Originally published in the Economic Times on 27th October, 2011
During the slowdown last year, sales at a luxury home builders had gone down so much that the company's chairman, could actually keep a count of the footfalls at his sales offices.
It was during those days that he got a call from a friend in the UK who told him about real estate opportunities in Spain and Montenegro. 'I landed there, saw some beautiful sites, met extremely FDI-friendly governments, and decided to invest,' he says.
The Chairman, now, 41, is now building 240 beachside luxury apartments and 22 villas in Montenegro, a tin east European country with breathtaking beaches — just the kind of place where well-heeled Russians, Uzbeks, Brits and Indians troop in during the winter.
He will begin marketing the project in about two months and is hoping that Russians and Uzbeks will buy more than three-quarter of these homes. Rich British and Indians will buy the rest.
'I can spread my risks that way. And I can also establish myself as a niche global luxury player,' says the Mumbai-based builder. Montenegro, whose economy is untouched by the current slowdown, is easily accessible by flight from Russia and India — there are direct flights from Russia and from India you can get there in 10 hours, as long as it takes one to reach London, with a changeover in Istanbul or Vienna. And in both these countries, the number of HNIs who want asecond home abroad is on the rise.
Increasingly, more and more Indian builders are looking to build projects overseas. The tallest residential building in the world has been built in Dubai by the Mumbai-based Hiranandani Group. The tallest building in Sri Lanka is being constructed by a consortium of Kolkata-based real estate builders through a subsidiary called Ind cean.
Even India's biggest private sector firm, Reliance Industries, has stepped on the gas in the African real estate market through a tie-up with Jaydev Mody, an NRI businessman with huge real estate interest in Africa, who also runs casinos in Goa.
Mody was in Sri Lanka for his casino business and could not take calls, but sources close to him said that Reliance Industries has set up a joint venture with Mody's Delta Corp that acquired nine plots of land in Nairobi for commercial and residential development. The company, in which Reliance has a 60% shareholding, has invested Rs 200 crore for the plots.