Interview: Oversupply in Dubai property market will separate the men from the boys, says Sobha Realty Chairman
Interview Oversupply in Dubai property market will separate the men


Speaking exclusively to Zawya from his Business Bay headquarters in Dubai, Menon referred to the issue of oversupply in the Dubai property market: “I am extremely optimistic of Dubai… [the] opportunity is there, but you have to be a man to run the business.”

The self-made Omani billionaire of Indian origin is worth $1.1 billion as per Forbes magazine’s real-time net worth and has committed 50 percent of his wealth to charitable projects that he runs in his native state of Kerala in India. 

The 71-year-old patriarch sailed to the Sultanate of Oman with mere $7 in his pocket about 44 years ago. Menon started his professional life when he set up an interior decoration firm in 1976. “The journey was very tough in the beginning as it was not easy to do business without capital,” he said.

The “painful exercise“, he claims, went on till he was able to secure capital for his interior decorating business that he had started with his Omani partner.

Menon said that his demand for perfection and maintaining the highest quality standards in his work helped grow his reputation. His biggest achievements, he said, were the opportunities to work on the palace of His Majesty Sultan Qaboos and the Grand Mosque in Muscat, which bear testimony to his work.

Thereafter, he received a lot of assignments from several palaces and hotels across Oman, Qatar, Bahrain, Brunei and the president of Tajikistan over the years. 

In pursuit of quality

Menon’s quest for quality work continues till date. “We don’t compromise [on quality],” said Menon.

Sobha Realty, the real estate firm that he set up after moving to Dubai in 2004, is perhaps the only fully backward integrated developer in the world. The developer does its own engineering, design, metal glazing and interiors in-house to ensure stringent control over quality.

Menon moved from backward to forward integration – he started his interior decoration business first and then shifted to construction work, which he believes provided him with a thorough understanding of every block of the real estate value chain.

“If you have total control over the entire spectrum of the business… you will be able to control the quality of the product, which is very important to me,” he explained.  

“Quality is never achieved. It is an endless exercise and you go on trying and trying,” said Menon. His ability to deliver quality helped his company receive international accreditation with ISO:9001:2000, ISO:14001 (2004 series) and OHSAS:18001 (2007 series) certifications for adhering to Environmental, Health and Safety standards.

Sobha Hartland, the company’s 8-million square feet mixed-use development, is its flagship project in Dubai, which was launched in 2014. It is a waterfront community of ultra-contemporary villas, townhouses, mid- and high-rise apartments, clubhouse, two international schools, three boutique hotels, restaurants, retail, spa, mall and leisure areas.

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The resort-style luxury housing project’s 30 percent area (2.4 million square feet) is reserved for green and open spaces.

The $4-billion project comprises a range of units that are priced between 835,000 UAE dirhams (for a one-bedroom apartment) and 39 million UAE dirhams (for a Dubai Canal villa).

Chinese investors top the list of buyers of Sobha Realty’s properties – accounting for about 30 percent of its sales in 2019, followed by Emiratis, Africans, Indians and Saudis.

In 2019, Sobha Realty sold 1,491 units, comprising a net area of 1.23 million square feet. More than 900 units at Sobha Hartland are slated for handover during 2020.

The developer announced an ambitious 2.5 billion UAE dirhams’ sales target for 2020 after surpassing its total sales target of 2 billion UAE dirhams in 2019. The year-to-date results mark a 165 percent increase in sales value over the same period in 2018.

The India story

Menon made an entry into the real estate market way back in 1994 in India, when he wanted to diversify geographically. “India at that point had 12,000 developers. I thought if 12,000 can survive then 12,001 can also survive… we won that game,” he said. 

Menon named his company, Sobha Developers, after his wife. His son, Ravi Menon, a civil engineering graduate from Purdue University in the US joined the India business in 2004 and took over as its Chairman in 2012. 

“Our Indian story has been reasonably good,” he said. Menon is rated as the sixth richest person from Kerala in the IIFL Wealth Hurun India Rich List 2019.

By June 2019, Sobha had delivered projects covering over 105 million square feet of area. The realty firm has a presence across 10 cities – Bengaluru, Gurugram, Chennai, Pune, Coimbatore, Thrissur, Kozhikode, Kochi, Gujarat (Gift City) and Mysore.

He has worked with some of the top tech and hospitality companies in India such as Infosys, Wipro, HCL, Dell, Taj Group of Hotels and ITC Hotels, among others.

“We have a beautiful relationship [with N.R. Narayana Murthy, the co-founder of Infosys, an Indian technology services and consulting firm] and we continue to make most of their buildings even now. This relationship helped me build the Sobha brand in India,” he said.

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Philanthropic trust

Despite the sheer scale of Menon’s achievements, he never forgot his humble beginnings or his roots that lie in Kerala’s Palakkad district.

He had a tough childhood after he lost both his parents by the age of 10 and he didn’t even complete his bachelor’s degree in commerce. 

“I had decided to spend a part of my wealth more than 35 years ago,” said Menon.

Menon formalised his philanthropic efforts and founded Sri Kurumba Educational and Charitable Trust in 2006. He fully funds the trust and has since supported people in Kerala’s villages of Vadakkenchery and Kizhakkenchery and Kannambra, by providing essential education, healthcare, housing, elderly care, young mothers rehabilitation, rural women empowerment, weddings without dowry, etc.

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The trust currently takes care of the education of 15,000 students, provides a home for senior citizens and young widows and their children.

Some of his key initiatives include, Sobha Academy where students receive free education; Sobha Vocational Training Centre, which allows the less privileged to pursue a vocation of their choice; Sobha Hermitage, a home for the elderly; Sobha Rural Women Empowerment Program that covers expenses of widowed mothers; Sobha Health Care Centre, Sobha Social Weddings and Sobha Green Initiative. 

Menon plans expand his philanthropic work to Bangalore, Delhi and Oman and help up to 60,000 children.

“Supporting those less fortunate and giving to charitable causes has always been an essential element to me. I view it as a duty… I have been very lucky to achieve so much in my lifetime and it is only right that I dedicate myself to helping others to transform their lives.”

Planning for the future

Menon has ensured that his legacy is carried on by his family members. In his absence, his wife Sobha will be chairperson and his son Ravi will be co-chairman. Sobha Realty will be taken forward by Francis Alfred, MD & CEO of Sobha Realty and Jyotsna Hegde, President of Sobha Realty. 

However, Menon has no plans to hang up his boots even after being on-the-go for almost five decades now. He still follows his “early to bed and early to rise” routine religiously. He wakes up at 5am (which is a “little late” by his standards) and works between 9am and 6:30pm whenever he is not travelling. At home, he is a complete family man and unwinds in the company of his seven grandchildren before calling it a day at 9pm.

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With enough land stock to last for another decade of development in Dubai, Menon says he has an immediate goal of consolidating his empire in the UAE.

Meanwhile, Menon will continue to focus on his dream project, which is still in the future, he says as he signs off.

(Reporting by Mily Chakrabarty; editing by Seban Scaria)

mily.chakrabarty@refinitiv.com

Disclaimer: This article is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Read our full disclaimer policy here.

© ZAWYA 2020



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