We do not launch any project without approvals

01 Apr 2012 CW Team

Cherag Ramakrishnan, CEO, Equinox Realty

Here's a company that's wasting no time whatsoever in making its mark. Established in 2007, at present, Equinox Realty has a portfolio of about 14 million sq ft under various stages of development. Part of the multinational conglomerate Essar Group, the company is currently operational in the states of Maharashtra, Karnataka, Gujarat, Madhya Pradesh and Jharkhand. Its projects are implemented with best-in-class construction technologies and feature internationally renowned architectural and services consultants for efficient planning and design. Cherag Ramakrishnan, CEO, shares his views on the company's operations, its future plans and the current real-estate scenario, in conversation with SHUBHANGI BIDWE.

The Equinox Business Park boasts of the plug-and-play facility. What are the other offerings?
This is the only campus in the Bandra Kurla Complex (BKC), in the heart of Mumbai's commercial district. Its main USP, the Equinox commerce centre, offers the plug-and-play facility. Spread over 30,000 sq ft, it offers small office suites or offices ranging between 700-800 sq ft and 4,000 sq ft, allowing smaller companies to use it over a short period of time. Here, contracts range from three to six months instead of five to 10 years. Companies can move into their customised offices and start operating immediately. We also offer larger solutions for these companies as their business grows within the first year. The newly launched fourth tower in this park adds about 480,000 sq ft of high-grade office space to the campus, bringing the total leasable area to full capacity at about 1.2 million sq ft.

How do you benefit from the plug-and-play facility?
The facility was launched with the vision to offer something different to our customers. It is valid only in a small portion of the park; of the total 1.2 million sq ft, only 15,000 sq ft is plug-and-play. I agree that this scheme is a little riskier as we can't increase the capex for the building. But in the long run, it will only add to our profit margins. As margins are functions of volumes and rates, if you are able to rent out all of the available space, you are sure to get better margins.

Is Essar Group actively involved in any of the company's operations?
Essar Group is involved in all our major financial decisions. But, otherwise, we operate independently. Decisions related to our growth and sales plans are taken independently by the management of Equinox. Ours is a very individual-driven business and one that drives through its processes.

Equinox Realty's projects are being implemented with best-in-class construction technologies. Tell us more.
We always try to find ways to reduce labour and increase mechanisation. For instance, for the Bengaluru and Vadinar projects, we have used Mivan shuttering, the cost of which is easier to recover than in other technologies. It also helps achieve a cycle time of seven days. Furthermore, we also plan to install automatic climbing systems in our Bengaluru project. Apart from working with known contractors like Shapoorji & Pallonji, we seek ad-vice from companies worldwide to improve our programmes.

What is your take on building green?
Incorporating green features has always been a part and parcel of Equinox's planning process and culture. The group takes environmental concerns and employee health and safety very seriously. Our project, Equinox Business Park at BKC is currently in the process of achieving LEED Gold certification; our other office project, Equinox Tech Park in Bengaluru, is already LEED Gold pre-certified.

The company has two townships under development in Gujarat and Madhya Pradesh. Do you have any more township plans on the anvil?
Currently, we do not plan to undertake any township projects. Our Gujarat and Madhya Pradesh townships are planned for oil and power companies. The Vadinar township in Gujarat is spread across 225 acre, of which phase-1 comprises 120 acre. Designed by US-based consultants Urban Design Associates, it includes a shopping complex, hospital, school, etc, and is likely to be completed by 2014. Our township at Waidhan in Madhya Pradesh for our power group covers 50,000 sq ft and will be built in a record time of four years. Green features such as water treatment and recycling are being incorporated in this project.

You are currently operational in five states. Any further expansion plans?
In terms of growth, we are only focused on Maharashtra and Karnataka. After our commercial project at BKC in Mumbai, we plan to develop a residential project in Thane. Similarly, we will soon launch Water's Edge, our signature residential development in Bengaluru. With plans to expand as per availability of suitable opportunities in these states, although we are also bullish on the Gujarat market, we will venture into it only after we are saturated with the former two.

What are your views on the current realty market? Any improvement after last year's sluggish period?
The past three months have been very positive in terms of growth. People have started returning to the market. Everyone is optimistic that the housing market will start looking up as the interest rates come down in the next few months.

In the present day, what are the major problems that developers face?
The three major problems developers face today are approvals, approvals and approvals. Although the amended Development Control Rules (DCR) tries to simplify this process, it still does not offer a single-window clearance. We need to get 55 NOCs for a single project, which translate into 100 tables. It's a cumbersome exercise that needs to be streamlined.

How do you view the Maharashtra state government's recently amended DCR?
The amended DCR were indeed a commendable job; in the long run, this will create a level playing field. It will encourage corporates like us to launch projects as we now know the exact FSI, built-up area, and exactly how much can be sold. As a result, many corporates like Bombay Dyeing and Tata Realty have also forayed into this market.

Developers are often accused of unethical practices. What is your take on this?
There are two sets of people in the industry: those who resort to corruption to get work done, and those who don't. However, while dealing with large stakeholders or buyers, one can't afford to engage in malpractices with the aspiration of being a long-term player; we follow very strict values and codes. We don't declare to our buyers things we cannot provide them with. For example, in Bengaluru, we have actually built a sample flat that we encourage buyers to see for themselves before booking. We do not launch any project without approvals. Owing to this, maybe our margins are not as good as the others, but we have our own set of values.

In the recent National Housing Bank Residex, Bengaluru saw a mere fall of 1 per cent in residential properties in October to December 2011, compared to the corresponding period in 2010. But Mumbai saw an 11.6 per cent jump in home prices. Would you like to comment on this drop and rise in property prices?
Bengaluru is a more or less stable market. Mumbai, on the other hand, is more volatile. If it drops by 20 per cent, it also gains by 17 per cent. The major reasons for this is off-take on interest rates. But, we expect interest rates to come down in the near future.

How did the company perform in FY11? What are your expectations from FY12? Any plans for the company's future growth?
FY11 was a good year for us as we stabilised many of our operations. With plans to launch new projects in 2012, we have a strong pipeline of opportunities and plan to capitalise on these accordingly.

Give us your inputs on this article at feedback@ASAPPmedia.com

Cherag Ramakrishnan, CEO, Equinox RealtyHere's a company that's wasting no time whatsoever in making its mark. Established in 2007, at present, Equinox Realty has a portfolio of about 14 million sq ft under various stages of development. Part of the multinational conglomerate Essar Group, the company is currently operational in the states of Maharashtra, Karnataka, Gujarat, Madhya Pradesh and Jharkhand. Its projects are implemented with best-in-class construction technologies and feature internationally renowned architectural and services consultants for efficient planning and design. Cherag Ramakrishnan, CEO, shares his views on the company's operations, its future plans and the current real-estate scenario, in conversation with SHUBHANGI BIDWE.The Equinox Business Park boasts of the plug-and-play facility. What are the other offerings?This is the only campus in the Bandra Kurla Complex (BKC), in the heart of Mumbai's commercial district. Its main USP, the Equinox commerce centre, offers the plug-and-play facility. Spread over 30,000 sq ft, it offers small office suites or offices ranging between 700-800 sq ft and 4,000 sq ft, allowing smaller companies to use it over a short period of time. Here, contracts range from three to six months instead of five to 10 years. Companies can move into their customised offices and start operating immediately. We also offer larger solutions for these companies as their business grows within the first year. The newly launched fourth tower in this park adds about 480,000 sq ft of high-grade office space to the campus, bringing the total leasable area to full capacity at about 1.2 million sq ft.How do you benefit from the plug-and-play facility?The facility was launched with the vision to offer something different to our customers. It is valid only in a small portion of the park; of the total 1.2 million sq ft, only 15,000 sq ft is plug-and-play. I agree that this scheme is a little riskier as we can't increase the capex for the building. But in the long run, it will only add to our profit margins. As margins are functions of volumes and rates, if you are able to rent out all of the available space, you are sure to get better margins.Is Essar Group actively involved in any of the company's operations?Essar Group is involved in all our major financial decisions. But, otherwise, we operate independently. Decisions related to our growth and sales plans are taken independently by the management of Equinox. Ours is a very individual-driven business and one that drives through its processes.Equinox Realty's projects are being implemented with best-in-class construction technologies. Tell us more.We always try to find ways to reduce labour and increase mechanisation. For instance, for the Bengaluru and Vadinar projects, we have used Mivan shuttering, the cost of which is easier to recover than in other technologies. It also helps achieve a cycle time of seven days. Furthermore, we also plan to install automatic climbing systems in our Bengaluru project. Apart from working with known contractors like Shapoorji & Pallonji, we seek ad-vice from companies worldwide to improve our programmes.What is your take on building green?Incorporating green features has always been a part and parcel of Equinox's planning process and culture. The group takes environmental concerns and employee health and safety very seriously. Our project, Equinox Business Park at BKC is currently in the process of achieving LEED Gold certification; our other office project, Equinox Tech Park in Bengaluru, is already LEED Gold pre-certified.The company has two townships under development in Gujarat and Madhya Pradesh. Do you have any more township plans on the anvil?Currently, we do not plan to undertake any township projects. Our Gujarat and Madhya Pradesh townships are planned for oil and power companies. The Vadinar township in Gujarat is spread across 225 acre, of which phase-1 comprises 120 acre. Designed by US-based consultants Urban Design Associates, it includes a shopping complex, hospital, school, etc, and is likely to be completed by 2014. Our township at Waidhan in Madhya Pradesh for our power group covers 50,000 sq ft and will be built in a record time of four years. Green features such as water treatment and recycling are being incorporated in this project.You are currently operational in five states. Any further expansion plans?In terms of growth, we are only focused on Maharashtra and Karnataka. After our commercial project at BKC in Mumbai, we plan to develop a residential project in Thane. Similarly, we will soon launch Water's Edge, our signature residential development in Bengaluru. With plans to expand as per availability of suitable opportunities in these states, although we are also bullish on the Gujarat market, we will venture into it only after we are saturated with the former two.What are your views on the current realty market? Any improvement after last year's sluggish period?The past three months have been very positive in terms of growth. People have started returning to the market. Everyone is optimistic that the housing market will start looking up as the interest rates come down in the next few months.In the present day, what are the major problems that developers face?The three major problems developers face today are approvals, approvals and approvals. Although the amended Development Control Rules (DCR) tries to simplify this process, it still does not offer a single-window clearance. We need to get 55 NOCs for a single project, which translate into 100 tables. It's a cumbersome exercise that needs to be streamlined.How do you view the Maharashtra state government's recently amended DCR?The amended DCR were indeed a commendable job; in the long run, this will create a level playing field. It will encourage corporates like us to launch projects as we now know the exact FSI, built-up area, and exactly how much can be sold. As a result, many corporates like Bombay Dyeing and Tata Realty have also forayed into this market.Developers are often accused of unethical practices. What is your take on this?There are two sets of people in the industry: those who resort to corruption to get work done, and those who don't. However, while dealing with large stakeholders or buyers, one can't afford to engage in malpractices with the aspiration of being a long-term player; we follow very strict values and codes. We don't declare to our buyers things we cannot provide them with. For example, in Bengaluru, we have actually built a sample flat that we encourage buyers to see for themselves before booking. We do not launch any project without approvals. Owing to this, maybe our margins are not as good as the others, but we have our own set of values.In the recent National Housing Bank Residex, Bengaluru saw a mere fall of 1 per cent in residential properties in October to December 2011, compared to the corresponding period in 2010. But Mumbai saw an 11.6 per cent jump in home prices. Would you like to comment on this drop and rise in property prices?Bengaluru is a more or less stable market. Mumbai, on the other hand, is more volatile. If it drops by 20 per cent, it also gains by 17 per cent. The major reasons for this is off-take on interest rates. But, we expect interest rates to come down in the near future.How did the company perform in FY11? What are your expectations from FY12? Any plans for the company's future growth?FY11 was a good year for us as we stabilised many of our operations. With plans to launch new projects in 2012, we have a strong pipeline of opportunities and plan to capitalise on these accordingly.Give us your inputs on this article at feedback@ASAPPmedia.com