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Mumbai real estate: Redevelopment is here to stay for more than 20 years, says Boman Irani of Keystone Realtors
Boman Irani of Keystone Realtors said he does not perceive developers entering Mumbai’s redevelopment space from other markets as a threat but as an opportunity
Redevelopment is here to stay in Mumbai for more than two decades and these projects offer massive opportunities to new real estate developers wanting to enter the space from other cities, said Boman Irani, CMD of Rustomjee Group also known as Keystone Realtors.
“I don't lose sleep over this as many developers are wanting to enter this space. The size of the redevelopment market of old buildings in Mumbai is so huge that there is no dearth of opportunities. New players will add value to redevelopment space in Mumbai,” he said.
He does not consider other developers stepping into the Mumbai redevelopment market as a possible threat.
Also Read: Rustomjee Group plans to foray into data centers; launch plotted development projects near Mumbai
“I look at it as an advantage because they bring with them a healthy competitive spirit. And quite honestly, it is better to have well capitalized, large developers enter the same space so that there is no knee-jerk reaction,” he said when asked if he considers developers from other cities launching redevelopment projects in Mumbai a threat.
The company is currently active in the redevelopment space in the Mumbai Metropolitan Region (MMR) and gradually plans to expand into plotted development and data centres.
Also Read: Planning to invest in a plotted development project near Mumbai? Here’s what you should know
"The size of the redevelopment market is so huge that there is no dearth of opportunities that will come. As a matter of fact, if I can say this, we have only scratched the surface right now. The larger societies, the more prestigious locations are yet to open up going forward. So, we have got plenty of headroom or play available in this business. And the more good developers that come in actually validates what we have said initially, that this is possibly one of the best types of development to get into," Irani said during the investors' call for Q2FY25.
"I don't think in the next 20 years we will see the end of redevelopment in Mumbai city. And if we take the history of cities around the world that have been built and rebuilt, Mumbai will also write down an entire chapter, if not the whole book, on redevelopment someday in the future. So, plenty of opportunities. I don't lose sleep over more developers wanting to enter this space," Irani added.
The company's exposure to redevelopment projects was 11% at the time of launching its IPO and may go up to 30% in the coming months, Irani had said in 2023.
Also Read: Why are real estate developers making a beeline for Mumbai and Bengaluru markets?
On expansion plans outside Mumbai Metropolitan Region
According to Irani, the company is open to launching projects outside MMR. "But quite honestly I see MMR itself growing in size. I mean, I would like to say that I consider Palghar Boisar as an MMR area and you know something that has got a great future growth," Irani said.
"We are already entering that market (Palghar Boisar) like I mentioned in the past, we are in no hurry to launch out there but definitely we are growing our reach in that market or growing our knowledge of that market. And having said that, someday, (I have said that) Pune and Mumbai will be sister cities, so who knows, we will even look at everything that is coming in between. But as of right now, I am very happy to state that MMR is keeping us fully occupied, (we are) fully well driven to continue growing in this market. So, focus is entirely here, we keep studying proposals, but nothing that is going to come up at least in the near future," Irani added.
Q2FY25 financial results
The company recently reported a jump in its consolidated net profit that touched ₹65.55 crore in the September 2024 quarter. Its net profit stood at ₹4.17 crore in the year-ago period. The company's total income, however, declined to ₹556.22 crore in the second quarter of this fiscal from ₹633.33 crore in the corresponding period of the preceding year, according to a regulatory filing.
