Headlines

NRIs BOOST INDIAN PROPERTY MARKET
India has a housing shortfall of 26 million units with the bulk of demand coming mostly from non-resident Indians (NRIs), making it a rich property market for developers to tap, a Citibank official yesterday said. Mumbai-based Ashish Mehrotra, business head and vice-president for mortgages at Citibank India, said the Indian property market has been increasing at between 30-35 per cent per annum, and will continue to see huge demand in the coming years. "The markets are very buoyant, and developers have been providing internationally-accepted standards in the property industry," he said at the opening of IndiaHome Property Exhibition, a trade show for NRIs seeking to purchase houses in India. He said the three-day event, which is being sponsored by Citibank and held at Shangri-La Hotel, targets the NRIs in Dubai and the whole UAE for properties being offered by 12 large developers covering India's 18 major cities. He added that Citibank, a member of global financial services company Citi, provides up to 90 per cent financing of the total value of home property, with a maximum repayment plan of 20 years. HSBC and the Indian house financing company HDPC also provide home loans to NRIs, whose biggest populations are in 20 economies such as the UAE, Kuwait, the US, the UK, Singapore, Hong Kong Canada and Australia. Having processed at least 1,000 home loans since January, Citibank now has over 8,000 customers in Dubai for this service, he said. He added that there are 40,000 NRIs who bank with Citibank in Dubai alone. He said Citibank, which has been extending home loans for the past two decades, is on its 10th year as sponsor of IndiaHome. Some of the developers participating in IndiaHome are Emaar MGF, DLF Ltd, Hiranandani Developers, SMR Constructions, Unitech Ltd, Sobha Developers, Aparna Group, Presidium and Vipul Ltd. Citibank said in a statement that these developers have residential, commercial and retail projects across various towns and cities in India offering purchase options of between Dh30,000 (30 lacs) to Dh10 million (10 crores). Vipul Kaput, global sales director at Citibank NRI, said that buying a home is an investment as well as an "emotional commitment" especially for NRIs. "Citibank has a rich experience and established presence in the Indian home loans market," he said at the event, whose inauguration was likewise attended by Rahul Soota, retail bank head at Citibank India and Burjor Patel, vice-president for marketing, Khaleej Times. Mehrotra said Citibank is offering pre-approved home loans on the spot to visiting NRIs based on their salary and identification documents during the three-day exhibition. These loans can be used to shop of property at various exhibitors.
SHIPRA GROUP TO RAISE $ 200 MN FROM OVERSEAS MARKET
Ghaziabad based Real estate developer Shipra Group is in talks with a number of overseas private equity players to raise USD 200 million. In the next three months, it aims at raising USD 125 million. The funds raised would be used for the development of its four projects. The funds are being raised from overseas investors because it feels domestic players are "conservative". The company has no plans to for initial public offering in the short-term and mid-term
RLYS TO PARTNER HOTELIERS TO BUILD BUDGET HOTELS
Indian Railways is planning to build budget hotels in partnership with leading hoteliers. A number of such hotel chains have come forward to tie up with Indian railways. Railways have decided to use its surplus land commercially. About 100 budget hotels would be constructed across the country on railway land. The railways have already identified the sites where the budget hotels would come up. The hotels would be constructed in public private participation mode. The estimated earning to railways would earn about Rs 300 crore from the collaboration with hospitality majors, though the revenue-sharing agreement has not been finalised yet. The Railways have finalised 20 sites mostly near the railway stations to be given to the hotel chains for construction of budget hotels. The sites are in Agra, Pune, Mumbai, Darjeeling, New Jalpaiguri, and Jaipur among others. It has a total 4.23 lakh hectares of surplus land out of which 42,846 hectares are vacant and located along rail tracks. The negotiations are in the final stage. After the signing of the final agreement, land would be given for construction of 20 hotels in the first phase.
FIIS RAISE STAKE IN INDIAN REAL ESTATE STOCKS
Indian real estate market is most attractive for foreign investors and they have raised their stake in a majority of realty firms listed on the bourses. A majority of them raised stake in the April-June quarter compared with their stake in the previous three-month period. FIIs increased their stake in 15 companies, including Unitech, Ansal Housing, DS Kulkarni and Indiabulls Real Estate. However, they decreased their holding in seven companies DLF, Atlanta, Era Construction, Lok Housing, Mahindra Gesco, Madhucon Projects and Unity Infrastructure. The buying of shares by FIIs in these companies comes at a time when a few analysts believe the countrys realty stocks are among the costliest in the world. A comparison of price to earnings (P/E) ratio of stocks from various countries showed that valuation of property stocks from the US and the UK moved lower, while those from emerging markets such as India continued to grow.
DLF'S LARGEST MALL PROJECT GETS ENVIRONMENTAL CLEARANCE
DLF Ltd has received environmental approval for developing the Mall of India project at Gurgaon-- slated to be the country's largest mall -- at a total cost of up to Rs 2,000 crore. DLF will develop four mn sq ft of retail space in the project. The company is also considering to expand the built-up space by an additional 1-2 mn ft. The total project cost is Rs 1,500 crore, but if the company plans to expand the area the cost could go up to Rs 2,000 crore. The Mall of India will come up at Gurgaon on a 32.87 acre piece of land. It is designed by Jerde Partnership Inc, an International Firm of Architects. The under-construction mall of India at Gurgaon has a total lettable area of around 39 lakh square feet and a total land area of 32.87 acres. DLF'S retail space development plan has six main formats: stand-alone stores, shopping centres, prime downtown shopping districts, neighborhood malls, destination malls and super-luxury malls. The business model includes sale, ownership and leasing of properties, though there is a focus on retaining ownership and managing mall properties by the company. DLF has secured land for the development of about 44 mn sq ft of retail space, of which 10 mn sq ft is under-construction.
PARSVNATH DEVELOPERS' Q1 PROFIT INCREASES BY 180%
Parsvnath Developers posted a net profit of Rs.1.02 billion in the first quarter of 2007-08. This is 180% growth from last year's Rs.365.5 million. During the quarter, the company's consolidated revenues stood at Rs.4.14 billion that surged by 66.44 percent from Rs.2.49 billion in the same period of 2006-07. Its operating margins increased to 36.70 percent from 23.29 percent in the corresponding quarter last fiscal. In addition, the firm's net margins also increased to 24.65 percent as compared to 14.68 percent in the first quarter of last year. The company has also embarked upon an aggressive growth plan to partner with real estate players based in other countries like Britain, Singapore, the UAE, Muscat, Bahrain and Mauritius. The company is currently working on five Special Economic Zones (SEZs), which have received a formal clearance from the government. It has also bagged 13 projects from Delhi Metro Rail Corporation (DMRC) with a developable area of 2.31 million square feet
IVR PRIME TO RAISE UPTO RS 849 CR THROUGH IPO
After public issues of DLF, Omaxe and HDIL, another real estate firm IVR Prime Urban Developers entered the capital market with its initial public offer to raise upto Rs 849 crore. The Hyderabad-based firm, a subsidiary of IVRCL Infrastructures and Projects, proposes to issue 1,41,50,000 equity shares of Rs 10 each through 100 per cent book building process. Price band for the issue has been fixed at Rs 510-600 per share. At the lower end, the company would raise Rs 721 crore. The focus of the company would be on affordable homes. The company was developing four projects in Chennai and Visakhapatnam. It intends to replicate the model in other parts of India as well. IVR has a land reserve of 2,479 acres that translates into development potential of 75.45 million sq ft in Hyderabad, Visakhapatnam, Chennai, Bangalore, Pune and Noida
INDIA'S FIRST INFRASTRUCTURE INDEX SERIES LAUNCHED
India's first Infrastructure Index Series has been launched by the Hon'ble Union Finance Minister, Mr. P Chidambaram in New Delhi. Infrastructure Development Finance Company Ltd (IDFC) in partnership with FTSE has formed this index. The FTSE IDFC India Infrastructure Index Series will represent the performance of Indian companies listed on the National or Bombay Stock Exchanges in India, generating the majority of their revenue from infrastructure, and is designed to underpin the creation of index tracking funds and structured products. FTSE IDFC India Infrastructure Index Series contains one tradable and one benchmark index and is calculated in real time and end of day basis. It contains stocks listed on the National or Bombay Stock Exchanges, focused on infrastructure sectors including Transportation, Energy, Communication and Construction
GLOBAL INVESTMENT ON REALTY REACHES $382 BILLION IN FIRST HALF OF 2007
According to Jones Lang LaSalle report, the global direct real estate investment amounted to a record US$382bn in the first half of 2007, a 16.6 percent rise on volumes in the same period last year. It surpasses full-year investment in 2003. Global real estate investment grew for the 16th consecutive quarter. In America, total investment surged 32 percent to $170.7bn. European investment volumes rose four percent to $156.6bn, with the UK, Germany and France accounting for over two thirds of volumes. Investment in Asia Pacific rose 12 percent to $55bn, with a significant proportion of the increase representing additional cross-border investment. Japan, China and Singapore represented the strongest real estate markets in the region. Singapore became 2007s hottest global market, with prime capital values increasing by 50 percent in H1 fuelled by astounding rental growth and yield compression. As strong Asian economic growth continues and interest rates in the region remain low, Asia is increasingly becoming the destination of choice for opportunistic international capital and we expect this trend to continue for the remainder of 2007
PURAVANKARA PROJECTS IPO OPENS ON JULY 31
Puravankara Projects Ltd, a real estate developer is issuing an IPO and it will open on July 31. Price band of the issue is Rs 500-525 per share. The company is issuing 21,467,610 shares of face value Rs 5 each through 100% book building process. The issue closes August 3. At the lower price band, the company would raise Rs 1,073 crore and at the upper price band it would collect Rs 1,127 crore. The issue would constitute 10.05% of the fully diluted post-issue paid up capital. The company plans to spend Rs 733.4 crore for land acquisition and Rs 289.9 crore for repayment of loans. Puravankara Projects has projects in Bangalore, Kochi, Chennai, Coimbatore, Hyderabad, Mysore, Colombo and the United Arab Emirates. DSP Merrill Lynch, Citigroup Global Markets and Kotak Mahindra Capital are the book running lead managers to the issue
HOME LOANS RATES ARE COMING DOWN; CORPORATION BANK CUTS RATES
Home loan rates are coming off. Corporation Bank has decided to reduce interest on fresh floating rate home loans by 25 basis points. The bank has reduced rates on fresh home loans of 5-15 year maturity by 25 basis points. Following this, the bank is offering home loans up to Rs 20 lakh at 10.25% and above Rs 20 lakh at 11.25%. The country's largest bank, State Bank of India (SBI)'s charges 10.75-11.25% on floating rate home loans and Punjab National Bank 10-11%. Meanwhile, HDFC has extended its special monsoon offer for new borrowers to August 14, from July 15 previously. The company had announced a 25 basis point floating rate cut to 11 per cent in June and the date has been extended. However, two big lenders in the segment - ICICI Bank and SBI - said they didn't have immediate plans to cut rates. "We have not decided yet and will wait for the credit policy," said Rajeev Sabharwal, head, ICICI home finance. The RBI will announce its policy on July 31
EMAAR TO PUSH HAMPTONS INTERNATIONAL AS 100% INDIA SUBSIDIARY
Dubais Emaar is going to set up a 100 per cent subsidiary in India. Though it has an equal joint venture with Delhi-based MGF, a real estate developer and financier, it plans to implement its new venture through Hamptons International, a UK company. Emaar had acquired Hamptons International last year for $500 million. The new subsidiary will sell residential property and consultancy services to developers and investors. Emaar has also started hiring people for the new venture. Under government rules, an overseas company has to get a no-objection certificate from its Indian partner before entering the same business in India through a wholly-owned subsidiary. An Emaar spokesperson said it was not necessary for Emaar to obtain a no-objection certificate from MGF to bring Hamptons to India.
GOVT FLOATS RS 100CR INFRA FUND FOR STATES
The Central government has declared a Rs 100 crore corpus to help states in preparatory work of projects coming up under public-private partnership (PPP). According to finance minister, it will be a revolving fund that will get replenished from successfully bid projects. In case it needs to be topped up, it would be topped up through budgetary support. The fund, to be called India Infrastructure Project Development Fund, would bear up to 75% of development costs of projects till the bidding stage
GLOBAL REALTY TRANSACTIONS HIT RECORD $600 BILLION IN 2006
According to an international property consultant DTZ, global real estate transactions hit a record high of $600 billion in 2006 up 25 percent on 2005 and a staggering 150 percent on 2004. Though buoyancy of the real estate market in the Gulf Cooperation Council (GCC) states such as Dubai with its mega projects and the emergence of Islamic real estate financing, the US by far accounted for the majority of global investment in real estate, followed way back by the UK. Together these countries accounted for 70 percent of the global investment in real estate in 2006. Transactions, according to the report, continued to be driven by a "wall of money", target real estate assets. DTZ estimates that global capital flows associated with real estate investments totaled $860 billion in 2006 up 5 percent on 2005 and 40 percent on 2004. This resulted in a total real estate capital market of some $9.63 billion in 2006
OBEROI GROUP PLANS NEW HOTELS BY 2011
The Oberoi Group plans to invest about 900 crore by 2011 to develop three properties in India besides entering into management contracts abroad. The group is developing one property each in Mumbai, Goa and Rajgarh in Madhya Pradesh on its own. It also has partnership projects in Bangalore and Hyderabad. The group is planning to add 1,500 rooms in India. Currently, the group has 2,950 rooms in India and the company's expansion programme will be completed in 2011. The company is also planning to enter into management contracts overseas for properties in Dubai, Abu Dhabi, Cambodia and Maldives. Currently, the Oberoi group, which operates 32 hotels in five countries, has 1,690 rooms overseas.
RAILWAYS APPOINTS CONSULTANT TO HELP DEVELOP 10 SITES
The Railways bid to commercially exploit surplus land and airspace available near existing railway infrastructure finally appears to be getting on track. The newly constituted Rail Land Development Authority (RLDA) has hired IL&FS Infrastructure Development Corporation to conduct feasibility studies and sell the idea to prospective developers for the 10 sites identified in the first lot.
GERMANYS MPC SYNERGY TO INVEST $1 BN IN INDIAN PROJECTS
Germanys MPC Synergy is going to invest $1bn in Indian Real Estate sector. MPC Synergy will invest over USD 200 million in three residential projects in Ludhiana, Bangalore and Mohali. MPC expects 15% returns from them. The German fund aims at tier-II cities for its activity .The projects are expected to commence in three months. MPC Synergy will subsequently fund malls, luxury hotels, hospitals and schools as well.
OMAXE PRICED ITS IPO AT RS 265-310 PER SHARE
Omaxe Ltd. has set a price band of Rs265-310 per share for its Initial Public Offer (IPO) which is to come shortly. The company aims at raising up to Rs14bn through this offer. The issue will constitute 11.20% of the fully diluted post-issue paid-up capital of the company, if the green shoe option is exercised and 10.30%, if the green shoe option is not exercised. Of the total issue, up to 17.5mn shares are for the public, while the balance 296,000 shares have been reserved for eligible employees. Additionally, 1.75mn shares are kept for the green shoe option.
INORBIT PLANS TO DEVELOP MALLS IN TIER-I & TIER-II CITIES OF INDIA
The US housing market remained sluggish last month; latest figures have shown, with sales of existing homes at their lowest level in four years. Sales fell 0.3% to 5.99 million units in May, the slowest pace of growth since summer 2003, according to the National Association of Realtors (NAR). Sales are now 10% lower than a year ago, when 6.68 million units were sold. The sharp downturn in the housing market, after years of stellar growth, has shown little sign of bottoming out. The number of unsold homes rose 5% to 4.43 million units.
USAS VOREANDO AND MIDC TO DEVELOP INTEGRATED TOWNSHIP
USAs Voreando Realty Trust has joined hands with MIDC (Maharashtra governments industrial infrastructure arm) to develop an integrated township at Hinjewadi on the outskirts of Pune. Hinjewadi houses some of well known IT companies like Infosys, Wipro, Oracle, IBM and others. Voreando is going to invest about $200 million on the township. The project is expected to be completed over the next five years. A special purpose vehicle has been formed in the name of Voreando-Hinjewadi Township Pvt. Ltd. that will execute the whole project. The shareholders agreement was signed by Rajiv Jalota, CEO, MIDC, Maharashtra, India and Michael Fascitelli, President, Voreando Realty Trust, USA at New York, on the sidelines of Maharashtra Investment Forums two-day meet.
REAL ESTATE COURSES ARE THE LATEST ATTRACTION FOR EDUCATIONAL INSTITUTIONS
At present there is a lot of activity going on in Real Estate sector. Every next day there is an announcement of major projects, comprising of general housing to Multiplex, Malls, Business Parks, etc. Governments policy has also eased foreign players to participate in these activities. Summing up all this it is clear that right now Real Estate sector has dominated almost all other sectors. To get a pie of this surging sector, a new breed of young professionals, MBA, engineering and architecture students who are looking at a diploma in real estate as an additional qualification. Real Estate Educational institutes are slowly catching up with the concept of real estate education in the country. The Indian Institute of Real Estate (IIRE) affiliated to the National Association of Realtors (NAR), the leading real estate association in USA which offers real estate certification programs online in India since 2003 had only a few registrations till the end of 2006. However, from the beginning of this year, the institute is looking at close to 50 students signing up for its eight-month diploma course in Principles and Practices in Real Estate. The sudden enthusiasm in registrations has also led the institute to think of a satellite programme in real estate. For this, it is in talks with the Maharashtra State Board of Technical Education (MSBTE) to beam a satellite diploma programme in Real Estate Principles and Management which, if accepted, will see the programme transmitted to nearly 50 affiliated colleges in Maharashtra. The proposed programme could be a short term course for around two-and-a-half months or a long duration programme of around eight months. The fee for the short-term programme has not been decided as of yet but the eight-month programme could cost close to Rs 8,500. The demand for courses in real estate has led London-based Royal Institution of Chartered Surveyors (RICS) to explore partnerships with Indian universities and B-schools to offer RICS-accredited courses in India.
INDIAN REALTY FIRMS TO FORM TRUST & GET LISTED IN SINGAPORE STOCK EXCHANGE
Real Estate firms in India are planning to constitute a REIT (Real Estate Investment Trust) like trust to get listed in Singapore Stock Exchange. A REIT is a tax-efficient vehicle for a corporation investing in real estate. REITs are required to distribute 90 per cent of their income, which may be taxable in the hands of the investors. The REIT structure was designed to provide a similar structure for investment in real estate as mutual funds provide for investment in stocks. Embassy group, Ascendas, DLF and Unitech are planning to list their fund structures, which mainly include REITs, on the SGX. SGX is popular for property trusts since it has nearly 20 REITs listed on it, which are mostly from South East Asia including China, Singapore, Hong Kong and Australia.
ANSAL API TO ENTER HOSPITALITY SECTOR
Ansal Properties & Infrastructure Limited, declared to enter into the hospitality sector by floating a new SPV along with Ambience Hospitality Management Pvt. Ltd., owned by Mr. Vipin Luthra of The Palms- Town & Country Club and Geoffreys restaurants. In the proposed SPV, Ansal API will hold 80% equity and the balance 20% will be held by Ambience Hospitality Management Pvt. Ltd. The SPV plans to set up 30 hotels over next 10years with an investment of Rs.2000crs. The proposed SPV will set up hotels in the 5 star and 4 star categories including palace hotels, golf resorts, business hotels, leisure hotels, spas, clubs and serviced apartments. Among the first hotels of the block, will be a palace hotel in Jodhpur and the golf resort in Lucknow, both of which will operate in the luxury segment.
MICROSOFT TO SET UP INFOTECH PARK NEAR PUNE
Microsoft will set up an InfoTech park in Hinjewadi near Pune soon. Microsoft chief Bill Gates made this declaration at a dinner which he hosted for Maharashtra Chief Minister Vilasrao Deshmukh in Seattle. Gates also said he could help farmers by setting up a centre most likely in Hinjewadi, which will provide information about agricultural trends. Gates also showed Microsofts readiness to start a human resource project in Maharashtra. Deshmukh is on a US tour to attract foreign direct investment. Gates had sent one of his vice presidents to extend invitation to the CM to come to the US. Microsoft already has a small project running at Hinjewadi. The new information technology park will be an extension of this facility. The company will come out with further details about the park very soon.
MARRIOTT TO OPEN 16 NEW HOTELS IN INDIA
The Marriott International Hotel is planning to expand its business by opening 16 new hotel properties in India by 2010. At present it has six hotels in India. The proposal comprise three JW Marriott Hotels and Resort properties and one Ritz-Carlton hotel in the luxury segment, one Marriott Hotels and Resorts and one Renaissance Hotels and Resorts property in the deluxe category, one Marriott Executive apartments property for extended-stay travellers and eight Courtyards by Marriott hotels in the upper-moderate segment. At present, the company has signed a management contract for six properties - with Viceroy Hotels in Chennai for a 371-room JW Marriott, with New India Hotels in Bangalore for a 328-room Renaissance Hotels and Resorts and with Unitech in Gurgaon for 129-room Mariott Executive apartments. The company will also come up with a 170-room Courtyard by Marriott in Ahmedabad, a 299-room Courtyard by Marriott in Mumbai and a 210-room Courtyard by Mariott in Pune.
Morgan Stanley Targets India With $8 billion Warchest
Morgan Stanley has raised the biggest property fund ever, a $8 billion established global markets, including Japan and Europe, as well as emerging countries such as China, India and Russia. Separately wall street rival goldman sachs has raised a $4 billion global property fund, a source familiar with the situation said. The Morgan Stanley Real Estates Fund 6, supplemented with borrowing, would have buying power of more than $30 billion, the US investment bank said. The move heralds an emergence of giant global property funds, with US private equity firm Blackstone raising $10 billion for real estates and credit Suisse planning a $2.5 billion fund. Morgan Stanley, which issued a statement on the fund in New York, has contributed 20 per cent of the new funds equity. Its portfolio would include real estate assets and companies from emerging markets, including China, India, Russia, Turkey and Latin America, as well as the developed markets including Japan, western Europe and Australia.
Hotspot realty options
Tier 3 cities are the next commercial hotspots in the Indian real estate market, A study by our experts. Kochi, Chandigarh, Ahmedabad, Jaipur and Nagpur are fast emerging as the top three IT/ITES commercial real estate destinations among Tier 3 cities in India, IT/ITES firms such as Wipro, Satyam, Infosys, IBM, Micrisoft, Genpact and Dell already have a presence in many Tier 3 cities across India, it says. Other cities such s Mysore, Coimbatore, Lucknow, Visakhapatnam, Indore and Baroda are also on the radar of IT/ITES on the radar of IT/ITES firms, creating a wide array of choices the traditional growth centers (Tier I cities) and the transitional Tier 2 cities have grown from strength to strength while tier 3 cities are fast emerging as hospitality sectors, the report points out. The increasing costs of doing business in tier 1 and 2 cities has been instrumental in providing tier 3 cities the opportunity to offer advantages in terms of lower cost of labour and real estate, says the report which goes on to say that Tier 3 cities provide cost arbitrage opportunities for off-shoring facilities although profiles vary substantially across locations. The cost of skilled IT/ITES manpower is relatively higher in Kochi and Nagpur compared with other tier 3 locations of Chandigarh and Jaipur though availability could depend upon the type of skill-sets required by respective businesses. Some of these cities such as Kochi and Nagpur have a number of colleges and institutions imparting professional education and with overall high literacy rates, Kochi (94%) and Nagpur (88%) may provide a larger English speaking talent pool suitable for the IT/ITES businesses. Factors that may be considered to evaluate cities for business location attractiveness include infrastructure support, governance, cost of living, quality of life, operating costs, etc., the report says. It also points out that with the Indian economy growing at the rate of 8 percent and no signs of a slowdown in the short term, the demand for of fice space will continue to increase, resulting in low vacancy levels. The weighted average grss-rental value in the central business district (CBD) and the SBD is expected to continue to rise in the next six months mainly on account of low vacancies. However, the 1.2 million sq ft of expected might trigger stabilization of rental values in the mi-cro-market. High streets in Delhi still command the highest rental values. Connaught place, the CBD of the NCR, continues to undergo a facelift and in the process has attracted many new retailers who leased spaces at rents as high as Rs. 600 per sq. ft. per month, the report states.
TATAS TO PUT RS 348 CRORE FOR 29 NEW GINGER HOTELS
Roots Corporation (RCL), a 100 per cent subsidiary of the Tata Group-controlled Indian Hotels Company (IHCL) , is planning to open 29 new Ginger hotels across the country, including 12 in Maharashtra, in the next three years. The company will invest Rs 348 crore in two phases in the proposed hotels. IHCL has developed the Smart Basic concept hotel under the brand name Ginger. The company, currently, has eight Ginger hotels with a total built-up area of 3.60 lakh sq ft across the country, including two in Maharashtra (Pune and Nashik) and one each in Bangalore, Haridwar, Bhubaneswar, Mysore, Thiruvananthpuram and Durgapur.
ANSAL GETS LICENCE FOR ITS TOWNSHIP PROJECTS IN HARYANA
Ansal Housing and Construction Ltd (AHCL) have received the licence for developing two townships from the Director, Town & Country Planning department, Chandigarh, Haryana. The first residential township will be developed over 100 acres in sector 19, Rewari, in Haryana. The company expects a turnover of Rs 150 crore over next two-three years from this project. AHCLs has also received the licence for developing a second township over 98 acres in sector 36, Karnal (Haryana). Ansal expects a turnover of about Rs 250 crore over the next three-four years from this project. Both the townships will be called Ansal Town and will be developed as integrated townships.
ASCENDAS SETS UP RS 1,328-CR PROPERTY FUND TO INVEST IN INDIAN REALTY
Business space solutions provider Ascendas has launched about Rs 1,328 crore funds focused on investing in real estate projects in India. Ascendas India Development Trust (ADIT) is the first development fund to be launched by Ascendas, following the US$250 million equity Ascendas India IT Parks Trust launched in June 2005. The fund has a target asset size of US$1 billion and an eight year term. It would invest in real estate projects to develop land for industrial, commercial, residential and retail use.
$6 BILLION FDI HEADING FOR INDIAN REALTY
Real Estate equity deals worth $30 billion (Rs 1.32 lakh crore) are in the offing for the current year across all Asian markets. One-fifth of these investments ($6 billion) will find their way into the Indian real estate market alone. According to a report by property consultants Jones Lang LaSalle on rising FDI in real estate, an estimated $10 billion foreign investment is expected to enter the Indian real estate sector in the next 12-18 months. More than a dozen overseas private equity firms such as Goldman Sachs, Morgan Stanley, JP Morgan and Blackstone Group are looking at investment opportunities in the Indian real estate market. Morgan Stanley recently closed a deal worth about $150 million with Oberoi Constructions in Mumbai. Meanwhile, the Nakheel Group in Dubai entered into a $10 billion deal with DLF for residential projects in Tier I and II cities. The reason behind foreign investors eyeing India are strong commercial property yields across metros, the high capital and rental value appreciation and the availability of quality supply in the country. Also, there has been an increase in confidence in Indias growth story among investors, with the fast-growing economy set to become the second-largest economy ahead of the US by 2050.
DLF, FORTIS JOIN TO DEVELOP HOSPITALS
DLF and Fortis Healthcare to set up hospitals across the country with investments of about Rs6,200 crore. Fortis will have a majority holding with 74 per cent stake while DLF will hold the remaining stake in the proposed joint venture. The joint venture will set up a chain of 200-450 bed hospitals in 31 cities in India within three to five years.The planned investment of Rs6,200 crore would go toward meeting cost of land, construction and medical equipments. The JV plans to build hospitals in cities where DLF has a presence. Already DLF has a land reserve of 10,255 acres in 31 cities. Fortis currently has a network of over ten hospitals mainly in North India, including the Escorts Heart Institute and Research Centre (EIHRC). It also has a heart command centre in Afghanistan.
DLFS RESULT WILL DEEPLY IMPACT REALTY PLAYERS IN MKT
DLFs presence in the market has given a dramatic boost to other players in the market at present. But it is again DLF, if falters, there will be a drastic scene. Shares of property companies have been on an up move ever since the Securities and Exchange Board of India (Sebi) cleared the industry giants mega initial public offering (IPO). The recovery has happened despite concerns over cooling property prices, which had soared to unprecedented levels amid the real estate boom.
DLF TO PRICE ITS SHARES AT RS 550-600
DLF Ltd, the Delhi-based developer is set to make an initial public offering (IPO), will likely price its shares between Rs550 and Rs600, helping it raise as much as Rs10,500 crore, in Indias biggest domestic share sale. DLFs attempt to raise money from the markets, its second within a year, will likely face stiff competition from ICICI Bank Ltd, which is also planning an issue that could raise almost twice what DLF plans, selling shares to both domestic and overseas buyers. DLF plans to offer 175 million shares to investors. K.P. Singh, 75, and his family who control about 90% of the company, may emerge as the richest Indians in the country based on the value of their holdings at this price, toppling Reliance Industries Mukesh Ambani.
TATAS TO FORAY IN TO REALTY BY DEVELOPING LAND OF GROUP COS
Tata group plans to expand its presence in real estate. The group plans to develop excess land owned by various group companies through the recently-floated $1-billion real estate fund under the Tata Realty and Infrastructure. Bombay House, the groups headquarters, is learnt to be finalising a blueprint for the new business. The group has hired KPMG to outline the commercial development of land owned by the group companies. In the first phase, the group would develop the excess land owned by group companies such as Tata Consultancy Services (TCS), Voltas and Rallis India. TCS, the Tata groups software company, has around 250 acres of excess land spread across Pune and Hyderabad, while consumer goods company Voltas owns 25 acres in Hyderabad. Rallis India, too, owns 100 acres in the southern city. As per the current plan, the group would form special purpose vehicles and hive off the excess land into the SPVs which will be developed later, Although other group companies such as Tata Motors and Tata Tea have excess land bank, details of the same couldnt be obtained. The group wants to develop mixed use project, commercial, residential and IT parks on the identified lands. The Tata real estate fund, which is in the process of mobilising $1 billion from domestic and overseas investors, would utilise a major share of the funds for developing land. Tata Sons, the holding company of group will invest $100 million in the fund. The group is also looking to enhance the size of the fund from the current $1-2 billion. Tata Realty & Infrastructure would also invest in infrastructure and real estate projects, housing complexes, special economic zones, construction of bridges, ports and airports.
FUTURE GROUP TO BUILD AN ENTERTAINMENT-CUM-COMMERCIAL ENCLAVE IN PUNE
Future Group, the parent company of Indias largest listed retailer Pantaloon Retail (India) Ltd, and a local real-estate firm will invest around Rs850 crore to build an entertainment-cum-commercial enclave in Pune to tap the growth in the countrys booming commercial space and retail sectors. The 2.8 million sq. ft project called Market City will have malls, a 300 to 350-room business hotel, entertainment space and offices and is expected to be completed in phases by mid 2010. Futures real-estate private equity fund, Kshitij Investment Advisory Co., and Pune-based developer City Group will invest Rs180 crore each with the remaining Rs490 crore being funded through long-term debt from banks and financial institutions, said Shishir Baijal, chief executive of Kshitij Investment. The project will be designed by Walker Architects of New Zealand and will be funded through a debt-to-equity ratio of 1.5:1, he added. Baijal said the company has so far committed around $230 million (Rs943 crore) to various real-estate projects in India out of its corpus (spanning two private equity funds) of $430 million. This will be the seventh Market City project from Kshitij after six others in Mumbai, Bangalore, Chennai and Hyderabad with each project costing between Rs500 crore and Rs1,200 crore including the cost of the land. The Chennai project will cost only Rs500 crore as it is smaller compared to the Pune Market The 30-acre Market City is coming up within the 350-acre residential project City Group is building in the Pune suburb of Hadapsa.
SIXTEEN SEZ GOT CLEARANCE FROM BOARD
Sixteen Special Economic Zones got formal clearance from the Board of Approval for SEZs. The Board considered 23 proposals which had earlier been given in principle approval at its meeting in New Delhi yesterday but gave formal approval to 16. There are as many as 369 SEZ proposals pending before the Board, out of which 160 have acquired land
LONDON COMPANY IN BENGAL REAL ESTATE
A UK company is taking the lead role in two housing projects near Calcutta, setting the stage for fresh foreign direct investment in Bengal real estate after the Salim Groups initiative. REIT Asset Management, a London-based company that manages real estate assets valued at over $6.8 billion globally, will partner a local developer to build nearly 5,000 flats on the northern and southern fringes of the city. The project in Bonhooghly, opposite the Indian Statistical Institute (ISI), will involve redevelopment of a refugee colony. Around 800 families living there now will be given a flat each, free of cost. The southern project at Maheshtala will be a fully commercial venture but the developers have promised to build a sports-cum-cultural centre for the municipality. The cumulative project cost is an estimated Rs 465 cores. The two projects will be developed over two to four years. The company had set up office in India two years ago, but has invested only in one project in Pune so far. REIT will hold a majority stake in both projects with local partner Eden Realty Ventures, promoted by NRI businessman Indrajit De. We are delighted to work with a global investor like REIT in Bengal, De said from New York. Both projects will have active participation from government departments. The Bonhooghly project will be a public-private partnership with the Refugee Relief and Rehabilitation Department of Bengal, while the Maheshtala Municipality will partner the other project. In Bonhooghly, structures built in the 50s to accommodate refugees will be pulled down. The displaced families will be given the flats in two years. Till then, each family will be given Rs 1,000 a month for temporary accommodation. Of the 18 acres in Bonhooghly, 6 acres are earmarked for rehabilitation. The rest of the land will have 25 buildings, including 16 G+15 towers. Prices are expected to be in the range of Rs 10-22 lakh. The Maheshtala project will have 44 buildings, including 30 G+15 towers, mostly for the middle-income group.
DLF GETS SEBI NOD FOR RS 13,600CR IPO
Real estate giant DLF has received approval from Securities & Exchange Board of India (SEBI) for its initial public offering (IPO), which is expected to raise a record Rs 13,600 cores. The approval, which will pave the way for the company's plan to tap the capital market, comes nearly a year after it first filed a revised draft prospectus. The company had filed a renewed prospectus in January this year after its first attempt came to naught due to certain regulatory objections over minority shareholders' complaints against the company. It had filed its first prospectus in May 2006, which it had to withdraw in August. K P Singh-owned DLF proposes to enter the capital market with a public issue of 17.5 cores equity shares of Rs 2 each. The post-issue dilution would be over 10% of the equity capital of DLF. "The company could raise more than or equal to Rs 13,600 cores," a company official had said in January. The fund would be deployed to meet construction cost, land acquisition and repayment of debt. When asked when the issue would open, the company official said: "We are on the job." Merchant bankers, however, said it would take at least a month as the issue size is big. DLF's plans to raise about Rs 13,600 cores in its second attempt, but with lesser shares being offered through the IPO, reflects the company's increased valuation over last year. The company had, last year, proposed to offer 20.2 cores equity shares, but the prospectus containing that offer was withdrawn.
$10 BILLION FDI IN REALITY SECTOR
With more than 35 big-ticket foreign funds having already checked into the real estate sector India, global realtors, banks and bond houses from New York to Jerusalem are suddenly finding the opportunity to invest in India irresistible. If the year 2006 marked some of the countrys biggest land deals, the future bets on India realty are set to usher in a gold rush. A study by the India Brand Equity Foundation (IBEF) suggests that the first half of 2007 will see at least 20 more funds making an entry into India. This translates into $10 billion of foreign direct investment in realty. In fact, the study indicates that India would be merely scratching the surface of the potential infrastructure opportunity with $191.51 billion of investments committed over the next five years. The sector is estimated to grow at a CAGR of 15% over the next few years . Merrill Lynch forecasts that the Indian realty sector will grow from $12 billion in 2005 to $90 billion by 2015. Prominent global funds including Carlyle, Blackstone, Morgan Stanley, Trikona and Warbus Pincus are sitting on a total corpus of $12-15 billion, say experts. Eminent global real estate business houses like the Philippines-based Ayala, and Signature group, Och-Ziff Capital, EurIndia and Old Lane from Dubai are keen on sizeable investments into India . While FDI from the UK is also likely to pick up in the next few months, investors in the US, Israel, Malaysia and Singapore want to be a part of the India story. Australian real estate consultancy major LJ Hooker, with 700 odd franchises in South East Asia, has opened its India account with a franchisee in Bangalore. US-based global investment bank Goldman Sachs and Unitech, the largest listed real estate company in India, will set up a special purpose vehicle (SPV) with a corpus of $208.7 million for investments in the real estate sector. DLF Ltd has forged a 50:50 joint venture with Nakheel, the largest property developer of the UAE, for two integrated townships in India at a whopping investment of $10 billion. The Tel Aviv-based $650 million real estate major, Alony Hetz is planning to invest $100 million in various residential projects in the country, mostly in Tier-II and Tier-III cities. Zurich-headquartered Credit Suisse, the worlds leading financial house, is finalising on a $1 billion fund to invest in Indias real estate sector. Dawnay Day International, the $10 billion UK-based investment company, plans to invest $1.5 billion in Indian real e1state in the next two years. Chennai recently witnessed two big-ticket property deals. AIG Real Estate Fund and RMZ Corporation purchased an 11-acre plot at Guindy for $686.9 million and Shyam Kothari, in another deal, bought IDBIs 2.5 acres Boat Club property in Chennai for $40.3 million. Experts believe the sector could easily see at least $400-500 million of fresh FDI in the next 3-4 years, a sizeable chunk of which would primarily flow into residential and commercial projects.
SEZS CREATING WEALTH FOR FARMERS
Rubbishing claims that Special Economic Zones (SEZs) were hitting farmers hard, a top government official said the zones were instead creating wealth for them. "I could say with confidence that SEZs have created more wealth for farmers than any other activity carried out for them after independence," Commerce Secretary, G K Pillai said in a lecture. Pillai said, "as per my estimation, SEZs would have created between Rs 60,000 to Rs 100,000 crore as wealth for farmers who gave their land for setting up SEZs in the country." The Commerce Secretary added the development of SEZs had pushed up farmland prices to all-time high. Citing an example, Pillai said that before the development of Mudra SEZ in Gujarat, the land prices stood at just Rs 30,000 per acre which has now shot up to Rs 1 crore per acre. Replying to a query on food security, Pillai clarified that the government had approved 234 SEZ throughout the country which involved 34,000 hectares of land, a fraction of the total farmland. SEZs would play a vital role in boosting exports, Pillai said, adding that the government was expecting exports of Rs 1,00,000 crore from SEZs by 2009. "The total exports from SEZ recorded 52 per cent growth at Rs 34,787 crore in 2006-07, which would jump to Rs 67,000 crore in 2007-08," he asserted.
New luxury apartments project in Ludhiana
Ludhiana, - Ludhiana based Deepak Buildcon Infrastructure has launched a luxury apartments project "Crosswinds Luxury Homes" on 1.5 acres of land near Lodhi Club in Ludhiana. 93 two to four bedroom apartments and four penthouses are to be delivered within two years. All the penthouses and 30% of the other apartments are all sold out. While the apartments range in price from Rs.35 to 55 lakhs, the penthouses have been sold for around Rs.1.1 crore each. The company is also working on a large apartment complex in Chandigarh on 7 acres of land.
Emaar MGF Land to raise $2.9 Bn in IPO
Mumbai - Emaar MGF Land Private Limited, a joint venture between Dubai based real estate giant Emaar Properties PJSC Dubai and Indian real estate developer MGF Development Limited, plans to raise over $2.9 billion in one of the largest real estate IPOs in India according to news reports. The funds will be utilised to grow the company's real estate activities in pan-India projects in the residential, commercial, infrastructure and hospitality sectors in integrated master plans and special economic zones. The company is expected to require $4 billion for these projects of which $1 billion was brought in last year in one of the largest FDI investments in the real estate sector in India. Emaar MGF reportedly has a land bank of more than 5,000 acres. Its current residential projects includes Mohali Hills and The Views villas and apartments on a 3,000 acre site close to Chandigarh, and The Palm Springs villas and apartments in Sector 54, Gurgaon. Emaar MGF is also building a mall "Central Plaza" at Mohali Hills. The company also formed in November 2006 a JV with French hotel chain Accor to set up over 100 budget hotels in India.
ROYAL ORCHID PLANS SERVICED APARTMENT PROJECT IN PUNE
Thanks to the skyrocketing demand within the hospitality industry and spiralling tariffs for luxury hotels, serviced apartments have emerged a cost-effective alternative for business travellers and tourists. Leading hospitality brands are entering this segment, especially in cities like Bangalore, where there is adequate demand. Bangalore-based Royal Orchid Hotels Ltd. (ROHL) is planning to launch its standalone serviced apartment project with 72 units in Pune next week. It has entered into a 20-year agreement with Pune-based builders Vascon Engineers to manage the apartments. We plan to manage serviced apartments across India, said Chender Baljee, Chairman and Managing Director, ROHL. The hotel chain is also planning to launch serviced apartments in Bangalore, in addition to the existing units on the fourth floor of its Hotel Royal Orchid
PUNE HOSTING CONSTRUCTION INDUSTRY EXPO
Leading construction equipment manufacturers and technology developers from Korea, China, Malaysia, Germany, Italy, Canada, Holland, Denmark and Dubai will be showcasing their products at Constro 2007, organised by the Pune-based Pune Construction Engineering Research Foundation (PCERF), an NGO working in the interest of the infrastructure and construction industry. The five-day meet will be held in Pune starting November 28
TRINITY TO INVEST $3 BILLION IN REALTY
Trinity Capital is considering to invest $3 billion in three to five years in real estate-related projects in India. It has invested $1 billion in India across five sectors - hospitality, commercial and residential real estate, retail and urban rejuvenation along with its partner IL&FS. Trinity, IL&FS and local developers invested $1 billion in each of the sectors including equity and debt, said Ashish Kalra, co-founder, Trikona Capital, the fund management arm of Trinity. We deploy $50-100 million equity every month in various projects and have deployed 80 per cent of the money we have raised from the market. We are planning to scale up the investment in the coming years, Kalra said. Trinity has tied up with IL&FS to invest 238 million in Indian real estate and infrastructure projects. Trinity along with IL&FS and international investment bank, recently bought 5.92 per cent stake in Mumbai-based developer D B Realty (DBR) Ltd, part of the Dynamix Balwas Group, for 25.72 million. DBR is a 500 million SPV which is developing 12 real estate projects in Mumbai
UAE FIRM MULLS RS. 20,000 CRORES INVESTMENT IN TN
Ras Al Khaimah Investment Authority of the UAE is planning two large investments totalling Rs. 20,000 crores in Tamil Nadu. It has signed an agreement with the Tamil Nadu Industrial Development Corporation to set up an IT SEZ with an integrated feeder township in Coimbatore and a residential-cum-water sports marina project in Kanchipuram district. The IT SEZ and township spread over 1,000 acres in Coimbatore is expected to come up over the next five years. It will have 5 million sq. ft. of IT space that will generate 50,000 jobs and a township with single and multi-family homes, facilities such as a golf course, shopping malls, resort hotel and spa. In Kanchipuram district, the 500-acre Kadalur Marina Project, would provide water sports, leisure, entertainment and high-end residential facilities. The facility is about 70 km from Chennai on the East Coast Road and less than 20 km from Siruseri, the IT hub. The projects are to be implemented by RAK Indo Developers Pvt. Ltd., a joint venture between Rakeen Developers, a subsidiary of Ras Al Khaimah Investment Authority, and an Indian partner Vishwateja Projects Pvt. Ltd. Both are equal partners in the venture. Vishwateja is a subsidiary of Trimex Industries, a member of the Rs. 820 crores Trimex Group, which has interests in mining and minerals. The land for the Coimbatore project has been acquired and the first phase would be over 650 acres.
TWO MORE SPENCERS RETAIL STORES
Spencer's Retail has expanded its presence in Kerala by launching two more stores in Kozhikode and Koilandy. With this, the company has 15 retail outlets in the State. The newly opened Spencers Daily at Elite Arcade in Kozhikode spread across 2100 sq. ft. is the friendly neighbourhood store for groceries, fresh food, chilled and frozen products, bakery items. The Koilandy outlet is spread over an area of 2000 sq. ft.
REALTY MAJORS QUEUING UP TO BOOK SPACE FOR SPECIALTY MALLS
Specialty malls seem to be the buzzword in the Indian retail mart. While the current focus for real estate developers seem to be these destination malls, retailers are also queuing up to book their space in them. Currently, the number of specialty malls in the country is only a handful, but the Retailers Association of India (RAI) expects that over the next three years, specialty malls will constitute nearly 10 per cent of the total malls in India. Among the most prominent specialty malls in the country is the Gold Souk Mall, a jewellery specialty mall developed by the Aerens Gold Souk Group. The mall houses jewellers providing both consumers and retailers an ambience of security and convenience. Likewise, the Bangalore-based Prestige Group has revamped its Eva Mall into a super-specialty ethnic Indian women wear mall. In Kolkata, a medical mall - Alpha Family Health Mall - has been launched by Alpha Medical Services while another city-based developer, the Merlin Group, has set up Home Land, the countrys first dedicated home mall. Several other specialty malls on auto-parts, furniture, home appliances are being planned across the country.
EMAAR MGF PLANS RS. 13,000 CRORES INVESTMENT IN HOTELS
Real estate player Emaar MGF Land Pvt. Ltd. is planning to invest around Rs. 13,000 crores in the next five years in construction of hotels. The company is planning to set up 10 hotels in the luxury segment and another 40 in the business class in this period. Shravan Gupta, Executive Vice-Chairman and Managing Director of the company said, We are considering joining hands with one to two partners in each category to manage our hotels. We have the desire of building one such hotel each in Delhi and Mumbai. Four-star business class hotels will be set up in top cities and capitals of major States including Ahmedabad, Indore, Lucknow, Kochi, Goa, Jaipur and Amritsar. While the major part of the investment will be arranged by the company, a part will also be raised through debt on a project-per-project basis. The company could go by 30:70 debt equity ratio. Part of the Rs. 13,000 crores investment will also go towards setting up of serviced apartments. The company is looking at this type of construction in eight major cities in the country. The investment includes Rs. 1,350 crores for the construction of 100 hotels in the budget category announced by the company earlier. The company plans to tap the capital markets to raise funds in the next 12 months.
KLG Group has tall hotel dream for city Beautiful
Two years from now, Chandigarh will have another landmark in the form of hotel that is likely to spell competition for the taj Hotel in sector 17.it is the giant metalic sculpture of the open hand ,the official emblem of chandihgarh,signifying the city`s characteristic of open to give,open to recieve. This new hotel,which will boast of high class 126 rooms,will come up at the roundabout of industrial area phase 1 and phase 2 on the chandigarhb -Ambala road.The proposed hotel`s USP will be its proximity to the chandigarh airport and the railway station . A project of the KLG group,which has now ventured into hospitality segment by opening a 30 room Hotel KLG in the upcoming sector 43 in Chandigarh with an investment of Rs 9.5 crore, is now firming up plans to set up one of the largest hotels in the city Beautiful,which could perhaps be tallest one as well.This will be KLG Group`s 5th venture after the hyundai car dealership,industrial steel pipes,sanitry and building material and new 30-rooom hotel. Giving details about the group` s new venture, MR Ajay Grover, CMD of KLG group told ET here on Wednesday that the company proposed to shift its Hyundai dealership business to an other site in Ram Darbar in the industrial area of phase 2 in the chandigarh and in its place set up the proposed hotel spread over the acre, which will be equivalent toa five -star hotel. The proposed hotel will boast of a parking lot spas, shoping area, restaurants ansd a convention hall, perhaps the biggest in the city and banquet halls. However, the swimming pool maybe added at a later stage.
He said the group would shortly apply to the Chandigarh administration for change of land use (CLU) to enable the group shift its Hyundai dealership outlet to an alternate site in the industrial area of phase 2 where it already has four-kanal(2,000 sqyards)land."We are in the midst of firming up our plans and after obtaining the CLU, would be in a position to say anything about the new hotel project," said Mr Grover. "For the group, this will be the prestigious project and once clearances are obtained, the project will take around two years for completion," he said ,Already, the group has sounded chandigarh-based architect vikram pannu for design and layout of project. Each room will cover around 460 sq ft of area and barring the swimming pool, the proposed hotel under the KLG banner would have all kinds of facilities. Mr Grover indicated the group` s turnover during 2006-2007Would be Rs 100 crore and during the current fiscal between 20-25%growth is visualised. Thus, the expected turnover during 2007-08 would be in the vicinity of Rs 125 crore. Moreover, in the view of government apathy, he indicated that the group may eventually decide to shift its industrial steel pipe business, which is mainly trading to another site in mohalli.
Leela bags Delhi plots for Rs 611 cr
Deal could Be Most Expensive in NCR's Hospitality Sector
This could will be the most expensive land acquisition deal in the Nationality sector. The leela Group of Bangalore has bagged a prime 3-acre hotel plot at Africa Avenue in the capital's diplomatic enclave for Rs 611 crore, marking the group's entry into Delhi for the first time .
The sale took place through a mix of online auction and sealed tenders , which saw seven hospitality and real estates majors ,including ITC, Emaar MGf,uppal Group and Apeejay surendra, vying for the prime plot. The leela group pipped emaar
MGF's Rs 525 crore bid through the online auction. The minimum bid price for the online auction was Rs 300 crore
Untill now the most expensive hotel plot auction in the capital was for two sites at jasola in south Delhi ,which bagged by Emaar MGF for Rs 388 crore last year. The hotel plot bought by Leela is located at the junction of chanakya puri and sarojini nagar and belonged to the ministry of urban development . Earmarked for development of hotel and service apartments ,the plot allows for area ratio (FAR) of 150% and ground coverage of 30%. National Building construction corporation (NBCC) facilitated the bidding process. Confirming the move ,NBCC chairman and managing director Arup roy choudhury said this was the first time that e-auction was used as a disposal mechanism of a central government land.
"The leela Group emerged as the highest bidder "he said. With the commonwealth games scheduled in the city in2010,the NCR is short of 30,000hotel rooms .At least a dozen hotel projects are in various stages of the development in NCR.
OMAXE TO SET UP WEDDING MALLS
Omaxe Ltd is going to set up Wedding Malls that will offer mehendi and teeka artists, pundits to solemnise the nuptial ties and halls where parties can be hosted. Even travel desks to take care of honeymoon package requirements. "Consumers now want value-added differentiated products and these malls would cater to just that." Apart from three Wedding Malls, Omaxe is also setting up a property to sell only home and office interiors.
GTM GROUP MULLS 10-12 MALLS IN INDIA
The Delhi-based GTM Group is planning to set up 10-12 malls across India that will house only educational institutions. To start with, the Group is constructing a mall in Jaipur (Rajasthan) that will bring together 60 colleges and institutes. This concept has been popular in the developed countries and it holds promising prospects in the long run in India too.
COMMERCIAL MALL AND MULTIPLEX SYNDROME - HELPING EACH OTHER
Initially we saw emergence of cinema multiplexes in Indian Metros and now this growth is spreading to Tier 2 and 3 cities like Lucknow, Indore, Nasik, Aurangabad, Kanpur, Amritsar and so on. Top players in this sector are PVR Cinemas, Adlabs Films (where Anil Ambani holds a 51% stake), Inox Leisures, Shringar Cinemas (Fame multiplexes), Fun Multiplex (of Essel group) and Cinemax India etc. All venturing into small towns across India (e.g. Darjeeling, Mangalore, Ghaziabad, Pimpri, Pune, Panipat, Allahabad, Indore, Latur, Agra, Thane, Lucknow, Hyderabad, Nasik, Jaipur, Visakhapatnam, etc.) Projects are under way in places like Kochi, Bhatinda, Coimbatore, Kota, Madurai & Ambala. Towns and Cities with a population in excess of 10 lakh people is becoming lucrative for them. Some 40 cities in India are qualified for that and given that are there lesser means of entertainment in these towns, there is a huge potential.
DLF AND PFI ANNOUNCES INDIA LIFE INSURANCE JOINT VENTURE
Leading real estate development company, DLF and Prudential Financial Inc., a financial services leader headquartered in the United States, have announced to establish a joint venture life insurance company in India. Subject to regulatory approval from the Insurance Regulatory and Development Authority, the new joint venture company, DLF Pramerica Life Insurance Company Ltd. (DLF Pramerica), will be established in the coming months and will offer life insurance products to customers in India. Under the terms of the agreement, DLF will have a 74 percent stake and PFI a 26 percent stake in DLF Pramerica.
BHARTI-AXA SET TO LAUNCH REALTY FUND
Bharti Enterprises and French insurance major AXA are set to launch a realty fund. They are in talks to finalize the details of the joint venture. Both companies are also on the verge of launching an asset management company to tap the mutual fund segment. Mutual fund joint venture is likely to be announced before the end of the current financial year. While AXA has 26% stake each in the two existing JVs, the French major will most certainly have a higher equity in both the asset management firm and the realty fund where up to 100% FDI is allowed. In the recent past, a spate of realty funds, domestic as well as foreign, has entered India. These include Goldmann Sachs $1-billion fund, the Ashok Piramal group promoted $250-million Peninsula Realty Fund, IL&FS Realty Fund and HDFC Realty Fund. Credit Suisses $1-billion India Realty Fund is awaiting regulatory clearances from RBI. Usually, funds invest directly in real estate companies and special project vehicles (SPVs).
TATA BETTING BIG IN REALTY
Even as most of the big industrial houses have set up their realty funds to invest in Indias real estate market, the Tata group has now suddenly woken up to the opportunity. It has decided to throw-in its hat in the ring with a staggering corpus of Rs. 4500 crores. Modelled on the lines of Kishore Biyani promoted Future group's Kshitij, which invests in real estate, Tata Realty & Infrastructure will invest in infrastructure and real estate projects. Bombay House, the group's headquarter is drawing out a blueprint for its new business. The Ambani brothers - Mukesh and Anil also have interest in private equity funds. Recently, Morgan Stanley Real Estate fund invested approximately $152 million (Rs. 675 crore) for a 10.75% stake in Oberoi Constructions, making it the largest deal in the brick and mortar space. Apart from the Tatas, foreign investors too would be sponsors of the fund. International Consultancy firm KPMG has been involved in strategizing the Tata's real estate business. Tata Realty would look at investing in housing complexes, Special Economic Zones (SEZ), construction of bridges, ports and airports.
  DELHI FARMHOUSES TO BE DEVELOPED INTO GROUP HOUSING SOCIETIES
The Delhi Master Plan is to allow re-development of farm houses into group housing societies. Farmhouse prices in prime areas such as Chattarpur, Bijwasan and Najafgarh amongst others are likely to shoot up now with the prospect of luxury high-rise developments. According to Ajay Maken, Minister of State for Urban Development, a policy will be announced to fix the minimum area for group housing societies on existing farmhouses. The cut-off date for recognizing farmhouses is 1990 and the minimum size is 1 acre. No new farmhouses are to be permitted in these areas.
Bharti-Wal-Mart To Explore Rental Models
The growing realty prices may see the worlds biggest retailer Wal-Mart shifting from its global policy of owning its stores. According to sources, Bharti-Wal-Mart is exploring other models, including long-lease and rentals. Meanwhile, Bharti-Wal-Mart has taken close to 1.5 lakh sq ft of retail space at Delhi, Noida, Gurgaon, Hyderabad, Bengalooru, Ahmedabad and Chandigarh, among others. Mr Sunil Mittal is leveraging group company Bharti Realty to tie up real estate and the company has learnt to have formulated a two-pronged strategy. In small cities, it would prefer owning hypermarkets and in large ones, opt for long-lease of properties since theres acute shortage of quality commercial real estate. However, according to industry experts, even this wouldnt cater the growing demand. Experts say, Bharti-Wal-Mart will have to divert focus to smaller cities, while having a symbolic presence in metros.
Retail, Realty Emerging Sectors In India: AMCHAM

The American Chamber of Commerce in India (AMCHAM) recently declared that retail, food processing and real estate were the emerging sectors in India that can attract American small and medium enterprises into the country. The chamber is working towards encouraging the American SMEs to expand their relationship with India. According to Mr Ramesh C Bajpai, ED, AMCHAM, "Our attempt is to focus the attention of cost-effective SMEs to come and operate in India, as they are the driving force behind a large number of innovations and contribute to the growth of economy.

Realty Market To Become $102bn By 2010 Says Developer

At a recent real estate and urban studies panel discussion at Indian School of Business (ISB), Mr Shyam Prasad Reddy, MD & CEO, Indu Projects Ltd said that our Indian realty sector is expected grow from the present level of $14 bn to $102 bn in the next decade. Explaining the current real estate scenario in the country, Mr Reddy said that the shortage of 19.4 mn housing units, including 6.7 mn units in urban India, and mushrooming of retail projects would provide a huge opportunity for domestic as well as global infrastructure players in the country. He, however, pointed out that Indian realty industry was ailed by lack of transparency and credibility, an acute shortage of data & academic research and a lack of uniform laws and regulatory systems. Many of the panelists presented at the discussions included Mr Ganesh Raj of Ernst & Young, Mr Arvind Pahwa of JP Morgan Asset Management, Mr Nayan Shah of Mayfair Housing, Mr Kishore Gotety of ICICI Venture Funds Management, Mr Suresh Maramreddy of Citigroup Property Investors, Mr KG Krishnamurthy of HDFC Property Ventures, Mr Neel Raheja of K Raheja Corp., Mr Ramesh Sanka of DLF, Mr Luv Shah of Deutsche Bank REOF, Mr Ramani Sastri of Sterling Developers, Mr Mohit Singh of Shipra Group, Mr Balaji Rao of Starwood Capital India & Mr William Kistler of Urban Land Institute ( Europe).
Business Standard New Delhi Edition

 EMAAR TO INVEST 10,000 CRORES IN INDIA

Dubai-based realty company Emaar group is all set to invest Rs 10,000 cr in developing malls in India through its joint venture company Emmar MGF Ltd. Mr Susil Dungarwal from Prestige group has been roped in to head the mall business. Emaar-MGF, which is now developing malls in the North (Delhi & Jaipur) has plans to create a pan-India presence and plans to carry out multiple housing and integrated township projects. Emaar MGF and French hotel major Accor has also formed a joint venture, Budget Hotels India Private Ltd, to bring Formule 1 brand of budget hotels to India and further plans to invest $300 mn over the next 10 years. The location for development of Formule 1 hotels has already identified and the company is planning to develop 50 hotels in the major metros during the initial five years of operations.

Mr Sunil Mittal Prepares For High Realty Prices & Rising Wages
Increasing wages and realty prices seem to be a serious concern for retailers in India. Considering the existing situation, Bharti group CMD, Mr Sunil Mittal, does not seem to be deterring his plans to open stores across the country and on the contrary has started work on setting up the back-end operations. We are looking at everything from leasing to buying and hiring. Real estate prices are hot around the tier two cities as well. But we will find a solution, he said. As for retail, he said there were reserves and fund flows that will help the group leverage debt.

 PARSVNATH PLANS 50:50 JV WITH DUBAI REALTY MAJOR

NEW DELHI: Delhi-Based real estate developer Parsvnath Developers is in advanced discussions with Dubai-based $30-billion real estate company, Nakheel Group, to set up a 50:50 joint venture for developing commercial, residential, and office properties on a pan-India basis.

The two partners will pump in Rs 1, 250 crore each with a considerable part of Parsvnaths equity contribution being in the form of its land bank. This JV will mark the entry of Nakheel group, one of the largest real estate firms in the world and developer of the famous palm-shaped islands, into India. Nakheel Group is part of the state-owned Dubai World, the holding company for Dubai Ports World, P & O, Free Zone World, Dubai Drydocks, Dubai Maritime City, Dubai Multi Commodities Centre and Istithmar.

Both the partners will set up a new company and the Dubai-based developer will not buy equity in Parsvnath Developers. When contacted by ET, Parsvnath Developers chairman Pradeep Jain declined to comment. An email questionnaire sent to Nakheel did not elicit a response.

Sources confirmed that talks were at an advanced stage and a deal is expected to fructify by March-end. Nakheel is learnt to be bullish on the Indian market and is set to firm up the deal as early as possible to get its share of the Indian realty boom.

According to sources, over the past three-four months, delegations from three-four well-known real estate firms have met the top management of Nakheel. However, the group has shown interest in tying up with Parsvnath, as they have found the maximum synergies, a source said.

On its part, Parsvnath is on an aggressive land acquisition spree. A tie-up with one of the leading international players will help the Indian developer to leverage the expertise of the foreign partner to further ramp up its presence in India.

With more than 800 employees, Nakheel currently has 17 major projects worth more than $30 billion under development. In November last year, Parsvnath Developers hit the capital markets with a public issue of 3.32 crore equity shares of Rs 10 each with a price band of Rs 250-300 per share. The company plans to deploy the proceeds of the offering for its various ongoing projects in India.

RELIANCE DRIVES THE REALTY BOOM

 

THE RELIANCE group continued its relentless bidding on the second day as well at the Delhi Development Authoritys auction on Tuesday .

Nettle Farms Private Limited a subsidiary of Reliance Industries bought a 13,628 square metre plot in Vikas Puri Commercial Centre, Block A for Rs 286 crore. With a reserve price of Rs 145.06 crore, the bid had fetched the DDA Rs 2.1 lakh per square metre for the plot. In two days, DDA has raked in Rs 1,516 crore from the auction of 37 plots.

On Monday, the same RIL company had bought six plots in Dwarka and Rohini for a record Rs 766 crore. The company bought an 867 sq. mt. plot in Dwarka Sector 4 for Rs 75 crore.

Its reserve price was Rs 28 crore. At Rs 8.65 lakh per sq. mt. it was one of the costliest land deal for a commercial plot.

The DDA auctioned 21 plots, netting Rs 610 crore, on Tuesday. The reserve price of these plots was Rs 260 crore. It had earned Rs 906 crore on Monday auctioning 16 plots.

Of the 21 plots auctioned on Tuesday, 18 are in Dwarkas Sector 20.

The reserve price of these plots varied between Rs 7.17 crore and Rs 6.22 crore. They went for more than double that amount. The highest bid was for Rs 20 crore, DDA officials said, adding that local developers had bought all these plots.

The 18 plots are small between 800 square metres to 693 square metres. We received a maximum bid of Rs 20 crore for a plot, a DDA official said.

The DDAs three-day auction will continue on Wednesday as well. Officials said Reliance Industries is likely to bid for two more commercial plots in Vasant Kunj Sector A and Sector D. The reserve prices of these plots, sized 2885 square metres and 4464 square meters, are Rs 36 crore and Rs 47 crore.

Real estate watchers and DDA officials said the boom in property prices is but expected in the aftermath of the sealing of unauthorized shops been going on in the city for the past several months.

In December, the DDA had auctioned 24 commercial plots across the city for Rs 982 crore. Of these, a 7232 square metre commercial plot in the Rohini twin district centre, sector 10, fetched the agency Rs 231 crore.

The hunt for hot property Nettle Farms Pvt. Ltd a subsidiary of Reliance Industries has bought seven plots for Rs 1,052 crore. Here are the details of its acquisition drive:

 

Location     Area Reserve(sq mt)Reserve Price(Rs cr)  Bid Amount (Rs cr)  Rate per sq mt (Rs lakh)

Dwarka Sec 13 11614.74                104.11                         266                                  2.29

               Sec 14 5757.95                   51.62                         150                                  2.61

               Sec 14 5973.85                    53.55                         100                                  1.67

               Sec 13  5597.97                   50.18                         100                                  1.79

                Sec 4    867.16                    28.02                          75                                   8.65

Rohini     Sec 22   868.18                    29.02                          75                                   8.64

Vikas Puri          13623.02                  145.06                         286                                  2.1

PANORAMIC TO INVEST RS.1,200 CR IN REALTY

After consolidating its position in hospitality sector, Panoramic Universal is now planning to enter the realty sector with an investment of close to Rs 1,200 crore over the next for year.

 

The company has already purchased land worth Rs 200 crore For residential and commercial complexes across Maharashtra, Uttaranchal ,Chandigarh and West Bengal , panoramic Group chairman Sudhir Moravekar said here today.

He said the company has already received approval from Its board and share holder to go ahead with the projects, to be built Mainly in tier-2 cities.

 

"In all probability, these projects will take off at the beginning of the next financial year would require 24-28 months for completion ," he said. The company, listed in the Luxembourg stock Exchange, plans to raise $12 million next month to finance the project, Mr Moravekar said.

 

Panoramic Universal owns and operates five hotels in US, one in New Zealand and three in India . It has lined up two five star hotels-one each in Pune and Goa . The company also plans to set up three budget hotels in kerala, Rajasthan and shimla and two three star hotal at Thane in Maharashtra and Durgapur in West Bengal .

HILTON HOTELTIES UP WITH DLF


 

THE RENOWNED international hotel company Hilton Hotels Corporation on Tuesday announced a joint venture company (JV) in India with leading real estate developer DLF Ltd (DLF) on Tuesday.
The company, subject to regulatory approvals, plans to develop and own 75 hotels and serviced apartments over the next seven years.
The JV-owned hotels will represent several brands from Hilton Hotels Corporations brand portfolio, including Hilton Hotels, Hilton Garden Inn, Homewood Suites by Hilton and Hilton Residences. The JV will develop and build these properties, while Hilton will manage them. DLF will hold 74 per cent in the JV while Hilton, the remaining minority stake as a symbol of its commitment to the venture.
Over the next five to seven years, Hilton will invest up to $143 million (Rs 640 crore) in the JV, a company statement said on Tuesday. The initial stage will involve 20 hotels in a number of key loca tions including Chandigarh , Chennai and Kolkata. A large number of these are expected to be Hilton Garden Innsa business hotel brand, offering focused service. Beyond the initial 20 sites, the JV will continue to identify and acquire sites and undertake new hotel developments.
Hilton Hotels Corporation has more than 2,800 hotels with 4,95,000 rooms in more than 80 countries. The company owns, manages or franchises a hotel portfolio of brands, including Hilton, Conrad, Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites and Hilton Garden Inn among others.
India is an outstanding market for hotel development, given its powerful combination of economics and demographics. Hilton will build on its collective experience in India and the opportunity with DLF is a compelling next step to capitalise on the development momentum and build our Hilton Family of Brands in India , said Ian Carter, Executive Vice President, Hilton Hotels Corporation and CEO of Hilton International Operations.
Shakti Singh, Director, Hospitality Business, DLF said: Through this strategic partnership, we are confident of bringing world-class hospitality and services across the country, further strengthening the benchmarks that DLF has established as a panIndian developer. gaurav.choudhury. Big plans The JV-owned hotels will represent several brands from Hilton Hotels Corps brand portfolio The JV will develop and build these properties, while Hilton will manage them

BIRLA START HIRING FOR BIG RETAIL PUSH

CLOSE ON the heels of Bharti Group and Reliance, which have announced big plans to set up their retail ventures, Aditya Birla group, one of the top three industrial houses in the country, is also concretising its plans to enter the domestic retail sector.
After months of deliberation, the metals powerhouse has started hiring people for its retail business.
The groups retail venture would be in hypermarkets or large discount stores, sources said. These are different from de partmental stores. Shoppers Stop follows the departmental store model, while Big Bazaar is the closest approximation to hypermarkets in the country today. The company has roped in Suman Sinha, the son of former finance minister Jaswant Sinha, to head its retail venture.
The people to be hired for this venture include sourcing and merchandising professionals, quality control personnel, ex perts in supply chain management, store design and business development. The company, which currently employs over 82,000 people, expects to ramp up its employee base through the exercise, sources said.
Incidentally, the retail space in the country is set for a churn with Sunil Mittal-controlled Bharti and Mukesh Ambanis Reliance getting into the race to capture the burgeoning pockets of the Indian middle class.
The reason for the interest by big houses is essentially the highly fragmented nature of the Indian retail segment. Only 3 per cent of Indian retail, which is es timated to be $300 billion, is organised. The rest are small and medium retailers. Large players include Kishore Biyanis Pan taloon and Tata Group-owned Trent, which owns Westside.
Tatas have recently inked a pact with Woolworths of Australia and are planning to launch a chain of consumer durable stores called Croma.
Bharti would be setting up a joint venture with Wal-Mart, the worlds largest retailer, and the number two company on the Fortune 500 list of companies.
The entry of Wal-Mart is widely expected to place the seal of approval on the Indian retail industry.
That the Aditya Birla Group is planning to take up retail as a major part of its operations in the country is evident by the scale of its hiring.
The model envisaged would include cash and carry and backend operations, contrary to Bhartis model, where only the back-end will be handled by WalMart, with Bharti owning the stores and the front end.
However, there has been widespread debate over the entry of multinational corporations in the retail segment, the latest being that of the Left parties threatening agitations on Monday as is said was stated in a note to the United Progressive Alliance.
suprotip.ghosh @hindustantimes.com Hot opportunity Indias retail sector, mostly unorganised is estimated to be $300 billion in size The entry of Wal-Mart is expected widely to be a seal of approval for Indian retail sector There has been a huge debate over entry of MNCs in retail
CLOSE ON the heels of Bharti Group and Reliance, which have announced big plans to set up their retail ventures, Aditya Bir- la group, one of the top three in- dustrial houses in the country, is also concretising its plans to en- ter the domestic retail sector. After months of deliberation, the metals powerhouse has start- ed hiring people for its retail business. The groups retail venture would be in hypermarkets or large discount stores, sources said. These are different from de- partmental stores. Shoppers Stop follows the departmental store model, while Big Bazaar is the closest approximation to hy- permarkets in the country today. The company has roped in Suman Sinha, the son of former finance minister Jaswant Sinha, to head its retail venture. The people to be hired for this venture include sourcing and merchandising professionals, quality control personnel, ex- perts in supply chain manage- ment, store design and business development. The company, which currently employs over 82,000 people, expects to ramp up its employee base through the ex- ercise, sources said. Incidentally, the retail space in the country is set for a churn with Sunil Mittal-controlled Bharti and Mukesh Ambanis Reliance getting into the race to capture the burgeoning pockets of the Indian middle class. The reason for the interest by big houses is essentially the highly fragmented nature of the Indian retail segment. Only 3 per cent of Indian retail, which is es- timated to be $300 billion, is or- ganised. The rest are small and medium retailers. Large players include Kishore Biyanis Pan- taloon and Tata Group-owned Trent, which owns Westside. Tatas have recently inked a pact with Woolworths of Aus- tralia and are planning to launch a chain of consumer durable stores called Croma. Bharti would be setting up a joint venture with Wal-Mart, the worlds largest retailer, and the number two company on the For- tune 500 list of companies. The entry of Wal-Mart is wide- ly expected to place the seal of approval on the Indian retail industry. That the Aditya Birla Group is planning to take up retail as a major part of its operations in the country is evident by the scale of its hiring. The model envisaged would include cash and carry and back- end operations, contrary to Bhartis model, where only the back-end will be handled by Wal- Mart, with Bharti owning the stores and the front end. However, there has been wide- spread debate over the entry of multinational corporations in the retail segment, the latest be- ing that of the Left parties threat- ening agitations on Monday as is said was stated in a note to the United Progressive Alliance. suprotip.ghosh @hindustantimes.com Hot opportunity Indias retail sector, mostly unorganised is estimated to be $300 billion in size The entry of Wal-Mart is expected widely to be a seal of approval for Indian retail sector There has been a huge debate over entry of MNCs in retail