Pinnacle

TIMES OF INDIA (PROPERTY PLUS ) Friday, March 28, 2008
By Kamlesh Pandya


AT the last Cityscape Real Estate exhibition held in Mumbai, a stall of an IT SEJ in Hyderabad was 'manned' by a 'consultant' from the UK. He was sharp, knew what was happening not just in the project he was selling, but also trends in the city/state/India/SE Asia; was very clear about the legal issues involved, had finance details on his finger tips, was incredibly polite and courteous, and was 'aggressively helpful' in potential leasers' decision making. A visiting card meant three calls across the next month plus e-mails that were friendly, packed with information with polite requests to get back in case any other details were required. Vinod Thakkar, CEO of real estate firm Square Feet is at his Mulund office, recounting the experience. "Unless Indian real estate brokers wake up to the reality that they need to adapt to the changing times, such guys will take over the" broking function altogether," he muses. "Let us face the reality - these global consultants as of now are only at the tip of the pyramid - branded, high-end real estate. But they are moving to other segments of the pyramid and this is a wake-up call for all in Indian real estate marketing and sales," he points out. Thakkar has just completed a re-branding exercise of the various 'estate agency' offices his company controls. A training session currently aims at standardising the experience for a customer coming to any of his offices while an IT back up will make data sharing a reality – with prices updated being reflected in real time.

Something new……
Foreign real-estate companies have been in India for years, says Sangeet H Kumar is CEO, ABCD Global Asset Corp
“They brought in credibility to the business, ‘respect’ for the broking community. They have been largely responsible for local brokers becoming more professional. I believe that these foreign players will definitely make the business more competitive and we should be prepared to take on the challenge by becoming more organized, systematic and professional.”

Thakkar says he's got miles to go - 'the scenario is changing, we have to be ready for today's customer with tomorrow's service levels'.

With global real estate agents operating in the Indian scenario, local builders will be able to easily market their products at better prices as these realty firms would be organised, 'presentable marketing agencies' on lines of HDFC
Realty, which is already operational, says Venkatesh lyer of the Chembur-based Siddhivinayak Estates. "This may enhance the cost of property due to the involvement of global firms, but ultimately, these firms have to will rope in local small-time brokers to run the show," he feels.

One impact that these global players will definitely have is on the fees and charges aspect. Ramneek Bakshi, principal, Australian realty major LJ Hooker in India, says Indian brokers have the concept of a 'fee-based service' for bringing a buyer and seller together and charge a commission from both parties. "We see this as a conflict of interest as the broker does not represent any one party. We make it clear to our clients, usually the seller, we represent their best interests and try to get them the best deal possible. As we are competitive with other brokers, we would be charging as much, if not less than the current market rates, but we would give our customers the comfort of knowing that their own interests are kept in mind," he says.

Andheri-resident estate agent Rajesh Bijiani feels it is pertinent that the government of India should mandate a license for such 'global consultants' who intend to deal in real estate. This, he feels, will stop the proliferation of 'misleading businesses' in real estate sector. "Half a decade back, finding a real estate agent in the interior areas was nearly impossible. Now, there are dozens of local and foreign real estate consultants in all sorts of locations all over the country. Most operate without a license and many of those that have them do not operate in the manner as we would have thought a real estate agent would in the so-called 'first world countries'. With no proper control, it is every man for himself; wheeling and dealing for his own best interest, and not that of the seller or the buyer."

Branding is the future of Indian real estate, says Bakshi. "As we have seen in other industries in India, the market will move to the branded players. For examples, the coffee business transitioned from the Rs. 5 coffee seller on the road side, to the Café Coffee Days and Baristas. The grocery business moved from the neighbourhood 'bania' to Reliance Fresh and Big Bazaars. Why should it be any different in the realty management sector? Lakhs of independent players will morph into (say) a dozen branded players in the future. As in any other industry, branded players will cater to the mass consumers, while the more traditional brokers will cater to niche markets."' Getting additional services with better business practices in one-shop convenient locations under the brand security of companies like LJ Hooker (and that also at lower rates) will be the way for the consumer in the future," he feels.

Sangeet H Kumar is CEO, ACBD Global Asset Corp., a new set-up which covers more than just real estate deals - it looks at real estate as an asset class, for one. He's back from a 'hard-sell' visit to the UK and UAE, and he is hard at work getting responses across to potential buyers he’s met while in two countries. “Buyers expectation are similar, whether they are resident Indians buying real estate at home, NRIs or PIOs buying Indian real estate from an Indian realtor, or an Indian in a foreign country dealing with a global real estate firm in that country. Transparency in terms of details and information, safety and security of their investment and a professional way of working," he says.

"When one says a 'professional way of working', it basically means quick response to the customers' queries, and the replies should be correct and complete," says Gurpal Singh Sethi, real estate personality who's recently returned from brokering a hotel deal in Seychelles. It has been his work in a previous hotel deal in the UAE which got him the enquiry from Seychelles, but he is quite clear that clinching the assignment required him being conversant with 'global best practices'. He is brokering a deal which seeks to convert a slew of 'ready possession residential towers' into serviced apartments at Vikhroli, and says times are changing. "In India, almost all real estate business happens because of word-of-mouth publicity and referrals. It is mostly verbal communication that drives deals at home. When you deal with an international clientele, this does not work. You have to quote from research reports, give price trends over a time frame and generally be a research / analyst- cum-finance expert-cum-legal eagle at the very least, apart from being a real estate agent who follows 'global best practices'. Otherwise, you don't stand a ghost of a chance," he adds.

Realtor Ramprasad has been handling realty requirements of expatriates in Mumbai since the last few years and says that their initial mind-set is that Indian real estate is full of cheats. "You have to be a true 'realtor', show them that your work is as good as the realtor they deal with in, say, the USA or UK. Once the barriers are down, you have a customer who doesn't do any further deals without you," he adds. An MBA with online selling portals galore, Padhi, like Thakkar, Sangeet and Gurpal represents the new face of Indian real estate selling. "The phase when you had a 'paan walla' or a 'kirana' shop seller doubling up as a 'broker' is over," muses Padhi. "These days, buyers are savvy, have done their homework, know their fiscal options and expect professionalism from their 'consultants' and unless the Indian real estate selling set-up measures up to these expectations, it will lose customers to developers' direct sales set-ups and also to the new development of organised, global firms that are setting up shop in India," he smiles. "Global players coming in will only ensure all players in the Indian real estate's sales and marketing will shape up. Else, they will have to ship out," he concludes.

__________________
Ram

chidgopkar

Dear Ram,

Your article lucidly sums up the curent scenario in real estate marketing. We need more professionals to come to real eastate brokering quickly otherwise the space will be filled up by outsiders. Unfortunately we cannot have MNS type agitation against foreign broking firm. We can only fight them with our competence and innovation.

I am sure more professionals will enter this field in coming years and will change the face of the industry. Incidently I also attended Cityscape 2007 and wholeheartedly agree with your views.