Realty cos learn new lessons

New Delhi, Dec. 25: Wiser from the last year’s free-fall, realty firms discovered a new mantra in ‘affordable housing’ and found help from banks who offered low interest home loans to build their businesses in 2009.

Prices continued to fall by 25-30 per cent even this year and the virtual shutdown in the property market that began in late 2008 forced cash-starved realty firms to go for distress sale of assets and shares to repay their mounting debts.

Yet, the appetite to raise funds was so high that as soon as the stock market bounced back to a reasonable level, about 10 realty firms announced their IPO plans to raise over a total of Rs 12,000 crore together.

“Property prices fell by 25-30 per cent in all the three segments (homes, offices and retail) compared to last year,” said global property consultant Jones Lang LaSalle Meghraj, chairman and country head, Mr Anuj Puri.

The market reality caught up with the realtors, including the country’s top two realty firms-DLF and Unitech, and their strategy of concentrating only on luxury housing projects was proved to be wrong.

“Our focus will be on the mid-income homes and commercial complexes,” said DLF vice-chairman, Mr Rajiv Singh.