DLF to launch two housing projects in Mumbai at Rs25,000/sf

DLF, the largest real estate developer in the country by market capitalisation, is looking to launch two housing projects in Mumbai at a price range of between Rs 15,000 and 25,000 per square feet as it expects the residential segment in the region to outpace the retail and commercial markets.

The company will launch a 2 million sq ft development as a slum rehabilitation project. It will be a joint venture project with Ackruti City and Shapoorji Pallonji, and is expected to be launched in another 1.5 years after rehabilitation work is completed.
This JV project will be a luxury one, priced at about Rs 25,000 per sq ft.

The second project would be at Lower Parel where the company was earlier planning to build a retail mall.

But now with falling demand in the retail and commercial market, the New Delhi-based developer is looking at mixed land use development.

The project will have 4 million sq ft of development space and would predominantly be a residential launch.

“We bought that land three years back at about Rs 800 crore, if you include all other charges on that land then that would give you about Rs 2,500 per sq ft as land cost, construction cost for that would be Rs 3,000-3,500 sq ft, so in all it will be Rs 6,000 sq ft.

And everyone knows where the Mumbai market is, even if we sell it at Rs 15,000 sq ft, not that we are going to sell it at that price, then it will give us huge margins,” a DLF official said.

Lately, the developer which was once strong on the commercial leasing space has aggressively started focusing only the residential side as leasing enquiries have been slow in translating into any meaningful transactions.

DLF spokesperson was not immediately available to comment on the developments.

The developer is also looking to launch projects in Bangalore, Chennai, and Hyderabad.  In the nine months ending December, DLF has launched about 8.5 million sq ft of projects.

It recently launched a luxury project in Delhi which was priced at 60% higher than its previous launch and has been tentatively priced at Rs 12,000 per square foot.

DLF’s rival Unitech has also upped its Mumbai play and is looking to develop 4-5 million sq ft of properties in the city from the next fiscal, along with its joint venture partners.