and Rajarhat are well connected and are in great demand. Many projects are also coming up in
the southern suburbs of Patuli, Garia, and Narendrapur. As land is very expensive in and around the city centre, new projects from middle scale realtors like us are more likely to be in the suburbs.
Q. How do you see the impact of GST on the sector?
A. Small players are facing problems due the roll-out of this new taxation system. Medium and large players are coping better because of the volume of their work. They are getting the GST benefit and sharing that with the customers. I must say that the unification of taxes has provided certain advantages for the organised real estate market. So, the new taxation has not proved to be too much of a problem for our segment or for the larger players.
The GST amount can be carried forward. The builders charge GST from the customers. The amount they get can be used to buy the material for the next project. So, the middle and large scale builders are able to provide discounts to the sellers. This is possible in the case of players who are working on many projects simultaneously. But for the small players who work on single projects, the GST has made things difficult.
Q. What are the new emerging demands in the luxury real estate segment?
A. Skywalk is definitely a new thing that is in great demand in the segment that you mentioned. High-end security systems connected to mobile apps is another emerging demand. A well-equipped clubhouse and community area is another interesting feature. Children’s play area is a feature that is prominent in consumer preferences cutting across price segments. Libraries are also in demand in the premium segment.
Q. Under the new regulations, price should be determined according to the carpet area. What will be the impact of this rule?
A. Initially, there may be some problems but in the long run, it will be a good system that will benefit both the customers and sellers.
Q. What are the ongoing projects of the Banyan Tree Group?
A. We are working on seven projects at this moment. Three of them are near completion. Three other projects are in the construction phase. We have started work on the seventh project very recently. Three of our seven projects are in and around Rajarhat.