GST 2.0 could slightly reduce construction costs: ASBL CEO

Hyderabad: ASBL,a Hyderabad-based real estate developer, has shed light on changing rental market dynamics while unveiling progress on its flagship residential project, Loft, in the city’s Financial District.

Speaking to media, ASBL’s founder and CEO Ajitesh Korupolu said the company acknowledged that recent GST reforms could slightly reduce construction costs, particularly in cement, and added that it wants to pass on benefits to consumers through product upgrades rather than price cuts.

He outlined how the rental market is increasingly driven by newly married couples and young families, while investors—mostly professionals approaching retirement—are seeking rental income as an additional source of financial security.

According to ASBL founder, properties offering strong walkability—where residents can literally walk to offices—are commanding a premium, with rental yields fetching a bonus of up to Rs50 per sq ft. Compact apartments in the 1,700–1,900 sq ft range are proving more profitable for investors than larger over 2,500 sq ft units, as rent-per-square-foot remains higher in mid-sized homes.

The company also compared residential rental assets with commercial real estate. Unlike commercial spaces—where ownership is fragmented, exits are difficult, and rental control lies with agencies—residential units offer clear ownership, easier exits, and direct control over leasing decisions. Corporates, too, increasingly prefer leasing single-owner commercial buildings over multi-owned ones due to challenges in cost-sharing for upgrades.

The Loft project, currently 60 per cent complete, is positioned to meet demand from mid-level professionals earning Rs24–30 lakh annually. The development consists of 894 three-bedroom apartments sized 1,700 and 1,900 sq ft, spread across two 45-storey towers. Handover is scheduled for December 2026. The project includes modern amenities such as a 5,000 sq ft co-working space and a 5,000 sq ft crèche—designed for young families balancing careers and childcare. Apartments are priced at around Rs11,000 per sq ft, making a typical unit cost approximately Rs1.85 crore.

The company has invested Rs500 crore in the five-acre project, with a topline potential of Rs1,600 crore. Of this, Rs1,000 crore worth of sales have already been booked.

Ajitesh emphasised ASBL’s focus on product-market fit, designing homes aligned with local job markets and income levels rather than relying solely on location. They noted that while Hyderabad absorbs about 50,000 housing units annually, certain micro-markets such as the Financial District face undersupply in mid-sized housing categories.

He said, ASBL has also distinguished itself by enhancing transparency. Since 2021, the company has uploaded monthly drone-shot construction updates on YouTube, addressing concerns from NRI buyers about project timelines.