Unitech to tweak luxury housing project into township

Under weakening property market conditions, realty major Unitech has been forced to develop its Rs 15,000 crore worth high-end luxury housing project in Noida as an integrated township, aiming to boost sales. Unitech had launched 'Unitech Grande' project in Noida in July 2007 on a 340 acre plot that it had won in May 2006 by outbidding bigger rival DLF for whopping Rs 1,582 crore. Earlier, the company had planned to build 5,300 flats targeting high-net worth individuals and NRIs for the ultra luxurious project. But, the buyers for the high-end products have vanished from the property market, which is going through a slowdown, forcing builders to change their product mix. "We are re-designing our Grande project in Noida and will re-launch the project as an integrated townships comprising high-rise apartments, bungalows, villas and developed plots," a Unitech spokesperson said. The spokesperson said that the company would develop 300 apartments that it has sold in Grande. "These apartments will be developed as per the original plan and will not be affected by the re-orientation of the project. Though these buyers will also be given an option to switch to new format". Unitech, the country's second-largest realty firm, has launched the plots in the township at Rs 51,000 per sq yard. While launching the project, Unitech Managing Director Sanjay Chandra had said the investment will be about Rs 6,000 crore and estimated revenue from this project over the next seven years would be about Rs 15,000 crore. Unitech's decision to redesign its Noida project came in the wake of huge response it received from the buyers for its recent affordable housing projects in Gurgaon and Chennai. In the last one and half months, Unitech has sold 750 flats priced at Rs 28-40 lakh in Gurgaon and 500 units in Chennai offered between Rs 19 and Rs 35 lakh. Unitech, which has recently raised over Rs 1,600 crore through private placements, plans to launch more than 40 projects across the country in the current fiscal, most of it would be affordable housing projects. It would largely utilise the funds raised to develop its projects. This would help Unitech in improving the cash flow of the company and meet debt obligations of Rs 8,400 crore. In a presentation to the investors, Unitech has recently said that it has commenced launch of projects priced below Rs 20 lakh and plans to offer products priced below Rs 10 lakh. As per the presentation, the company plans to offer housing units at affordable prices by cutting down sizes and also working under reduced margins. "Unitech has a large, low-cost and well diversified land bank which is sufficient to meet its development plans for the next 7-8 years," the company said, adding it would not acquire further land bank except for "extremely attractive opportunities". The Gurgaon-based company has a land bank of about 700 million sq ft.