Kolkata’s new wave of aspirational homesJuly 3, 2017 / By
Kolkata is emerging as one of the destinations for high-end luxury homes for the last five to six years.
The super luxury home segment has been developing in Kolkata at prime locations since 2011. Previously, developers ventured primarily into small to medium-scale residential projects, aiming for quick entry-exits; while buyers who could afford high-end homes were satisfied with homes in premium locations.
Table: Residential Locations and Pricing, 2Q17
Source: JLL 2Q17
Map: Residential Zoning in Kolkata, 2Q17
Source: JLL 2Q17
Some notable high-end projects from 2000 onwards include:
- Hiland Park (941 units): in 2000, a 28-floor project along Eastern Metropolitan Bypass with high-end facilities was priced at INR 1,300-INR 1,400 (US$ 20.15 – US$ 21.70) per sq. ft., a premium of 14-15 per cent. Premium on resale at INR 6,500-INR 7,000 (US$ 100.77– US$ 108.52) per sq. ft., is 29-30 per cent.
- South City (860 units): in 2004, a 35-floor condominium in the Jodhpur Park area with high-end facilities was launched at INR 1,650 (US$ 25.58) per sq. ft., a premium of 10-12 per cent. Premium on resale at INR 11,500-INR 13,000 (US$ 178.28 – US$ 201.53 ) per sq. ft., is 18-25 per cent.
With a growing number of the population now accustomed to international standards of living, a premium location alone does not suffice. We observe demand for high-end luxury homes with personalised facilities, home automation and imported fittings. A new generation of investors is also moving towards such projects which include:
- Atmosphere (80 units): A 36-floor project along Eastern Metropolitan Bypass, offering 4& 5 BHK duplexes (6,000-9,000 sq. ft. super built-up area), private terraces and “Deya”, floating sky club bridging two towers. Currently quoting INR 18,500 (US$ 286.80) per sq. ft., a premium of 50-55 per cent; the premium when launched in 3Q11 was 45-50 per cent. Due for completion in 4Q17, it has a quarterly sales rate of approximately 1.1 per cent (26 units being sold across 24 quarters, from launch till date).
- The 42: a 62-floor skyscraper in the CBD, slated to be the tallest building in eastern India, has 56 apartments (4 & 5 BHK) of 7,700-7,800 sq. ft. super built-up area at INR 21,000 (US$ 325.56) per sq. ft., at a premium of 11-12 per cent. During its launch in 2010, the premium was in the same range. The project due for completion in 4Q18 has a low sales rate of approx. 0.6 per cent, with 16 units being sold across 28 quarters from launch till date due to certain legal issues.
- Urbana (1175 units): the first green residential project with 45 floors off Eastern Metropolitan Bypass, offers 100,000 sq. ft. club and 3 BHK (1,800-2,400 sq. ft. super built-up area) and 4BHK (2,800-5,300 sq. ft. super built-up area) apartments at INR 8,000-INR 8,500 (US$ 124.02 – US$ 131.77) per sq. ft. at a premium of 24-25 per cent. The premium in 2010 was 20-22 per cent. The project completed in 4Q16, is witnessing a quarterly sales rate of approx. 40.5 per cent with 1100 units being sold across 27 quarters from launch till completion.
These projects are labelled premium for their superior location, high-grade amenities, construction quality, imported fittings and unit sizes. Though they command a premium on capital price, the sales rate in these projects is not very promising.
This indicates that while these projects certainly have an appeal that will likely lead to higher demand in the future, Kolkata might not be completely ready for such luxury projects. Moreover, the trend of developing such projects is likely to attract national level developers who have yet to expand their business in the city.
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