The world will surely not be the same post the pandemic crisis. As Real Estate Developers we are a pivotal part of the Real Estate Industry which is a US$ 160 billion industry and is expected to reach US$ 1 trillion by 2030 which would be 1/3rd of present size of India’s economy. Real Estate Industry is expected to contribute 13% of India’s GDP by 2025 (IBEF,2020). More than 250 Ancillary Industries are part of the sector hence making Real Estate the second largest employer. Real Estate Sector has the potential to uplift the economy.

However, since 2017 rapid changes brought through demonetization, enactment of RERA, introduction of GST, IL&FS crisis, IBC and NCLT Courts, NBFC & HFC crisis and now the global pandemic of COVID 19 has brought about a massive liquidity crisis. Albert Einstein once remarked that “In the middle of adversity there is great opportunity”.  Real Estate Developers are one of the most resilient specie with an enormous capacity to recover quickly from difficulties. Who better than Promoters of Real Estate Development Companies to suggest strategies to operate during and post Lockdown?

FINANCE:

• Restructure facility with extended Principal Moratorium, Interest Moratorium & Top-Up Facility
• Refinance to capital with better terms
• Revise the Cashflows and Business Plan
• Analyse your financial leverage and optimise the capital structure, we would recommend less issue of debts for the projects
• If you have not yet, start exploring other development models like Joint venture, Joint Development and Development Management (basically an asset light model).
• Control your costs and Increase liquidity within the firm
• Adopt a slightly aggressive strategy for old collections

MARKETING:

• Communicate : Real Estate Acha Hai, Real Estate Safe Hai, Real Estate He Sahi Hai
• Your Website is your Sample Flat !
• Focus heavily on Digital marketing
• Introduce Virtual Reality & Walkthroughs
• Inculcate Technology to a great extent
• Increase use of CRM software
• Shift from Physical Campaigns to Online Campaigns
• Come up with creative and innovative benefits to the customers; prevent offering unrealistic discounts we need to be united to keep the margins healthy
• Reduce Marketing Spend till FMCG & Automobile Sales Increase
• Think of Safety & Sanitation precautions to be taken for Site Visits
• Increase use of Tele Marketing
• Price Reduction is not the solution, focus on product design and characteristics

SALES:

• Interact with Channel Partners (CP) to get Pulse of Market
• Try for direct customer deals and pass them the CP incentives
• Don’t encourage if CP’s are being opportunistic about brokerage structures
• Incentivise Referral Customers
• Subvention Scheme is the solution to revive demand for under-construction
• Schemes like 10:90 (Builder Subvention) should be evaluated well before offering the same to customers
• Be flexible with your ask, try and bring the customer to even terms, use spot discounts instead of public announcements.
• Periodic virtual review interactions with the brokers for improved morale, feedback and action plan for improving sales efficiency
• Focus on loyalty sales as a key lever in delivering on sales revenues
• Focus on completing projects as fast as possible to ensure sales

DEALING WITH CUSTOMERS AND INVESTORS:

• Conduct Virtual Meetings, Communication is the Key !
• Call each Customer and apprise them about the revised timelines
• Send them regular monthly work updates for first 6 months post Lockdown
• Introduce hassle free documentation by moving online
• Handle each and every complaint with 100% assistance
• Be true with them, pacify them for what’s coming and offer discounts on upfront payments
• Offer Price Protection & Refundable Booking amount
• Flexible Payment Schedule

DEALING WITH EMPLOYEES, STAFF:

• Communicate, Communicate and Communicate with Honesty & Transparency
• Reserve Cash Flow, Give Sustenance Pay, Avoid Job Cuts !
• Rationalize Salaries, No Increments this Year
• Treat your employees & labour as your family, ultimately, it’s their effort that will bring you out of this crisis, make them a “Part of You” – more than ever
• Halt new recruitment if not extremely necessary
• Focus on outsourcing tasks instead of in-house operations.
• Develop a sense of inclusion, lead from the front
• Make sure all your workers/employees are heard at the top level
• Ensure health and safety of labourers and employees
• Lead and motivate them to achieve targets and offer performance-based incentives
• Increase Productivity with Technology and ERP Systems

DEALING WITH EMPLOYEES, STAFF:

• All the consultants can be dealt using Web calls, as they have high client exposure in daily life, it will be advisable to avoid the meeting for some time
• Deal with consultant on need basis only
• Consult on their views and ideas of tackling the crisis.
• Take all their advices seriously and be open to innovation and change in long used processes
• Request Consultants to accept part payment now and balance on completion of project or receipt of sales accruals

DEALING WITH VENDORS:

• Assure them payment will be available, now is the time to stand by them
• DO NOT Renegotiate the existing contracts of vendors / contractors
• Communicate with them and instil trust in clearance of dues by making prompt payment
• Mutually develop new prices and timelines
• Establish relationships and ensure both survive the crisis
• Insist on Technological Upgrades
• Safety, Security of Labours is of Paramount Importance
• Financial Security of Assurance of Receipt of Payment is of utmost importance

Related Blogs:

• FINANCIAL LOCKDOWN OF SMALL AND MID-SIZED REAL ESTATE DEVELOPERS
• Warehousing, Industrial and Logistics (WIL) – Emerging Industry Leader
• FORCE MAJEURE IN LIGHT OF COVID 19
• REAL ESTATE EMERGENCE: POST LOCK DOWN
• Are REITs (Real Estate Investment Trusts) the Future of Indian Investments?

broker certification course careers Communication Covid 19 DCPR 2034 Digital Marketing Expert Opinion Finance Financial Lockdown FSI impact of the DCPR Indian Real Estate Industry Insights Lockdown real estate Real Estate Broker Certification Program real estate broker course Real Estate Business Real Estate Developers real estate professionals real estate skills site layout Soft Skills TDR Technology Training