Chennai: It is his customers ''walk'' to their destinations, offices, mall or school- that the P Suresh, 49, managing director, Arun Excello Infrastructure Pvt Ltd expects would propel him into the bigger real estate league.

The Rs100-crore turnover group that sold over 1,000 residential apartments promoting 19 projects, is planning to double that number in a single project called Estancia. An integrated township project, it comprises an IT park, school, shopping mall, hotel and serviced apartments coming up at Vallencheri, on GST Road near Chennai.

Undoubtedly, the Rs1,500 crore project on a 78-acre plot is a Hanuman jump for the group headed by this mechanical engineer from Guindy Engineering College, Chennai and an MTech from IIT, Kharagpur. All these years the group was promoting projects in the band of 3-4 acres.

A first-generation entrepreneur, Suresh started his career with Voltas Limited. Five years later in 1986 after gaining project construction experience at Voltas Refrigeration, he along with his brother, brother-in-law and cousin promoted Arun Excello Fabricators, a turnkey contractor building oil storage tanks, distribution lines and others within and outside India. With its experience in civil construction gained they ventured into real estate development in 1996.

While their focus was on residential apartments alone, the young entrepreneurs took in the changes in Chennai''s real estate. The demand for IT office space was going up dramatically, fuelling the demand for residential space, which attracted big operators like DLF, Raheja, Hiranandani and others landed in the city with big projects.

"Given this scenario, survival for us meant scaling up," says Suresh. He decided to acquire the required land 35km away from Chennai while others were putting up township projects in the vicinity of Chennai''s IT highway, the Old Mahabalipuram Road. "The area is congested and does not have the necessary social infrastructure," he says. As a matter of fact, the group sold its land in that area.

Initially planned as a residential apartment project, Estancia underwent changes in line with the market. As a purely upmarket residential apartment would not attract people to live 35km away from the city, Suresh decided add other features like a school, IT Park, shopping mall, a club, hotel and serviced apartments.

There are two reasons for this. First the availability of a reputed school, an IT park that would house employers, a shopping mall and a clubhouse were expected to create demand. Second, leasing out non-residential buildings would generate perennial revenue for the project promoters.

As the project turned out to be different from its original plans Suresh decided to look at people with relevant expertise and funds and approached L&T.

The construction giant immediately bought the idea as it had the needed expertise while the Rs300-crore land for the project came on a platter. "The whole deal happened in just 10 days. L&T will participate in the project through one of its arms L&T Urban Infrastructure Limited," he adds.

The two will execute the projects through three special purpose vehicles - one each for residential, IT and the commercial projects. The project-wise equity holding pattern will be - residential 67:33 between Arun Excello and L&T Urban respectively; IT and commercial projects 49: 51 between Arun Excello and L&T Urban. The whole project, divided into three phases, will be complete by 2011.

According to the final plans Estancia will consist of a residential space of around 3 million sq.ft spread over 37 acres; a 27 acre IT park with a built up area of 2.7 million sq.ft. office space; the retail mall, hotel and serviced apartments totaling 1 million sq ft. The school will come up on a 3 acre plot.

As to the division of roles, Arun Excello will develop and market apartments while L&T Urban will do the same for IT and commercial projects.

The first phase will comprise 700 residential apartments, 1-million sq ft IT space and the branch of Vidya Mandir School. "The serviced apartments and the hotel will be in the second phase." The group is negotiating with financial institutions for project assistance. "The debt: equity will be 2.5: 1," Suresh says.

According to him, it was Vidya Mandir School that saw the value in our proposal and decided to come on board. "The school project involves an outlay of Rs20 crore. The land, we will own building and other assets. The Vidya Mandir School will bring its management and educational experience."

Another first of its kind for the Chennai market is the roping in of film actor Madhavan as the brand ambassador for the project and shooting an attractive television commercial. The company plans to spend around Rs90 lakh for promotion.

The bookings for apartments is on at brisk pace, says Suresh. "Nearly 50 per cent of the first phase has been booked," he says. The apartment size ranges between 1,510sq.ft to 1,860sq.ft. The total cost to buyer including the three-year maintenance charge to be paid in advance would work out to around Rs53 -Rs 65 lakh based on the apartment category.

"We are not skimming the market. Our price is based on cost plus basis. All the floors have uniform pricing unlike many other projects." Speaking about the prospects for Estancia he says several projects in the IT, auto and other segments, are coming up around the area. High net worth individuals would like to reside near their place of work with all other facilities thrown in.

Even though the group is promoting another housing project on a 40-ground plot called Desh four kilometers from Estancia, Suresh says the group would henceforth focus on township projects.