We aim to be a Rs.500 crore company by the next fiscal
ECONOMY & POLICY

We aim to be a Rs.500 crore company by the next fiscal

Pratap Kunda, Managing Director, Golden Gate Properties

Eighteen-year-old Golden Gate Properties has had quite a journey. Established in 1997, the company´s projects were initially based in Bengaluru until 2003, when it started spreading its wings. ´This can be attributed to the rise in market prices and IT parks gradually cropping up in various parts of the city,´ says Pratap Kunda, Managing Director, Golden Gate Properties. Today, with the support of international architects and consultants, the company has projects primarily residential spread across various cities in South India. It also recently made a foray into the commercial segment. With numerous ongoing projects in Bengaluru and Hyderabad, Golden Gate Properties has projects spread over 5 million sq ft under construction. Kunda shares an industry perspective and factors that have kept the company ahead in the race in conversation with MONISHA RAO.

The rise: As the market began to stabilise in 2012, we started expanding our operations across South India: Chennai, Mysore and Hyderabad. Different group companies under the Golden Gate umbrella, a Rs 400-crore company, now offer homes to different segments of the commercial and residential market affordable, mid-market and high-end luxury. While the affordable segment offers homes in the range of Rs 20-30 lakh, the mid-market houses are in the range of Rs 50 lakh to Rs 1 crore. The high-end luxury segment offers homes in the range of Rs 1-5 crore. These along with a land bank of over 400 acre ensures that the company caters to a wide segment of the evolving market in various cities.

Market take: South India is a huge market with immense opportunities. While the Bengaluru market is stable, Hyderabad is currently unstable; the situation is likely to improve by next year. Although most players are eyeing Hyderabad in a big way, other cities like Vijayawada and Visakhapatnam are also likely to evolve. We are planning to initiate some projects in these areas as they will open new investment opportunities for both buyers and builders. Projects in Tier-II cities such as Coimbatore, Kochi and Mangalore are also likely to commence soon. Along with this, we also aim to meet the requirements of the new urban population in cities like Bengaluru and Hyderabad. Although there are many projects that have come up in these cities, they lack efficient facilities. Hence, we focus on providing a self-contained enclave with all possible amenities. These developments require large parcels of land, the acquisition of which does not pose major problems in the South. The recently passed Land Acquisition Bill has not had much of an impact on builders in South India as most of them acquire land on their own compared to builders in the North, who go via a government tender. Our internal land acquisition department as well as an extensive local broker network enables us to smoothly acquire land at strategic locations in various cities. However, major challenges faced by builders in the country remain operational issues and inconsistencies and ambiguity in government policies.

Operational activities: On an operational level, labour is one of the biggest problems faced in the country today, with most of the experienced force slowly diminishing. With the fluctuation in currency, prices of raw materials have increased by 10-20 per cent. This ultimately forces builders to increase selling prices by a minimum of 10-15 per cent. Moreover, unexpected hikes in material prices also escalate the rates by 25-30 per cent. This overall price rise impacts the developer´s profitability as selling prices are fixed and cannot be revised once sold. To overcome such situations, labour costs need to be reduced and construction processes mechanised. This will not only reduce dependency but control the quality of the end product. Addressing such scenarios is our in-house construction capability a team of over 400 members which enables us to develop projects at lower costs. It also ensures flexibility to mobilise machinery at various project sizes. Moreover, the company implements a complete mechanised and technology-driven operation through modern techniques such as MIVAN shuttering technologies and precast construction. This not only improves quality and reduces time consumption but reduces waste and risk of shortage of labour or material.

Policy matters: As far as government policies are concerned, the recently formed Regulatory Bill is very confusing and vague. The government needs to discuss the regulations with the industry players to avoid causing delays in existing projects. The Bill is likely to come in force next year and we suspect that there will be a lot of confusion as everyone will interpret it in their own manner. This will affect the demand and supply scenario, ultimately resulting in high prices. Although there is an urgent need for a regulatory body, it must be noted that the more you regulate, the more the scope for perfection û but it all comes at a price.

Roadmap: Despite the sluggish market scenario and uncertain government policies, Golden Gate Properties, with an annual growth rate of 30-40 per cent, aims to be a Rs 500-crore company by the next fiscal. We have identified potential cities in the South and have chalked out plans to initiate new projects with new technology and simplified construction methods. With utmost importance given to timely delivery of projects, we are working towards creating a new trend in the construction industry.

Fact Sheet:

Year of Establishment: 1997
Top management:
Pratap Kunda, Managing Director;
Sanjay Raj, Executive Director and CEO
No of Employees: Over 350
Centre of Operations: Bengaluru, Mysore, Chennai and Hyderabad
Ongoing Projects: Golden Grand, Golden Homes, Golden Panorama, Golden Valley,
Bhuvana Greens, Hanging Gardens, Orchids, Commune, Golden County
Upcoming projects: Golden Serenity, Golden Hive
Turnover: Over Rs.400 crore
Current order book: 5 million sq ft (residential space)

Pratap Kunda, Managing Director, Golden Gate Properties Eighteen-year-old Golden Gate Properties has had quite a journey. Established in 1997, the company´s projects were initially based in Bengaluru until 2003, when it started spreading its wings. ´This can be attributed to the rise in market prices and IT parks gradually cropping up in various parts of the city,´ says Pratap Kunda, Managing Director, Golden Gate Properties. Today, with the support of international architects and consultants, the company has projects primarily residential spread across various cities in South India. It also recently made a foray into the commercial segment. With numerous ongoing projects in Bengaluru and Hyderabad, Golden Gate Properties has projects spread over 5 million sq ft under construction. Kunda shares an industry perspective and factors that have kept the company ahead in the race in conversation with MONISHA RAO. The rise: As the market began to stabilise in 2012, we started expanding our operations across South India: Chennai, Mysore and Hyderabad. Different group companies under the Golden Gate umbrella, a Rs 400-crore company, now offer homes to different segments of the commercial and residential market affordable, mid-market and high-end luxury. While the affordable segment offers homes in the range of Rs 20-30 lakh, the mid-market houses are in the range of Rs 50 lakh to Rs 1 crore. The high-end luxury segment offers homes in the range of Rs 1-5 crore. These along with a land bank of over 400 acre ensures that the company caters to a wide segment of the evolving market in various cities. Market take: South India is a huge market with immense opportunities. While the Bengaluru market is stable, Hyderabad is currently unstable; the situation is likely to improve by next year. Although most players are eyeing Hyderabad in a big way, other cities like Vijayawada and Visakhapatnam are also likely to evolve. We are planning to initiate some projects in these areas as they will open new investment opportunities for both buyers and builders. Projects in Tier-II cities such as Coimbatore, Kochi and Mangalore are also likely to commence soon. Along with this, we also aim to meet the requirements of the new urban population in cities like Bengaluru and Hyderabad. Although there are many projects that have come up in these cities, they lack efficient facilities. Hence, we focus on providing a self-contained enclave with all possible amenities. These developments require large parcels of land, the acquisition of which does not pose major problems in the South. The recently passed Land Acquisition Bill has not had much of an impact on builders in South India as most of them acquire land on their own compared to builders in the North, who go via a government tender. Our internal land acquisition department as well as an extensive local broker network enables us to smoothly acquire land at strategic locations in various cities. However, major challenges faced by builders in the country remain operational issues and inconsistencies and ambiguity in government policies. Operational activities: On an operational level, labour is one of the biggest problems faced in the country today, with most of the experienced force slowly diminishing. With the fluctuation in currency, prices of raw materials have increased by 10-20 per cent. This ultimately forces builders to increase selling prices by a minimum of 10-15 per cent. Moreover, unexpected hikes in material prices also escalate the rates by 25-30 per cent. This overall price rise impacts the developer´s profitability as selling prices are fixed and cannot be revised once sold. To overcome such situations, labour costs need to be reduced and construction processes mechanised. This will not only reduce dependency but control the quality of the end product. Addressing such scenarios is our in-house construction capability a team of over 400 members which enables us to develop projects at lower costs. It also ensures flexibility to mobilise machinery at various project sizes. Moreover, the company implements a complete mechanised and technology-driven operation through modern techniques such as MIVAN shuttering technologies and precast construction. This not only improves quality and reduces time consumption but reduces waste and risk of shortage of labour or material. Policy matters: As far as government policies are concerned, the recently formed Regulatory Bill is very confusing and vague. The government needs to discuss the regulations with the industry players to avoid causing delays in existing projects. The Bill is likely to come in force next year and we suspect that there will be a lot of confusion as everyone will interpret it in their own manner. This will affect the demand and supply scenario, ultimately resulting in high prices. Although there is an urgent need for a regulatory body, it must be noted that the more you regulate, the more the scope for perfection û but it all comes at a price. Roadmap: Despite the sluggish market scenario and uncertain government policies, Golden Gate Properties, with an annual growth rate of 30-40 per cent, aims to be a Rs 500-crore company by the next fiscal. We have identified potential cities in the South and have chalked out plans to initiate new projects with new technology and simplified construction methods. With utmost importance given to timely delivery of projects, we are working towards creating a new trend in the construction industry. Fact Sheet: Year of Establishment: 1997 Top management: Pratap Kunda, Managing Director; Sanjay Raj, Executive Director and CEO No of Employees: Over 350 Centre of Operations: Bengaluru, Mysore, Chennai and Hyderabad Ongoing Projects: Golden Grand, Golden Homes, Golden Panorama, Golden Valley, Bhuvana Greens, Hanging Gardens, Orchids, Commune, Golden County Upcoming projects: Golden Serenity, Golden Hive Turnover: Over Rs.400 crore Current order book: 5 million sq ft (residential space)

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