In an exclusive interview with MBAUniverse.com, Director, School of Real Estate at the RICS School of Built Environment talks about built environment, large-scale urbanization and ideal candidate profile at RICS.
RICS School of Built Environment, Amity University has been set up in Delhi NCR to provide quality education for aspiring professionals in built environment. RICS Provides, MBA in Real Estate & Urban Infrastructure with specialization in Investment & Finance or Marketing, MBA in Construction Project Management and MBA in Construction Economics & Quantity Surveying.
Piyush Tiwari is Professor and Director, School of Real Estate at the RICS School of Built Environment. He is also the Head - Property, Faculty of Architecture, Building and Planning, University of Melbourne and was previously the Director-Policy at Infrastructure Development Finance Company. He also worked as a Senior Lecturer (Property) at the University of Aberdeen, UK. He has also worked with the largest mortgage company, HDFC India, and has held academic positions at the University of Tsukuba, Japan.
Given below are the excerpts of edited interview
Q. What are you teaching to your students with regards to the mortgage crisis that rocked the US and the scope of such practices in developing economies?
Ans. US subprime loan crisis questioned some of the beliefs that property market had. The new innovations in financial markets that created new products, here I am talking about securitization, while on one hand provided liquidity to the "non-liquid" real estate markets, lowered interest rate for borrowers, freed lenders of some of their risks and opportunities for large number of investors to share the real estate pie, on hindsight these innovations also raised the concern that investors invest in such products in an arm’s length way without understanding the underlying asset, it could cause disaster. Real estate drives its values from fundamentals and is local in nature.
Q. What are the key ideas that you share in your curriculum?
Ans. We in our subjects -
- explore the fundamentals that drive real estate markets. These are related to real economy
- talk about financial markets, the role that interest rates play in determining investment in real estate
- talk about property cycles and their unpredictability
- talk about innovations in real estate investment market
The world is globalized and what happens in matured markets affect us, directly or indirectly.
Q. Is the built-environment prepared enough to be able to provide to the shelter needs of the country over the next 5 years? What are the challenges you foresee?
Ans. There are number of issues which pose challenge for meeting shelter needs. First we have to understand the nature of this challenge. Of the total shortage, almost 95% is in the affordable housing segment while the supply of new housing is in luxury and high end segment. We also have other issues such as lack of rental housing and a large proportion of houses that are vacant as Census 2011 showed. If the requirement is in affordable housing segment, we can't build these on high cost land. Low cost land can't be made available in cities without government intervention. Time in obtaining approvals and technology are other key considerations. Prefab technologies can reduce the cost but then they are still not easy to implement.
Q. One of the challenges of large-scale urbanization is to provide cost-effective solutions which are environmentally sustainable at the same time. Is significant R & D going into solving challenges like these and are we as a nation capable of getting this balance right in the near future?
Ans. Three issues: one cultural acceptability; second developers' willingness to adopt and three right policy instruments. Most important of these is the policy instrument, if that is right other things will fall in place. I experimented with "Energy tax", which was linked to embodied energy in building material and found that if energy tax is instituted and is at appropriate levels, it acts as deterrent for using energy intensive building materials and users/developers shift their choice of building materials. So yes, R&D; is important but we need policy instruments such as taxes as well. As mentioned in the RICS 2020 survey, there are only 0.6 million professionals in the field of built environment against a requirement of 4.4 million.
Q. What kind of job profiles do you see evolving alongside the growth of the industry?
Ans. The job profile is becoming multi-disciplinary. I may be sticking my neck out but in my view the traditional model of engineers or architects is now outmoded. Property developers now have to negotiate with architects, engineers, financiers, planners, lawyers, valuers, investors, buyers at national and international levels. The profile that I see emerging in the industry is for professionals who can converse with all these different professions. Traditional approach of "built and they will come" does not hold anymore. The market is competitive and to compete one needs a holistic understanding of the sector.
Q.Who is the ideal candidate for your program? How would you, in very simple terms, explain the deliverable of the program you teach at RICS?
Ans. An ideal candidate for our program is a graduate in any discipline with open mind and curiosity for built space. So an engineer, architect, commerce graduate, economist, sociologist, with an interest in real estate can join. The program focuses on six core principles - economics, construction technology, property law, urban planning, valuation and investment and sustainability, which are necessary for real estate. We then provide opportunities to specialize either in marketing or in investment and finance through offer of core and elective subjects. All programs are accredited by RICS, which means that degree is global and graduates can work anywhere in the world
RICS School of Built Environment, Amity University has been set up to serve as a modern world class institution delivering quality education for aspiring professionals in built environment. The School - an industry led academic institution has been set up after a strong call from the industry and is supported by leading firms as well as the Ministry of Urban Development, Govt. of India. RICS is the world`s leading self-regulatory professional body for qualifications and standards in land, property, construction and associated environment issues. RICS is also a global accrediting body for over 600 built environment courses of reputed academic institutions across the world.
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