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But, as is the case with real estate across the country, the sector in Nagpur is also caught in a slump, though some builders continue to sound upbeat about the city's potential as an emerging investor destination.
Like other businesses here, real estate players blame the slow development at the Multi-modal International Cargo Hub & Airport at Nagpur (Mihan) for all their woes. "Had the Mihan project taken off well in time, the real estate industry would have grown immensely," says the owner of a local realty company. Local realtors include Saptagiri, Concrete Developers, Revati, Pushkar and Infratech Realty.
Then and now
"Every street corner had a builder's office around 2008-09; now, you have to search for them," says Suhas More, chairman and managing director, Revati Associates & Infrastructure. His estimates suggest the number of developers in Nagpur has dropped from about 500 in 2009, the boom period, to about 150. Many of the builders have shifted base to places such as Raipur and Indore in Madhya Pradesh, where real estate is still on a high, says More, who has a long queue of visitors waiting to meet him at his South Ambazari Road office.
"I used to sell 40-50 units a month till sometime back. Now, I'm lucky if I can sell four-five a month," he says. To balance out the gloom here, Revati is planning projects in other cities - Pune, to begin with, and perhaps Mumbai, too.
As for prices, another builder says it's tough to sell a Rs 1-crore flat in the city. Estimates show from 2002 to 2008-09, property prices in Nagpur rose about 100 per cent. In the past two years, rates have crashed in some parts of the city, primarily on the outskirts, by as much as 30 per cent.
While rates in the city are pegged at Rs 7,000-10,000 a sq ft, those on the outskirts have fallen to Rs 1,700-1,800 a sq ft. In their heydays, Nagpur outskirts saw property prices of about Rs 3,000 a sq ft.
Big players join the race
Even so, prominent realtors such as Godrej Properties, Tata Realty and Mahindra Lifespaces are launching high-end and luxury flats in the city, as well as on the outskirts. Just a few months ago, Tata Realty and Infrastructure, a subsidiary of Tata Sons, launched a premium high-rise residential complex, Capitol Heights, at Medical Square in central Nagpur. The project is slated to be completed in 2015. Recently, Godrej Properties forayed into Nagpur with its luxury project Anandam. Earlier, Pirojsha Godrej, managing director and chief executive, Godrej Properties, had said Nagpur was developing rapidly and had strong demand for quality residential real estate.
Bloomdale, off Wardha Road, Mihan, is Mahindra Lifespace's maiden offering in Nagpur. Smeeta Neogi, head of marketing, told Business Standard, "It is one of the first cities we commenced operations in, beyond the four metros. The project is a low-density, gated community spread across 25 acres, with homes to suit every budget and lifestyle preferences ranging from one-BHK to row houses." Here, prices range from Rs 22 lakh to Rs 78 lakh for units ranging from 700-1,500 sq ft to 2,300-2,400 sq ft.
Though the norms of Nagpur Improvement Trust, the local body guiding construction and realty, prevented high-rises till recently, vertical structures are now being allowed on a case-to-case basis, following a rush of proposals by realtors.
Another peak soon
Kartik Balakrishnan, director, Pushkar Real Estate, argued builders who refused to change gears had vanished from Nagpur. He said this was one of the rare real estate markets that hadn't seen cases of cheating, despite the slow growth. Though he claimed property prices here hadn't crashed, he admitted to a definite slide in rates on the outskirts.
"In another three years, property rates will peak again, as Mihan takes off," he says.
Balakrishnan is pinning his hopes on information technology companies such as Tata Consultancy Services and Infosys, expected to hire thousands of professionals for their Mihan offices. It was expected about 25,000 jobs would be created in three years, he said, adding the employees and their families would need houses to live in. On builders shifting to Raipur and Indore, Balakrishnan said, "Nagpur will be way ahead of those markets."
The company, meanwhile, is also looking at other markets - Mumbai, Coimbatore and, yes, Raipur!
Other than IT, tourism is also expected to drive the sector in Nagpur, as the city is close to tiger destinations such as Kanha and Bandhavgarh.
Talking about challenges, Neogi of Mahindra Lifespace said the real estate market across the country, including Nagpur, had witnessed slower-than-expected growth through the last year. "Though it's a nascent market with few organised players, it's poised for growth."
