Hyderabad a safe bet for realty biz

Real estate is the only sector wherein entrepreneurs from Telangana are present in large numbers, says Credai Hyderabad president Ram Reddy

Real estate sector in Hyderabad has gone through sluggish phase till 2014. That was obviously due to the Telangana movement. How is the sector doing now?
Obviously, there was an impact on the sector during the movement. The sector is back on growth track now. I am proud to say that building construction and real estate sectors are the only areas where entrepreneurs from Telangana are present. It is a fact that there are not many from Telangana in industrial and service sectors. That way, we are holding Telangana flag very high in this sector. We have to admit that Telangana is very poor and people here are not rich compared to their Andhra counterparts. The Telangana government took up irrigation projects on a large scale. It should continue such developmental activities at least for a decade more. Then, Telangana will march forward.

Some say there is an artificial realty boom in Hyderabad and its surrounding places and the boom may burst in a few months. What do you say on this?
That's absolutely wrong. People who say so are ignorant about the sector. If we go back and see what the property prices were in 2008 and 2009, we know the reality. Property prices in Hyderabad have not yet reached that level. People who bought properties in 2009 have not seen any appreciation in value till now. My understanding is that city will continue to expand, and property prices will go up by at least four times from the current levels in a decade and that's the potential the city offers. Given the ideal climate, geographical conditions and infrastructure the city has, it should have grown into the biggest city in South India and third biggest in India long back. Hyderabad will outpace Bengaluru and Chennai and emerge as third largest city in India in not so distant future.

Will the early polls adversely impact the real estate sector?
I don't think so. Current policies will continue whoever comes to power. People are aware of this. Moreover, there may not be any change in the government if we go by the current trends. So, there will not be any adverse impact on the sector on the account of early elections.

There is a view among people that anti-social elements are involved in real estate sector in Hyderabad. Mohammed Nayeemuddin, a former naxalite who turned gangster, was killed in a police encounter in 2016. His episode clearly exposed the nexus between anti-social elements and real estate sector. What is your take on this?
Nayeemuddin issue is an isolated case. However, there is every likelihood of anti-social elements involving in real estate sector because land deals and high-value transactions take place in this business. It happens across all the cities and countries. Frankly speaking, presence of anti-social elements in Hyderabad real estate sector is minimal when compared cities like Mumbai where such characters dictate terms and involve in land disputes, etc. It is very much safe to do real estate business in Hyderabad. I have never faced any such problem so far.

In future, we want to be the best in Hyderabad

How did you get into real estate business?
I am an architect by profession. Hailing from Mancherial, I completed B Arch from New Delhi in 1984. Afterwards, I worked for a year in a private company before establishing my own architectural and design consultancy. But I wanted to do more. With support of partners and friends, I took up a small residential project at Habsiguda, Hyderabad, in 1990. I worked with partners for a few years and executed several projects. In 1993, I established my own company, SMR Holdings. But architecture is passion for me, not profession. Even today, I handle structural and architectural designs for our projects. Also, I do business for passion, not for profits. But doing business is not a cakewalk. We have to constantly struggle.

How many projects did SMR Group complete so far?
We executed about 78 projects in the last 25 years. We took up projects in Kondapur area, now part of Hi-tech City, when the area did not have proper road connectivity. That way, we look far ahead of the market and go to areas which are likely to develop in long-run. We constantly scout for new avenues and new opportunities.

What are the new projects that your group is executing?
We have around three ongoing projects. We will launch new projects once we complete the existing ones. We have started phase 2 development at our ongoing project in Bandlaguda, in which we will have 400 apartments. We also completed phase 1 (350 apartments) of SMR Vinay Iconia in Kondapur. We will start second phase there. We are also developing a shopping mall in Miyapur

Your group is present in Bengaluru too. When did you enter that market?
We started our Bengaluru operations in 1996 itself. Bengaluru is an advanced city compared to Hyderabad. We have been doing well, catering to Telugu community there. Nearly 30 per cent of our business comes from there. We completed 23 projects.

What is the current size of the group in terms of turnover?
Our turnover varies from year to year as it's linked to the business environment. At present, our turnover is around Rs 100 crore. Sometimes, it comes down to Rs 50 crore too. Further, turnover has never been our focus. We have over 400 employees and need to look after them well whether business is down or up.

What are your long-term growth plans?
We want to be the best in Hyderabad or wherever we operate. That's our long-term plan and goal.

You had actively supported and participated in the Telangana movement. Do you have any plans to enter politics?
My sole reason for supporting and participating in Telangana movement is that Telangana region lacked development and I wanted to see it developed. Andhra Pradesh should also develop. I have nothing against Andhra people. I supported the movement knowing fully-well that real estate sector would suffer, so would also my business. But we have separate Telangana now and it is well on course to all-round development. Of course, I am keen on serving people. But I will enter politics when I am sure that I will be able to devote 100 per cent of my time for people.