Mr. Vasudevan’s exclusive interview has been featured in
the ‘News’ Section
of InfraWindow.com – India’s first Daily News
Portal dedicated to the Construction and Infrastructure business.
Here is the log of the article. You can read the article by
clicking here.
With over 22 years in the business and 100 completed projects
in his kitty, R.
Vasudevan, the visionary behind the successful EPC and
real estate company Vascon Engineers Limited, is the apple of
the eye in the construction industry. In an exclusive interview
with Debajyoti
Samal, he speaks about his business, future plans, the
current real estate scenario, rising interest rate, his life
and his love for golf.
What are the major projects that are being carried out
by Vascon
Engineers and what is the total area under
development?
On the residential front, Vascon has ongoing projects of around
2.3 million sqft and upcoming projects of around 4 million sqft,
to be launched in the next one year. Last year, we had achieved a
target of about 7-8 million sqft of EPC development and this
year, the company has targeted the same number, despite the
slowdown. Currently, Vascon Engineers is working on two major
projects in Pune. One is Forest County, a residential project at
Kharadi in Pune with 2, 3 and 4 BHK apartments of 1,000 and 2,000
sqft each and the other one is Windmere Duplex and Windmere
Apartments at Koregaon Park in Pune with 3,000, 4,000 and 8,000
sq. ft. apartments. The company is also planning to start Vista -
Phase III at Nashik, with an area of 100,000 sq ft. The
company is also working on commercial projects such as Ruby Mills
in Mumbai, V-Tech IT/Commercial Park in Nashik, Neelkanth Palacia
in Mumbai and Legislative Assembly Complex in Chennai. Upcoming
projects of the company include the Chennai Project of 1,573,570
sqft and Panache Heights of 584,850 sqft in Hyderabad.
Vascon Engineers is responsible for a number of landmark
projects in the city of Pune. Why is the 8th largest
city in India so attractive for both commercial and private
real estate customers?
Reason for this is the fact that Pune’s growth is driven by
various sectors. Sectors like auto, auto auxiliary, IT and ITES
have made their mark and played a major role in boosting the
infrastructure development at every nook and corner of the city.
Moreover, Pune has a number of educational institutions, which
are best in the country and are definite crowd-pullers. The
pleasant climatic condition of Pune and the close proximity to
Mumbai, the financial capital of India, are two vital factors
that make Pune the most preferred choice for both commercial and
private real estate customers. While there are so many plus
factors, there are some drawbacks also. Improvement in
connectivity is needed, as the public transport system in Pune is
in bad shape. Considering the fact that Pune has a number of
MNCs, there is an urgent need for an international airport,
within the vicinity of the city.
In the long-run, what kind of potential for urban development
do you see in the growing metropolitan regions like
Pune?
In terms of growth, Tier-II cities are way ahead of metros. Look
at Navi Mumbai and Panvel, and even Pune, the way these satellite
towns have been developed and at the fanatical pace they are
growing, are the best examples of urban development. The huge
land bank of these cities helps urban planners to work on the
modalities easily and also reduces the pressure on land.
In one of the interviews you had mentioned that you have made a
mark in construction of green buildings. Could you please tell
us what are the green building projects you are working on
currently?
One Earth, the new corporate headquarters that we have built for
Suzlon Energy Limited has been awarded the highest level of LEED
Certification – Platinum (from LEED India). At Vascon Engineers,
we have always been inspired by a single vision – to make our
world a greener, happier and abundant place. Building the
greenest building in the world is merely another expression of
that resolve. It is our way of committing to a future without
harmful emissions, of reducing our carbon footprint, of creating
a sustainable, profitable alternative, and of giving Pune a
reason to walk tall. Some of our projects are recipients of Five
Star rating, and awarded 96 out of 100 points from GRIHA.
It has been a year now that Vascon has taken over GMP Technical
Solutions. Do you believe that this union has garnered any
positive result so far? If so, how would you rate this success
and can you also tell us how it will help the realty
sector?
Vascon successfully took over GMP Technical Solution with a cash
outflow of Rs 62.63 crore. I believe the union became extremely
successful so far. GMP Technical solution is a company engaged in
the manufacturing of modular clean room partitions and office
partitions, apart from offering HVAC, electrical and building
management solutions. Any union of this kind sets both long term
and short term goals. In terms of achieving short term goals, it
has been a valuable deal as we are using the services of GMP
Technical Solution in all our construction activities in some
form or the other. We also set long term targets, in terms of
growth, wider productivity, operating speed etc. We have been
strengthened by the technical and intellectual resources of a
young company. I can rate 50% success for Vascon Engineers and
50% for GMP, so far.
Vascon Engineers is designing and constructing HDIL’s
commercial complex in Kurla (Mumbai), which you intended to
complete in 18 months. Did you meet the deadline?
No, the deadline of this project has not yet been met.
Why is the delay? Could you tell us the reason? Is the new
deadline set?
The delay was due to some last minute design changes. Although,
we were almost at the verge of meeting the deadline, the client
insisted a change at the very last moment. No, not yet. But the
project will be completed without any hitch now.
Could you elaborate impact of rising interest rates on the
realty industry?
Yes, the rising interest rates are badly affecting the industry,
especially, the EPC and the real estate segment. The buyers as
well as the developers and builders are equally affected by the
rising rates. For example, two years ago, the price which a buyer
had to pay for a 1 or 2 BHK apartment has now been increased 10
to 20% and is now beyond the reach of the potential buyer in this
segment. The escalation in property prices and interest rates in
the last two years has brought the realty sector to a grinding
halt. Neither the demand has decreased nor the supply. In fact,
the soaring migration of people in big cities is taking the urban
realty market by storm. But the rising interest rate has dampened
the spirit of the potential buyers, who are now reluctant to buy
property. As a result, the developers or builders have hit a
roadblock. As far as reduction of prices by builders and
developers are concerned, the builder is bound to stick to higher
price, unless the government hikes the Floor Space Index (FSI).
However, the state government's recent decision to hike the FSI
by 0.33 in the suburbs is a welcome move.
So who do you think is responsible for this
escalation?
No one. In my opinion, it's just a matter of time. I hope the
interest rate will go down to its usual level. Government
measures should be implemented to bring the rates down. In the
interest of the industry, long term approach should be adopted.
Talking about Mumbai, where some of your bigger projects are
being developed, the changing social fabric and the widening
gap between the rich and poor has pushed the city to the back
seat. As a developer, don’t you feel the poor and the middle
class has the right to get their space under the urban skyline?
Do you agree that it’s high time Mumbai needs an integrated
plan for bridging this gap? Your views.
I have spent more than 25 years in Mumbai. In all these years, I
spent a lot of time commuting to and fro, from my office. Lately,
I have realized that the majority of Mumbaikars are forced to
live in suburbs due to skyrocketing property price and are forced
to spend a lot of their time, mapping long distances between
their home and workplaces. Thus, the gruesome commuting affects
their productivity.
Yes, I agree there is a wide gap between the rich and the poor.
The government needs to think over this disparity. In order to
get better infrastructure and better standard of living for the
people, the government should encourage redevelopment or
rehabilitation projects, which should have a clean and
corruption-free approach. Land cost should also be reduced to
make way for the construction of affordable housing.
Do you also have plans to develop affordable housing schemes in
Pune?
Building affordable housing depends upon how FSI has been fixed.
More and more developers nowadays are influenced by foreign
architects and their designs. Do you think it’s worth hiring
foreign architects for Indian projects? Do you favour such
obsessive attitudes?
The knowledge must spread. We do not mind taking inputs on
something which we never experienced. There is nothing wrong in
sharing knowledge, thoughts, ideas and exploring new
architectural elements while constructing a building. But in the
hindsight, there are drawbacks also. Although, the designs the
foreign architects make attract eye-balls, it is not always at
par with the Indian climate and living conditions. For example,
the glass façade they use extensively on most of the building
construction in Dubai is mostly irrelevant in Indian living
conditions.
His Persona
What’s
your favourite hobby? If we are not mistaken you play a lot of
Golf.
Mr. Vasudevan:
As I have said earlier, when I was in Mumbai, I spent most of my
time travelling to my workplace. I had little time to do any
recreational activity. But here, in Pune, the situation is
different. Now I have more spare time to follow my fitness
regime. Yes, I do play Golf, and spend at least two hours every
day for fitness activities.
You are a successful industry person… Is there anything that
you miss in life?
Time. I have devoted a lot of quality time to my work. I miss
time when it comes to giving it to my personal space.
What is the most important thing that changed your
life?
Venturing into business from general office work was the biggest
life changer for me.
What is your most cherished possession?
The company I formed is the most cherished possession in my life.
It has grown from one to 800 people. This gives me immense
satisfaction.
What skill do you think every man should have?
Compassion and care are two things that a man should give
unconditionally to people. Be it an employee or client, you need
to make all of them happy.
How much of a perfectionist are you?
I am passionate about my work. I love my work and on the basis of
that if you call me a perfectionist, then I am a perfectionist
indeed.
Are you a tough boss?
Considering my last two answers, I would say I am a tough boss in
this regard (laugh).
Three things you can’t live without.
Family, friends and loved ones.
Not any material thing? Like your Blackberry.
(Laugh) For me material things are irrelevant.
The entrepreneur, who has inspired you the most.
I don’t have a role model as such. But to be successful one needs
to have an eye for detail and has to be a good PR or HR person.
That makes one a good entrepreneur.