The Hindu Business Line : `Specialisation must to sustain biz'

Real estate developers must position themselves as specialists catering to niche industries. Only then can they survive during an unattractive market phase, according to Mr Ramesh Nair, Local Director, Corporate Solutions, Jones Lang LaSalle — a global property and investment management firm.

Speaking at `Estate South 2006', a real estate industry seminar organised by the Confederation of Indian Industry (CII), he said, positioning oneself as an industry specialist could help sustain business in future.

"Today developers are in an exuberant mode and want to get into every sector — information technology (IT), hospitality, retail malls and hospitals. But they must look at creating sustainable competitive advantage," he said.

Demand for office space in India is estimated to go up by 20 crore sq ft over the next four years.

Clearance Mechanism

He said real estate developers would face competition from IT and finance companies in the office development space in future. IT companies today prefer building campuses and not rental office space, he said. To begin with, developers could look at positioning themselves based on pricing and eventually diversify into areas like property management, brokerage, lease management and project management, he said.

The seminar also discussed the need for a refined clearance mechanism to sanction infrastructure projects, especially in the IT sector.

Mr R. Jayaraman, Senior Director - REF, Oracle India Private Ltd, emphasised proactive support from the Government. "IT industry consumes 70 per cent of real estate in the top cities in India. But getting clearance from the Government is like getting ragged in a boot camp," he said.

Clearance for IT projects takes at least 6 months. He suggested IT companies be given a single authority clearance for all development related issues and a preferred industry status for project approvals.

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