Arihant Foundations plans to invest INR 650 crore in real estate projects in Chennai and Bengaluru by FY25, focusing INR 150 crore on Grade A office spaces in Bengaluru. The Chennai-based developer aims to develop 0.5 million sq ft of commercial space and 1 million sq ft of residential space in both cities. Arihant's MD Kamal Lunawath highlights new commercial and residential projects, including premium and mid-segment apartments and senior living developments in Chennai. The company targets 15-20% growth in FY25, driven by increasing investment in Chennai's real estate market and robust office leasing activities.
Chennai-based listed real estate developer Arihant Foundations and Housing is set to invest INR 650 crore in real estate projects in Chennai and Bengaluru by the end of FY25. Managing Director Kamal Lunawath disclosed these plans to Moneycontrol, emphasizing the company's strategic expansion into Bengaluru. Of the total investment, INR 150 crore will be allocated to developing Grade A office spaces in Bengaluru, with the remainder focused on projects in Chennai.
Arihant Foundations is particularly targeting areas close to Bengaluru's central business district, the northern regions, and the eastern IT corridor of Whitefield. Lunawath highlighted that in the first half of FY25, the company aims to finalize several commercial transactions in Bengaluru and is actively searching for residential land parcels.
The company has ambitious plans to develop around 0.5 million square feet of commercial space and 1 million square feet of residential space across both cities within FY25. Historically, Arihant has developed approximately 20 million square feet in Chennai, including 4 million square feet of office space.
In the previous financial year, Arihant achieved a top line of INR 84 crore. For FY25, the company is targeting a growth rate of 15-20%. Lunawath pointed out that while Chennai remains the primary market, the expansion into Bengaluru represents a significant step forward. The company is focusing on standalone marquee commercial office spaces, each no less than 0.5 million square feet.
Recently, Arihant signed a notable agreement with Equitas Small Finance Bank to develop its corporate headquarters at Anna Salai in Chennai. This project, covering nearly 0.2 million square feet, has a transaction value exceeding INR 300 crore.
In the residential sector, Arihant specializes in premium luxury apartments, with unit prices ranging from INR 2 crore to INR 15 crore. However, the company is currently working on a mid-segment project in Chennai, with units starting at INR 1.5 crore. Future developments within FY25 will continue to focus on the luxury segment.
Additionally, Arihant has partnered with Ashiana Housing to create senior living projects in Chennai, aiming to develop at least 0.5 million square feet of elder-care housing within FY25. One such senior living project is planned for East Coast Road in Chennai, marking a joint development effort.
Lunawath noted a significant shift in Chennai's real estate market. Historically cautious and driven primarily by end users, the market now sees more homebuyers eager to invest in premium luxury apartments priced upwards of INR 2-3 crore. He expects this growth momentum to persist through FY25.
Supporting this optimism, Chennai experienced the highest growth in the Housing Price Index in the third quarter of FY24, with an 8.41% increase year-over-year, as per data from the Reserve Bank of India. Furthermore, in 2023, Chennai recorded the highest-ever office leasing, with 10.5 million square feet of gross absorption. This achievement positioned Chennai in the top three markets for office leasing, alongside Bengaluru and Delhi-NCR, according to a report from real estate consultancy Colliers India.
In summary, Arihant Foundations' significant investments and strategic expansions reflect its confidence in the growth potential of both Chennai and Bengaluru's real estate markets, underscoring the company's commitment to developing high-quality residential and commercial spaces.
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