Profile-Valley Homes (P) Ltd.

Profile-Valley Homes (P) Ltd.
New Business Age, September 2007

With the mushrooming growth of housing companies and colonies over the last some years, the recent trend among the developers is to go for higher end of the market. Valley Homes (P) Ltd. is one such company. But the promoters say, right now they are more in developing the company and its brand than in making immediate financial gain. The strategy adopted is to let the customers choose the interior of the house so that the houses are customized to the needs of the individual buyer that is unlike in case of other colonies where the buyer has to buy what the builder has developed.

Spread over 76 ropanis of land located at Sunakothi village, about three kilometers drive from Satdobato of Lalitpur, the new colony developed by Valley Homes is of international standard targeted to the high income families, says Suraj Narayan Joshi, Chief Executive Officer of the company.

The first phase of the project is now complete and all 28 homes built in this phase using up some 25 ropanis of land are already sold, he says and informs that all the new owners will move in over the next couple of months.

According to Joshi, upon completion, the project will have about 80 or 90 homes with the entire necessary infrastructure, which, according to the plan, include a club house, grocery store and a recreation centre in addition to the drainage, water supply system, power supply system and the like.

Being targeted to high end buyers, the Valley Home houses are priced high. “But that is commensurate with the quality,” says Joshi. By quality he means not only the construction standard and material used, but also the environment. “It is the whole package that we are selling. The customer buys not only the dwelling unit, but the entire atmosphere. For which he is always ready to pays the extra.”

Having already sold 28 units, the business idea of the company has proved itself. As Joshi admits, the idea was initially like a hypothesis, not based on any research on the target customer base of the company. “It was based on the observation of similar high-end housing colonies at Gurgaon and NOIDA near New Delhi of India. We had concluded that if something sells in India, it will sell also in Nepal. And that gamble has paid off,” he adds.

The strategy adopted by the company is to build the skeleton of the colony according to the company’s design but let the buyers of the house select the lay out for the interior. “One customer may need a Puja Kotha whereas the other one may need bigger room for the children. We build their houses accordingly,” says Joshi.

In the course of the development, Joshi has made a number of interesting findings related to housing business in Nepal. The most important finding, according to him, is the fact that the Nepali buyers of houses in colonies are not ready to make the buying decision until some infrastructure is ready or the construction of the house is completed to a certain level. “I think it is the reflection of their mistrust on the developers,” he says. That was precisely the reason why the Valley Homes are being developed in phases. Now that the first phase is developed and 28 houses are already sold, the interested buyers of the homes in the next phase have something they can see and evaluate the developer.

In the second phase, Valley Homes is developing a grocery shop and children’s park as well in addition to planned batch of 30 additional houses. The work is already in advanced stage of development and bookings are to start soon. And Joshi says, also the work on the third phase is to start soon.

The second finding of the company is that since a lot of women are now in high income earning jobs, they are ready to pay something extra for their new house if the environment is good. Similarly, the company has also concluded that the Nepali people too don’t mind commuting 15-30 minutes to work as long as they are sure that the homes are in good environment. Both of these findings are very much similar to the experience in Delhi’s satellite towns Gurgaon and NOIDA.

And Joshi is happy that the location of present colony has given his company the opportunity to create such environment. The location is pristine village away from the busy city centre. While the residential colonies developed in the past in the city centres are now gradually turning into commercial centres, this is not likely to the case in Valley Homes’ colony. The expansive area owned by the company gives it enough space to separate the dwelling units from the disturbances that may be there when the locality outside the colony develops into a commercial area.

Though Joshi complains that his company had to make a very high investment to develop the water supply system, he is happy that the water that is now available in his colony is of very high standard. For that purpose, the company has to deep bore and install its own filtration system. But as the surrounding area is free from any industrial activities and urban waste, the underground water is free of any contamination. “The water that comes on the house taps is totally safe for drinking,” he claims.

After the Valley Homes, the company is considering to go for developing some entertainment facility. For this purpose, some land is already acquired in Godavari area, informs Joshi. Then on the cards is a commercial complex nearer to the city.