Good Traction In Bengaluru & Hyderabad For Recent Premium Residential Launches: Brigade Enterprises

Summary

In this conversation, Pavitra Shankar, Managing Director of Brigade Enterprise, discusses the current real estate market and Brigade’s approach to premium housing. With a diversified portfolio spanning mid and upper-mid segments, Brigade has seen steady sales, particularly in Bengaluru and Hyderabad, while Chennai’s market remains slower. Despite a more cautious consumer attitude post-market correction, Pavitra remains optimistic, emphasizing stable prices and careful decision-making in the sector. Brigade's plans for FY 2026 include expanding in southern markets and maintaining growth. The conversation also touches on Blackstone’s increased interest in residential real estate, further formalizing the sector.

Takeaways

• 😀 Brigade Enterprises has a diversified portfolio, with 80% of their projects in the mid and upper-mid segments, but is also focusing on premium housing with launches in key cities.
• 😀 Brigade’s premium housing projects include Brigade Insignia in Bengaluru, Brigade Icon in Chennai, and Brigade Gateway in Hyderabad, with prices ranging from ₹4 crores to ₹22 crores per unit.
• 😀 Bengaluru's market is stable, Chennai has seen a slightly slower pace in ultra-luxury housing, and Hyderabad's premium market has experienced rapid sales with units sold within weeks of launch.
• 😀 While the market was more frenzied a year ago due to rising prices, demand for ultra-luxury homes is now more measured, with customers taking more time to make decisions.
• 😀 Brigade’s focus on steady pricing has led to a stabilized market, with price increases now in the 8-10% range, as opposed to the previous 30% year-over-year hikes.
• 😀 Brigade Enterprises is targeting sales of ₹6,300-6,500 crores in FY 2024-25, and has already launched 11 million square feet out of the planned 12.6 million square feet for the year.
• 😀 Brigade plans to continue growing its presence in Hyderabad and Chennai, aiming for an increase in sales of 15-20% year-over-year for FY 2025.
• 😀 The company has already secured some approvals in March 2025, and expects further stable growth, though approval delays are less problematic now compared to the previous year.
• 😀 Institutional players like Blackstone are showing increased interest in the residential market, which Shankar views as a positive development that adds more formalization to the sector.
• 😀 Brigade Enterprises does not plan to raise additional equity capital, having already raised sufficient funds through a QIP in 2024, along with internal cash flow to support their land acquisitions and business development.

Q & A

What percentage of Brigade Enterprises' portfolio is focused on ultra-luxury housing?

Around 80% of Brigade Enterprises' portfolio is focused on mid and upper-mid segment properties, with ultra-luxury housing (priced above 5 crores) making up a smaller portion.

How does Brigade define the 'premium' housing segment in terms of pricing?

Brigade defines premium housing as properties priced above 5 crores, with specific projects ranging from 4 crores to 22 crores depending on the city and location.

What has been the performance of Brigade's ultra-luxury properties across different cities?

In Bangalore, Brigade's premium properties have been stable with gradual sales, while Chennai has seen slower sales for premium properties compared to Bangalore. Hyderabad, however, has witnessed strong demand, with over 200 units sold in a short period.

Why is there a decrease in the level of urgency from customers in making purchases for premium properties?

The decrease in urgency is due to the stabilization of property prices, as the market is no longer experiencing the rapid price increases seen a year ago. Buyers are taking more time to compare options and make informed decisions.

How does Brigade approach the pricing of its premium housing projects?

Brigade takes a cautious approach to pricing, with an understanding that the market has stabilized. The company has adjusted its pricing based on a clear understanding of market conditions, aiming for steady growth without the frenzied price hikes seen in previous years.

What are Brigade's projections for sales and launches in FY 2026?

While specific guidance for FY 2026 is not provided, Brigade aims for 15-20% year-over-year growth in terms of value. The company is focusing on expanding its presence in Hyderabad and Chennai and has a strong pipeline of launches for the coming year.

How much of Brigade's planned supply for FY 2025 has been launched so far?

As of the end of Q3, Brigade has launched nearly 11 million square feet of residential projects, with an additional 4 million square feet added since then. The total planned supply for FY 2025 is around 12.6 million square feet.

How does Brigade view the impact of delayed approvals on its business?

While delayed approvals were a challenge in the past, especially during periods of high demand, Brigade feels the situation has improved. The company is confident in its current position with approvals and expects steady project launches moving forward.

What is Brigade's stance on Blackstone's investment in the residential real estate market?

Brigade sees Blackstone's investment in the residential market as a positive development, as it adds formalization to the sector and increases competition. Pavitra Shankar believes that more quality players in the market will benefit both developers and customers.

Is Brigade planning to raise additional equity capital in the near future?

No, Brigade is not planning to raise additional equity capital. The company raised funds through a QIP in August of the previous year and is currently generating sufficient funds internally to support its land acquisition and business development.