Note: Founding Fuel is leading a series of conversations to explore reset opportunities across a variety of businesses, through an Indian lens. This is the second in the series on the realty industry.
There are three ways you can access this discussion: 1. Watch the complete video above (recommended). 2. Listen to just the audio track below. 3. Watch interesting takeaways from the discussion (further below in the article) before you choose to watch or listen to the full discussion.
The realty business has been roiled by both demand side issues as well as supply side dislocations. Within that kind of churn, it's likely to throw up some interesting new opportunities for realty businesses to rethink and reimagine the business.
Our four special guests discussed what realtors and proptech businesses are trying out and the possibilities that exist. The panel, moderated by Indrajit Gupta, included
- Arvind Subramanian, MD & CEO designate, Mahindra Lifespaces
- Sujay Kalele, co-founder of TRU Realty
- Vikram Kotnis, founder and MD of Amura Marketing Technologies
- Nruthya Madappa, managing partner, CoWrks Foundry.
Highlights from the discussion
But does demand exist?
Arvind: On the demand side, contrary to many analysts, I'm a bit more upbeat. I think demand is more resilient.
Vikram: People are just waiting to see if it bottoms out. You will actually see a spike in pricing sometime in next three months because it's already bottomed out.
Arvind: Players who've been smart about their financing in the past, were not over leveraged, who have a stronger balance sheet and staying power are the ones who will be able to see this through.
Watch this clip on why demand is strong from first home buyers and how consumer needs have changed.
The industry’s digital transformation
Sujay: The core of real estate development is execution and efficient execution. How can we reinvent that and make it much more efficient and collaborative? That is going to define how profitable and how fast the industry recovers.
Vikram: To execute, you need a good process. You need a good reporting platform to know what's going on. You need good people.
Nruthya: What is really interesting is now suddenly startups have a foot in the door. Because large developers are suddenly finding themselves a little off guard. Now everyone is learning a lot more very, very intently and very intentionally.
Watch this clip on customer behaviour and the developer behaviour driving digital transformation
How to get past the supply side constraints
Sujay: The focus has to now shift from the number of labourers to productivity per labour.
Arvind: Real estate has pretty much been stuck with their feet stuck in cement. The way we construct buildings has not fundamentally changed. Over the last 10 years, there's been a lot of work on prefabricated construction elements. It does appear far more expensive. But, with labour becoming scarce, there will be a need to embrace these technologies. And as more developers embrace these technologies, scale will drive the economics.
Watch this clip on how technology can reduce cost and make construction efficient
Partnering with startups is key. Because no one company has all the solutions
Vikram: What consumers want is not to work from home, but if the project has a co-working space they are willing to pay for it. So, they want asset management as a service. Basically smart homes, smart assets, and smart services. So solutioning and planning fundamentally, has changed.
Nruthya: What we're seeing right now is sort of this Swiss cheese theory. Each layer of Swiss cheese has massive holes in it, but you layer in half of them on top of each other, you’ve sort of covered all of your pieces.
Arvind: A lot of the problems that we think are unique to real estate actually have been solved elsewhere. And it's really important to keep our eyes open to that and adopt the solutions.
Watch these two clips on some exciting solutions that are coming up.
Still Curious? Read Arvind’s column on why developers will need to reimagine a holistic digital journey for homebuyers. For going digital means much more than just creating a website. And for more stories and discussions in The Reset series, click here.