Chennai: Shantiniketan. The word should remind you of Tagore, and the enticing university town in West Bengal. Perhaps the magic rubbed also on to 105-acre mega real estate project in Bangalore, which Irfan Razack promoted in February 2005. “The pre-sale of the Rs 1,500 crore project set a scorching record of sorts in Indian real estate,” recounts Manoj Namburu in ‘Moguls of Real Estate’ (www.landmarkonthenet.com).
It got sold out within a couple of weeks, because Irfan had adopted ‘a unique marketing strategy,’ Namburu narrates. “Although his marketing team was very confident of selling all the units by themselves, Irfan felt this approach would turn out to be ‘penny wise, pound foolish’.”
For, ‘How could a marketing team of ten service 2000 customers?’ The solution was to tap the services of every real estate agent in Bangalore, not for buying the property for speculation but to bring in only genuine customers.
“The scheme was to ask agents to deposit Rs 2 lakh and get their names included in Prestige Shantiniketan advertisements. For this amount, they would also get a stall at the launch premises on the site and would be accorded the status of accredited agents for the project. If any agent sold more than 50 units, the company would refund their Rs 2 lakh deposit.” How did the idea work out? “Prestige was able to whip up unprecedented real estate euphoria. Irfan says the agents did free publicity for Shantiniketan.”
As a result, the promoters had to take out full-page ads in newspapers announcing the pre-sale of the entire project. “All press advertisements scheduled for subsequent weeks were dropped.”
Ask Irfan, he’d reminisce how he considers the marketing and selling of the project as the easiest aspect. Because the ‘real’ challenge lies in delivering the finished product of the highest quality within the promised time, as Namburu explains.
Another biography in the book is of Shapoor Pallonji Mistry, who belongs to the oldest real estate family in the country. “When he stepped into the 132-year-old family business in 1992, the group was concentrating almost exclusively on construction contracts, with no development projects,” writes Namburu.
Shapoor’s first real estate deal was the purchase of a sea-facing property in a dilapidated state in Colaba in 1992-93 for Rs 2 crore. “Hiring a Scottish architect, he gave it a complete makeover at a cost of an additional Rs 2.5 crore. As the real estate market picked up, he was able to give it out on a ten-year lease to a bank. He then got the lease rental discounted to secure a whopping upfront payment of Rs 77 crore.”
Tracing the family business back to 1865, the book captures how the small construction firm named Littlewood Pallonji Constructions, co-founded by Pallonji Mistry Sr (Shapoor’s great grandfather) constructed Bombay’s first water reservoir atop Malabar Hill. “A large number of textile mills and other commercial establishments had by then sprung up necessitating the construction of the Malabar Hill reservoir for supplying water to the burgeoning population.”
Joining the founder, in 1902, was Shapoorji, who as a 13-year-old decided to drop out of Class V to help his dad’s business during difficult times; he then rose to become ‘the biggest building contractor in Bombay.’ His first independent job was the construction of the footpath at Girgaum Chowpathy, the book notes. “Though it was a small contract, Shapoorji did his best to execute it promptly. He used to walk every day to work from his house in Khetwadi with his father to save the 2-anna (12 paise) tram fare.”
They made a profit of Rs 2,000 on the six-month contract, an earning that was ‘much more than the income of many a graduate of that period.’
Absorbing tales.
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