Reeling from the worst-ever financial crisis that threatened his company and state a few months ago, Emaar Properties Chairman Mohammed A. Alabbar said his Indian collaboration Emaar MGF, where Emaar holds a 40 per cent stake, is not looking at low-cost, low-budget houses in India. On a hot summer's day, Alabbar was cool and composed. Excerpts from an interview:
On prices in India
Prices here are more reasonable compared to other locales that had crazier price points. This is the reason why we are bullish on our growth in India. In fact, massive opportunities exist in India with its robust demand that is putting an upward pressure on the prices.
On where Emaar MGF stands on pricing
Prices differ from location to location but the average will be around Rs 5,000 per sq ft. However, we also offer top-end properties like the Commonwealth Games Village project at New Delhi that is quoting at around Rs 14,000-15,000 per sq ft.
On the India strategy
Today our focus is mid-higher segment and that will remain our core business and our forte. The housing shortage in this category is huge and the number of people moving up the social ladder is also huge making the mid-higher segment a lucrative option. If you ask me to outline the specific focus areas then I may not be able to spell them out because three years down the line the market dynamics might change along with the environment.
On Delhi versus Dubai
Well, in today's market I would say that Delhi is more interesting. Though prices have bottomed out in Dubai and business has been growing for our company, Delhi seems where growth lies.
On property crash in Dubai
Well, the financial turmoil had an impact on every government, every business and bank. When you do business there often are times when you do need to re-schedule your payments, and that could happen with almost all companies. Also I feel the Dubai story has been spiced up a bit simply because Dubai is a good story (laughs).
On Dubai's over capacity
I don't think this was the cause. The Dubai crisis was fallout of the global financial crisis. If we want to keep growing then we want to be affordable even in a city like Dubai. In fact, even at the adjusted prices we are making fair returns. Residential property prices rose by 60 per cent in 2008 but they dropped by 48 per cent in 2009. So prices have evened out. The unbelievable jump and craziness of 2008 have been done away with. We can now live and rent our offices.