Expert talk on Real Estate Business Development and Challenges by Mr. Chetan Shah

30/10/2018

Mr. Chetan R. Shah, Chairman & Managing Director of Marathon NextGen Realty Ltd. delivered an expert session about “Real Estate Business Development and Challenge” on 24th October 2018.  Major highlights from the session are cost-benefit analysis, cash flow ratio and 4ps in the context of real estate/flat.  He stated that the cost-benefit analysis is the outcome of the analysis will determine whether the project is financially feasible or if the company should pursue another project. Cash flow ratio is the operating cash flow ratio is a measure of how well current liabilities are covered by the cash flows generated from a company’s operations. The operating cash flow ratio can gauge a company’s liquidity in the short term. He explained the 4PS Pricing, Place, Product and Promotion in the context of real estate/flat. The comparison of traditional and complex project characteristics in-terms of standard practices can be used (design, funding, contracting), static/dynamic interactions and high level of similarity/uncertainty to prior projects.

Floor Area Ratio: The floor area ratio (FAR) is the relationship between the total amount of usable floor area that a building has, or has been permitted to have, and the total area of the lot on which the building stands.  A higher ratio is more likely to indicate a dense or urban construction. Local governments use FAR for zoning codes.

Comparison of traditional and complex project characteristics

  • Traditional projects :

Standard practices can be used

  1. Design
  2. Funding
  3. Contracting

Static interactions

High level of similarity to prior projects

  • Complex Projects :

Standard practices can be used

  1. Design
  2. Funding
  3. Contracting

Dynamic interactions

High level of uncertainty about final project scope.

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