Luxury duplex apartments in Mumbai left without buyers

The project, however, currently does not have any takers. The last sale was reported in February, when two duplexes were sold in the building

Duplex apartments in a posh Mumbai neighbourhood that could cost Rs100 crore and offer stunning views of the Arabian Sea have failed to find a single buyer in eight months, reflecting the telling impact of a realty slowdown.

Morarka Bungalow on 29, Nepean Sea Road, in south Mumbai, not far from Altamount Road—recently tagged the world’s 10th most expensive street by Wealth Bulletin published by News Corp.—is being rebuilt from a palatial colonial bungalow into a high-rise. At Rs80,000 per sq. ft, each of the 12,000 sq. ft duplexes in the building would cost some Rs100 crore.

The project, however, currently does not have any takers. The last sale was reported in February, when two duplexes were sold in the building.

Sea-facing residences have always been in great demand in the city, more so given their extremely short supply. Most are sold privately by invitation only.

The current economic depression, it seems, has not spared even the country’s uber-rich. In the past six-eight months, sales of the country’s most expensive apartments have stopped, even as sellers struggle to stick to their prices, and network heavily with so-called high networth individuals, the target buyers for such residences.
Priced at around Rs80-100 crore, these apartments are scattered in and around Nepean Sea Road, Malabar Hill and Altamount Road.

To be sure, Pankaj Shah, promoter of Satellite Group, which is developing the Morarka bungalow project, is sticking to his guns. “The building is going to be very exclusive and we will complete it soon,” he said. “I can’t disclose the booking price and status of sale for the project.”

Pujit Agarwal, managing director of Orbit Corp. Ltd, a publicly traded property developer, is candid when he says the last apartment he managed to sell in the Orbit Arya project on Nepean Sea Road was seven months ago at Rs58,000 per sq. ft. Three out of nine apartments in the high-rise remain unsold.

The developer was more cautious with his other project, Orbit Haven, in the same area. To counter the slowdown, the builder has shrunk the apartments, from 4,500 sq. ft to 2,500 sq. ft, with a sticker price of Rs55,000 per sq. ft.
The results have not been markedly different.

“We thought bigger the flats, the more expensive they become, and hence more difficult to sell,” said Agarwal. “But we have sold only two out of 18 apartments since we opened bookings in April.”

The last big ticket sale in south Mumbai was in May 2007—a Rs30 crore apartment bought at Rs1.2 lakh per sq. ft by actor and Bharatiya Janata Party MP Vinod Khanna in the Il Palazzo building on Malabar Hill.

Property prices spiralled upwards from 2005 when even resold properties in the financial capital were going at unbelievable prices. In December 2006, a 3,000 sq. ft apartment at Maker Tower B in Cuffe Parade was sold at Rs73,000 per sq. ft and another flat in the high-profile NCPA building on Marine Drive was resold at Rs63,000 per sq. ft.

“Apartments, particularly big ticket ones above Rs25-30 crore, are getting difficult to sell. Demand is down and that has reflected in the sales,” said Abhisheck Lodha, director of Lodha Group.

The company’s project Lodha Solitaire on Nepean Sea Road, which has only nine apartments, one to a floor, has 20% of the stock left, the last sold about nine months ago, Lodha said.

A south Mumbai property consultant said another residential project with 11 apartments on Altamount Road hadn’t sold a single flat since it opened for bookings six months ago. The price quoted for the 5,500 sq. ft apartments was about Rs55,000 per sq. ft at that time. “The project got the occupancy certificate six months back and now the sellers are willing to negotiate at a price of Rs30,000-35,000 a sq. ft as well,” the consultant said on condition of anonymity.

Agarwal says current market conditions have also propelled him to consider leasing out his upcoming project rather than waiting to sell or sell at a lower price.
S.G. Maheshwari, former chairman of lobby group Estate Agents Association, said he doesn’t expect sales to gain in the next six months. “Developers will compromise heavily on their profit margins because they can’t afford to sit on such expensive properties without selling them,” he said.