DBS Communities. days. Learning and Responding to optimally Design Build Serve

Transcription

1 DBS Communities 1000 days Juy 2009-June 2012 Learning and Responding to optimay Design Buid Serve

2 esign uid erve By 2020, DBS Communities wi have buit 50,000 iveabe and affordabe homes, and wi have grown and expanded into a arge socia enterprise where peope who join as customers transform their ives and become partners in the movement, and mentor newcomers.

3 Journey of 1000 days, Contents Preface 01 Executive Summary 05 DBS Communities: An Overview : DBS Starting the Journey 09 Potentia DBS Customers A Snapshot 22 The DBS Business Strategy : Pioting, Learning and Responding to Needs 28 The Design Charette 29 DBS Piot Project Umang Lambha, Ahmedabad 35 Credit Camps 45 Housing Faciitation Centre - Griha Pravesh : Progress and Learning 61 Umang Naro 62 Adaaj Campus and ASHRAM 66 Lambha Customer Profiing - The Findings : Partnerships and Management Systems 77 Umang Sachin, Surat 78 Setting a Benchmark for DBS Umang Projects 80 Key Lessons after 1000 days 83 Beyond June 2012: Way Forward and Future Pans 94 The Core Team 98 Our Partners & Associates 107 Media Coverage 108 Acknowedgements 110 Notes and Abbreviations 111

4 esign uid erve DBS aims to estabish an efficient, viabe and transparent system for the arge-scae mass-production of houses that are affordabe and financed through savings and credit systems that are accessibe to the bottom haf of the socio-economic pyramid.

5 Journey of 1000 days, Preface As an architect, I have ong been interested in deveoping affordabe housing for the ower income groups in India, where the need for affordabe housing is immense. In pursuit of this interest, I had experimented with this market with a ow cost housing deveopment caed Nandan Nagar in Athough the Nandan Nagar piot was not a success, it provided invauabe earning and insights that convinced me that affordabe housing was a significant niche business area. After a hiatus of three years, my passion for deivering affordabe houses intensified when I read CK Prahaad's Fortune at the Bottom of the 1 Pyramid. Specificay, I was enthused by Prahaad's argument that the economicay ower sections of society are a arge market in emerging economies and their needs coud be met through innovative business modes that have to be ow margin high voume. The enthusiasm ed to my decision to focus on this niche market systematicay. I asked B.R. Baachandran, an architect and panner who shared my passion and with whom I had been discussing my desire of working for this niche market, to partner with me in this endeavour. I aso requested Dinesh Jain, a chartered accountant, to join us. In 2009, we aunched DBS Affordabe Home Strategy Limited. The first step was to articuate our vision, mission, objectives and approach. We were cear that to reach our potentia customers, we needed to buid affordabe houses and tacke the hindrances that ow-income famiies face in purchasing houses in the forma market. We reaised that we needed expertise in community deveopment and interaction. We therefore decided to partner with Saath - an NGO with 20 years of experience working with the urban poor, and asked its cofounder, Rajendra Joshi to join our core team, which at the time incuded senior researcher - Sowmya Haran, architects - Vineet Chadha and Anjum Gupta, Chief Executive Officer - Manish Panchoi, Vice-President Finance - Sudershan Iyenger and Management Consutant - Ravi Iyer. The Team beieved strongy in earning from experts, practitioners and businesses, and in getting a better understanding of the issues reated to affordabe housing and its customers. Thus, with the genera objective of getting our strategy endorsed, we conducted a Design Charette in January The Charette provided important insights and reiterated understanding that affordabe housing woud work when issues of design, iveihoods and housing finance were addressed pro-activey as part of our business mode. This contributed to the formaising of the core of our approach and business strategy. With carity about our approach and articuation of our business strategy, we were ready to aunch a piot project. Umang Lambha was aunched in Ahmedabad in May The response to the project was overwheming with amost 300 houses DBS Affordabe Home Strategy Limited 01

6 esign uid erve booked within a week. The experience confirmed that there is a huge demand for affordabe housing. In March 2011 we aunched a second project - Umang Naro in Ahmedabad, and in February 2012, we ventured out of Ahmedabad to aunch Umang Sachin in Surat. With each project, we experimented with a different impementation mode. For Umang Lambha, DBS bought the and and undertook the construction work, for Umang Naro, we partnered with a andowner and took responsibiity for project construction and marketing, and for Umang Sachin, we partnered with andowners who are responsibe for construction whie DBS is responsibe for marketing and customer management. For each project, we have been aby supported by housing finance companies, such as Micro Housing Finance Corporation Ltd, GRUH Finance and Muthoot Finance that are venturing into the affordabe housing space and providing oans to the forma and informa sectors. In ooking for good practices in the affordabe housing sector in India, we reaised the need for research and considerabe advocacy with poicy makers and practitioners. We therefore estabished a separate entity - Academy for Sustainabe Habitat Research and Management (ASHRAM) for this purpose. In addition, DBS and Saath estabished a housing faciitation center caed Griha Pravesh that works with buiders and housing finance agencies to increase awareness about and access to housing finance and affordabe housing. In order to better understand the big picture in affordabe housing and to estabish the highest standards of governance and accountabiity, we DBS Communities beieves in accountabiity and transparency in a its actions. For effective and efficient use of a its resources, DBS is in the process of operationaizing an enterprise resource panning system that wi integrate interna and externa management information across the entire organization and faciitate the fow of information between a functions of DBS Communities. invited Mr Sakti Prasad Ghosh who has been associated with the housing sector in India at the highest poicy eves, to join our Board of Directors. Further, to enhance design, quaity and standardisation, DBS has coaborated with Mr Nimish Pate (architect, urban designer) and Ms Paru Zaveri (architect) of Panika who have since 1979, worked on architectura, panning, conservation, renovation and interior projects of varied scaes. A dedicated affordabe housing division in Panika wi work on the DBS projects. In this journey of 1,000 days since DBS Communities was estabished, I beieve we have aid a strong foundation by taking a hoistic approach that benefits a stakehoders, and have progressed substantiay towards addressing our objectives. Our business approach of a virtuous cyce of research, practice and refection continues to provide rich experiences that enrich our understanding 02 DBS Affordabe Home Strategy Limited

7 Journey of 1000 days, about affordabe housing. We have a dynamic and dedicated team that is doing its best to Design and Buid affordabe houses to Serve our customers. DBS Communities has taken this opportunity of sharing its experiences, observations and essons earnt in the pursuit of enabing ow income famiies experience the 'joy' of owning a house. This incudes an overview of the processes and the efforts, events and activities that have gone into panning, designing and initiating Umang Lambha, Umang Naro and Umang Sachin, as we as the need for handhoding / supporting peope in getting their paperwork together and in their interactions with housing finance institutions. In October 2012, our first customers wi start occupying the houses that DBS Communities has buit. I am confident that apart from owning their individua houses, these customers wi show us where we have been right and where we need to improve our services. We expect to continue the process of earning and responding to new essons, insights and chaenges as we work towards achieving scae and voume, and thereby impact not ony the ives of those who purchase houses buit by DBS Communities but aso those who want to cater to the niche market. This incudes peope invoved in poicy-making, financing housing and infrastructure projects, in strategic panning and in supporting communities. Sanjay Shah June 2012 DBS Affordabe Home Strategy Limited 03

8 esign uid erve Affordabe home deveopers must continue to innovate to be abe to provide sma homes at the most competitive price. It is cear that there is a much arger market waiting to be tapped. Ideay housing for this segment in the city of Ahmedabad shoud be kept under Rs.7,00,000. Incrementay of the housing unit can be expored in terms of interior finishes. The more austere the finishing's, the greater wi be the affordabiity and the greater the access to forma mortgageabe asset creation. 04 DBS Affordabe Home Strategy Limited

9 Journey of 1000 days, Executive Summary In Gujarat, there is saying that If start-ups survive the first 1000 days, they wi survive through compemented by the beief that the test of future success of a business is its surviva in the first 1000 days. DBS Affordabe Home Strategy Limited, aso known as DBS Communities, which has been aunched with the dream of revoutionizing the housing industry within a decade, crossed this miestone of 1000 days in May The DBS Team is confident that the essons earnt and actions taken over the past 1000 days have contributed substantiay to strengthening the organisation and the processes, systems and approaches for increasing the suppy and access to affordabe housing. This Report provides a gimpse of the dreamers, their dream and the actions taken over 1000 days by DBS Communities and its partners to works towards accompishment of the dream. The aim of this chronoogicay organised report is to document and share with the reader, the efforts, events and activities that have gone into panning, designing, initiating and marketing three DBS housing projects, as we as the experiences, essons and actions taken to meet newy identified needs. Each step of the process from articuating the DBS Communities' business strategy to the introduction of innovative processes and practices provides significant essons for housing finance institutions, deveopers, non-governmenta organisations (NGOs) and other stakehoders interested in the affordabe housing ecosystem. The chronoogica organisation of the report draws attention to the fexibiity and customer responsive approach of the DBS Each step of the process from articuating the DBS Communities' business strategy to the introduction of innovative processes and practices provides significant essons for housing finance institutions, deveopers, nongovernmenta organisations and other stakehoders interested in the affordabe housing eco-system. Team and its partners. It emphasizes the DBS Communities' approach of earning from and responding to the context with appropriate strategies and actions. The report provides the reader with insights and information about: a) The Vision, Mission and Business strategy of DBS Communities; b) An anecdota study of two potentia customers, a snapshot study 100 potentia customers and a study of 360 Umang Lambha customers; c) Three Umang projects aunched and under construction; d) the financing issues identified from the perspective of deveopers, housing finance institutions and home buyers, and e) the faciitating actions taken by DBS Communities to bridge the gap between requirements for oan sanctions, documentation and margin money avaiabe with Umang customers. The process and experiences have aso provided insights into the needs and characteristics of potentia customers and about factors that hinder or support affordabe housing. The Preface by Sanjay Shah provides a gimpse of his invovement in the affordabe housing market and his focus on providing vaue-additions to the customers rather than a minima house. These DBS Affordabe Home Strategy Limited 05

10 esign uid erve With the experiences and essons earnt in strategizing, initiating partnerships, and aunching joint venture projects with different impementation arrangements, DBS Communities has taken significant actions that have resuted in vaue additions for its customers. experiences heped Sanjay in deveoping his approach and in strategizing and panning for affordabe housing schemes. He provides an overview of the events and activities of the 1000 days. At the end of 2008 when Sanjay Shah, B R Baachandran and Dinesh Jain decided to set-up a new organisation for buiding affordabe housing, they were convinced that they shoud go sow, and work-out a fu mode before 'aunching a project and starting construction'. This section emphasises the strong beief amongst the Core DBS Team that a market based soution is possibe and that any eement of subsidy woud be detrimenta if a robust rea estate market were to deveop for the identified customer group. Graduay, many of the ideas that were discussed at the time were written out. In 2009, DBS Affordabe Home Strategy Limited was incorporated with the objective of meeting the need of affordabe housing for famiies earning between Rs.8,000 to Rs.20,000 per month. The three core eements for providing affordabe housing were identified as: i) Design and production of housing, that is, right sizing and right pricing of homes; ii) Housing micro-finance, that is, enabe access of customers to finance for housing; and iii) Community deveopment through heath, education and iveihood interventions. The emphasis on community deveopment highights the Team's conviction in getting the required expertise through coaborations and patforms such as the 5 Design Charette. In January 2010, DBS organised a Design 5 Charette where the direction, processes and activities that the Team panned to introduce were presented. Athough the DBS strategy and approach were argey endorsed, DBS was cautioned by housing finance companies and Ashoka Foundation about setting-up a housing finance company. The key concern was the ikeihood of a confict of interest and the possibiity of apses in due-diigence in the pursuit of processing oans quicky for more customers. The issues identified at the Design Charette were addressed by DBS whie panning its piot project in Lambha under DBS's Umang banner. The aunch of Umang Lambha was a significant step for DBS Communities and it put in intensive efforts to pubicise the scheme amongst potentia customers. The response of customers confirmed that there is a huge demand for affordabe housing. It aso reveaed that whie most peope in the target group aspired for arger houses, they coud ony afford one or two room houses, whie those who coud afford the three-room apartments were from higher income groups. DBS Communities therefore decided to confine itsef to 06 DBS Affordabe Home Strategy Limited

11 Journey of 1000 days, constructing one and two rooms houses. At the aunch of Umang Lambha and in the foowing weeks, DBS and its partner Saath identified the need for a patform for more intensive interaction between potentia customers and financing entities, and for innovative processes to guide customers, assess their affordabiity and process the oans. It aso highighted financing probems because of sow and irreguar cash-fow from peope booking and purchasing the apartments. These observations and experiences ed to the decision for organising Credit Camps, and for setting-up an autonomous and dedicated singe-window faciitating entity - Griha Pravesh. DBS Communities has been working cosey with housing finance companies such as MHFC and HFFC to refine arrangements at the aunch of projects, organise Credit Camps and support potentia customers. The outcomes of the Credit Camps and the faciitating support through Griha Pravesh revea the vaueadditions and good practices that have been introduced by DBS Communities. Its partner RJD Buidcon is constructing Umang Sachin. The outcomes and essons from these coaborative approaches wi infuence future partnerships for Umang projects, and infuence others invoved in the affordabe housing ecosystem. During this period of 1000 days, DBS has conducted a short anecdota study, a snapshot study of 100 famiies that represent potentia DBS customers, and a survey of 360 customers who have booked apartments in Umang Lambha and Umang Naro. These studies were undertaken to better understand the needs, affordabiity and aspirations of the DBS target group, and the findings provide interesting insights about the customers of affordabe housing. Subsequenty, the DBS Team has been cosey observing the emerging needs, anaysing the studies and survey findings and is incorporating the essons earnt on a continuous basis. Severa organisations too have shown keen interest in the DBS strategy, approach, and processes for enhancing access to affordabe housing. DBS aunched Umang Naro in March 2011 ten months after the aunch of Umang Lambha and Umang Sachin in Surat in February The experiences after the aunch of Umang Lambha, especiay probems faced because of irreguar cash-fow ed to DBS adopting a coaborative approach for these projects. Both projects are being impemented in partnership with the andowners on a profit-sharing basis. DBS has retained the responsibiities for the design, panning and marketing of both projects and for construction of Umang Naro. DBS Affordabe Home Strategy Limited 07

12 esign uid erve DBS Communities: An Overview EFFORT EVENT OBSERVATION RESPONSE Way Forward ŸAchieve greater transparency & financia & resource efficiency ŸIncreased interaction with entities invoved in affordabe housing ecosystem ŸLaunch of Umang projects in other cities ŸOrganise & participate in events for sharing experiences & essons ŸGrowth in demand for affordabe housing ŸHave a sustainabe revenue mode ŸMore coaborations ŸStrengthen staff capacities ŸAdvocacy for poicy & reguatory reforms that can catayse the market 2012 (Up to May) ŸStrengthen management systems ŸDocument deveopments of 1000 days ŸLaunch of Umang Sachin at Surat ŸGriha Pravesh expands coaboration with deveopers ŸContinue tracking customers and their progress ŸBenchmark for Umang projects required ŸDesign Manua ŸDBS Team expansion & coaborations with experts 2011 ŸGreater efficiency in project design & management ŸGreater efficiency in resource panning & management ŸASHRAM Campus inauguration ŸLaunch of Umang Naro in Ahmedabad ŸNeed to understand way of ife of potentia customers ŸExpand association with experts ŸConduct research on 360 Umang customers ŸAchieve vaueadditions for customers 2010 ŸImpement piot to test concepts, ideas & approaches ŸTeam strengthened ŸPartnership with andowners for Umang Naro ŸGriha Pravesh incorporated ŸLaunch of piot Umang Lambha in Ahmedabad ŸDesign Charette ŸNeed for a housing faciitation centre ŸAternative deveopment & revenue mode ŸGriha Pravesh & Parivaar Pragati Seminars ŸCredit Camps ŸCose cooperation with housing finance entities 2009 ŸEvove & refine DBS Business s Strategy ŸTo have required expertise in DBS ŸCreate a brand identity ŸDBS Affordabe Home Strategy Ltd. incorporated ŸBrand name Umang decided ŸCoaboration with Saath ŸNeed for expertise ŸNeed to understand way of ife of potentia customers ŸSnapshot study ŸAnecdota study of famiies of Diipbhai & Tusiben ŸExpansion of Core Team 08 DBS Affordabe Home Strategy Limited

13 Journey of 1000 days, DBS: Starting the Journey We expect to continue the process of earning and responding to new essons and insights as we work towards achieving scae and voume, and thereby impact not ony the ives of those who purchase houses buit by DBS Communities but aso those who want to cater to the niche market at the bottom of the socio-economic pyramid. DBS Affordabe Home Strategy Limited 09

14 esign uid erve The Beginning Three individuas who were independenty experimenting with aternative soutions in their areas of work, came together in ate Their ongoing diaogues, ideas and a desire for innovation were cataysed by C.K. Prahaad s path-breaking book - The Fortune at the Bottom of the Pyramid (2005). The three peope were: Mr Sanjay Shah as a Rea Estate Deveoper brought in fifteen years of experience as a buider in Ahmedabad, Dubai and Morocco, and experiences of innovative cost contro, pricing and effective quaity management systems. He aso brought in his vision and capabiities as a strategist who beieves in the viabiity of a market based approach to community housing. Mr B.R. Baachandran as an architect, panner and strategist with neary two decades of professiona experience, brought in his understanding of the urban housing process with its mutipe dimensions, and a focus on systems and processes that enabe affordabiity for the target customers of DBS. Mr Dinesh Jain as a Chartered Accountant brought in over two decades of experience in corporate finance, of conceptuaizing new enterprises and guiding them to their fu operation, and expertise in buiding arge and robust financia management systems. During initia discussions, these individuas agreed that deveopment of affordabe housing for ow income groups coud not be mixed-up with other rea estate deveopment initiatives. Subsequenty, the passion, drive and a strong beief in the viabiity of affordabe, good quaity and market based housing soutions for owincome famiies ed to the incorporation of DBS Affordabe Home Strategy Limited on 7 Juy The focus on designing and buiding affordabe houses for famiies who do not have access to the forma rea estate market because of their economic situation is refected in the name of the enterprise that is, DESIGN, BUILD and SERVE DBS. As the Team addressed key issues invoved in successfuy enabing peope in the informa sector purchase a house, it identified the need for focussing on the communities and peope for whom the houses and housing projects were to be buit. The Mission and Vision of DBS Communities are therefore buit on the inherent strengths of a community based approach. This ed to a study ed by Baachandran and Sowmya Haran. The two famiies that were studied were of Diipbhai an office assistant empoyed in the private sector, and Tusiben a vegetabe vendor. The aim was to get a better understanding of the need and affordabiity of famiies iving in renta and own accommodation in informa settements; this was our first concept eve presentation, namey, A House for Diipbhai and A House for Tusiben. 10 DBS Affordabe Home Strategy Limited

15 Journey of 1000 days, A House for Diipbhai A House for Tusiben One of the persons' whose way of ife was studied was Diipbhai - an Office Assistant who earns Rs.4000 per month. Diipbhai rents a house of 120 sq.ft. where he ives with his wife and two chidren. He pays the house owner a monthy rent of Rs.1500 and Rs.30 per month for the water. Diipbhai's famiy shares a common water tap and toiet with the house owner's famiy. Diipbhai wants to buy his own house for which he can pay a monthy instament (EMI) of Rs In addition, he can mobiise some down payment. At Rs.1250 per sq.ft., Diipbhai can buy about 200 sq.ft. of buit-up area. However, houses of 200 sq.ft. are avaiabe ony in sums or iega ayouts, and hence Diipbhai has no choice but to ive in an informa settement. Tusiben, who is ony 28, ives with her famiy in a 144 sq.ft. house in Behrampura. Tusiben owns the house but has no documentation for it. She has a water connection in the house but shares a toiet with other famiies. She aso has an iega eectricity connection for which she pays Rs.150 per month. Tusiben and her husband are vegetabe vendors who aso make and se kites seasonay. She owns a handcart/ ari, which they use for vending vegetabes. Tusiben wants to buy a house costing up to Rs.2,00,000 for which she cannot mobiize any down payment but for which she is wiing to pay a monthy instament of Rs.3,000. At the market rate of Rs.1,250 per sq.ft., she can buy a house of about 160 sq.ft. However, the smaest ega house wi start at Rs.3,50,000 or Rs.4,00,000, and houses of around 160 sq.ft. are avaiabe ony in sums or iega ayouts. Thus, if Diipbhai purchased a 150 sq.ft. house for Rs.200,000, and was supported through community deveopment initiatives to start saving money reguary, repay the housing oan, upgrade his skis, and improve his income, at the end of three years, he wi be abe to take an additiona oan and move to a house of about 300 sq.ft. area. DBS Affordabe Home Strategy Limited 11

16 esign uid erve Evoving the Vision and Mission DBS aims to estabish an efficient, viabe and transparent system for the arge-scae mass-production of houses that are affordabe and financed through savings and credit systems that are accessibe to the bottom haf of the socio-economic pyramid. The DBS Mission and Vision evoved to incorporate the dreams of the initiators and got articuated as foows: Vision By 2020, DBS Communities wi have buit 50,000 iveabe and affordabe homes, and wi have grown and expanded into a arge socia enterprise where peope who join as customers transform their ives and become partners in the movement, and mentor newcomers. We visuaize that our enterprise wi be acknowedged as the market eader and pioneer in effective approaches to community housing and produce 10,000 houses every year. Our customers are our brand ambassadors having created great ives for themseves in the environment we nurtured. We visuaize that hundreds of rea estate companies/ organizations wi be offering iveabe and affordabe housing soutions for a income groups across cities in India. DBS has infuenced radica reforms in housing poicy and housing market operations in India. Mission To estabish an efficient, viabe and transparent system for mass production of houses, which are affordabe and financed through savings and credit systems, and are accessibe to the bottom haf of the socia and economic pyramid. Governance DBS Communities beieves in accountabiity and transparency in a its actions. The DBS Board of Directors, which comprises the CMD Mr Sanjay Shah, two independent Directors and four Directors, meets at east every quarter to review progress and take strategic decisions. DBS aso beieves in effective and efficient use of a its resources, and is in the process of operationaizing an enterprise resource panning (ERP) system to integrate interna and externa management information across the entire organization. The ERP covers finance/ accounting, construction, saes, marketing, panning, materia purchasing, inventory contro etc. The aim is to have a centra repository for a information and faciitate the fow of information between a functions of DBS Communities. 12 DBS Affordabe Home Strategy Limited

17 Journey of 1000 days, Deveoping the Business DBS aims to estabish an efficient, viabe and transparent system for the arge-scae massproduction of houses that are affordabe and financed through savings and credit systems that are accessibe to the bottom haf of the socioeconomic pyramid. The community housing projects that DBS Communities wants to deveop are targeted for famiies primariy earning up to Rs.20,000 per month. Peope in this segment of the urban housing market find it difficut to purchase houses that are constructed by mainstream rea estate deveopers. They are therefore argey resigned to iving in rented and/ or iega housing. Their situation deprives them of the opportunity to buid egitimate assets or weath and they continue being trapped in a vicious cyce of poverty and iegaity. As professionas and practitioners who had imited experience in the affordabe housing market and of its potentia customers, the DBS Core Team decided to have a committed team of practitioners, professionas, experts and advisers from reated By 2020, DBS Communities wi have buit 50,000 iveabe and affordabe homes, and wi have grown and expanded into a arge socia enterprise where peope who join as customers transform their ives and become partners in the movement, and mentor newcomers. sectors. The Team was graduay expanded to incude more ike-minded individuas who represented different sectors, and shared the same passion and simiar objectives - some as part of the Management Team. With the experiences and knowedge of practitioners on the DBS Team, the business concept evoved further to address mutipe concerns and issues. DBS commenced its initia operations from 14 August 2009 with a staff architect whose first task was to research oca, nationa and internationa efforts, modes and experiments for suppying affordabe housing. The objective was to understand the diverse issues, contexts and paths taken to increase access to affordabe housing and to have knowedge about innovative approaches and processes that others have attempted. In addition, Sowmya Haran an architect and urban panner, and architects Vineet Chadha and Anjum Gupta joined the DBS Team. Sowmya took responsibiity for research and documentation whie Vineet and Anjum started exporing and identifying appropriate design options for one, two and three room apartments. In 2009, DBS procured 1.5 acres of and in Ambapur near Adaaj for deveoping a campus to accommodate the DBS Corporate Office and other documentation, conference and training faciities. DBS Affordabe Home Strategy Limited 13

18 esign uid erve "Umang : Deciding on a Brand Name In an environment where the Government is aggressivey promoting construction of 'basic' houses for sum dweers and the poor under various schemes, the DBS Team decided on creating a unique image for the houses it buids. The aim was to estabish the significant and differentiated presence of DBS in the market both for the customers and the investors/ financing institutions. The DBS Team therefore decided to create a 'brand' identity that highighted the management's strategic focus and choices, quaity, features and design of the apartments, and the added vaue in terms of community deveopment initiatives. Since, the ong-term aim is to have customers who are satisfied with physica and operationa functionaity, quaity, and performance of the schemes of DBS Communities, the Team decided on using the name UMANG - meaning Happiness. The name Umang draws attention to the emotiona aspect and satisfaction customers woud experience once they moved into DBS constructed housing projects. The Team decided to create a 'brand' identity for DBS projects that highighted the management's strategic focus and choices, Subsequenty, the Team decided on using the name UMANG - meaning HAPPINESS or JOY 14 DBS Affordabe Home Strategy Limited

19 Journey of 1000 days, Thinking about a Piot Project As the business strategy and approach were being evoved, it was apparent to the Core Team that it had to demonstrate its commitment and the viabiity of its business approach to peope whose support and coaboration were required. Some team members fet strongy that they needed to impement a project to test their initia concepts, ideas and approaches. This required the purchase of and in a ocation that woud be attractive for peope for whom the project was to be deveoped. DBS identified a pot, which was reasonaby priced at Lambha in Ahmedabad. The pot is ocated aong the Ghodasar Cana and next to the Lambha - Naro Highway (NH 8) in a deveoping residentia area within the boundary of Ahmedabad Municipa Corporation (Pin Code ). The site is cose to Asai Circe/ cross-roads on the 200 feet Ring Road. It is 3 kiometres from Naro crossing and the BRTS route, and is easiy accessibe by city buses, auto-rickshaws, shutte services and inter-city buses. It is aso in cose proximity of market paces, tempes, schoos and hospitas. DBS bought this and (Origina Pot) with money borrowed on interest, with the expectation that they woud pan, deveop and se the apartments, and repay the oan amount within an 'average construction period'. The ocaity was then mapped by Sowmya Haran and her team of architects and panners. Once the pot at Lambha was mapped, a committed team of architects headed by Vineet Chadha and Anjum Gupta started deveoping the design options. By ate 2009, a Concept Pan for Umang Lambha and a presentation were prepared for further discussion and deveopment. The Team presented the concept pan to some practitioners (architects, panners, urban designers) for their inputs. The discussions reveaed that athough design, construction, financing and customer issues were significant eements for the DBS Team and of the business strategy, it woud be usefu to get a deeper understanding of who the potentia customers' were in terms of their existing economic and spatia situation, their aspirations and capacity for purchasing a house. DBS Affordabe Home Strategy Limited 15

20 esign uid erve Comparing Diipbhai's House with Midde-Income Renta Accommodation Diipbhai s House Tusiben s House Private House 120 sq. ft. 144 sq. ft sq. ft. Rent Rs.1,500 Own House Rent Rs.25,000 No individua toiet or water connection Has a water connection but Three toiets and penty of water shares a toiet with other famiies Monthy cost per sq. ft. = Rs N/A Monthy cost per sq. ft. = Rs.8.33 Mr. Jayantia Hansraj Darji Fat No. G-109, Umang Naro. 16 DBS Affordabe Home Strategy Limited

21 Journey of 1000 days, Anecdota Study Findings The anecdota study showed that the priorities of potentia DBS customers were: i) An affordabe house with drainage and reguar water suppy, ii) iii) Easy to pay monthy instaments, and An easy and uncompicated oan. Bearing in mind the needs for an affordabe house and a oan that the famiies can comfortaby take, the DBS Communities' vision for their future is: The famiies purchase a 150 sq.ft. house for Rs.2,00,000, A community deveopment agency heps the famiies save, repay monthy oan instaments reguary and aso upgrade their skis and improve their income, and In three years, the famiies take an additiona oan and move into a 300 sq.ft. house. Considering the need to buid houses that are affordabe for peope earning up to Rs.20,000 per month, DBS Communities had to confront the foowing issues: High and and property prices in the market; The sizes of houses being sod in the market are too arge for paying capacity of peope earning up to Rs.20,000 per month; The ack of credit worthiness of peope in the informa sector in terms of income proof etc. for the forma approva of oans from nationaised banks and housing finance institutions, and The imited access of potentia customers to Micro-Finance Institutions. Therefore, to construct affordabe housing, DBS identified the need to: I) Buid high density housing with a mix of unit sizes and type, ii) iii) iv) Reduce the share of and vaue in the price of buit-up area, Design efficient and at the same time comfortabe houses, Coaborate with housing finance companies that offer oan products for peope with ow incomes and in the informa sector, and v) Support the customers in enhancing their credit worthiness through improved access to heath and education services, skis upgrading and participation in savings and credit groups. In addition, to enabe customers to purchase the houses, DBS Communities needs to coaborate with housing finance companies that offer oan products for peope in the informa sector, and support the customers in enhancing their credit worthiness through improved access to heath and education services, skis upgrading and participation in savings and credit groups. DBS Affordabe Home Strategy Limited 17

22 esign uid erve Paths for meeting community needs Need Factors to be addressed Means for enabing access to affordabe housing An Affordabe House High Land and Property Prices House sizes too arge for paying capacity High density housing Reduce share of and vaue in price of buit-up area Design efficient and iveabe house A Comfortabe Loan Lack of Credit Worthiness in terms of pay sips etc. Limited or no access to Micro-Finance Institutions Access to Micro Housing Finance Institution Community Deveopment Programs for enhancing credit worthiness 18 DBS Affordabe Home Strategy Limited

23 Journey of 1000 days, Strengthening the Team and Customer Focus As the DBS Strategy was getting refined, the need for having someone who had worked cosey with potentia DBS customers, and understood their context and needs was fet very strongy. The aim was to have someone represent the context and requirements of potentia customers' at every stage during interna debates and decision-making. DBS Communities therefore invited Rajendra Joshi, a socia entrepreneur and the founder and Managing Trustee of Saath - an NGO working for the urban poor to join the DBS Board of Directors. Rajendra, who has introduced some market-oriented strategies in deveopment and socia interventions to improve the ife of the urban poor, accepted the offer in November He brought in the required focus on community deveopment and partnership with Saath Charitabe Trust, which has a wide outreach to potentia customers. As the DBS discussed the issue further, the Team members agreed that Saath woud assist potentia cients in getting frequenty required services through an on-site Urban Resource 2 Centre, improve their iveihood means and ensure a ong and asting reationship. One of the first activities undertaken with Saath was the Snapshot Study of potentia DBS customers. The snapshot study reveaed that just the construction of affordabe houses woud not meet the needs of the famiies. It was essentia aso to support them for reated and interinked needs such as for getting access to housing finance and margin money, and for overa and gradua improvement in the quaity of their ives through community deveopment initiatives. DBS Affordabe Home Strategy Limited 19

24 esign uid erve The occupations of peope who were surveyed incuded those isted beow. Air conditioner repairing etc. Cyce repairing Garage work Scrap vendors Buiding/ construction work Eectrician Fabricator Meta worker/ roing Painter/ painting work Pipe repairing Pumber Weder Potter Wood vendor Wood poish work Carpenter/ uphosterer Furniture maker/ carpenter Diamond worker Tuition/ Teacher Professor Ca center worker Municipa corporation empoyee Foremen/ supervisor Factory worker Supermarket empoyee Liftman Security personne Driver Peda rickshaw driver Auto-rickshaw driver Beauty paror workers Stitching Embroidery Patchwork Kite making Sweeper Farm worker Casua aborer Manua aborer NGO worker Anganwadi workers Chidren's maid Sef-hep group worker Heath worker Pan/ cigarette sta Sma business Mithai/ sweets/ confectionary shop Mik vendor Provision store Vendor seing snacks Henna vendor Fruit vendor Coth/ cothes vendor Cothes ironing Restaurant Cook Househod chores/ ceaning Home manager Hospita worker/ heper 20 DBS Affordabe Home Strategy Limited

25 Journey of 1000 days, Potentia DBS Customers - A Snapshot In December 2009, DBS and a Saath team, aong with architectura students Ata ur Rahman, Areen Attari and Digant Shah, conducted a Snapshot Study of 100 famiies to get a better understanding of the target popuation to be served and for whom the houses have to be designed and buit. The specific objectives of the study were to: capture anecdota portraits of the ives and ifestyes of the target customers, and understand the issues and compexities of potentia DBS customers. The study was not meant to be a representative sampe of the condition of the urban poor in Ahmedabad, and was imited to sampe famiies seected from informa settements where water connections and toiets were provided at the househod eve (between 1999 and 2007) under Ahmedabad Municipa 4 Corporation's Sum Networking Project. These incuded settements where Saath had either independenty or in coaboration with the Municipa Corporation impemented community deveopment initiatives such as educationa, heath and iveihood Programs and introduced savings and credit activities. Some women and young peope in the area who had upgraded 3 their skis under iveihood Programs (Urmia 3 and Umeed ) introduced by Saath had higher incomes and stabe empoyment. Thus, the sampe famiies were from Saath 3 areas (83) comprised famiies of Umeed 3 trainees (30), Urmia home managers (20) and the micro-finance group (40). It incuded peope iving in Aah Nagar, Behrampura, Dani Limbda, Jamapur, Juhapura, Om Nagar, Santosh Nagar, Sarkhej, Shah-e-Aam, Shakti Nagar, Someshwar Nagar, Swami Narayan Nagar, Vanjara Vas, and Vasna areas. The survey methodoogy incuded structured interviews and observations. Observation formats were deveoped to capture the architectura quaity of the iving spaces and the neighbourhood context. The key findings from this Snapshot Study were: About 70% respondents can and are wiing to pay a monthy oan instament of around Rs.2,000. About 50% respondents woud ike a house in the range of Rs.2,00,000 to 4,00,000. About 70% of respondents who want a house are wiing to reocate to an area beyond 5 kiometres from their current residence. On average, the space utiization per person in the current residence is 6.5 sq.m./ sq.ft.. The aspirations of peope for an improvement to their house incuded: A 'pucca' house (house constructed with bricks and cement), A house with a basic services and faciities, A house in a good ocation, A arger house (1-2-3 rooms), A house with a separate room and kitchen, Space for chidren to study, and A house with a better socia environment that wi contribute to a better future for the chidren. DBS Affordabe Home Strategy Limited 21

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28 esign uid erve Financia Characteristics of Target Customers Indicators Characteristics Age group 19 to to 50 Above 50 Income eve Less than to to 8000 Above 8000 Income consistency Consistent Inconsistent Consistency of projected income Expected to Increase Expected to Taper off Inconsistent Consistent Expenditure (as percent of income) More than 90% 70 to 90% 50 to 70% Less than 50% Savings & Assets Less than 50,000 50,000 to 100, ,000 to 500,000 More than 500,000 Desire to upgrade Yes No Down payment capacity Up to 30,000 Less than 100, ,000 to 200,000 More than 200,000 EMI capacity Less than to to 9000 More than DBS Affordabe Home Strategy Limited

29 Journey of 1000 days, A Few Typoogies of Target Customers Community Deveopment Occupation Indicators Type 1 Type 2 Type 3 Type 4 Husband Transport Wife Home manager Wife Stitching Husband Painting Son Share broker Husband casua abour Husband Transport Wife House work Daughter - Tuition Secondary Occupation No No No No Education Husband TY B.Com Husband Cass 12 Husband Cass 10 - Son TY B.Com Wife Cass 10 Wife Cass 7 Additiona Skis Daughter Tay Software Wife, Daughters - Embroidery No - Part of SHG No Yes Yes Yes Desire to upgrade Yes Yes Yes Yes A Few Typoogies of Target Customers - Design Indicators Type 1 Type 2 Type 3 Type 4 No. of Foors Condition Moderate condition Good condition Good condition Moderate Materias Roof Corrugated Tin Corrugated Tin Corrugated Tin Corrugated Tin Wa Brick & Mud Brick & Lime Brick & Lime Brick & Mud Foor Cement Kadappa/ Limestone Cement Cement No. of Rooms 2 + toiet 2 + toiet + bath 2 + Toiet 1 Rooms & Function Kitchen & Wash Seeping & Store Kitchen, seeping, storage Mutipurpose room Seeping, Wash Kitchen, seeping Working, seeping Area of house 336 sq. ft. 276 sq. ft. 264 sq. ft. 144 sq. ft. Area of common 120 sq. ft. 80 sq. ft. 20 sq. ft. 30 sq. ft. spaces used DBS Affordabe Home Strategy Limited 25

30 esign uid erve Evoving the DBS Strategy The snapshot study reveaed that just the construction of affordabe houses woud not meet the needs of the famiies. It was essentia aso to support them for reated and inter-inked needs such as for getting access to housing finance and margin money, and for overa and gradua improvement in the quaity of their ives through community deveopment initiatives. The study indicated that a typica DBS customer: Starts with a house she/ he can afford, and which she/he has bought with a oan that she/he can repay comfortaby; With support from DBS s community deveopment initiatives, improve skis, iveihoods and incomes, and repay oan instaments reguary; Purchase a better house with an enhanced oan, and Become a mentor for other famiies. By the end of 2009, after the presentation of the concept and discussions with experts, and the, snapshot study, DBS formay articuated its approach for creating a new genre of community housing. Design and Production of Community Housing The aim is to have a new genre of community housing that incorporates features that serve the needs of the specific market segment and compement their way of ife. These incude: A range of sma, efficient and iveabe housing options from the smaest one room and kitchen unit to a more spacious two room and kitchen unit, and Supportive infrastructure such as community spaces, work spaces, services such as for heath, education, iveihoods, crèches etc. Housing Finance Access The housing finance mode needs to be customised to the needs and reaities of ow income househods through features such as fexibiity in repayment terms and periodicity, as we as options for personto-person oans. This woud incude: Mapping financia characteristics of potentia customers and matching with financia products avaiabe in the market Exporing potentia coaborations with micro finance institutions, and Exporing viabiity of setting up a DBS owned MFI. Community Deveopment Community deveopment is a core activity and DBS is committed to activey support the upward mobiity of customers, that is, enabe them in making economic and socia progress through: Liveihood deveopment and skis enhancement interventions, Heath and Education services, and Activities for improving credit worthiness 26 DBS Affordabe Home Strategy Limited

31 Journey of 1000 days, The DBS Business Strategy The enterprise mode and business strategy of DBS Communities is buit on three core areas, namey, i) Design and production of community housing; ii) Housing finance for communities, and iii) Community deveopment initiatives aimed at cataysing the upward socia and economic mobiity of DBS customers. Design & Production of Community Housing Community Deveopment Initiatives Community Housing Finance Research & Deveopment Business Strategy of DBS Communities DBS Affordabe Home Strategy Limited 27

32 esign uid erve 2010: Pioting, Learning and Responding to Needs Despite the demand and saeabiity of houses in projects meant for peope in the informa sector, DBS experience reveas that the rate of canceation and new bookings for peope in the niche segment is about ten times more than in projects meant for the forma housing market. This is because the financia situation of the customers is fragie and any unforeseen expense can resut in the customer not having adequate funds to pay the margin-money or the oan instaments. In some cases, the booking is canceed because the person acks proper documents for getting a oan. 28 DBS Affordabe Home Strategy Limited

33 Journey of 1000 days, The Design Charette DBS Communities organised the Community Housing Design Charette on 9 and 10 January 2010 with the aim of bringing together peope from mutipe discipines and backgrounds to deiberate on the proposed business strategy of DBS Communities and to expore in detai the panning of the first Umang project. In the process, the design Charette was expected to yied a set of principes and a finaized package of products and services for the first project of DBS. The invitees were mosty peope known to the DBS team, incuding architects, panners, rea estate deveopers, contractors, bankers, housing finance institutions, socia workers, academicians, bureaucrats, investors, financia institutions, NGO representatives, and payers in the rea estate industry. The specific objectives of the Design Charette were: 1. To present the DBS vision, mission, objectives, business strategy and proposed design for the first project - Umang Lambha ; 2. To seek inputs for (a) further refinement of the business strategy and (b) refining the pan of Umang Lambha with respect to the three core eements of the business strategy; 3. To identify institutiona, technica and financia resources for operationaizing the business/, and 4. To expore opportunities for coaboration with various stakehoders/ interested parties in the industry and those supporting deveopmenta initiatives, incuding investors, housing finance companies, microfinance companies, phianthropic organizations, community deveopment organizations, etc. The Design Charette was organised to incude penary sessions and group work focused on review, discussion, and refinement of the proposas. The presentations and discussions covered the three eements of the DBS business strategy and the cross-cutting or overarching issues. 1. Community Housing Design, 2. Community Housing Finance, 3. Community Deveopment, and 4. Integration, synthesis and communication. On the first day, the DBS Team presented the preiminary proposas and preparatory work covering the Core Team's understanding of housing affordabiity, the socio-economic characteristics of potentia customers and the spatia quaity of their surroundings as identified through the snapshot study. In addition, Mr. Vishnu Swaminathan from DBS Affordabe Home Strategy Limited 29

34 esign uid erve Ashoka gave a presentation on the deficit of housing finance and housing faciities in various urban areas in the country. A presentation on community housing finance highighted options for making finance accessibe to peope at the base of the socio-economic pyramid. The DBS Team aso presented the conceptua design of Umang Lambha. The enterprise mode and business strategy of DBS Communities was vaidated by participants of the Design Charette. Further the core area activities were eaborated as foows: Design and Production of Community Housing: To deveop a range of house types from one to three (now two) room apartments in iveabe community environments with community work spaces, crèches, cinics and community resource centres. Community Housing Finance: To evove and offer innovative and customized housing finance soutions, incuding carefuy mediated Personto-Person oans and fexibe repayment schedues ike Equated Daiy/ Weeky/ Monthy Instaments. Community Deveopment Initiatives: The DBS/ Saath socia workers to partner with DBS customers for creating aternative iveihood opportunities, enhancing skis, securing heath and education services, and buiding a credibe financia track record. 30 DBS Affordabe Home Strategy Limited

35 Journey of 1000 days, On the second day, the DBS core team discussed the significant insights and feedback from the Design Charette, which bostered their confidence in their approach and work. DBS Affordabe Home Strategy Limited 31

36 esign uid erve Issues addressed during the Design Charette Community Housing Finance 1. One of the main approaches being expored for faciitating access to finance invoves the creation of an interface between our customers and housing finance companies. This interface wi use mechanisms ike estabishing identity and income proofs, compusory banking behaviour, group guarantees, etc. to create comfort eve on both sides in the ending process. The two issues expored in this context were: a) How can we persuade the mainstream banking system to accept the due processes that we create as equivaent to mainstream documentation and reduce the perceived risk eve of our customers? b) How can community deveopment agencies be equipped to take on the task of impementing the critica interventions ike compusory banking behaviour? 2. What is the additiona cost of creating an effective interface? What are the avenues for funding this additiona cost, may be through phianthropic or government intervention? 3. What form of ownership document wi be appropriate in the ending conditions that we wi encounter? Shoud it be freehod tite to be mortgaged or some form of Hire Purchase? 4. How can we create a procedure to mainstream our customers and hand over their oan portfoios to mainstream companies? 5. Are there any poicy measures that are being formuated by the Government that wi hep us deveop this business 6. Who - peope or organizations can hep us in our endeavour? 7. What shoud be the form of the Community Housing Finance division of DBS? Shoud it be a separate ega entity? What wi be the ega/ corporate inkage between the CHF division and the parent company? Are there any confict of interest issues? 8. How can we adapt traditiona modes of ending and deveop person-to-person type of financing mechanisms? 9. What are the subject areas reated to community housing finance where research is required urgenty? Community Deveopment Initiatives 1. What shoud be the functiona scope of the CDI? What sectors shoud it cover? 2. Shoud this initiative take the form of a community services provider or that of a phianthropic change-maker organization, or a bit of both? 3. How much wi be the cost to run this kind of an intervention? 4. How shoud this activity be funded? Shoud it be free standing and sef-sustaining? Is it ok for the CDI to be part-funded by the rea 32 DBS Affordabe Home Strategy Limited

37 Journey of 1000 days, estate business and the housing finance business? 5. Shoud we seek externa phianthropic input? What are the potentia sources? 6. What shoud be the form of the Community Deveopment Initiative? Shoud it be a separate ega entity? If yes, shoud it be forprofit or not-for-profit? 7. What sort of oca entity a community based organization (CBO) can be created in each project? What can be the scope of this entity? What sort of a capacity buiding program can be estabished to create and sustain these entities? 8. What are the subject areas reated to community deveopment initiatives where research is required urgenty? Community Housing Design 1. What are the different ways in which effective, usabe community spaces be created in high density apartment compexes? 2. To what extent can we oad the cost of community faciities on the home buyer? Can phianthropic funding offset some of this cost? What are the sources for such funding? 3. What specific features need to be incorporated in the design to cater to the specific needs of our customers? at the individua fat eve, at bock or custer eve, at the overa project eve? 4. What specia privieges can be secured in the reguatory regime for enabing community housing design? 5. What features of design and specification can substantiay reduce the operation and maintenance costs of the buidings? 6. Is it possibe to accommodate incrementa investment possibiities? 7. What are the subject areas reated to community housing design where research is required urgenty? Cross cutting issues 1. At a corporate management eve how can we strike a baance between the three divisions, giving each the space to function autonomousy and sti achieve synergy between them? 2. What sort of partnerships can be created to make this business mode a success? Shoud they be project specific or organizationa or both? 3. What shoud be the nature and mode of communication to our customers? 4. What can we do in the corporate governance of DBS Affordabe Home Strategy Ltd. to hep us approach any agency at nationa and internationa eve for support in fufiing our objectives? 5. What can we do to attract investors, and owners and other key industry payers to do business with us on terms that hep our customers? DBS Affordabe Home Strategy Limited 33

38 esign uid erve From the commercia perspective of a deveoper, the construction and sae of a scheme shoud be competed as quicky as possibe so that he can move on to another scheme. He cannot be casua or charitabe because he is constructing affordabe housing. 34 DBS Affordabe Home Strategy Limited

39 Journey of 1000 days, DBS Piot Project - Umang Lambha, Ahmedabad Umang Lambha the first project under the DBS Communities banner was aunched in association with Saath Charitabe Trust on 2 May 2010 in the Vatwa area of Ahmedabad. whether the shops woud be considered commercia or residentia property, and whether commercia by-aws woud be appicabe. One of the primary requirements was to achieve maximum ground coverage whie minimising the circuation area and the deveopment costs to be borne by apartment owners. Considering the vision and ong-term objectives of DBS Communities, architects Vineet and Anjum decided on a step-by-step design approach rather than immediatey aim for the maximum/ permitted ground coverage. They experimented with inear pans where apartments were organised aong we-it and ventiated corridors whie minimising circuation space. They finaised pans for three types of apartments 1 Room with Kitchen (1RK), 2 Rooms with Kitchen (2RK) and 3 Rooms with Kitchen (3RK) priced from Rs.3,50,000 to Rs.8,50,000. The initia ayout was changed from a inear ayout where ony 35 percent ground coverage was achieved to a custer pan which ed to 45 percent ground coverage. The apartment designs and custer pans were further refined based on the inputs and 5 feedback received from the Design Charette. Further, considering the requirements of potentia customers, mixed use was panned with aocation of spaces for sma shops at different eves of the apartment bocks. However, this raised ega issues such as DBS Affordabe Home Strategy Limited 35

40 esign uid erve 1 Room Kitchen UNIT 2 Room Kitchen UNIT The approved pans and designs of the apartments require minima changes to individua units depending on their ocation within a custer. The custer pans, with a maximum of 24 apartments per foor, provide interesting pubic spaces whie utiizing the buit and semi-covered areas optimay. The open space around the apartment bocks and the unit ayouts are expected to ensure good dayight and ventiation. Community use spaces are provided for Urban 2 Resource Centres (URC), a primary heath centre, a credit society office, a centre for women's deveopment activities, a reading room, a community ha, and a pre-schoo/ crèche etc. The aim is to ocate community deveopment activities and iveihood programs within the project area and activey support interventions that enhance incomes of the famiies. The Project aso houses a make-shift schoo run by Saath for chidren of construction workers. The ayouts were further modified considering the Genera Deveopment Contro Reguations of Ahmedabad Urban Deveopment Authority that: i) restrict maximum buiding ength of 50 meters; ii) require a gap of 4.5 meters between buiding bocks of 50 meters ength; and iii) require cacuation of open courtyards as buit-area if there is no through road. In addition, changes had to be made to meet Ahmedabad Municipa Corporation buiding by-aws and the fire reguations. The common infrastructure incudes bore wes, underground water reservoir and overhead tanks in each bock for 24-hours water-suppy, paved roads, street ights, compound wa, and open spaces/ gardens. Arrangements have been made for on-site recycing of sewerage. The recyced water wi be utiised for the green areas/ andscaping. 36 DBS Affordabe Home Strategy Limited

41 Journey of 1000 days, Origina Site Layout Pan, Umang Lambha Fina Site Layout Pan, Umang Lambha DBS Affordabe Home Strategy Limited 37

42 esign uid erve Project Launch DBS Communities wanted to ensure that the potentia customers were informed about the aunch of Umang Lambha. It therefore used various marketing methods for greater outreach. Besides newspaper advertisements, brochures and fyers, Saath informed its members through word of mouth and road shows. Radio spots were on from 1 May 2010, arge hoardings were put up at prominent paces, and ampe signage was put up to guide peope to the site. In addition, free transport was arranged from the nearest road junctions (Asaai and Naro), and a discounted rate was announced for the first phase of booking. assistance, were connected to the space with the fu-scae modes. This was done to prevent purchase of a arge number of apartments by specuative buyers a ikey scenario based on experiences of other ow-cost housing projects impemented in Ahmedabad and Mumbai. DBS ensured that whie pubicising the Umang Lambha scheme and the aunch, the emphasis on the scheme not being for investors was obvious. This was because the DBS team was aware that in a arge proportion of affordabe housing schemes in the country, peope from higher income groups buy off the apartments for investment. A arge aunch paviion was erected at the site with three arge spaces and smaer support areas. The first arge area at the entrance had a set of arge panes and a mode of the entire project area where the project and the concept were expained. Connected to this space were fu scae modes of two types of apartments, that is, the one room and kitchen unit, and the two room and kitchen unit. Two booking areas one for peope requiring assistance and the second for peope not requiring 38 DBS Affordabe Home Strategy Limited

43 Journey of 1000 days, Arrangements at the Launch of Umang Projects Person enters the ha Ensure that she/he gose to the right pace Directions and Guidance Tabe 1 Registration desk Name and contact (aternative contact) PARESH and ROSHAN Tabes 2 and 3 Counseing Counseing - that is fiing up the URC questionnaire DHRUV and DEVUBEN Tabes 4, 5 and 6 MHFC Assessments - Sanctions MHFC Team and DIVYANG Tabe 7 Down payment s assessment and record of the oan process Record how much oan has been approved by bank How much more does she/he need NIRAJ and CHINMAYIBEN Interested buyers were ed to one of these booking areas as appropriate. The first booking area was for peope who needed financia assistance and genera handhoding. On 1 and 2 May, a Saath team assisted famiies coming to this area to understand the scheme and options on offer. They briefed customers regarding the detais of houses, answered their various queries and ensured that the visitors decision to purchase a house met their needs, and was appropriate for them. The second booking area was for peope who did not need any assistance, and were therefore directy assisted by DBS staff. Housing finance companies ike Mahindra Housing Finance, Micro Housing Finance Corporation (MHFC), GRUH Finance and Dewan Housing Finance Corporation Ltd. were provided desks in between the two areas. Mandap Layout Layout of Launch Paviion at Umang Lambha Customer Response The response to the project aunch was overwheming. At the end of the day, an estimated 5000 visitors had passed through the paviion. Of DBS Affordabe Home Strategy Limited 39

44 esign uid erve these, about 70 percent were from the target group. About 220 apartments were booked (20 percent of the apartments in Phase I, which was opened for booking). About 50 percent of the famiies that booked apartments on the same day had come to the aunch through Saath. Of these, about 50 famiies that had not come prepared for making the booking/ down payment, came the next day to compete the booking process. By the end of the aunch process, DBS ended up having a waiting ist of about 800 potentia customers. apartment) in one instament. DBS aso reaised that if house bookings were invited in the open market, it was ikey that a apartments woud be sod - indicating a strong investor interest in the affordabe segment. Looking at the overwheming response in the context of the weather, the sushy approach roads and the inauspicious month of the Hindu unar 6 caendar (Kamurta ), the demand for affordabe housing was confirmed. For the DBS Team, this reinforced the appropriateness of its business strategy and approach. DBS aso found that whie its target group aspired for a house with two rooms and a kitchen many coud afford ony a one-room and kitchen unit. Further, many potentia buyers have difficuty in arranging the down payment or 'margin' money (which is usuay 30 percent of the price of the 40 DBS Affordabe Home Strategy Limited

45 Journey of 1000 days, Launch Pubicity Ashoka at the site of Umang Lambha Ashoka Innovators for the Pubic, founded in 1980, has over time focused on aunching eading socia entrepreneurs and offered a range of programs and initiatives to dea with changing needs. More recenty, Ashoka is working to ensure that socia entrepreneurs and their innovations continue to inspire a new generation of change makers to create positive socia change. In Ahmedabad, Ashoka Foundation was in contact with Rajendra Joshi - an Ashoka Feow who was contributing to the deveopment of its Housing for A (HFA) initiative financed in partnership with the Hiti Foundation. Under this initiative, Ashoka contributes to cooperation among community organizations, and deveopers and banking institutions to create affordabe housing conditions for the poor. In this context, representatives of Ashoka Foundation and Hiti Foundation had met Rajendra and visited Saath. Subsequenty, after Rajendra briefed them about his and Saath's invovement with DBS Communities for buiding affordabe housing, Hiti Foundation and Ashoka provided strategic support for the aunch of the Umang Lambha. DBS Affordabe Home Strategy Limited 41

46 esign uid erve Lessons from the aunch of Umang Lambha DBS Communities, Saath, Micro Housing Finance Corporation Ltd (MHFC) and others had the opportunity to observe and earn from the activities and issues identified before and during the aunch of Umang Lambha. These can be categorised in terms of: Panning and design issues; Launch management, and Housing Finance, and Customers and visitors Panning and Design The piot project, because of its scae and ocation, provided severa site-panning and deveopment chaenges. First, in its desire to initiate a piot quicky, DBS had not paid adequate attention to the pot s ground conditions and it had expected to get carifications regarding the and-use shorty. Despite assurances from the Town Panning Department, DBS faced the foowing situations: Initiay, the TP Scheme of the area showed an 18 meters wide road going through the site. Later, AMC carified that there was no road passing through the site. was earmarked as an institutiona area. Thus, construction on that part was hated, resuting in deveopment of esser apartment bocks on the site. A corner of the site was encroached upon. This ed to the decision of not buiding on that part of the pot. The changing situations ed to aterations in the ayout pan a number of times, and finay after due reguatory permissions were received, the construction works for Umang Lambha formay commenced in August, However, after construction work was started, the foundation design had to be modified to a raft-foundation because of high ground water-eve. In addition, DBS found that contractors were not wiing to continue with the project. Queries reveaed that the contractors had found the requirements and cost for scaffoding higher than envisaged because of the high density of coumns and beams. Thereafter, the DBS Design Team was further expanded with engineering and other support function staff, and prominent structura and services consutants were roped in to assist the in-house Design Team. 20 percent of the site was earmarked for institutiona use but it was not cear whether this was as a singe bock or spread-out across the site as smaer pots. After the aunch of the project, DBS found that part of the area where construction was started Launch management A critica issue identified at this eary stage was that the key peope (Saath staff and others) who interacted with potentia customers at the site were inundated with queries, such as: 42 DBS Affordabe Home Strategy Limited

47 Journey of 1000 days, I) The differentia pricing of houses with access to terrace and garden space; ii) iii) iv) The stepwise process for booking of houses; Meaning and impications of nonagricutura pot (NA) and No Objection Certificate (NOC); The oan papers to be made avaiabe by the buiders; v) Rationae and method for charging foor premium; vi) vii) Area to be deducted from the super buitup area; Charges for Dastavej/ Sae Deeds of properties and eectricity connection. In this context, visitors were particuary interested in knowing which of the two eectricity companies in Ahmedabad woud be suppying power to the project; viii) The detais of construction and finishing materias (RCC, finishings etc.), and ix) The DBS Affordabe Housing financing options. Customers and visitors The door to door marketing of the project was innovative, and this infuenced the number of visitors to the aunch. Queries on how peope heard about the aunch of the scheme showed that word-of-mouth was the most frequent, foowed by radio spots and newspaper advertisements. The need for a ot of handhoding of customers was identified. Therefore a team of 4 to 5 persons were foowing-up with customers interested/ booking apartments in Umang Lambha. Subsequenty, DBS decided on outsourcing the task of oan faciitation in the future. Customer foow-up incuded severa critica housing oan reated issues, such as convincing potentia customers that taking arger oans was not good for them and that they shoud take a minima oan. In addition, since many cients came with the expectation that some financia benefit or subsidies woud be avaiabe for a scheme meant for owincome groups, they had to be informed that DBS Communities and Saath were not providing any discount on price, rate of interest on oan or financia assistance to the buyers of apartments in Umang Lambha. Based on the experiences and observations at the Umang Lambha aunch, DBS Communities, Saath and MHFC decided to organise a Credit Camp, a patform where potentia Lambha customers coud have detaied interaction with housing finance companies. It aso ed to the identification of the need for ong term actions in the area of financia awareness and capacity buiding and of a housing faciitation centre. DBS Affordabe Home Strategy Limited 43

48 esign uid erve Housing Finance The key essons from the Umang Lambha project that were deiberated whie considering options for the new projects were reated to finance. DBS found that the purchase of and with borrowed money was not a cost-effective soution.to have greater outreach to the market and for everaging capita investment in the and, the management decided to aunch projects with the and owner as a project partner. DBS therefore approached peope who owned and that had yet to be deveoped, and offered to deveop the and-parce specificay for affordabe housing on a profit-sharing basis, and received a good response to this offer. DBS reaized that housing finance is not reaching this segment because of the reguatory environment, the associated risks and the vunerabiity of the customers. Further, there is a need to assess potentia customers in terms of their capacity and affordabiity, and provide handhoding support in terms of taking bookings, connecting the customers to the appropriate housing finance institution, getting the correct documents, supporting the appication process, and submitting requests to the housing finance institutions for reease of oan at different stages. This required continuous and intensive interaction with the customers. Besides the faciitating support provided by Griha Pravesh, the Team decided that it was more appropriate to outsource this task. DBS has seected an agency for this for its new projects. One of the significant essons earnt after the aunch of the piot project was the chaenges of maintaining a cash-fow when commitments for purchase of a house by peope whom DBS is catering to are very fragie. The DBS observation is that the rate of canceation and new bookings for peope in the niche segment is about ten times more than in projects meant for the forma housing market DBS therefore decided that whie the demand was confirmed, it woud be prudent at this stage to cater to customers who had aready shown interest at the Umang Lambha site. DBS therefore decided on a simpe aunch of its next project where ony 'waitisted' peope were invited. 44 DBS Affordabe Home Strategy Limited

49 Journey of 1000 days, Credit Camps After the successfu aunch of Umang Lambha the DBS team and Saath received severa queries from potentia customers about getting oans. DBS found that athough Mahindra Home Finance, Micro Housing Finance Corporation Ltd (MHFC), GRUH Finance, and Dewan Housing Finance Corporation Ltd (DHFL) had stas at the aunch, peope coud not have detaied discussions with the finance companies because of the arge crowd. Further, based on an anaysis of a database of appicants created after the aunch, and feedback received through Saath, it was obvious that the arge number of peope from the informa sector woud have difficuties in getting oans from schedued banks because they woud not have monthy pay sips. DBS Communities therefore identified the need for a patform where potentia customers coud have detaied interaction with housing finance companies. The main requirements were for peope to know the avaiabe options for procuring oans, their affordabiity, and the oan process especiay the requirements for documents. This ed to a decision to organise a Credit Camp where such interaction can happen. with MHFC executives to understand the on-going efforts of DBS Communities and Saath, and of peope's response to the camp. The first Credit Camp was organized on 5 and 6 3 June 2010 at the Umeed Centre (Umeed is a iveihood program run by Saath) near Behrampura Post Office - a centra and easiy accessibe ocation convenient for most peope. The Camp was organised specificay for customers who had booked apartments in Umang Lambha, and for those whose bookings were canceed or cheques were returned. To ensure active participation, the customers were sent etters in Gujarati informing them about the time, date, and ocation of the credit camp as we as a ist of documents that they shoud bring with them for oan processing. About 150 customers turned up for the credit camp. A two-part questionnaire for getting essentia information about the customers was prepared by The first Credit Camp was a joint initiative of DBS, Saath and MHFC to understand the financia positions of the cients better by interacting with them and by coecting the required documents for oan processing. A few peope from Monitor Group (India) came aong DBS Affordabe Home Strategy Limited 45

50 esign uid erve Saath and MHFC in consutation with each other. At the camp, representatives of Saath and MHFC fied-in the forms with information given by the cients. Subsequenty, executives from MHFC had a minutes discussion with each cient. They even counseed and convinced a few of them to sette for a smaer house and oan amount due to their income imitations or ack of documents. At the end of the Credit Camp, amost a famiies were found to be eigibe for a housing oan, and most oan-appicants were given preiminary approvas. However, in many cases, there was a gap between aspiration and affordabiity. It aso emerged that some customers woud need additiona support for mobiizing the down payment. In tota, of about 150 peope who participated in the camp, 75 came with proper documents. The experience of the credit camp reveaed the extent of support required by potentia customers and the need for an active faciitation process. This soon ed to a decision for setting-up a housing faciitation unit caed Griha Pravesh, and the decision to organise Credit Camps on Day 1 of the aunch of future Umang projects. 46 DBS Affordabe Home Strategy Limited

51 Journey of 1000 days, Observation about the Credit Camp On 5 June day 1 of the Credit Camp, Saath s Micro Finance Institution was hosting its Annua Genera Meeting at the same venue. Therefore, when the meeting ended, a mass of inquisitive peope crowded at the registration and information desk. There were foods of enquiry on the type and cost of housing and a possibiity of getting a oan. We requested them to come to the construction site and see the fu scae mode and aso had to restrict them from interacting with the executives from MHFC so that the purpose of the credit camp remains intact. It was enthraing to hear the cient s background, stories and dreams of having a house of their own. Stories of success and sorrow ranging from a technician who rose to have his own enterprise to a mother who ost a young son in an accident quite recenty and was determined to buy the apartment her son had dreamed of. The cients were fied with determination, anxiety and one coud see a twinke in their eyes during the interaction, which seemed impossibe to shake their confidence and et them go dejected. We expect the booking bes to continue ringing once the oans gets sanctioned as many other potentia cients from the target group woud foow their friends and seek oans through MHFC. We earnt about our cients and the motivation they possess to move up the socia and economic adder. We understood that we need to prepare two questionnaires; the preiminary one wi determine their eigibiity for oans and aso invove counseing which wi be done by Saath and the detaied questionnaire wi be used by the MHFC for an in-depth understanding of the cient s financia position and scrutinizing the documents. We intend to host some more credit camps every fortnighty for the benefit of our cients in near future. Out of the 75 peope who brought their documents, 63 peope have got a principa approva out of which 13 oans are sanctioned aready. DBS Affordabe Home Strategy Limited 47

52 esign uid erve Griha Pravesh Operation and Seminar Photos 48 DBS Affordabe Home Strategy Limited

53 Journey of 1000 days, Housing Faciitation Centre: Griha Pravesh The need for a housing faciitation centre evoved with the reaization that the customers fet harassed and negected because they faced probems in getting responses to queries about the project or finances. DBS reaised that the end-user and customers require support in getting a information regarding affordabe housing projects, housing finance and on the proposed community deveopment activities. DBS reaised that if a singe-window faciitation centre was created, potentia customers, especiay the iiterate and semi-iterate, woud not have to visit various organizations/ peope. It woud contribute to DBS efforts for estabishing a sustainabe mode of housing provision by puing together the strengths and experience of DBS in the rea estate space and of Saath in the socia incusion space. The faciity woud initiay resut in improved efficiency, and over time become a arger and independent entity. Such a centre woud require a team of experts with current information on the various aspects to assist the cients. DBS, Saath and MHFC principay agreed to have a not-for-profit Section 25 Company under the Companies Act 1956 as a housing faciitation centre. In 2010, Saath and DBS Communities set-up a housing faciitation centre, caed Griha Pravesh, which wi provide an interface between potentia home buyers from the informa sector who earn between Rs.10,000 to Rs.25,000 (in 2010), and deveopers, housing finance companies and community deveopment organizations. We expect to continue the process of earning and responding to new essons and insights as we work towards achieving scae and voume, and thereby impact not ony the ives of those who purchase houses buit by DBS Communities but aso those who want to cater to the niche market at the bottom of the socio-economic pyramid. Griha Pravesh aims to make it easier for peope to own a house by: 1. Gathering and disseminating information about 'affordabe housing projects' to assist potentia cients make informed decisions about purchasing their house; 2. Faciitating access to housing finance and support for margin money, and 3. Faciitating integration of community deveopment initiatives with housing. The target group incudes peope for whom DBS Affordabe Home Strategy Limited 49

54 esign uid erve understanding the housing/ housing finance market may be difficut because of the compexity of paperwork, ega formaities and compiance requirements invoved in purchasing a property. It may incude peope whose decision to purchase a house is affected by factors such as ack of information about affordabe homes and nonavaiabiity of suitabe housing finance, knowedge about access to heath and education services and empoyment opportunities in an unfamiiar ocation. The interface with potentia affordabe housing and existing DBS customers wi be through Parivaar Pragati Seminars that wi be organised for information dissemination and support as required. To ensure that ony those seriousy interested in purchasing a house participate in the Seminars, participants are required to register as Griha Pravesh members. The benefits of becoming members of Griha Pravesh are: i) The members are informed about the reasons and benefits of asset creation, financia panning and banking, housing finance processes and reated requirements documentation, etc., ii) Opportunities avaiabe to the members for ski enhancement to enhance their incomes, and iii) Introduction to services/ products such as savings, oans, insurance, iveihood enhancement, etc., for enhancing upward socio-economic mobiity. Griha Pravesh Operationa mode Griha Pravesh has been set-up under the umbrea of Saath's Sheter and Liveihood Services (formery Saath Liveihood Services which was incorporated as a 'Section 25' company in 2007), an existing iveihood promotion patform to enabe it to deveop synergies with on-going community deveopment initiatives. The Griha Pravesh office has temporariy been estabished at the Saath office, with two peope dedicating 50 percent of their working time to its activities. Initiay supported by DBS and Saath, Griha Pravesh wi eventuay become an autonomous initiative that wi coaborate with different associate organizations, and repicate its faciitation mode in other parts of the country. Whie partner associates in different cities may vary, Griha Pravesh's core mandate of providing 50 DBS Affordabe Home Strategy Limited

55 Journey of 1000 days, affordabe housing to the poor wi remain unchanged. To ensure this, each new organisation/ institution wishing to become a member of Griha Pravesh wi have to be approved by the founding members. Envisaged as a pan-india initiative, Griha Pravesh wi adopt a fexibe approach as far as the operationa mode for providing faciitation services is concerned. Therefore, whie a centra office wi be common in every city, different outreach strategies coud be adopted for reaching out to potentia cients. These may incude fied offices or mobie services operating directy in target communities. Griha Pravesh is being set up with a Board of Directors drawn from the Saath and DBS teams suppemented by independent Directors. A professiona team, consisting of peope with experience in community services, housing finance and housing deveopment, is being put together. Eventuay the Board of Directors wi be an independent body overseeing and guiding the professiona team. Initia funding is being mobiized by DBS and Saath. The first three years of operation is estimated to cost about Rs.2,00,00,000 (two crores). Griha Pravesh is open to receiving funding from ike-minded donors wishing to support the cause of affordabe housing. As a not-for-profit company, individuas and other entities can contribute in the foowing ways: I) Sponsor a Parivaar Pragati Seminar Rs.30,000 per event ii) Support 5 famiies towards home ownership Rs.50,000 (over a 2 year period) iii) Support the running of a community centre for 3 months Rs.1,00,000 iv) Support the estabishment of a new community centre Rs.3,00,000 v) Support the preparation of communication videos Rs.2,00,000 Partnership opportunities are aso avaiabe for those organizations that contribute directy to upward socio-economic mobiity of DBS Communities' customers either through their products or services. Information on Affordabe Housing projects Griha Pravesh wi assist potentia cients in making a choice of a housing unit based on their budget and affordabiity by providing information on: Affordabe housing projects in the city; Housing site ocation and connectivity; Interna ayout, unit type and size options avaiabe; Housing terminoogy such as buit-up area, super buit-up area, shared coective responsibiity, maintenance fund for common areas etc.; Basic prices of housing units together with DBS Affordabe Home Strategy Limited 51

56 esign uid erve additiona costs which the cient is expected to pay, incuding registration fee, stamp duty, ega fee, utiity charges etc., and the tota cost price of the individua housing units; Schedue of payments, and Expected time of possession. Housing finance assistance Griha Pravesh wi faciitate smooth and speedy provision of housing finance to the cient by providing information on: Maximum oan avaiabe as a percentage of cost of property; Amount to be paid as margin money; Income and eigibiity criteria for oan; Age criteria for oan appicants; Financia impications of their decision to purchase a particuar house, incuding how househod cash fows wi be affected; Loan interest rate and maximum tenure for which oan is avaiabe; Loan appication fee and processing fee; Documents required for oan processing identity, address and income proof; Loan terms and conditions co-appicant requirements, mode of repayment (post-dated cheques, ECS) etc., and Detaied information and handhoding in the oan process. Griha Pravesh wi aso expore options for securing margin money assistance for those cients who are not in a position to make the down-payment for the house. Research & deveopment Griha Pravesh can be effective in achieving its basic objectives ony if it continuousy updates information about ow-cost housing projects etc. and tracks the outcomes of decisions made by Griha Pravesh members based on the support it provided. Therefore, Griha Pravesh wi activey coaborate with ASHRAM (Academy for Sustainabe Habitat Research and Management) for undertaking research and deveopment activities, incuding training and poicy advocacy. In addition, Griha Pravesh wi coaborate with other institutions with simiar areas of interest. Community services Griha Pravesh wi ensure embedding of community deveopment interventions by activey faciitating an interface between cients and community service organizations for providing primary heath care, education, iveihood, vocationa training and microfinance services and in getting essentia identity and income documents. Griha Pravesh wi provide an end to end soution for affordabe housing by creating a database of potentia cients, and by inviting 52 DBS Affordabe Home Strategy Limited

57 Journey of 1000 days, documenting the cients progress and deveoping reations with MFIs, NGOs, financia institutions and affordabe housing payers a around the country. Another key activity that wi support the effective functioning of Griha Pravesh is the ongoing staff training program comprising three eves of training modues. The focus of the training is on famiiarisation with the objectives and processes of Griha Pravesh, the housing finance options and making the right match for the customers, the objective, scope and detais of the community deveopment initiatives, and finay functiona skis. DBS Communities and Saath aim to reach within ten years, more than 10,00,000 urban customers across more than seven States in India, and by 2014/15, have 5,000 Griha Pravesh members through its six centres in Ahmedabad and other cities of India. various high net-worth individuas (HNIs), corporates, buiders and rea estate payers working in the affordabe housing market, and financiers ending to the informa segment to be a part of the organization and to donate generousy. It wi aso hep genuine cients for bridging the margin money shortfa, heping the cients improve their iveihood means by the various community deveopment initiatives, DBS understands that a sustainabe venture can be achieved through continuous endeavour and by fostering positive coaborations. It therefore intends to enter into partnerships with investors, reputed construction companies and and owners. DBS Affordabe Home Strategy Limited 53

58 esign uid erve Parivaar Pragati Seminars As part of its assistance for housing finance and margin money, Griha Pravesh has been organising Parivaar Pragati Seminars. The participants are required to register as Griha Pravesh members. The DBS Team found that when the fee was Rs.100 for the first seminar, many persons who were not seriousy interested in purchasing a house in the near future aso became members. Consequenty, the registration fee was increased to Rs.350 from the second seminar. Griha Pravesh has organised three Seminars on the Need for Financia Panning and Asset Creation. The first Seminar was hed in Behrampura on 3 September 2011, the second was hed in Bapunagar on 24 September 2011, the third Seminar was organised in Meghaninagar on 26 November The participants of a the Seminars were taken through a process of visioning, current financia status assessment as we as steps for securing the future. The Seminar sessions were interactive as we as informative with peope from diverse backgrounds sharing their thoughts with great enthusiasm. Griha Pravesh at the end of the first Seminar and 44 at the second event. Based on a diagnostic assessment, each famiy wi be counseed on savings and banking, preparation of documents, home oans, ski enhancement, insurance and various other services. Since Griha Pravesh is functioning as a market deveopment catayst, it is aready inviting and working with other deveopers in Ahmedabad. It organised a Seminar sponsored by Foiage Rea Estate Deveopers Pvt. Ltd. on 24 March 2012 at Isanpur. The objective of this Seminar was to market Foiage's Garetpur housing project. Thus, more than one HFI and deveoper are now invoved in Griha Pravesh. Now more HFIs and Deveopers are invoved in Griha Pravesh. About 66 participants registered as members of 54 DBS Affordabe Home Strategy Limited

59 Journey of 1000 days, Comparing the Parivaar Pragati Sammeans / Seminars Sammean 1 Sammean 2 Sammean 3 Sammean 4 Date 3 September September, November March 2012 Theme Financia Panning and Asset Creation Financia Panning and Asset Creation Financia Panning and Asset Creation Market Foiage s Garetpur housing project Venue Behrampura Bapunagar Municipa ha at Meghaninagar Panethar Ha, Isanpur No, of peope attending Numbers of chaws visited for pubicising Sammean Occupationa Profie of peope in chaws visited Key Speakers Sma businesses Rajendra Joshi Niraj Jani Dharmesh Kansara from Muthoot Finance Daiy wagers Niraj Jani Manish Panchoi Madhuben Parmar, Dharmesh Kansara from Muthoot Finance Government empoyees Paru Prajapati Jayesh Shah, MHFC Akshay, from Foiage Rea Estate Deveopers Pvt. Ltd. NA NA Mixed group Fareed from Foiage Dharmesh Kansara from Muthoot Finance Key Sponsors Empower Pragati Saath Muthoot Finance Empower Pragati, Saath & Saath MFI DBS Muthoot Finance DBS Empower Pragati Saath Muthoot Finance Foiage Rea Estate Deveopers Pvt. Ltd. Method of communicating knowedge Registration fees Number of peope registering as Griha Pravesh Members Sef-Hep exercises and Seminar Rs Sef-Hep exercises and Seminar Rs Audio-Visua Presentation Rs.350 NA Audio-Visua Presentation Rs.350 NA DBS Affordabe Home Strategy Limited 55

60 esign uid erve Griha Pravesh Stages of Customer Interaction 11 GRIHA PRAVESH 10 Home Registration & Stamp Duty 9 Loan Sanction Letter 8 Appication for Loan 7 Seection of Home 6 Saving of Margin Money 5 Connect to Community Deveopment programs 4 Guidance based on Diagnostic Report 3 Address and KYC Verification 2 Detaied Survey of the Customer 1 Customer becomes a Member Type of support required Probem Not having Margin Money at the time required Not aware of possibiity/ option for getting a oan Source: from Griha Pravesh Overview presentation Exampe Customer is unabe to pay 30 percent margin as required due to damage of tobacco crop in his pace of origin. However, he can pay it in around two to four months and retain the booked fat. If given a week's time, he coud discuss the options with his famiy in the viage. An auto-driver coud pay the margin money in about three to four months' time. In the absence of any option, decided to cance the booking for an apartment. A taior did not have the required margin money and woud have opted out of purchasing an apartment if informed about his ineigibiity for getting a oan through the faciitators. 56 DBS Affordabe Home Strategy Limited

61 Journey of 1000 days, Griha Pravesh Functions Dissemination Campaigns Engaged Faciitation Asset creation Documentation Financia iteracy Ski upgrading, education and heath Home maintenance House seection to fiing-up submission and registration of documents Source: from Griha Pravesh Overview presentation DBS Affordabe Home Strategy Limited 57

62 esign uid erve DBS at the Goba Summit of Housing Entrepreneurs The Fu Economic Citizenship (FEC) Program of Ashoka Innovators for the Pubic and the Hiti Foundation under their 'Housing for A' initiative organized a Goba Summit on Housing Entrepreneurs in Barceona from 30 November to 1 December The participants from more than 8 different countries incuded business, finance and citizen eaders who were working in the affordabe housing sector. Rajendra Joshi, B R Baachandran and Sowmya Haran participated in this conference and shared the DBS mode for hoistic community deveopment through housing. This was greaty appreciated and the directors of DBS where abe to contribute usefu insights to every seminar in the conference. Various aspects of provision of affordabe housing from finance to construction technoogy were discussed. A draft set of recommendations were circuated before the conference and discussed during the deiberations. The directors of DBS are aso contributing vountary time to other activities of Ashoka such as the Porta for Coaboration of Affordabe Housing Stakehoders Certification System for Affordabe Housing. 58 DBS Affordabe Home Strategy Limited

63 Journey of 1000 days, Core Team Expansion DBS Communities has focussed on buiding up a high quaity professiona team committed to deveoping an effective enterprise mode for deivery of affordabe houses. During 2010, the DBS Team graduay expanded to incude practitioners who represent different sectors and speciaisms. This incuded the DBS management and finance teams which were strengthened with Mr. Manish Panchoi - the then Chief Executive Officer and Mr. Sudarshan Iyengar - the then Vice-President (Finance) joining in May 2010 and October 2010 respectivey. DBS Affordabe Home Strategy Limited 59

64 esign uid erve 60 DBS Affordabe Home Strategy Limited

65 Journey of 1000 days, : Progress and Learning Looking to the tremendous response received from the market with the aunch of Umang Lambha, the Team decided to start another project in the same ines. The experience with the Umang Lambha project greaty infuenced the DBS approach for the next project Umang Naro. DBS Affordabe Home Strategy Limited 61

66 esign uid erve Umang Naro DBS Communities identified a and parce of 3.4 acres in Naro, ess than 3 km from the Umang Lambha site, and the second DBS Communities project in Ahmedabad was aunched on 6 March 2011 in partnership with RJD Buidcon. The site is easiy accessibe from the Lambha - Naro Highway (NH8), and 2 kiometres distance from pubic amenities such as the BRTS services. The site has a tota of 8 bocks with RCC frame construction and five foors above parking on the ground foor. Of the 885 units (360 units of 1 room-kitchen and 525 units of 2 rooms-kitchen) to be buit on the site, bookings were opened for 450 units at the time of the project aunch. The response was again tremendous with 96 percent of the apartments booked within 2 weeks. The project incudes pucca roads, street ight, own bore we, garden, and spaces aocated for an Urban Resource Centre, heath centre, community ha and micro-finance activities. Prices start from Rs.3,99,000. Based on the experience of Umang Lambha, the apartment and custer design is simper, with the ground foor space retained for community use, more openings in the apartments for ight and ventiation, and services provision in a way that wi make maintenance easier in the future. 62 DBS Affordabe Home Strategy Limited

67 Journey of 1000 days, Photographs of Umang Naro Site taken in Apri BHK Unit : Type A and Type B 2 BHK Unit : Type A and Type B DBS Affordabe Home Strategy Limited 63

68 esign uid erve Umang House Owners Mrs. Rohitbhai Parmar, Umang Naro, Fat No. C-406 Geetaben and Babubhai Chauhan, Umang Lambha, Fat No. R DBS Affordabe Home Strategy Limited

69 Journey of 1000 days, Devuben Kanjibhai Parmar, Umang Lambha, Fat No. R2-220 Nainaben Dave, Umang Lambha, Fat No. G-203 DBS Affordabe Home Strategy Limited 65

70 esign uid erve Adaaj Campus On 23 Apri 2011, the sprawing DBS campus was inaugurated. The invitees to the event incuded participants in the Design Charette. The campus comprises of the DBS Communities Corporate Office, ASHRAM, studios, amphitheatre with a seating capacity of 200 in two tiers and an exhibition gaery beow the amphitheatre. The roofing for the studio is a transucent gass sheet with stee stanchions grounded in support for the roof. The upper seating in the amphitheatre has been aid in the form of the steps and a circuar stage has been set for performance. It is necessary to work with the peope to ensure that they have the capacity to repay the oans. DBS decided to introduce activities that mitigate the risks by introducing heath, education and skis upgrading services within the scheme. This incudes working with peope so that they have better incomes and their aspirations rise and within a few years, they become customers for a arger house. The DBS staff shifted into the new Corporate Office from June, A residentia bock for the use of security persons and support staff is ocated at one end of the site. 66 DBS Affordabe Home Strategy Limited

71 Journey of 1000 days, We have envisioned a future in which safe, ivabe and ega housing is a reaity for a. We have taken it as our mission to buid an enterprise which is capabe, not just to deiver thousands of houses to base of pyramid home buyers, but aso to provide a host of support systems incuding housing finance and iveihood support. We are convinced that such a mission can be accompished ony by a dedicated and passionate team working with the best of faciities in an inspiring environment. Our new campus at Adaaj has been created to provide a ivey space, equipped for high productivity. It wi accommodate the offices of both DBS Affordabe Home Strategy Ltd and ASHRAM, its research centre. The campus refects our commitment to our vision and mission. It is not enough just to design and buid affordabe housing schemes. The deveoper/ buider needs to make arrangements that enhance the confidence of the HFIs in the viabiity of projects that argey cater to peope in the informa sector. We have embarked on a journey. We know the destination. We are discovering the route as we go aong. When we started work on this campus, we were sti formuating our business mode. Today we are on a rapid growth path and we see this as essentia infrastructure for operating at scae. Therefore, even in the face of chaenging financia situation, we have made this investment for our future. We invite you to join us on our mission and make this campus yours too. Wecome to the DBS ASHRAM campus. DBS Affordabe Home Strategy Limited 67

72 esign uid erve ASHRAM: Academy for Sustainabe Habitat Research and Management Advocacy; Speciaized consutancies; Creating and participating in strategic patforms, and Pubication and dissemination of knowedge. Based on its initia experiences, the DBS Management decided to deveop a dedicated research and deveopment centre, named Academy for Sustainabe Habitat Research and Management (ASHRAM). ASHRAM wi contribute to the growth and deveopment of the 'Affordabe Housing Eco-system' by: Creating vaue and supporting the affordabe housing eco-system; Contribute to the arger body of knowedge on affordabe housing; Bring together stakehoders from the affordabe housing eco-system for knowedge sharing and fostering meaningfu partnerships; Serving as a think tank for research and advocacy, and Fostering socia entrepreneurship in affordabe housing. Specificay, to achieve its vision and mission, ASHRAM wi engage in the foowing activities: Research and Deveopment; Training peope invoved in and/or wanting to get more invoved in catering to the affordabe housing eco-system; 68 DBS Affordabe Home Strategy Limited

73 Journey of 1000 days, ASHRAM wi undertake research, pubication and training broady in the foowing thematic areas: Design and Production of Affordabe Housing: Housing affordabiity depends on the right sizing and right pricing and this varies with the context. This woud depend upon oca economic deveopment potentia, the status of the informa sector, rea estate activity and a host of other variabes. A ot innovation in design is possibe and desirabe to arrive at an optima iving space both for new homes and home improvements. Further many new technoogies in construction processes, materias and outputs are being tested. The key efforts in this sector wi be directed to the preparation of anaytica toos so that practitioners can make informed choices on appropriate ocations, product mix, sizing and pricing, construction technoogy, construction management practices, materias and specifications, etc. ASHRAM wi research and deveop cost effective and eco-friendy approaches that have the potentia for directy invoving target group home-buyers in the housing process. The effort wi be to systematicay compie knowedge in a way that makes it accessibe and supports generation of new knowedge. This wi cover the entire spectrum from understanding context specific feasibiity to construction and post occupancy maintenance of housing projects. Affordabe Housing Finance: One of the greatest chaenges in the affordabe housing eco-system is the access to credit by the informa sector. There are very few financia institutions that target the informa sector with oans of more than Rs.1,00,000 and with oan tenure up to 20 years. Many of them require guarantors or other kinds of security. The oan products are pre-determined with inadequate fexibiity to address the specia needs of the informa sector. This area requires specia efforts in research and advocacy. ASHRAM wi utiize DBS projects to undertake action research and deveop effective modes in micro finance modes for housing. Whie proven micro finance modes are avaiabe for iveihoods, micro finance for housing is sti in at a nascent stage in India. ASHRAM's activities wi aso focus on enhancing awareness about the potentia of this market segment, amongst housing finance institutions. ASHRAM wi aso ook at the possibiity of creation of a guarantee fund to encourage financia institutions to end to the informa sector. Community Deveopment: The provision of affordabe housing must go hand in hand with initiatives for community deveopment especiay in the areas of iveihood, behavioura change with respect to banking and savings habits, heath and education. These initiatives are important to buid a cohesive community, enhance socio-economic status of the customers and cutivate a heathy eco-system for access to credit. ASHRAM aims to coate goba best practices and knowedge, and encourage socia entrepreneurship that contributes to the affordabe housing eco-system. ASHRAM wi undertake research and training to support the Community Deveopment Initiative of DBS, and wi partner with organizations having domain expertise in the areas of heath, education, iveihoods and microfinance to design and impement innovative initiatives which can be scaed up as socia ventures. DBS Affordabe Home Strategy Limited 69

74 esign uid erve Photographs of ASHRAM taken in May DBS Affordabe Home Strategy Limited

75 Journey of 1000 days, Lambha Customer Profiing - The Findings In order to better understand the target community it aims to serve, ASHRAM and Griha Pravesh undertook a survey of 360 of the 500 customers of DBS's first project Umang Lambha in May For ASHRAM, the profiing of these Umang Lambha Phase 1 customers wi continue over a period of seven years. The findings from the survey, which are important for the different entities invoved in the affordabe housing segment, are given beow. Location The Umang Lambha customers are from different ocations across Ahmedabad, with the maximum customers coming from Vejapur (~15 Kms from Lambha), Isanpur (~6 Kms) and Naro (~5 Kms). This indicates that for customers in the targeted segment, the distance of an affordabe house from the current pace of residence and occupation is not a deterrent in their decision to purchase a house. Income eves 56% of the respondents earn Rs.20,000 or ess per month and 27% earn between Rs.20,000 to Rs.30,000 per month. Since many househods have more than one earner and/or comprise joint famiies, there is a possibiity that some respondents ony reported their own incomes. Thus, there may be some under reporting of the famiy income. Expenditure 23% of the respondents spend more than 70% of their income, with the highest expenditure being on food and misceaneous expenses. Banking and Savings 94% of main oan appicants and 45% of coappicants have a bank account in their own name, and State Bank of India, Dena Bank and Bank of Baroda are the most popuar amongst the account hoders. Ony 43% of the respondents have some sort of savings whie 57% have assets in the form of and or property, 4% have renta incomes, 12% have cars and 69% have 2 wheeers. Ony 11% respondents have taken other oans. Occupation Of the 60% respondents who are sef-empoyed or informay empoyed, 36% are sef-empoyed, 6% have sma shops/ stas, 9% are daiy-wage workers, 3% are independent service providers such as pumbers, eectricians, mechanics etc., 7% are working as auto-rickshaw and bus drivers or conductors etc. and 1 % are home-based workers. 40% of the respondents are formay empoyed/ saaried (4% in Government and 36% in private empoyment). DBS Affordabe Home Strategy Limited 71

76 esign uid erve Findings: Lambha Customer Profiing Access to services 90% of the respondents have paved access to their homes, 85% have a water-suppy connection and a toiet in their homes and 100% have eectricity connections. The high eve of access to services is because the respondents come from sums that have been improved under the sum networking project of Ahmedabad Municipa Corporation ( to 2006). Documentation There is a huge gap between the requirements of housing finance entities for processing oan requests and the documents the respondents have. As indicated in the diagrams, there are a variety of documents that are acceptabe to housing finance entities for considering and processing oan appications. Despite this, the Sef Empoyed with shops/restaurants/garage 6% Autorickshaw, transport 7% Daiy wage abor 9% Home basedtuition/taioring/ embroidery 1% Sef empoyedother 34% Independent service providers (pumber, mechanic, etc.) 3% Saaried- Govt. 4% Saaried- private 36% 72 DBS Affordabe Home Strategy Limited

77 Journey of 1000 days, ack of a reguar income proof is a major hindrance for peope in the informa sector. These findings about avaiabiity of KYC reated documents with customers have provided the housing finance companies with a good indication of the issues that wi be faced with the target group customers. HFIs The research reveaed that instances of persona oans have been under reported by the customers at the time of oan appication. This indicates the potentia for home oans that provide an option for debt consoidation. In addition, as the DBS experience has shown, there is a need for housing finance companies that are dedicated to this segment to invest in genera awareness programs, customer education, and in creating patforms for assisting individuas in appying for oans and for obtaining required documentation. NGOs & CBOs The DBS experience ceary highights the fact that handhoding support cannot stop with the purchase of a house. The occupants need effective support Avaiabiity of KYC reated documents with saaried customers Do not have Have Identity proof Residentia proof Saary sip of past three months IT Form 16 detais of past three years Income Tax Returns of past three years Bank Statements of past 12 months Last Provident Fund Statement Appointment / confirmation etter Private company profie Previous oan statements, if any Additiona investment detais (LIC, KVP etc.) DBS Affordabe Home Strategy Limited 73

78 esign uid erve Findings: Lambha Customer Profiing Avaiabiity of KYC reated documents with sef-empoyed customers Do not have Have Identity proof Residentia proof Income Tax Returns of past three years Audit report of the past years Bank Statements of past 12 months Address proof of business pace Agreement of Partnership Business profie Pan Card Number of Company Previous oan statements, if any Additiona investment detais (LIC, KVP etc.) of CBOs and/ or NGOs even after they move into their new homes, especiay for supporting them in their efforts for upward socio-economic mobiity and to encourage their invovement in the ong-term operation and maintenance of the project areas. This experience indicates that organisations working on housing issues can enabe access of the poor to affordabe housing by promoting others or becoming faciitators and market enabers. This wi provide stimuus to the affordabe housing ecosystem, and increase the demand for the DBS mode of providing pre-schoo education, activities for women's empowerment, financia iteracy, ski upgrading etc. in the new settements. Other Organizations ASHRAM aso conducted short surveys of famiies who booked homes in Umang Lambha and Umang Naro, and who ater canceed their bookings. The study reveaed that the corpus 74 DBS Affordabe Home Strategy Limited

79 Journey of 1000 days, avaiabe with the customer for the down payment and the monthy instament on the oan sanctioned often resuts in a viabiity gap of Rs.20,000 to Rs.30,000. Consequenty, the home aspirant is unabe to make the downpayment in a timey manner, eading to canceation of the booking. This shows that a fund that coud hedge the risks of the housing finance company or provide interest free oans for the 'margin money' woud be a possibe soution to this probem. The government, charitabe foundations or non-profit agencies intending on working in this sector coud activey consider support in this area. Deveopers The DBS experience shows that the niche market for affordabe housing is arge. In Ahmedabad, the housing for this segment shoud ideay cost ess than Rs.7,00,000. Thus, deveopers of such schemes need to be innovative to provide one and two room houses at competitive prices. Photograph of Umang Naro site taken in Apri 2012 DBS Affordabe Home Strategy Limited 75

80 esign uid erve Strengthening the DBS Team The DBS Team is keen on the invovement and guidance of experts and practitioners who can support the cause of affordabe housing and be cataysts for enabing access of peope in the informa sector to affordabe housing. In addition, DBS endeavours to continue buiding capacity of its human resources. In 2011, Mr. S.P. Ghosh, an authority in the fied of finance, investment and reguation, accepted the DBS invitation to join its Board as an Independent Director. Mr. Ghosh was associated with the Reserve Bank of India for more than four and haf decades, and was formery Executive Director of Nationa Housing Bank (whoy owned by RBI). He has hed various important positions in RBI which incuded mutipe deputations to the Unit Trust of India and the NABARD during their formative years. He was aso Consutant to the Asian Deveopment Bank and the Citibank. He is currenty an Advisor and on the Board of Directors of reputed corporates such as Sahara Group and the Benga Ambuja. 76 DBS Affordabe Home Strategy Limited

81 Journey of 1000 days, : Partnerships and Management Systems The first four months of 2012 have been eventfu with the aunch of Umang Sachin in Surat and substantia progress in severa other areas. Mansing and Rekha Maurya, Umang Lambha, Fat No. G-120 DBS Affordabe Home Strategy Limited 77

82 esign uid erve Umang Sachin, Surat... One of the key achievements at the start of the year was the decision to aunch a new Umang project in Surat in partnership with RJD Buidcon. Sachin is a major industria hub, a raiway junction on the Surat - Navsari raiway ine, and there are severa housing schemes under impementation in the surrounding areas. Surat Municipa Corporation too has constructed 2,372 dweing units in the area for economicay weaker section groups under a sum upgrading initiative. The Umang Sachin project site of 4.02 acres (16,307 sq.m/ 175,465 sq.ft.) is cose to the raiway station, and it wi have 839 apartments (128 of 1 room+kitchen and 711 of 2 room+kitchen) in a tota of seven bocks. Four bocks wi have four foors above a hoow-pinth and three wi have five foors above a hoow-pinth. The apartments are priced in the range of Rs.4,85,000 to Rs.7,11,000. At the aunch on 26 February 2012, Umang Sachin received a tremendous response. Informay more than 80 percent of the units were booked before the project was officiay aunched. 78 DBS Affordabe Home Strategy Limited

83 Journey of 1000 days, Snapshot Comparison of Umang Projects Project Name Location Tota site area Setbacks & Margins Net Saeabe Area No. of Bocks Number of foors Number of apartments and their sizes Umang Lambha Vatwa, Ahmedabad 3.62 acres (14,641 sq.m) / (1,57,534 sq.ft.) 13 m. from high tension ine 4.5 m. from road 3 m. from pot boundary ine 3,42,279 sq.ft. 10 Ground +3 foors (4 Bocks) Ground +4 foors (1 Bock) Ground +5 foors (5 Bocks) Tota 792 of which bookings were opened for 519 units in Phase I & 273 units in Phase II Umang Naro Naro, Ahmedabad 3.4 acres (13,762 sq.m)/ (1,48,079 sq.ft.) 4.5 m. from road 3 m. from pot boundary ine 3,66,390 sq.ft. 8 Ground +5 foors (parking on ground foor) A Bocks Tota 885 of which bookings opened for 450 units and the rest after 2 months Umang Sachin Sachin, Surat 4.02 acres (16,307 sq.m)/ (1,75,465 sq.ft.) 4.5 m. from road side 10.5 m. from centreine of road to buiding face 3 m. from pot boundary ine 4,48,650 sq.ft. 7 Ground +4 foors (4 Bocks) Ground +5 foors (3 Bocks) Tota bookings opened for a units at the same time Launch Date 1 rm+kit 312 nos (~40%) 2 rm+kit 435 nos (~55%) 3 rm+kit 45 nos (~5%) 2 May to 324 sq.ft. 486 to 585 sq.ft. 667 sq.ft. 1 rm+kit 360 nos. (~41%) 2 rm+kit 525 nos (~59%). 6 March to 324 sq.ft. 486 sq.ft. 1 rm+kit 128 nos. (~15%) 2 rm+kit 711 nos. (~85%) 26 February sq.ft. 550 sq.ft. Price range Rs. 3,50,000 to 8,50,000. Rs.3,99,000 onwards Rs. 4,85,000 to 7,11,000 Partners DBS Communities Saath DBS Communities Saath RJD Buidcon (Land Owner) DBS Communities Saath RJD Buidcon (Land Owner) Booking Status on % booked 95% booked 70% booked Pricing Range as on Avg Rate/sq. yd=rs.10,690/ - (min. 9,999/ -& max. 13,500/-) 1 RK unit price (min max Lakh) 2 RK unit price (min max Lakh) 3 RK unit price (min max Lakh) Avg Rate/sq. yd Rs. 13,900/ - (min 11,750/- & max. 15,500/-) 1 RK unit price (min max Lakh) 2 RK unit price (min max Lakh) Avg 1,450/- 1 RK unit price 4.81 Lakh fixed 2 RK unit price Lakh fixed DBS Affordabe Home Strategy Limited 79

84 esign uid erve Setting a Benchmark for DBS Umang Projects The projects buit under the Umang banner wi have simiar faciities, ayout pans, finishes and detaiing. With its focus on providing customers with optima useabe space and quaity finishing, DBS Communities decided to use conventiona buiding techniques and materias rather than go for new technoogies and construction materias. Consequenty, the efforts for new projects/ deveopments woud focus on site panning and refinement of custer and bock designs. This woud resut in optima use of unit and custer designs and in reduction of time required for panning and designing new projects. Considering the affordabiity of its target customers, and prices, and the costs of buiding materias and construction, the average size and panning options for one and two room units are imited. Therefore, once the design team ed by Vineet Chadha and Anjum Gupta finaised the basic pans of different size apartments and custering options, the DBS Team agreed that these coud be adapted in other ocations with minor adjustments and refinements in response to the site contexts and conditions. Having finaised which buiding and finishing materias to use to maintain a quaity standard acceptabe to DBS, and to set a benchmark for design standards for a Umang Projects, DBS decided on preparing a Design Manua that wi guide future projects and practices more efficienty. The DBS Design Manua wi provide cear guideines about the processes and ways of constructing the houses, detaiing of eements and specifications of buiding materias and finishes. It wi provide comprehensive information about reevant deveopment guideines that have dictated the design of the individua units and the apartment bocks, as we as about requirements for spaces for the community deveopment initiatives. 80 DBS Affordabe Home Strategy Limited

85 Journey of 1000 days, Spreading Association with Experts In 2012, DBS formay initiated coaboration with Nimish Pate and Paru Zaveri (architects, urban designers and conservationists) of Panika, Ahmedabad. The aim is to further ensure that DBS customers get good vaue for money, resources are optimay utiised, and optima comfort and space utiisation are achieved, Henceforth, a dedicated affordabe housing division in Panika wi work on the DBS projects. The design phiosophy of Nimish and Paru incudes the foowing: Every probem, irrespective of its nature, magnitude or constraints has an appropriate soution Appropriate soutions wi ony come through carity in the identification of the probems, the seection of the correct toos and their appropriate appications Design and construction processes must offer opportunities for creative inputs at a eves of participation In order to achieve its Mission, DBS is committed to working with peope who are exporing aternative paths and passionatey working towards equity and a sustainabe approach to deveopment. Since its inception, the core group and management team has expanded to incude other experts in the fieds of socia deveopment, architecture, panning, housing finance and management. The expertise avaiabe with DBS Communities has aso grown through association and partnerships with other individuas and entities. DBS Affordabe Home Strategy Limited 81

86 esign uid erve There are severa new housing finance companies that are specificay targeting peope in the informa sector. Working with peope with varied financia situations, the HFIs requires specia skis and attitudes that are specific to the segment. 82 DBS Affordabe Home Strategy Limited

87 Journey of 1000 days, Key Lessons after 1000 Days The DBS Team members share a vision and recognise that their work is not ony about constructing and seing affordabe houses for a specific market. It requires a ot more efforts, actions and processes that address the issues, gaps and hindrances that arise because of the specific market that the product is catering to. It entais faciitating and enabing peope to appy for housing oans, and ater, for reguar repayment of their oan instaments and maintenance of their house and environment. For DBS, this incudes enabing access to heath and education services and support through Urban Resource Centres after the famiies move into their new homes. The efforts and actions of the Team over the initia 1000 days has given insights about severa issues and provided opportunities for earning significant essons that woud be usefu for buiders/ deveopers as we as other entities/ groups that are interested in working in the affordabe housing market, especiay financiers. Essentia areas to ook into are: 8 1. The Poicy/ reguatory environment; 2. Design and construction; 3. Partnerships and Joint Ventures: 4. Housing finance, and 5. Demand side support. DBS Affordabe Home Strategy Limited 83

88 esign uid erve Key Lessons after 1000 Days The Poicy/ Reguatory Environment Housing poicy in India has argey focused on the suppy side. However, in order to have a thriving market for affordabe housing, it is essentia to address poicy issues for the suppy and demand side of the affordabe housing market, that is, from the perspectives of the deveopers and the customers. The deveoper's perspective 1. The requirement of environmenta cearance for projects of more than 20,000 sq.m buit-up area is a significant and important requirement, but has negative impications on the affordabe housing market. The engthy process eaves deveopers with two options: a. To pan projects that cover ess than 20,000 sq.m buit-up area and thereby ose economy of scae in providing common faciities, or b. To factor in the cost of deays of 6 to 12 months in aunching the project. 2. The specia provisions for ow-cost housing in buiding reguations are generay meant ony for up to two storied tenements and are not suitabe for ow-cost buidings. Thus, deveopers have to foow reguations, such as aocating parking spaces for cars etc. At the same time, the reguations do not incude provision for mixeduse/ commercia spaces at different foor eves. 3. The other buiding norms and space standards resut in the minimum cost of a dweing unit being too high. Thus, the owest cost apartment is not truy affordabe to peope with incomes of up Rs.20,000 per month. Permission for deveopment of a wide range of house types incuding dormitory or singe rooms that have custer or group-eve kitchens, and toiet and bathing faciities etc. woud encourage more experiments and options for those seeking a basic sheter. 4. Deveopers of affordabe housing need access to bridging finance/ funds because the processing of home oans takes onger for this market segment. This makes the cash infow back ended. Further, since this market segment is highy price sensitive, the project cyces need to be as short as possibe. 5. Most deveopers wanting to serve this segment are reativey new entrants and are in this business for reasons arger than short term financia gains. With shorter track records, they face chaenges in accessing cheap project finance. 6. Structura issues in urban deveopment cause artificia constraints in and suppy in the private domain and consequenty drive up the market vaue of and. 7. Whie structura reforms in the sector are awaited, provision of egay cear deveopabe and at market vaue by the government wi substantiay support the affordabe housing deveopers. In fact, this woud benefit the market segment without any eement of subsidy. 84 DBS Affordabe Home Strategy Limited

89 Journey of 1000 days, The customer's perspective The issues that customers face are reated to 'quaifying' for a housing oan and to the actua terms of borrowing. 1. Entry barriers for home oans for this market segment, such as documentation, banking habits and income proof hinder mainstream housing finance companies and banks from ending to ow income customers even though they are considered a priority sector. Based on the DBS experience, it is essentia to invest in providing faciitating and handhoding support for the customers. DBS estabished Griha Pravesh to provide such support and is activey promoting its use by other deveopers. 2. Peope with incomes of up to Rs.20,000 per month end up paying amost twice the interest that higher income customer's pay and that too in haf the time. Aso they get much ower oan to vaue ratio. The risk perception is unduy high despite extremey positive experiences of Housing Finance Institutions (HFIs) and Micro Finance Institutions (MFIs) deaing with this sector. Given this situation, the margin money component becomes a big barrier for many ow income customers who woud otherwise make it through. manner owing to 'Guideines of the Reserve Bank of India'. Thus, a famiy of 8 members having ived together for more than 10 years with a combined monthy income of Rs.22,000 is not eigibe for a Rs.4,40,000 oan (given by 30% of monthy income as EMI), but wi probaby get a oan based on the incomes of the 'appicant and the co appicant'. Therefore their actua eigibiity may come to about Rs.240,000, and a famiy that requires a minimum iving space of about 500 sq.ft. can ony afford a house of about 350 sq.ft. 4. A majority of ow income customers ive in rented accommodation (even in informa settements and sums) and find it difficut to pay both rent and pre EMI during the construction period. Therefore housing oans with a moratorium on interest during construction is desirabe. 3. Peope in this segment generay have very strong ties with their kith and kin, and heping each other is fundamenta to their existence. Therefore joint famiies are not uncommon. However when a housing oan is given, HFIs sti evauate their credit worthiness in a very myopic DBS Affordabe Home Strategy Limited 85

90 esign uid erve Key Lessons after 1000 Days Project Panning, Design and Construction DBS Communities ensured that the design of the individua units was based on the size and character of mutipe use spaces that potentia customers are used to and not dictated by cost and space constraints. Further, the custer pans aimed at creating externa spaces that peope coud use comfortaby. Further, quaity finishing materias such as granite kitchen patforms were used to enhance the quaity of the finished units. The aocation of spaces for community deveopment initiatives have resuted in some reduction in saeabe apartment area but the benefits of introducing these services in each project area means that the occupants have better and easier access to basic services. In the current economic situation, the targeted market segment can afford a maximum of tworoom apartments. An anaysis of the background studies and DBS observations have contributed to the panning of one and two room apartments and custers. Thus, athough future projects wi comprise of one and two room units, there is scope for refinement of the unit and custer pans in response to the context and feedback from Umang Lambha customers. Standardisation and a product mix are essentia for efficiency and resource management. Introduction and refinement of design eements is a continuous process. Additiona efforts are required to provide spaces for community interaction. The decision to introduce community deveopment initiatives as part of the business strategy and aocate spaces for them means that athough the deveoper is osing out on 'saeabe apartments', the design is more responsive to the needs of the targeted customers. The buiding norms are in favour of parking spaces and hence design cannot be responsive to the spatia needs of specific customers, such as requirement for open and semi-open community use spaces. Athough coordination amongst speciaists working on the architectura, structura and infrastructure pans for such projects is argey faciitated by the Design Team and/or deveoper, during the panning and impementation stages of Umang Lambha, DBS identified the need for better coordination with the structura design team. 86 DBS Affordabe Home Strategy Limited

91 Journey of 1000 days, Joint Ventures DBS Communities has experimented with a different impementation mode for the three projects aunched before Apri In the piot project at Lambha, DBS bought the and, undertook construction and deveopment work, and marketed the project. With an on-going project to demonstrate what DBS Communities was aiming for, DBS partnered with a andowner for the Umang Naro project. The arrangement was for the andowner to get a share of the profits, whie DBS took responsibiity for the project's construction and marketing. For the third project Umang Sachin at Surat, DBS once again partnered with the andowners who aso are responsibe for construction and infrastructure deveopment. In this case, DBS is responsibe for designing, marketing the project and customer management. For each project, DBS is supported by housing finance companies that are venturing into the affordabe housing space and providing oans to both - the forma and informa sectors. These incude MHFC, GRUH Finance, HFFC, Muthoot Finance, etc. Joint Venture Arrangements for Umang Projects LAND DESIGN CONSTRUCTION MARKETING FINANCE Umang Lambha Ahmedabad 3.62 acres 14,641 sq.m DBS buys the and DBS responsibe for Design & Site Panning DBS responsibe for construction DBS responsibe for project marketing and customer management MHFC, GRUH Finance Ltd. and Dewan Housing Finance Corp Ltd. Umang Naro Ahmedabad 3.4 acres 13,762 sq.m Land owner partners with DBS DBS responsibe for Design & Site Panning DBS responsibe for construction DBS responsibe for project marketing and customer management GRUH Finance Ltd., MHFC and Muthoot Finance Umang Sachin Surat 4.02 acres 16,307 sq.m Land owner partners with DBS DBS responsibe for Design & Site Panning Landowner responsibe for construction DBS responsibe for project marketing and customer management Micro Housing Finance Corporation and Muthoot Finance DBS Affordabe Home Strategy Limited 87

92 esign uid erve Key Lessons after 1000 Days Housing Finance Despite the demand and saeabiity of houses in projects meant for peope in the informa sector, the projects cannot be treated the same as those meant for the genera housing market. The deveoper needs to put in substantia efforts to have the required cash-fow. Athough the demand for houses costing up to Rs.8,00,000 exists, there are issues reated to cash-fow because of the market segment for which the houses are being buit. This is because the financia situation of the customers is fragie and any unforeseen event (such as a sickness reated expenses) can resut in the customer not paying instaments or the downpayment. In some cases, the customers had to cance a booking because they coud not get a oan due to ack of proper documents for the financing entity. Sometimes customers make the down payments prompty and the banks tentativey approve oans, but since the customer is unabe to provide the required documents/ documentation, the HFIs do not reease the funds. The deveoper/ buider needs to make arrangements that enhance the confidence of the HFIs in the viabiity of projects that argey cater to peope in the informa sector. Since HFIs are more comfortabe in extending finance to the informa sector when an intermediary such as an NGO is acting as an interface, DBS has an advantage because of its association with Rajendra and partnership with Saath. The DBS observation is that the rate of canceation and new bookings for peope in the niche segment is about ten times more than in projects meant for the forma housing market. Thus, the buider/ deveoper requires funding to bridge the time between getting the returns from the customers and the timing when funds are required for timey and efficient construction process. HFIs have aid-down formuae, which ook at the debt burden, income and ongevity of the person for giving oans in the forma sector. However, this is not true for the informa sector, which comprises peope with a variety of occupations such as bus-conductors and sweepers who are formay empoyed and have reguar pay-sips and vendors etc. do not have this. Further, whie borrowers in the forma sector are generay we aware of the nuances and have the required paperwork such as driving icense for address proof, the informa sector customer may ony have a ration card. So guidance for customers from the informa sector is absoutey essentia through trained staff/ faciitators of entities such as Griha Pravesh for inking them up with finance companies. 88 DBS Affordabe Home Strategy Limited

93 Journey of 1000 days, Currenty, there are few such faciitating entities compared to the huge market requirement, and deveopers cannot take this up because it woud require them to empoy three times the number of peope to engage with three times the potentia cients (one-in-three potentia customers actuay become a rea customer/ house buyer). The experiences and reated actions taken by DBS Communities in terms of estabishing Griha Pravesh and organising the Pragati Parivaar Seminars have resuted in more financing companies coming forward to support Umang projects. Faciitators need skis for judging the risk underwriting for potentia customers. Generay, since each person does the risk underwriting intuitivey, different faciitators and financing institutions are ikey to differ about the risk posed by a potentia cient. For the informa sector, assessors ook for the foowing three indicators: 1. The amount of steady income for month 2. The one-shot spend pattern of the person 3. Capita spend income who can decide on whether to give oan to particuar customers whie others require the paperwork to be sent esewhere or their head office. When the customers have a the papers/ documents, the HFIs can sanction the oans very quicky, for exampe, HFFC sanctioned 3 oans on the day of the aunch of Umang Sachin in Surat. Looking at the issue from the commercia perspective of a deveoper, he woud ike to compete the construction and sae of a scheme as quicky as possibe and move on to another scheme. He cannot be casua or charitabe because he is working on enabing access to the poor for an affordabe housing. Thus, in schemes for affordabe housing, here are diverse attitudes to the 'projects'. Unike in the forma sector, where generay a cient woud be prompt in meeting the banker when caed pertaining to a oan, in the informa sector, the same urgency in making timey EMI payments is not observed. Further, about 4 to 5 meetings are required with informa sector cients before the oan process is finaized whie for the forma sector, the process may end with one or two meetings. Some HFIs such as GRUH and MHFC in Ahmedabad have staff DBS Affordabe Home Strategy Limited 89

94 esign uid erve Community Deveopment The main earning from the DBS Communities' efforts and activities of the past 1000 days is that it is possibe to enabe access of peope from the informa sector to forma housing. However, in order to achieve this objective, there has to be coherence and concerted actions for addressing the three core areas of the DBS business strategy. The commitment of DBS Communities to support peope at the base of the socio-economic pyramid to purchase a house has ed to further actions such as providing an interface between the communities and housing finance companies. DBS Communities has coaborated with Saath to provide/ extend the foowing to its targeted customers: Key Lessons after 1000 Days Faciitating support and outreach to potentia customers in different sum areas in Ahmedabad; Conducting research/ studies of peope in the informa sector; Specia arrangements and activities as for Griha Pravesh, and Once customers start occupying/ moving into their new homes, extend heath, education, deveopment and micro-finance/ savings and credit activities through Urban Resource Centres. 90 DBS Affordabe Home Strategy Limited

95 Journey of 1000 days, Rekhaben Mansingbhai Maurya, Fat No. G-120, Umang Lambh DBS Affordabe Home Strategy Limited 91

96 esign uid erve HFI Perception of DBS Micro Housing Finance Corporation Limited (MHFC) Micro Housing Finance Corporation Limited ( MHFC ) is the first housing finance organisation to focus excusivey on the financiay excuded urban ow income househods. It focuses on persona verification of income and expenditure patterns rather than insist on income proof and paysips. MHFC works with deveopers who are constructing apartments costing ess than Rs.10,00,000. To start with, since MHFC and DBS are targeting the same economic group, DBS invited MHFC for the Design Charette. During initia interactions, MHFC was very impressed with the commitment of Sanjay, Baachandran and Rajendra, and their focus on endusers. MHFC decision to coaborate with DBS was infuenced to a arge extent because of its association with Saath and Rajendra Joshi. MHFC has partnered with DBS in the three Umang projects aunched ti Apri 2012 and its confidence in DBS has been strengthened because of the foowing observations: a) DBS's focus on end-users has ed to important initiatives such as the organising of Credit Camps and setting-up of the customer counseing centre - Griha Pravesh. The initiative of supporting the financiay excuded famiies in their quest for a house and heping them become eigibe for oans is unique. MHFC has been activey invoved in the Credit Camps and Pragati Parivaar seminars organized by Griha Pravesh. MHFC is particuary impressed with the Pragati Parivaar Seminars where the customer is not just given information on DBS projects, but aso on other competing projects. This transparency and focus on the customers getting maximum choice wi utimatey make it sustainabe and make it DBS stand out amongst its peers. b) DBS has a ong term perspective. It is buiding its business bock-by-bock and has stayed true to its origina mission by not moving into the mid or higher market segments. It views 'profits' as a means for sustaining the organisation rather than making the maximum possibe profit as quicky as possibe. This is ampy demonstrated by the fact that unike severa other deveopers, DBS has raised the prices of the houses in a more conservative manner. c) Another unique approach of DBS is that it reserves a certain percentage of houses for cients who come through Saath, which further reveas it's commitment and focus on ower income end-users. d) DBS is now impementing its third project and it has about three more in pipeine. It shows that DBS is a serious and credibe ong-term payer in this segment. For MHFC, the reationship with DBS as important and it expects the partnership to grow over time. As on 31 March 2012, a MHFC's customers who may not have been deemed credit worthy by mainstream banks and housing finance companies, are paying their EMIs on time. There were no past dues. 92 DBS Affordabe Home Strategy Limited

97 Journey of 1000 days, Home First Finance Company (HFFC) Home First Finance Company (Home First) aims to make home oans easier for consumers who are buying their first home. Its focus is on peope wanting to purchase houses in the range of Rs. 5,00,000 to 20,00,000. The range is wide because the house prices in cities ike Mumbai woud be very different from others. Since many housing finance companies that focus on the affordabe housing market have started over the past 4 years, HFFC's business strategy is to tie-up with deveopers who are constructing houses for the same target group. As of 30 Apri 2012, HFFC has a presence in urban peripheries of Ahmedabad, Bangaore, Chennai, Dehi, Mumbai and Pune. HFFC has found that because of its focus on customers wanting to purchase housing costing a maximum of Rupees 20,00,000, the suppy is restricted. DBS is one of the deveopers that has continued its focus on peope who can afford houses of up to Rupees 10,00,000 by constructing houses of 1 and 2 rooms and kitchen. This is unike other buider/ deveopers who get tempted to construct arger houses, se them and move on to the next project. the decision to purchase a house because it invoves a high financia risk. They ask a ot more questions to carify doubts or ascertain detais. At the same time, they have few documents that are required by housing finance institutions. HFFC therefore has evoved a process for the evauation of such customers through physica verification. HFFC identified DBS Communities as a potentia partner whie searching for organisations working with its target segment. This was substantiated by a Monitor Group Report that identified DBS as an important entity in the affordabe housing market. By the time DBS Communities and HFFC came together, amost a the units in Umang Lambha were sod out. HFFC therefore started its association with DBS with Umang Naro. HFFC is ikey to continue its association with DBS in the future because they are targeting the same market segment. Customer counseing is very important for the affordabe housing customers and DBS is doing this very we in two ways. One is the activities through Griha Pravesh and the second is through DBS staff that support customers on site by responding to their queries. Further, DBS has associated with Saath which takes care of the preparatory work in terms of thee customers having bank accounts and having some savings for the down payment. In the affordabe housing segment, customers are generay purchasing their first house, and are ess aware about the processes invoved than peope in higher income groups. In addition, they are more hesitant about making DBS Affordabe Home Strategy Limited 93

98 esign uid erve Beyond June 2012 Way Forward and Future Pans On competion of 1000 days, besides acting on the essons and directions identified to date, DBS communities wi be working towards actuaising its vision and mission together with its Team of experts. The DBS Team is poised to take actions as foows: 1. DBS sha begin to access forma financia institutions for project financing. The business mode is viabe and profitabe and there are penty of options avaiabe from banking institutions to ending companies. 2. DBS understands that a sustainabe venture that provides quaity products can be achieved by fostering positive coaborations. It therefore intends to enter into partnerships and tie-ups with investors, reputed construction companies and and owners. 3. DBS recognizes the need to generate goodwi and participation from the arger community and intends to enro a wide range of accompished individuas as symboic owners of the company. 4. DBS has put in pace ERP systems in pace, which through ongoing impementation, wi hep DBS in becoming a system driven organization. 94 DBS Affordabe Home Strategy Limited

99 Journey of 1000 days, Housing Finance goods that are offered by retaiers. This woud revea what is the minimum documentation 'accepted' for such consumer oans (PAN number, Name and supporting proof documents). 1.To have an assessing window that assesses the potentia customer as soon as he/ she waks in to 'possiby book an apartment'. This can either be done by Griha Pravesh or by the housing finance institution. When DBS next opens a scheme/ or ocation, Griha Pravesh or the HFI wi assess the customers' readiness in terms of avaiabiity of paperwork/ documents and margin money when they wak into the booking office. If the customer is ready, the HFI takes her/ him and works towards approving a oan and if not ready, she/he comes under the guidance of Griha Pravesh. 4. Demand Aggregation introduce a means that provides visibiity into purchasing requests for 'affordabe housing' through the process of coordinating and consoidating requirements. Demand aggregation woud faciitate various companies of an enterprise. It woud enabe identification and equipping of potentia customers who are not yet ready to purchase a house. Further, this can hep in cost-effectiveness through identification of product demand across mutipe ocations, and aggregation of distribution channes or other units of the enterprise. For exampe, a singe purchasing request and ordering from a imited set of suppiers foowing standardized purchasing procedures. 5. The roe of Griha Pravesh is very important and one woud want it to scae-up mutipe times. 2. To have an anaytica too such as CIBIL (Credit Information Bureau of India Limited, which acts ike a centra repository of credit information in India where as many as 500 different banks and financia institutions report each of their customers actions to them) for this target group. 3. To check whether this group takes consumer oans for TVs, refrigerators and other white DBS Affordabe Home Strategy Limited 95

100 esign uid erve Way Forward... Community Deveopment As aready highighted, community deveopment initiatives for the ong-term have aready been panned and spaces for ocating them are an integra part of each DBS project pan and design. However, DBS Communities anticipates some changes in the nature of activities in response to the wider socioeconomic environment and aspirations of the peope. As individuas get activey invoved in say microfinance, heath, education and/or iveihood activities in a particuar project, they wi be supported for further upgrading of skis for managing community deveopment activities within the project area as we as for supporting and training others in new areas. 96 DBS Affordabe Home Strategy Limited

101 Journey of 1000 days, Future Umang Projects in Gujarat India - Gujarat Gandhinagar Ahmedabad Rajkot Vadodara Bhavnagar Surat DBS Affordabe Home Strategy Limited 97

102 esign uid erve The Core Team DBS Affordabe Home Strategy Limited is ed by a team of practitioners and professionas who come from diverse backgrounds finance, architecture, urban panning and management. What unite them in this venture are their passion and a strong beief that it is possibe to provide financiay viabe, good quaity, and market based soutions for affordabe housing. Sanjay Shah has over 15 years of experience in architecture and rea estate deveopment, and is currenty invoved in rea estate deveopment in Ahmedabad, Dubai and Morocco. Sanjay Shah Sanjay Shah Rea Estate Deveoper & Architect I have aways been inspired by traditiona and informa finance systems which are buit entirey on reationships of trust. I want DBS Communities to extract the essence of these traditiona modes and cast them into a system that is both humanitarian and viabe, and use it to create iveabe and affordabe community housing. Sanjay started his career as a rea estate deveoper in Ahmedabad in the mid-nineties. Way ahead of the market at that time, he conceived and buit a successfu series of fuy furnished and moderatey priced apartments under the brand name Nandanvan. In the process, Sanjay innovated on cost contro as we as pricing, and his company became one of the first few in Ahmedabad to deveop effective quaity management systems. Since 2005, Sanjay has aso been invoved in a construction business in Dubai where one of the speciaized areas of work that he has been deaing with is workforce housing. This experience reinforced his earier interest in affordabe housing. Sanjay beieves in the viabiity of a market based approach to community housing. He brings his vision, his capabiities as a strategist, and pragmatism to every aspect of DBS s functioning and project concepts and ideas based on his many years of ground experience,. He beieves in chaenging himsef and others and his invovement brings rigor to processes in the organization. He wi focus on strategic positioning of DBS Communities in the rea estate market, on the company's interna systems, and on strategies for procurement of and, construction and marketing. 98 DBS Affordabe Home Strategy Limited

103 Journey of 1000 days, B.R. Baachandran is an architect and urban panner with neary two decades of professiona experience. He is the Managing Director of Achemy Urban Systems Private Ltd. - a professiona panning and design firm based in Bangaore. B. R. Baachandran Architect & Urban Panner Urban India has just begun its journey of transformation. It is important that this transformation shoud start with the peope who actuay buid our cities. It is my vision that DBS Communities wi participate in buiding the foundations of a truy egaitarian society. Baachandran started his career as a practicing architect in Thiruvananthapuram, and then from 1997 to 2006 worked as a panner in Environmenta Panning Coaborative), Ahmedabad. As its Executive Director, his notabe contributions incuded the reconstruction panning of Bhuj (Kutch, Gujarat) after the earthquake of In 2007, he set up Achemy Urban Systems Pvt Ltd and has been working on projects ranging from panning for water management in Kohapur to panning for post-food reconstruction in Bihar. Baachandran has ed panning teams on the preparation of Deveopment Pans and other urban panning projects across India as we as in Sri Lanka, Nepa, Bangadesh, Mauritius and Indonesia. With his coeagues at Achemy, Baachanadran has been campaigning for changing urban panning, poicy and egisation to enabe market based soutions for affordabe housing. As one of its Directors, Baachandran brings to DBS, his understanding of the urban housing process with its mutipe dimensions. He focuses on systems and processes that enabe affordabiity for the target group of buyers. DBS Affordabe Home Strategy Limited 99

104 esign uid erve Dinesh Jain is a Chartered Accountant by profession. He has 20 years' experience in corporate finance. Based in Ahmedabad, he is one the main promoters of the Company. Dinesh started his career with the Ahmedabad based Jinda Group in He was aso a Director in severa group companies incuding Baaji Reaty Ltd, a subsidiary of Jinda Wordwide Ltd (isted in the BSE). Dinesh has managed the finances of many group companies invoved in texties, dyes and intermediaries, internet service providers, rea estate and investment activities. He has been invoved from the conceptuaization of new enterprises to their fu operation. Recenty, Dinesh entered a new phase in his career and business as Promoter and Director of severa new companies incuding Tanya Infrastructure Pvt. Ltd. and DBS Affordabe Home Strategy Ltd. As one of its main promoters, Dinesh brings to DBS his expertise in buiding arge and robust financia management systems, the quaities of eadership and sound principes of financia management. He focuses on corporate finance, project finance and community housing finance. Dinesh Jain Chartered Accountant I firmy beieve that sound financia management systems are essentia for any company to deiver on its promise. I am committed to the highest eves of integrity and accountabiity in the finances of DBS Communities. 100 DBS Affordabe Home Strategy Limited

105 Journey of 1000 days, Rajendra Joshi Socia Entrepreneur & Founder Trustee, SAATH I am convinced that the quaity of ife of the urban poor wi improve when they are approached as a significant market. For housing, the need is to create a sustainabe market ecosystem for this segment. At DBS, we want to demonstrate that the cost and design of houses, affordabe housing finance and community deveopment are compementary enabers for affordabe housing. Rajendra Joshi, a socia entrepreneur, has been invoved in deveopment work with the urban and rura poor in India through Saath - an NGO he founded in His experience in deveopment and socia entrepreneurship has made a great impact in the ow income communities and sums of Gujarat, and other Indian states. Working in cooperation with severa government, academic and nongovernmenta organisations and institutions, he has made severa interventions to improve the ife of those at the Bottom of the Pyramid. By using market-based strategies to create incusive societies in both poor urban and rura communities, he has strategized, panned and faciitated interventions in pubic heath, education, iveihoods, infrastructure and basic services, microcredit, natura resource management, institution buiding, organisation deveopment, pubic poicy, confict resoution and disaster management. As a Director of DBS Affordabe Home Strategy Ltd., Rajendra brings to the enterprise his indepth understanding of community deveopment and in particuar, the areas of iveihood, microfinance and housing affordabiity. DBS Affordabe Home Strategy Limited 101

106 esign uid erve Sakti Prasad Ghosh Ex- Executive Director (Nationa Housing Bank, whoy owned by the Reserve Bank of India) Urban India has just begun its journey of transformation. It is important that this transformation shoud start with the peope who actuay buid our cities. It is my vision that DBS Communities wi participate in buiding the foundations of a truy egaitarian society. Sakti Prasad Ghosh has a chequered service career spanning over three and a haf decades. The journey started as a Probation Officer (Cass I) in the Reserve Bank of India (RBI) and ended with him retiring on superannuation as Executive Director, Nationa Housing Bank (Reserve Bank of India). During this period Ghosh was paced on deputation, twice with Unit Trust of India (UTI), and to Nationa Agricutura Bank for Rura Deveopment (NABARD) and Nationa Housing Bank (NHB) during their formative years. The ong career with RBI has provided him understanding of macro-economic dynamics, functiona aspects of Centra Bank and Deveopment of Financia Institutions. On superannuation, engagement with Asian Deveopment Bank (ADB) as Management Speciaist-cum-Staff Consutant has provided an understanding of working with mutiatera institutions. Concurrenty, association with Citi Bank as Consutant has provided understanding of business strategies of financia services institutions. Currenty, Ghosh is on the advisory and board eve of various Infrastructure and Housing Deveopment companies and Housing Finance Institutions. 102 DBS Affordabe Home Strategy Limited

107 Journey of 1000 days, Paru Zaveri and Nimish Pate's practice Abhikram (meaning 'Initiation' in Sanskrit) was estabished in 1979 with a view to expore the design directions, and processes, which make the buit environment, functionay, psychoogicay, environmentay and spirituay, more contextua and more comfortabe for the end-users. After 23 years of efforts in initiating directions, approaches, process and use of traditiona materias, technoogies and skis, ABHIKRAM made room for PANIKA, through which Paru and Nimish undertake works that attempt to re-estabish the reevance of traditiona decision-making processes in contemporary context, and to conserve energy through Passive Human Comfort Systems. Nimish and Paru bring to DBS their beief in the visionary thinking behind architecture of India which captures the aspirations and uses the capabiities of human resources for transforming them into unimaginabe future reaizations. Need photo Nimish Pate and Paru Zaveri of Panika, Ahmedabad. Sr. Conservation Architects To Paru and Nimish, the Buit Environment means: Ÿ A response to human needs that must go beyond function, economics and aesthetics to cover human comforts. Ÿ Human comforts comprise physica as we as psychoogica aspects. Ÿ Adequacy of physica and psychoogica comfort eads to increased productivity, better human reationships, and overa peace and happiness. Ÿ It is ony when architects address these issues that the contribution of the profession to society is ikey to increase in geometric progression. DBS Affordabe Home Strategy Limited 103

108 esign uid erve Vineet Chadha and Anjum Gupta are architects and urban designers with neary twenty years of professiona experience. They estabished SAAR Studio for Art and Architectura Research in Bhopa. Vineet and Anjum, who beieve in the creative use of innovative, costeffective and eco-friendy buiding systems, have designed, coordinated and executed urban, architectura, interior and andscape design projects. Vineet and Anjum have extensive experience in arge residentia and institutiona projects and have won many accoades for their work in different parts of the country. Vineet and Anjum are bring their passion and experience in deveoping approaches to design and construction that are most appropriate for community housing in different cimatic, geographic and socio-economic situations. They have designed Umang Lambha and Umang Naro projects and aso have deveoped the housing typoogies for DBS. Vineet Chadha & Anjum Gupta Architects & Urban Designers We firmy beieve that in the future that we are a iving into, community spaces, coective processes and sustainabe use of materias and technoogy are vita for the heath of human societies and this panet. We visuaise DBS Communities as a eader in this new genre of community housing. 104 DBS Affordabe Home Strategy Limited

109 Journey of 1000 days, Sowmya Haran is an architect and urban panner with over ten years of professiona and academic experience. Sowmya started working on urban panning projects at Environmenta Panning Coaborative where she worked on preparation of oca area and city deveopment pans. As a Director of Achemy Urban Systems Private Ltd., which she co-founded with B R Baachandran, Sowmya manages a variety of projects. Sowmya Haran Architect & Urban Panner Sowmya brings to DBS her understanding of systemic issues in housing provision, and wi focus on Corporate communications, and the research and deveopment agenda of DBS for infuencing the nationa housing poicy. Ravi Iyer is an independent Management Systems consutant with neary twenty years of professiona experience. He quaified as a construction technoogist and is a certified Lead Auditor in ISO 9000 and Ravi has deveoped quaity management systems for varied functiona areas such as marketing, quaity contro, shop foor management, purchase and inventory and human resource management. He speciaises in systems for rea estate deveopment, construction, and architectura design and engineering services. Ravi Iyer Construction Technoogist As an expert who is extensivey invoved in systems deveopment, training and auditing, Ravi is instrumenta in deveoping systems for DBS and in training the staff in its use. He is working towards ensuring that DBS Communities is a systems-driven organisation. DBS Affordabe Home Strategy Limited 105

110 esign uid erve Manish has and overa experience of 15 years in S & M, Business deveopment & Operations. He has headed arge teams of peope in the entertainment industry and successfuy estabished business processes from scratch. His ast stint was with E- city ventures, ZEE group. Manish Panchoi Director (Saes & Business), DBS Sudarshan is an accompished finance professiona with over two decades of experience in Retai Finance, which incudes Housing, Auto and Consumer Finance. He has hed eadership positions in we know Financia Institutes such as GRUH, Citi Group and Future Group. His desire to make a change in the socio-economic status for Base of Pyramid cients, through affordabe housing has evoved to make him an important part of the core team at DBS. Sudarshan Iyengar Director, DBS 106 DBS Affordabe Home Strategy Limited

111 Journey of 1000 days, Our Partners & Associates Saath Saath is a non-governmenta organization registered as a pubic charitabe trust in Gujarat, India. It has faciitated participatory processes to improve the quaity of ife for the urban and rura poor and provide a patform for individuas, institutions and corporate to partner with bottom of the pyramid communities. Tanya Infrastructure Private Limited It is a rea estate company currenty invoved in sae of pots and deveopment at Sanand and Na Sarovar. Saar (Design and Execution) Studio for Art and Architectura Research is a Bhopa based firm working on urban design, architectura design, interior design and andscape design projects aong with their supervision and execution. They have done projects ike Ispat industries, ICICI Lombard, Madhya Pradesh eco-tourism board, hote Hitone and Hote Recuse (Mt. Abu), Greenwoods country cub, Drishti offset etc. Achemy Urban System Private Limited. Achemy is committed to the task of enabing the continuous positive transformation of Indian cities by providing creative and insightfu professiona services in the areas of urban panning, urban design and urban management. Panika The focus of works undertaken by Paru Zaveri and Nimish Pate through PANIKA, which was estabished in 2002, is on re-estabishing the reevance of traditiona decision-making processes in the contemporary context, and to conserve energy through Passive Human Comfort Systems. Mr. Sandeep Shah, Pruthvi Management Consutancy - PMC Mr. R.G. Desai and Mr Siddharth Desai, Sarjan - Structura Engineer Mr. Devang Shah, Kena Consutant - Structura Engineer Mr. Apoorva Parikh, Eectrica Consutant Mr. Miind Mehta, Pumbing Consutant DBS Affordabe Home Strategy Limited 107

112 esign uid erve Media Coverage Business Standard - Apri 1, 2011 DBS to offer 3,800 affordabe housing units in Ahmedabad In what coud give a fiip to the affordabe housing sector in Ahmedabad, DBS Affordabe Home Strategy Ltd., in association with SAATH, an Ahmedabadbased non-government organisation, is set to aunch a 3,800 residentia housing project in the Rs 4-10 akh bracket. To be aunched under the brand name, 'Umang Vinzho', the units wi come up in phased manner on the outskirts of the city. According to BR Baachandran, executive director, DBS Affordabe Home Strategy Ltd., the project wi entai a turnover of Rs 250 crore in the near future. We are conducting a feasibity study on the project. However, we have been abe to successfuy book a of 792 units in our earier project," said Baachandran. Earier, DBS and SAATH have aunched simiar project 'Umang Lambha' with nongovernment organisation (NGO) Ashoka Foundation. Part of Ashoka Foundation's Housing For A (HFA) program, the project saw around 792 affordabe residentia units being offered to end users. "We intended to offer units for peope who do not have a saary sip or statement and find it difficut to avai oans. But for this, we needed support of a deveoper with and accessibiity and an organisation that coud aggregate the end users. Which is why we tied up with DBS and SAATH for offering affordabe housing," said Vishnu Swaminathan, director, Housing for A, Ashoka Foundation. URL: standard.com/india/news/dbs-to-offer affordabe-housing-units-in-ahmedabad/430500/ DNA - Friday, Mar 4, 2011 DBS pans 5,000 affordabe homes near Ahmedabad DBS Affordabe Home Strategy pans to construct around 5,000 affordabe homes in the vicinity of Ahmedabad. The rea estate deveoper has partnered with Saath Charitabe Trust for the affordabe housing scheme at Lambha based on Ashoka Innovators' Hybrid Vaue Chain (HVC) mode and has aready aunched 2,400 units in the price range of Rs3.5 akh to Rs8.25 akh. The group is targeting ower income peope. "Athough this group is in a position to repay home oan EMIs they find it difficut to quaify for forma sector oans for want of income proof, address proof and financia track record," said Sudarshan Iyengar, vice president of DBS Affordabe Home Strategy. He said that the company pans to come up with around 5,000 more affordabe houses in the vicinity of Ahmedabad, but did not mention the time ine for the same. The company has aso aunched affordabe housing scheme caed 'Umang Lambha' for the peope at the bottom of the famiy income pyramid. This scheme is aso based on HVC mode and is aunched in coaboration Saath trust. Vaeria Budinich, vice-president of Ashoka said that these type of HVC partnerships are rapidy spreading the growth of affordabe housing in India and over 10,000 homes are being panned and under construction in 6 cities, unocking a market potentia of Rs400 crore. "New aiances to design, buid, finance, market and scae up affordabe housing throughout India are now in pace. Over the next four years, Housing for A, an initiative of Ashoka, wi start new projects based on this mode in many states across the country, said Budinich. URL: The Economic Times - Friday 10th February, 2012 Case study: DBS Affordabe Home Strategy offers easy oans hep poor own homes DBS Affordabe Home Strategy was aunched in 2009 with the aim to create affordabe dweing units for the urban poor. "We wanted to create a company that focused soey on affordabe housing and did not ook at affordabe housing as a side business," said architect BR Baachandran, who founded the venture with chartered accountant Dinesh Jain and rea-estate deveoper Sanjay Shah. The company is buiding two housing projects -- Umang Lambha and Umang Naro -- on the outskirts of Ahmedabad in Gujarat. Consumers choose between two modes -- one room-kitchen or two roomkitchen in a community iving format. The units, which vary between 220 sq ft and 450 sq ft in size, are priced between Rs 4 akh to Rs 9 akh. These projects are targeted at ow-income consumers, most of who are empoyed in the informa sector. To reach the target ow income customers, DBS partnered with SAATH, an Ahmedabad-based NGO that has worked extensivey with sum dweers. "Finance for consumers is what makes or breaks affordabe housing," said Baachandran. Whie mainstream banks require income proof documents and a higher down payment, companies such as Micro Housing Finance Corporation (MHFC) set up in 2008, and Muthoot Housing Finance do not have such requirements. This has heped turn affordabe housing into a viabe business proposition as organisations such as MHC began to end to home buyers without insisting on income proof. However, Baachandran says this is just the proverbia tip of the iceberg. "Government needs to do more, not just in providing housing finance. Land reforms are urgenty needed to keep costs ow." DBS has aunched a new project in Surat and pans to expand beyond Gujarat in six months. URL: rea-estate/reaty-trends/case-study-dbsaffordabe-home-strategy-offers-easy-oans-heppoor-own-homes/articeshow/ cms 108 DBS Affordabe Home Strategy Limited

113 Journey of 1000 days, After 1000 Days, we have earned that this initiative requires ot of support from ike minded peope who are wiing to contribute something in this pursuit. We invite you to join hands with us whatever be your interest and expertise, we envisage a roe for you. contrary to more conventiona investment strategies, no firm can do this aone. Mutipe payers must be invoved, incuding oca governmenta authorities, nongovernmenta organizations (NGOs), communities, financia institutions, and other companies. Four eements creating buying power, shaping aspirations, improving access, and taioring oca soutions are the keys to a thriving Tier 4 market. Each of these four eements demands innovation in technoogy, business modes, and management processes. And business eaders must be wiing to experiment, coaborate, empower ocas, and create new sources of competitive advantage and weath. 9 C.K. Prahaad and Stuart L. Hart, DBS Affordabe Home Strategy Limited 109

114 esign uid erve Acknowedgements This report is based on information from many DBS Communities' sources and has benefited greaty from inputs of many contributors. The documentation woud not have been possibe without the contributions of severa peope. Sanjay Shah eaborated on the background, context, strategies and experiences of the past 1000 days. This incuded the chaenges that DBS Affordabe Housing Strategies Ltd. has faced, the essons earnt and actions taken in response to gaps and needs identified, and the processes and systems being introduced to enhance transparency and efficiency. He aso provided vauabe comments and advice during the documentation period. B R Baachandran provided insights into the strategies adopted for strengthening the approach and business strategy, heped fi-in the gaps and eaborated on the DBS perspective on the poicy and reguatory environments. Rajendra Joshi eaborated on his and Saath's invovement with DBS Communities, the chaenges faced by potentia customers of affordabe housing and the innovative actions taken in response to the needs and chaenges identified. He aso provided the reasoning and insights for the organizationa structure of Griha Pravesh and how the community deveopment initiatives are expected to be deivered in the Umang projects. Vineet Chadda and Anjum Gupta expained the reasoning behind the panning and design of the individua apartment units, custers and site pan for Umang Lambha, and the chaenges encountered in finaizing the pans in accordance with the deveopment reguations and site constraints. Nimish Pate described the potentia for making the experience of the owners and occupants more satisfactory through detaiing and strategic management of the deveopment process in consonance with his and Paru Zaveri's design phiosophy. Sudarshan Iyengar expanded on the financia issues invoved in the deivery of affordabe housing and on the issues faced by financing companies in oan processing for the home-purchasers in the informa sector. He aso provided his perspective on the potentia impact of the Credit Camps and the faciitation support of Griha Pravesh on the affordabe housing eco-system. Rajnish Dha of Micro Housing Finance Corporation Ltd and Manoj Vishwanathan of Home First Finance Company provided inputs regarding their company's focus on affordabe housing and shared their experiences todate with DBS Communities. Dinesh Jain's strategy and systems for financia management have highighted the importance of these eements for the deivery of affordabe housing. Manish Panchoi not ony expanded on the management actions for enhancing efficiency and minimizing costs, but was aso instrumenta in tracing and providing essentia information. Niraj Jani of Saath expanded on the actions for marketing of Umang Lambha, and the experiences from the Credit Camps and Parivaar Pragati seminars, and provided detais and data from the survey of 360 Umang project customers. Sowmya Haran's documents provided detais of ASHRAM. The endeavor was supported by Ravi Iyer who provided the background materia, context for severa actions, and coordinated the preparation and production of the report. He has taken most photographs in this report. Further, many others who were invoved in the compiation of previous documents of DBS Communities too have contributed indirecty to this endeavor. Suresh Karpatiya and Manish Agravat of Kumbh Design handed the design and production of the report, and patienty incorporated changes in the content. The initia work for this documentation was undertaken by B R Baachandran and Ravi Iyer. However, the responsibiity for any errors and gaps rests primariy with me. Sharadbaa Joshi Urban Deveopment Consutant 110 DBS Affordabe Home Strategy Limited

115 Journey of 1000 days, Notes 1. Prahaad, C K The Fortune at the Bottom of the Pyramid: Eradicating Poverty through Profits. Pearson Education/Wharton Schoo Pubishing, New Dehi. 2. Saath has supported the setting-up of Urban Resource Centres (URCs) as one-stop shops run by community members in sum areas of Ahmedabad. For famiies that become URC members for a nomina annua membership fee of Rs 125, the URCs ink them to famiies with microcredit, schoos, job training, medica care, infrastructure, and with access to government entitements and programmes. The aim of URCs is to transform service deivery to the urban poor from the NGO mode to a market-orientated approach. ' 3. Urmia' and 'Umeed' are pacement based iveihood programmes that Saath introduced to train women and youth in skis required for services in the business and domestic sectors, and then pacing them in appropriate companies. 4. The Sum Networking Project in Ahmedabad was introduced as a partnership project between the Ahmedabad Municipa Corporation, NGOs and the private sector. The Municipa Corporation provided in-sum infrastructure, andscaping and soid waste management. The sum residents paid Rs.2,000 per house for getting individua water suppy and sewerage connections. 5. A Design Charette is an intense effort to sove any architectura or design probem within a imited time. The word is used by the architectura and design community to describe any intense, on-the-spot design effort. In and use or urban panning, a charrette invoves intense and possiby muti-day meetings for consuting with a stakehoders incuding municipa officias, deveopers, and residents. 6. The period from December 16 to January 14 when the Sun transits through Sagittarius is known as ''Kamurta in Gujarat. Traditionay, the beief amongst Gujaratis is that any auspicious activity initiated during the inauspicious ''kamurtas'' is ikey to fai. Thus, Gujaratis avoid formaising significant decisions such as for marriages, buying and seing of property and other assets, making important business transactions etc. during this period. 7. From Saath. 8. From note on Insights from the DBS Communities Experience of Affordabe Housing prepared by B.R. Baachandran, Executive Director, DBS Affordabe Home Strategy Ltd, Ahmedabad. October C.K. Prahaad and Stuart L. Hart, The Fortune at the Bottom of the Pyramid, strategy+business, 26, First Quarter. Accessed from: Abbreviations ASHRAM Academy for Sustainabe Habitat Research and Management CBOs Community Based Organisations CEO Chief Executive Officer DBS Design Buid Serve HFFC Home First Finance Company (Home First) HFC Housing Finance Company HFI Housing Finance Institution MHFC MFI NA NGOs NOC RCC SHG URC Micro Housing Finance Corporation Ltd. Micro Finance Institution Non-Agricutura Non Government Organisations No Objection Certificate Reinforced Cement Concrete Sef Hep Group Urban Resource Centre Dastavej Griha Pravesh Umang Sae Deeds of properties House Entry - Literay means first entry into a newy buit house Happiness or Joy DBS Affordabe Home Strategy Limited 111

116 esign uid erve Creating buying power, shaping aspirations, improving access, and taioring oca soutions - the four eements of the commercia infrastructure for the bottom of the pyramid are intertwined. Innovation in one everages innovation in the others. C.K. Prahaad and Stuart L. Hart, DBS Affordabe Home Strategy Limited

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