Redeveloping the Future of Transit-oriented Development

Anyone passing through Bhopal in the last few months would be hard pressed to have missed the incredible transformation the Habibganj Railway Station (now known as Rani Kamlapati Railway Station) has gone through. From resembling every other generic railway station in India to now becoming one of India’s most attractive and uber-premium first PPP railway station, Habibganj has come a long way. Avnish Hasija, CEO-Commercial of the Habibganj Railway Station Redevelopment Project, a first of its kind Public Private Partnership (PPP), is the man who brought the station to life by apt zoning and leasing. A veteran entrepreneur with over 35 years of experience in business development, real estate development and asset management, Avnish has created an admirable legacy out of sheer hard work, learnings and networking. Corporate Citizen chats with Avnish about the highlights of his career, his role in redeveloping India’s first PPP railway station, and his philosophy of life, among many other topics

"One thing I was clear about is that I wanted everything to be done as per international standards. I even took a few courses in the US, Singapore and Dubai because I wanted everything to be done systematically"

- Avnish Hasija

Corporate Citizen: You have had an illustrious career spanning over 35 years. Tell us about your early career.

Avnish Hasija: After my higher education, I joined my family business. Our family was into the business of selling automobiles. We were dealers for various automobile companies. I joined that business when I was 18-19 years of age, since I tragically lost my father very early. I participated in the business in various roles over the years. I handled the entire marketing strategies for selling. I also handled the Principle relationships with Automobile Companies. Dealers were very essential to our company at that point in time. I was the one who was primarily responsible for maintaining the relationship between the principle and the dealers. It was by virtue of this relationship that I also went on to do a one-year MBA course for which I was nominated by one of our Principle Companies. It was the first of its kind where the Escort Dealer Development Association had lined up a faculty from a renowned Business School abroad. The faculty had come over to their Bengaluru training farm where they conducted a one-year mini MBA course specialising in the handling of dealerships. I completed that course on the behalf of dealers from Madhya Pradesh. This was in 1987.

CC: How did you transition into real estate?

Around 2001, our family decided to do away with the dealerships and since we were a joint family, we decided to diversify our businesses. We were dealers for Hindustan Motors and DCM Daewoo, and both these car manufacturers had shut down, so we had no option but to shut the operation. At that point in time, companies were not willing to award more than one dealership in the cities, so we chose to sell the company assets and everyone would go on our separate ways.

Around that time, I met a friend over a cup of coffee. He had a lot of entrepreneurial qualities and he also dabbled in diversified businesses. We began talking and I asked him what I should do since that our company was shutting down. He said that he was going to Mumbai to check on a new business potential, and asked me, why I don’t I go along with him. I went with him the very next week and we checked out Crossroad One, which was the first-ever organised shopping mall which was set up in India. We somehow managed to meet with the promoters to see if they were willing to get into a joint venture to open something in Indore. My friend had his ancestral home in the most potential area of the city and we zeroed down on that as our site in Indore, which I believed held a lot of potential. We loved the idea and that’s how I started in the real estate business.

One thing I was clear about is that I wanted everything to be done as per international standards. I even took a few courses in the US, Singapore and Dubai because I wanted everything to be done systematically and not haphazardly like how many others were doing at that time. We then decided to set up a project called Treasure Island in Indore. It was a very successful project which we launched in 2005. Mind you, malls were a novelty in India in the 2000s. Treasure Island became the eighth shopping mall of the country and first mall of an Emerging 2-Tier Town, Indore . That’s how the story started. Over time, a lot of companies then began investing in us, such as ICICI Ventures and other FDI Funds. Fresh from the success of our first project, we began to roll out a cluster of our malls. I then went to Mumbai and learnt best practices from our Partners. From 2005- 2015, I had a rich experience of working with them.

"If you see the volume of passengers which are travelling, it is huge. If you actually give the passengers what they need, the volumes are more than enough for monetisation"

CC: Tell us about your current role as the CEO of Habibganj Railway Station Redevelopment Project. How did that come about?

We split up from our Partners in 2015. I then changed my role and went to Bengaluru to explore another class of real estates, which was second homes. There was a company which was formed by two NRIs called Zion Hills Golf County. They were developing a golf course along with a golf training academy. I joined there as the COO of the real estate to plan and sell the second homes they were building on that property. Around that time, I got a call from the Madhya Pradesh Government. They were aware that I had done the Treasure Island project a few years ago, and they invited me to come to Bhopal, and participate in a new landmark project which was coming up, floated by the Indian Railways and Bansal Group. Bhopal had the honour of having the first station hosted on this new PPP model. That’s how the Habibganj Station redevelopment project came into my hands. There were several reasons why this project was close to my heart. The project was being executed in my home state and I had the opportunity of being close to my home town after so many years, and cherry on the cake was to participate in the first of its kind landmark project So, I took on the offer and started in this role around five years back.

CC: This project has been made at a cost of 450 crores. That’s a large amount of investment. Was most of it made by you?

The Government has come up with its own PPP concept. The Government wanted the station to be redeveloped, and the Government did not want to pay in cash for the project. The Government stated that the company which wins the bid should conduct the redevelopment of the entire station and then make the station compensate us for the money we will be spending on redeveloping the land. They handed over to us four pieces of land, and we had to strategise and decide how to monetise these pieces of land, what to build on them, and how to get our money back. We had grand plans for the redesign. That’s the reason the total investment was initially pegged at Rs.450 crores. However, during the entire process of planning and conceptualising, the entire investment has more than doubled . The reason for this spike in costs is essentially, the kind of asset we were building to do justice to the excellent prime location and the class of assets that we are building to justify the same. We are confident that the location and quality of assets we are building should make our investment feasible. The location is very premium and we truly believe that we should build something which will be there for a long time. The land has been leased to us for 45 years. We are planning a project which will see the light for more than 45 years.

CC: Do you think you will take up more such PPP projects with the Railways?

That’s the basic idea moving ahead. We will be bidding for new stations which will be redeveloped under PPP. We already have the experience of finishing the first project successfully, although the commercial development is still pending.

CC: What commercial development did you have in mind?

We are constructing four big projects lining the railway station. One is a mixed use building with corporate offices and a retail high street. This building is known as Bansal One. We are about to give possession and launch this in by March-April 2022. The second is called Bansal Plaza. Bansal Plaza is an integrated shopping mall with a multiplex, also having a budget hotel of 100 rooms. That should be nearing possession by Jan 2023. We should see this operational by June 2023. The other class of projects that we are hosting is a five-star hotel with a convention centre. The fourth project we are going to be bringing in is a multi-specialty hospital of 400 beds. Our company is already into hospitals and we are already running a hospital with 300 beds called Bansal Hospital for the last six years. We thought this was the right location to bring in the second expansion for the hospital of our company. All put together, these four projects will form the commercial arm of the Habibganj (now Rani Kamlapati) station redevelopment.

"The location is very premium and we truly believe that we should build something which will be there for a long time. The land has been leased to us for 45 years"

CC: You have redeveloped the station on international lines, which is very commendable. But has there ever been a concern about monetisation considering the economic profile of railway passengers as opposed to air travellers?

Not at all. If you see the volume of passengers which are travelling, it is huge. If you actually give the passengers what they need, the volumes are more than enough for monetisation. People were already spending at railway stations on water, samosas, chai, etc. But if you actually look at the volume of these products which were being sold, you would be shocked. Earlier passengers were spending `50 at railway stations. Today, that number has easily gone up to `200. If you see the other aspect, there are more and more new trains which are being introduced with air conditioning. You cannot say that a person travelling in AC coaches does fit in the profile of air travellers. There are several reasons why passengers choose to travel by trains, for example, to rest overnight and have a more comfortable journey. At our station, 60% of the daily travellers who gets down or board at our station are AC travellers. One just has to plan products and offerings targeted at these passengers.

CC: You are a privately held company. Any plans to go public?

Not at the moment. We are currently working on indictment of FDI and inducting equity. Once we take on another 2-3 stations, we can then think of an IPO.

CC: Are you able to strike a work-life balance?

Yes. Bhopal as a city is very easy going and beautiful city, and I have always believed in work-life balance. I have spent 12 years in Mumbai and three years in Bengaluru. I have never faced an issue with striking the right balance.

CC: What’s your idea of relaxation?

I mostly believe in reading. I also like going to a remote place to relax at a resort for a few days with my wife. My children have grown up and they are independently involved working with various companies.

CC: What is the philosophy that you live by?

“To let go in life”. I don’t believe in holding on to anything. I am largely a project man. I believe in finishing a project and then moving on to the next.