Thiruvananthapuram: Ajay Prasad, Country Managing Director – India for Boston-based Taurus Investment Holdings is a ‘Trivandrumite’ first, as his Twitter handle says. It comes as no surprise, considering his never-say-die belief in the city’s potential to rise on the development and infrastructure front. Of course what Ajay didn’t see as a youngster, then a social
Thiruvananthapuram: Ajay Prasad, Country Managing Director – India for Boston-based Taurus Investment Holdings is a ‘Trivandrumite’ first, as his Twitter handle says. It comes as no surprise, considering his never-say-die belief in the city’s potential to rise on the development and infrastructure front. Of course what Ajay didn’t see as a youngster, then a social development blogger and the face of Trivandrum Development Front driven by the city’s people, is that he would be back to helm what is, by his own admission, “the single largest project ever in the history of Kerala”.
Development evangelist Ajay Prasad shares his vision for the city that raised him, proof that he has always believed in the capital’s ability to lead, riding on its many social and economic factors
An alumnus of St. Thomas School in Thiruvananthapuram, Ajay took a degree in Electronics from College of Engineering Trivandrum (CET) followed by management studies from Indian Institute of Management (IIM) Calcutta. He then joined as strategy consultant at a development firm in Kerala. In the years that followed, Ajay went on to become one of most followed voices as a development evangelist through the blog tvmrising.in. Now, at the helm of the Taurus Downtown project in Thiruvananthapuram, he flies in to Kerala from the US once a month to chair meetings and lead discussions for the project.
In an exclusive interview with technopolis, Ajay Prasad shares his vision for Taurus Downtown and development possibilities in the State.
Can you tell us about how your career took off?
While in college, I was also politically active which led to my becoming the general secretary of the students union at CET. I was general secretary of the union at IIM Calcutta as well. This emboldened me to try my luck as a politician but it never clicked. Then, I worked for about seven and a half years in various managerial positions at consulting firms. In 2010, I went to MIT to do my second masters in real estate development and joined Taurus after that. This will be my seventh year with the company.
How did the shift to urban development happen?
For some reason, I was always fascinated by buildings. Honestly, I wanted to be a civil engineer. In India, you are driven by the entrance rank, and mine got me a seat in Electronics. But by a curious turn of fate, when I started working in consulting, almost all my clients turned out to be from the construction field. Of all those in the consulting team, I was the only one who used to understand the front-end from the back, so I was constantly put on construction assignments. It then felt right to make an entry into the actual industry myself. But I never had any formal training in real estate development. So I decided it was time to go back to school. Not keen on another MBA, I looked for a specific degree and MIT offered a Master of Science (MS) program in real estate development. After covering the initial part of the syllabus which is mandatory, I was permitted to pursue any course of my choice at MIT and Harvard. So I gravitated towards subjects that were unrelated to real estate, such as transportation and planning. In that sense, it was the perfect course for me.
What led Taurus to a tier II city like Thiruvananthapuram?
Taurus is a truly global company. We are, at any given point, in 10 countries from four continents in over 35 geographical markets.
Taurus has been looking to enter India from the early 2000s, because it is a company that follows macroeconomic factors. Hence, our presence in countries like Canada, Argentina, Turkey and so on. So the management of the firm, notably the chairman, understood that India is the future – the demographics, rising GDP and all – it was clear as a company, we had to look at India for the long run.
While there was no breakthrough then, we tried again in 2011, deciding that secondary markets were a better option than primary markets as they were very competitive. We looked at multiple secondary markets before zeroing in on Thiruvananthapuram, which we were familiar with – a factor that played an important role in our considering it. The company chose this project because it was a PPP, something Kerala was comfortable with.
How did Downtown Trivandrum come into being?
We approached Technopark in early January, 2013. In the latter half of 2014, the government formally awarded the project to us. In September 2015, we signed a framework agreement with the Government of Kerala, spelling out the terms and conditions.
It was a long wait as the government was dealing with some financial issues that Technopark had to resolve before we could take over. At the time, we also realised that due to the sheer scale of the project, a joint venture partner would be required and Embassy Group came onboard. A JV agreement was signed with Embassy in September 2017 and in March, the following year, we formally acquired the project from the government.
What is the timeline of the Taurus project?
Taurus Investment Holdings launched the project in October 2018. There are two divisions: the office – Embassy Taurus TechZone Trivandrum, and the non-office section that comprises retail, entertainment and hospitality. The first component, the office section, is what we call the Keystone. It is a 65,000-sq. ft., temporary pre-fabricated office building. The idea is that till the main building becomes operational, we will provide 800 seats as a franchisee office for tenants. Work commenced in November last year. We expect to deliver at least 200 seats in April 2019 and have the building operational by June 2019.
We hope to deliver a significant portion of the Taurus project by August, 2020. That will be about 1.5 million sq. ft. of built-up area. We hope to deliver the non-office section by December 2020.
We are building 4.4 million sq. ft. in Phase I while Phase II will be another 1.5-2 million sq. ft. Depending on how much office space we are building, the project might end up having about 6 to 6.5 million sq. ft. of space.
What will Taurus offer the technology sector in Kerala?
We are delivering about 2.3 to 2.8 million sq. ft. of occupied space, on the technology (office) side, which, in today’s occupancy ratio, will provide about 35,000 people direct employment opportunities. The non-office section will provide around 5,000 jobs.
But more than being a job creator, we want to be at the centre of the whole ecosystem. Downtown Trivandrum hasn’t been named so as it rhymes well but because we want to create a hub of social infrastructure. When we came here in 2012, it was learnt from big IT firms at Technopark that a dearth of social infrastructure remains their biggest concern. It continues to be the same for later entrants as well.
Today’s millennial workforce – I call myself a borderline millennial, is concerned about quality of life. So if you have to track and retain talent, a good quality of life is essential in a technology ecosystem.
Thiruvananthapuram scores on certain aspects – the city is clean, relatively uncongested and a great place to live in. But do you have much to do after 5 pm? Perhaps not. We are trying to create that in ways that are sustainable and smart.
When it comes to sustainability, all the buildings will be Platinum LEED-certified, digitally-enabled and hence, known as a Smart District. There will be building management systems, Wi-Fi and other amenities. We are also trying to create an app-based user experience platform. The app is envisaged in such as way as to assist shoppers, cinemagoers, hotel guests and office-goers at Downtown.
I believe real estate developers need to be people who provide an experience. Real estate itself has become secondary. With the works of Wework and Airbnb, real estate itself has become a service and not a product. The sooner developers understand that, the better their chances of survival.
How does Taurus plan to bring in more companies?
I was, in fact, discussing how to expedite the project, with my team because we have been receiving good response from the industry. We are looking at medium and small tenants as well, not just big tenants. We are bringing New York-headquartered co-working firm WeWork to the city. It is the first time they are setting up a location outside a tier I city. The main aim behind the move is to cater to this kind of an audience. What I have pitched with WeWork’s (a franchise of Embassy Group) India CEO Karan Virwani is not just about having a cool co-working space but a firm that manages the workspace of corporate occupiers. And yes, we want to bring that to Thiruvananthapuram.
Besides, we are leveraging our global network of tenants and apart from Embassy’s tenants across India. It probably has the best clientele in India with over 190 tenants like JP Morgan, Mercedes Benz and IBM whom we are trying to bring here. I always ask Jitu Virwani, Chairman and MD of Embassy why he chose to come with us to this city. He says Embassy has a lot of tenants in Bengaluru, Pune, Chennai and Hyderabad who tell him that they are looking for a more relaxed city which, at the same time, has great talent and productivity. In Thiruvananthapuram, for example, one may not probably get stuck in traffic unless it is a very rainy day and even then, one may not spend more than an hour in traffic. These companies also admit that a great deal of their best talents hail from Kerala. So obviously wouldn’t those employees be a lot happier if they get to work in a place closer to home?
The attrition rate of companies in Thiruvananthapuram is 4 to 5 per cent whereas in Bengaluru, it could be as high as 20 per cent. Massive cost associated with losing and replacing an employee is another factor for medium-and high-profile companies. It’s not just hiring and re-training costs, but those incurred on opportunity cost, business disruption cost and so on. So, companies want to keep employees with them, happily at that, for as long as possible. Hopefully, by January, we will be able to announce our first set of big tenants.
What about the city brings companies here?
There are more than 10 good companies here that are established and are of global repute. A scalable model is already present. Kerala has an impressive reputation in terms of talent and is more politically stable than other states and has great social indicators that are very important especially for international investors, particularly in HDI, education, female workforce and so on. It is cost competitive. If you look at fully loaded cost, what tech companies refer to as per seat cost, it is still about 20 per cent cheaper than Bengaluru, and that matters.
It is not direct real estate expenses, but re-training costs are cheaper, people are willing to work for a lower salary hike since their expenses are lower and they are close to their family, and travelling is not a hurdle. If we look at the ease of investing in Kerala as opposed to other states, we are doing really well.
Once you get into the groove, it is really fast. Infrastructure, for a lot of people, is not bad in Kerala. It has great connectivity. We are not Singapore – I don’t think we want to be Singapore. But we are very competitive and pretty much a more established destination.
How can the capital grow alongside the tech industry?
What we need to do is plan ahead. Infrastructure is a long gestation investment because even if you are Chinese, you will need anywhere near a five year period to install infrastructure on that scale.
Thiruvananthapuram’s road infrastructure is in pretty decent shape. Apart from a few flyovers what we need is a mass transit system. Technopark is starting to choke up because 90 per cent of 65,000 people there use their own means of transport. That is not sustainable. Unfortunately, the metro project is lagging. It is doable with a restructuring of the existing route which is completely lackadaisical.
Instead, it should have a route that immediately addresses the requirements of Technopark Phase I, II and III which will allow the project to become commercially viable.
The next factor is transit-oriented housing, one area where a lot of cities have started to lose out. Mass transit should be able to connect areas that are further out. As for social infrastructure, it is in the process of being resolved. The one area where we still lack and is in the domain of the government is a decent convention centre. We need one and it has been lagging for a long time. It will definitely help the technology and tourism industry.
Mantra to boost investor confidence in Kerala?
I think we need more senior sponsorships on development projects, such as having the chief minister or the chief secretary or a designated minister directly overseeing and reviewing projects. They will need to identify top priority projects.
Kerala needs to refine the skillsets of its labour force. The raw material unique to Kerala is the talent it has. Rather than supply them to different countries we need to enable them with the right skillsets so as to be employable here. Revising the education system to make it more industry-oriented is important.
The third thing the government could do is focus on basic research and applied research facilities. The handful of national-level research institutes here are not doing much. Our companies ought to become confident about leveraging the intellectual capital of our population. That should be top priority as we are sitting on a treasure trove.
The downtown trivandrum project fact file
In Phase III of Technopark, Downtown Trivandrum is developed by Taurus Investment Holdings along with partners Embassy Group and Asset Homes on 22.16 acres. The project will include Embassy Taurus TechZone, an office complex with 33 lakh sq. ft. of collaborative workspace; Taurus Zentrum, a 12-lakh sq. ft. retail and entertainment centre; Asset Taurus Identity, 300-plus units of serviced residences; and a business hotel with 200 rooms. Chief Minister Pinarayi Vijayan launched the project on October 13, 2018. “As a priority sector, the government is emphasising the creation of necessary social milieu and basic infrastructure in the IT sector, aiming at increasing software export and attracting investors,” said the Chief Minister at the launch. Phase I of Downtown Trivandrum will be completed by 2020, he said, and also unveiled the model of the project on the occasion.