RMZ Corp forays into residential segment

RMZ Corp, which has so far been only into commercial space development, announced its entry into the residential segment. The company has launched three premium residential projects in Bangalore.

All the projects would be located in north Bangalore, and Mr Raj Menda, Co-owner and Managing Director, RMZ Corp, said that with that region getting infrastructural improvements such as a 12-lane road, “I believe this growth corridor is where the future is”. Going forward, he expected the residential segment to contribute to 35 per cent of the company's revenues.

The company also plans to launch two villa projects in the second half of this calendar year in the city. One of these would be located in Whitefield, while the other would be in north Bangalore. The focus would also be on east Bangalore, said Mr Menda.

Of the three projects launched, RMZ Galleria would be a 12-lakh sq ft integrated project, of which five lakh sq ft would be residential. The Rs 315-crore residential segment of the project would see development of 322 units — two- and three-bedroom apartments. While two-bedroom units would be priced at Rs 70 lakh, three-bedroom units come with a price tag of about Rs 1 crore.

“We have already sold 20 per cent flats without any advertisements,” said Mr Menda. He added that the company hopes 40 per cent of the customer base to come from the employees of corporates occupying his commercial developments.

The Rs 450-crore RMZ Latitude would offer 122 apartments comprising of four-bedroom units — about 3,900 sq ft, and glamour suits — about 5,600 sq ft at an average price of Rs 3.25 crore and Rs 5.8 crore respectively. The project, which was soft launched a month ago, has already seen nine units being sold. “Bigger units are selling faster,” said Mr Menda.

The RS 105-crore RMZ Sawaan would see development of 34 villas with unit sizes ranging between 4,200 sq ft and 4,900 sq ft, and prices start from Rs 3.85 crore.

Except the villa project in Whitefield, all other projects would be joint development with the land-owners.

Plans to enter Chennai, Hyderabad

With the entry into residential segment, real estate developer RMZ Corp plans to launch residential projects at Chennai and Hyderabad soon.

The company plans to develop 10 million sq ft in Bangalore, Chennai and Hyderabad, said Mr Raj Menda, Co-owner and Managing Director, RMZ Corp. “We have lined up lands. But we are in the early stages of discussion,” he said. The company proposes to develop two million sq ft on the East Coast Road in Chennai and two small projects in the city centre, while in Hyderabad it would three million sq ft development spread over two projects.

On funding for the residential projects, Mr Menda said that the company had no fund raising plans for now.

“We will need equity partners at the SPV level to ramp up residential projects post-June this year,” he added. The company has a “committed line of private equity funds of Rs 1,100 crore”, he pointed out. The company also announced its entry into the serviced apartments segments with a tie-up with Ascott Group. It plans to start work on four serviced apartment projects this year. The first property, with 150 keys, would come up at RMZ Galleria, said Mr Menda.

On the commercial segment, he said that the company has 1.6 per cent vacancy levels.

At an industry level, he expected sluggishness till June due to indecisiveness on the part of corporates owing to the economic crisis.

“Past experiences show that the effects post-slowdown have been a lot more beneficial to India. But it takes up to a year to see these benefits,” he added.

RMZ Corp has 2.9 million sq ft space under construction at Outer Ring Road, and 2.2 million sq ft in the newly launched integrated projects in Bangalore.

Mr Menda pointed out that the company has also pre-leased 3.5 lakh sq ft at RMZ Galleria, which was announced on Thursday.