Real Estate

KG Group co enters retirement home market in Coimbatore

R Yegya Narayanan Coimbatore | Updated on January 24, 2018 Published on January 09, 2015

gardencitynew   -  Business Line

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The Central and State Governments should take steps to reduce the taxes levied on homes with carpet area of up to 600 sq ft to make them affordable, according to G Kannappan, Chairman, Town & City Developers, Coimbatore.

He said, if the said demand is met, the housing shortage particularly in the affordable segment in the country will ease to a great extent.

He said his company, which belongs to the Coimbatore-based KG Group having presence in different segments like housing, textiles etc, has also entered into the retirement home segment by launching a project for senior citizens as part of the third phase of its Garden City project in Vedapatti in the city.

Speaking to Business Line on the sidelines of a meet to announce the launch of the projects, he said the previous Government had estimated that there was a need for building 2.3 crore homes in the country, especially to meet the needs of the Economically Weaker Sections and the Low Income Group (LIG). He felt that if the target is to be achieved, the Centre and State Governments should come forward to offer tax concessions so that the cost of building homes comes down.

Kannappan pointed out that even in case of budget homes in the range of Rs 7-8 lakh, nearly 40 per cent of the cost went towards various levies. The Governments should rationalise the taxes levied on building materials, the service tax, stamp duty for registration and cost involved in getting approval from the regulatory authorities etc so that the overall investment needed for housing would come down. He felt that it would not materially impact the earnings of the Governments as increased investment in housing would give a push to overall economic development.

He also wanted the Government to revive the tax exemption given for infrastructure development. The Government provided financial aid for infrastructural development for roads, sewerage treatment, drainage, water supply projects etc under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) scheme but this was limited to works sponsored by the government. This aid should be extended to the private developers also so that affordable home projects aimed at benefiting the low income groups would significantly benefit from it.

He said while the Government was insisting that a particular percentage of housing schemes should be allotted for the economically weaker sections under the affordable housing scheme. Kannappan said, his company’s Vedapatti project was targeted at this segment in full. But care was taken to ensure that while making the project affordable, there was no compromise on the luxury element or on quality. The apartment costs in the third phase would only be marginally higher than the first two phases and 2 BHK apartments of about 500 sq. ft in size would come with a starting price of Rs 11.99 lakh.

Sanjana Vijayakumar, MD, Town & City Developers, said by next month handing over of 684 flats built under phase 1& 2 of the project would be completed. In the third phase now being launched, the company plans to build nearly 200 flats (2 BHK flats) and also 48 apartments as part of the retirement homes initiative.

She said the idea of foraying into retirement homes segment came from her customers who felt that if services like house keeping, laundry, catering etc were provided, they would make the project a `perfect home’ for retirees to settle down. Hence the company decided to allot a bloc for retirement homes so that its occupants lived in a bustling community rather than in an isolated area.

She said the price of retirement homes (2 BHK apartments) came with a price tag of Rs 17.99 lakh onwards and it was not for high income retirees alone but would also be affordable to the middle income families as well.

Kiruthika Vikram, MD, Town & City Developers, asked about the monthly expenses for retirees for food etc, said the choice of availing of particular services like food or house keeping has been left to the occupants of the retirement homes since some people preferred to do it themselves. Hence, the recurring cost would depend on the services availed. The project also came with facilities like departmental store, 2 wheeler workshop, banking service etc. The catering facility could be used by others in the project area.

Sanjana said the company has planned to go for the fourth phase of the project later this year with about 300 apartments with which the entire project spread over 11 acres of land would be completed.

Published on January 09, 2015
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