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News & Views on Indian Real Estate

Monday, August 11, 2008

Builders Concerned About Cutting Costs

Akruti City is planning to use pre-fabricated slabs in its buildings, which will help the company in saving 15 to 20 per cent cost over manually-laid slabs. The company is also exploring new techniques to build walls and pillars that could save up to 20 per cent over conventional techniques. However, Akruti is not the only developer trying to cut costs due to the realty slump caused by higher interest rates and capital curbs by the government. All across India, realty companies are sourcing cheaper materials, using more advanced technology and new techniques to reduce construction time even as overheads are being slashed. The drive to cut costs is becoming critical as key input costs - steel, cement and labour - that account for 40 per cent of project costs have escalated 50 per cent over the past year. Mahindra Lifespace Developers has recently set up an innovation cell to explore the use of new construction materials such as fly ash instead of cement, using better mechanisation and technology to cut costs. Now, the company has reduced the time taken to lay slabs from one month to 21 days and plans to cut it to a fortnight. Besides this, there is a buzz is that real estate companies are retrenching staff and cutting salaries but Parsvnath Chairman, Mr. Pradeep Jain said such moves would not serve any purpose. "When you set up a company, employees become part of your growth. You cannot penalise staff in bad times. But we can certainly cut overheads," he said.

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Julia Dutta said...

Regarding The DDA flats on my blog, your comment needs to be re-checked as from very reliable sourses I have come to know - These flats advertised now found no takers earlier for various reasons including poor construction, proximity to jhuggi jhopri , and water problems. These are not new flats, just flats being offered for ready possession.- hence any promotion of the same is anti-public interest!
Julia

Vikas Bamotra said...

With the city’s real estate market being dominated by smaller and unheard of players whose actions could fright away prospective buyers, the bigger players are joining hands to give a professional touch to the realty business.

And it’s necessary for cutting cost and introducing more technology.

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