Tier 2 Cities are Tomorrow’s Metros

A trusted advisor to developers, occupiers, and Anuj Puri, Chairman and founder Of Anarock Consultants, is today a highly respectable name in the Indian real estate sector. With over 30 years Of experience in Indian and global real estate markets, Anuj is widely recognized for revolutionizing the Indian real estate sector. Having worked with international property consultancy, JLL India as Chairman & Country Head for many years, Anuj went On to set up his own property consultancy. In just about five years Anuj has steered it to India’s leading independent real estate services company across retail, commercial, hospitality, investment banking, land services, strategic consulting and valuation, industrial and logistics as well as management In this exclusive interview with Torbit realty, Anuj Puri talks about the journey Of Anarock, the role of technology in real estate, post-covid real estate scenario and the impact Of rising input costs on real estate growth ahead. Excerpts. Vinod Behl

How do you look at the journey over the last five years in terms of challenges and high points? Considering that you have competition from IPCs and leading digital marketing platforms like Proptiger/Housing.com, 99 Acres.com, Magicbricks.com, and Square No Broker. cxlm, how have you been able to meet it ? In the first place, the Indian real estate marketplace is massive and large enough to accommodate a number of good service providers That said, some will obviously do better than others based on their specializations, team size and quality, technological capabilities, and market
Healthy competition is a good thing because it keeps every player in top-performance mode. Anarock was launched with several key advantages, including deep market expertise and key industry relationships. We also pioneered the mandated projects model, which continues to be our forte. Moreover. we have continually upgraded our technological prowess – and technology is now the primary success driver in the real estate brokerage industry. We have been steadily adding new verticals, including in the fields Of retail, commercial, land, capital markets, hospitality, industrial & warehousing, and strategic consulting advisory services. Today Anarock is the pre-eminent independent real estate consultancy in the country – but we have the healthiest respect for all our industry contemporaries and prefer to see it as being first among equals.

In today’s housing landscape, what is the differentiating factor in residential real estate marketing? What unique deliverables does Anarock bring to the table ?

There are several differentiators that give Anarock a competitive edge. TO name two – Our proprietary mandated projects model allows developers to entrust the marketing of entire projects to us thereby eliminating the need to appoint and keep track Of multiple consultancies. Our superlative in this field ensures consistent loyalty from our existing developer clients as well as new business. Moreover, Anarock was the first Indian real estate consultancy to introduce A1/ML technology in real estate consulting. This and Other technologies developed in-house with the best technology brains in the business, have ensured that we consistently stay several steps ahead Of the competition.

Post-Covid, we are seeing a pick up in luxury real estate. Going forward, how do you see the affordable, mid-priced, and luxury real estate market playing out ?

Covid-19 certainly helped luxury housing come out of the doldrums after many years. In fact, many industry pundit-shad wrote Off luxury housing in India altogether. To some extent, this proves that while there certainly are constants, there are few permanent truths in any market. Real estate can sometimes be as fickle as the market, with unexpected twists and turns. Mid-income housing has also revived convincingly. In a way, Covid-19 helped the real demand dynamics to Crystallize and rise to the surface. The demand for bigger homes is likely to sustain long beyond the pandemic era with its fading WFH ethos, Nevertheless, the real need in India is for affordable housing. It is no accident that this is the most highly government-incentivized segment. In my opinion, the next few years will see a comfortable realignment Of all segments, with developers chuming out only as much supply in each segment as is needed. This is a welcome change from the previous feeding frenzy.

The real estate ecosystem, post covid, has undergone tremendous transformation with technology ( both marketing and construction) making rapid inroads. How have IPCs and large marketing companies like Anarock responded to that?

Indeed, COVID-19 has been a major change catalyst, underscoring the need for technological acceleration in Indian real estate as no Other single event has done. All major consultancies have responded by upping their tech game, since it is obvious that technology is the most important marketing tool available now and in the future Likewise, most large developers have also embraced new technologies. In a way, Covid-19 is the next necessary evolutionary leap across the industry.

WFH has proved to be a boon for both residential and commercial Office markets.. How do you see the popularity Of hybrid models complementing the growth Of both residential and Office real estate ?

During the worst parts of the pandemic, there was no option but to adopt WFH and the hybrid model Of working. Now that the lockdowns and restrictions are us, we are seeing a clearer WFH, and hybrid working was an almost unknown concept in India before the pandemic struck; now that the worst is over, we can see both the advantages and disadvantages more lucidly. Valuable new lessons have certainly been learned and new, progressive models adopted. Now we are witnessing the primary
drive from employers and employees to return to business as usual. Apart from the fact that certain businesses mandatorily involve office-based work, office work is also deeply ingrained in the Indian psyche. While some players from certain industries will continue exploring hybrid and WFH most of India Inc will return to office-based work.

Over the last couple Of years, we have seen Anarock going in for acquisitions to aid faster growth. Moving ahead, what are your business plans and roadmap for expansion including plans to enter newer verticals ?

Anarock is nowhere near the end of its expansionary journey If we have added so much to our scope and in just five years the future unfolds at a less ambitious pace. We have a vision Of industry depth and excellence which we will not compromise on, and we will work diligently towards achieving it. How do you 100k at the impact Of hardening Of rates and rising input costs on demand and supply side and pick up in sales ? Price growth and an overall increase in acquisition costs is a natural real estate cycle, and it is its appreciating quality that attracts end-users as well as investors The natural appreciation cycle has been arrested for several years for a variety Of reasons. but has now kicked in once again. Sales will not decrease because the asset in question is becoming more valuable. In my opinion, quite the contrary. People don’t buy homes when they are at their cheapest — they buy them when they want to own homes.

How do you see the real estate market evolving over the next few years in terms Of emerging trends and investment prospects? Which cities will perform better?

For a long time, it was primarily the tier 1 cities that witnessed any real growth. The tier 2 and tier 3 story was acknowledged, but not really taken very seriously. This mindset is now changing. Today’s tier 2 cities are tomorrow’s metros, and this is where growth must necessarily take place. In terms of real estate market trends, the future belongs to the strongest technology adopters – traditional brokerage is rapidly going the way of the dinosaurs. In short, the mantra of the future is technologise’ or perish.