Bandra Replacing South Mumbai As Property Hotspot

South Mumbai has always been the preferred home to Mumbai’s upper crust for years. But now with virtually no land to be had in the Island City, the elite are moving into the suburbs and Bandra seems to be the hot new destination.
Malabar Hill, home to the city’s elite and till now the most famous of addresses in South Mumbai, is facing serious competition from bandra, popularly known as the Queen of the suburbs.
And with many famous people moving in, it’s certainly living up to that name. The latest celebrity to move to Bandra is Sachin Tendulkar, who has bought an old Parsi Villa on Perry Cross Road for Rs 39 crore and he has many other famous people as his neighbours.
Shah Rukh Khan’s Mannat on Bandra Bandstand has virtually become a tourist spot just like Salman Khan’s Galaxy Apartments.
Also by the sea, is Abhishek Bachchan’s brand new home Naivedya on Carter Road while Aamir Khan’s has already been living for quite sometime now. Even Saif Ali Khan has bought his new home in Bandra.
And with the hot shots living in Bandra, can the rest of the Bollywood brood be far behind?
Actor Aftab Shivdasani, a true blue townie in fact, has also recently succumbed to the Bandra bug.
Not just the entertainment industry, but business offices and consulates too are now moving to Bandra with great speed.
This, even as the current rate there continues to hover around Rs 22000 per square foot.
But top real estate agents say new buildings in Bandra are often fully booked even before construction is complete.
Real estate agent Prakash Jain says, “Bandra is a very, very popular destination and the kind of buildings that are coming up, the receptions with swimming polls, gymnasium and gardens etc., you don’t find in South Bombay now.”
So move over South Bombay, or Sobo as it’s fashionably called, Bandra is where the galaxy of stars has landed.

Godrej Properties Files DHRP With SEBI

Godrej Properties Ltd, Real estate arm of the Godrej Group, declared that it has filed the Draft Red Herring Prospectus (DHRP) with SEBI for an IPO of approx seven million shares.

According to a company statement, the firm proposes an IPO of 9,429,750 equity shares of ten rupees each through 100% book building process to part finance this plan. ICICI Securities Ltd and Kotak Mahindra Capital Company Limited are the BRLMs for the Issue.

The company currently has real estate development projects in eleven cities in the country at various stages of development.

It has completed a total of 19 projects consisting 13 residential and 6 commercial project on 15th of this month.

Godrej Properties’ land reserves currently stands at 404 acres, which includes its ongoing projects and forthcoming projects.

Its promoter and parent company Godrej Industries Limited, currently holds 81.41% of the equity share capital of Godrej Properties.

Rs 100 Crores Will Be Invested By Inox In East India

After putting up 24 multiplex screens across cities like Vadodara, Kolkata, Mumbai and Goa in the last 6 yrs, the company has been silently signing up properties in Burdwan Rajarhat, Panditya Road, Haldia, Howrah, Jessore Road Asansol and even Siliguri to throw open multiplexes.

The total investment is estimated to be over one hundred crores rupees. The move, which is part of the company’s overall plans to scale up its presence across the country, is expected to shore up the group’s overall business from the eastern sector.

Alok Tandon, COO, Inox Leisure, said, “Kolkata and eastern India as a whole is an integral part of the company’s strategy. Going forward, we will have at least 18 multiplexes with 67 screens from just five multiplexes in this part of the country.”

“The future appears to have more in store. Following the hub and spoke model, Inox is planning more multiplexes in multiple locations. These will include cities like Bangalore, Hyderabad, Nagpur, Goa, Mangalore and newer hubs across Navi Mumbai.” Tandon added.

Outlining the corporate strategy, Tandon said the company would be spreading out across three-four fresh locations every year for the next two-three years. By 2010, the company intends to have at least 68-70 multiplexes with some 260 screens. Each screen, on an average, will find an investment of Rs 2-2.5 crores being ploughed in. The investments cover aspects like projection and concessionaire equipment, interiors flooring and false ceiling.

The company is looking at all options to give shape to its expansion programme. “If we get land at attractive price and the financial are viable, we may purchase the property and develop it ourselves or go for lease. We are also open to more acquisitions in the near future if the opportunity comes,” he added.

Sometime ago, the company had acquired Calcutta Cine Pvt Ltd (CCPL), a joint venture between Bengal Ambuja Group & its associates and Consolidated Entertainment Pvt Ltd.

Meanwhile, Inox Leisure board will meet on June 09, to consider recommendation of dividend, for the financial year ended on March 31, 2008.

IBull Realty Arm May Raise 286 Million US Dollar In Singapore

The trust, part of Indiabulls Real Estate Ltd., plans to sell 353 million units of Indiabulls Properties Investment Trust at between S$1 and S$1.10

Indiabulls Properties Investment Trust could raise up to $388.3 million (US$286million) selling units in a real estate investment trust (REIT) in Singapore, according to reports. The trust, part of Indiabulls Real Estate Ltd., plans to sell 353 million units of Indiabulls Properties Investment Trust at between S$1 and S$1.10.

This will be the first such sale by an Indian real estate company.

Billionaire Lakshmi Mittal, the world’s fourth-richest man, has reportedly agreed to buy 91mn units. Mittal was among the initial investors in Indiabulls Financial Services Ltd., which last year spun off Indiabulls Real Estate as a separate company.

The projected yield for the trust is 4.66-5.12% based on forecast income for the year ending March 2009. Presentations to institutional investors start today, with pricing scheduled for next week.

Deutsche Bank and Merrill Lynch are handling the deal, which will see Indiabulls inject into the trust two projects with a total of 3.4 million square feet of space, according to the prospectus filed with the Monetary Authority of Singapore earlier this month.

The Mumbai properties due to be ready by August, are designed for IT and financial firms and retail outlets, and has residential components. The two assets are estimated by Knight Frank to be worth US$3.2 billion.

The Indiabulls REIT would be the first major test of investors’ appetite for new listing since the market crash in November. The last two REITs to list in Singapore, Lippo-Mapletree Indonesia Retail Trust and Saizen REIT, tumbled on their debuts in November and are still trading well below their IPO price.

Credit ratings agency Moody’s only last week issued a negative outlook for Singapore’s REITs over the next 12-18 months, citing weak market sentiment and tighter liquidity that have impaired their access to capital markets.

The poor market conditions sparked by the US subprime crisis and the ensuing global credit crunch had forced Indiabulls Real Estate, and fellow Indian developers Unitech and DLF, to postpone their planned Singapore REIT IPOs in March.

India In Top Three Favored Destination For Investment

India and China, the world’s two fastest growing economies, leads the list of best places for investment and development, driven by their current GDP growth rates, appropriate investment climate and substantial trade opportunities, a latest report says.

According to global consultancy Grant Thornton’s International Business Report 2008 on rising global Markets, China, India and Russia have emerged as the top three most- favored destinations for investment and development.

These are followed by Mexico at fourth and Brazil at fifth place. The study also revealed the presence of 22 other rapidly growing global economies, including Malaysia, Indonesia, Iran, Pakistan, Thailand and Poland, that offer immense avenues for future growth.

“Availability of low-cost yet highly educated labor force with strong work ethics, combined with fast industrialization, technology deployment and a strong focus on infrastructure development is enabling these countries to close the gap with the more affluent and relatively slower-growing mature economies,” Chatrath said.

According to current projections, China’s Economy would move ahead of the US by 2027, India would catch up with the US by 2050 and the BRICs (Brazil, Russia, India and China) as a group will surpass the G7 by 2032.

Emerging and developing economies’ will on an average grow by 6.3 % in 2008 and 6.4 % in 2009. In contrast, “advanced economies” are forecast to grow by 1.3 % during this period.

Gayatri To Buy Five Infrastructure Companies

Infrastructure firm Gayatri Projects is all set to acquire five smaller infrastructure firms in the country, paving the way for its inorganic expansion. The company plans to fund these acquisitions through divestment of 49% equity in favour of Australian multi billion-dollar wealth management firm AMP.

The latter will bring to the table Rs 200 crore through foreign direct investment (FDI) for the planned expansion of Gayatri Infra Ventures (GIVL), a subsidiary of Hyderabad-based developer Gayatri Projects.

The company plans three acquisitions in the north, giving it access to projects on the north-south corridor, and two acquisitions in the south, including that of the Cyberabad Expressway eight-laning project. Western UP Tollways (WUPTL), Gayatri Jhansi Roadways (GJRL), Gayatri Lalitpur Roadways (GLRL), Hyderabad Expressways (HEL) and Cyberabad Expressways (CEL) special purpose vehicle (SPV) are the other acquisition targets.

WUPTL is a joint venture SPV with Satyam-promoted infrastructure firm Mytas and Nagarjuna Construction Company. The plan is to acquire 40% WUPTL stake while 30% each remains with other two partners for the strengthening, improvement and maintenance of NH 58 in Uttar Pradesh. Gayatri also plans to buy out 49% stake of GJRL and GLRL in their joint ventures with IDFC.

Omaxe Annual Business Report

Realty firm Omaxe on 26th may reported consolidate net profit of around four hundred ninety five crore rupees for the year ended 31 Mar 08, a more than two-fold jump over the preceding year.
The company had recorded a consolidated net profit of around two hundred forty four crore rupees in the earlier fiscal, Omaxe said in a statement.
The consolidated revenue rose by 60.26 % at Rs 2,307.75 crore in 2007-08 following solid demand in the property market, it said.
The company also pronounced a dividend of 25 % on equity shares for the FY ended 31 Mar 08.

Overseas Investment Spurs Dubai real Estate Development

The real estate sector in Dubai is being driven mainly by overseas investment, with individuals and companies from other countries consist of 60-70 % of the buyers of freehold units.
2 out of 3 of all the new freehold properties in the emirate are bought by overseas companies or persons who live outside the country, says a study, which also divulges that property developers in Dubai have USD 100 billion worth of new development projects in hand.
MAG Group Property Development, which is looking to produce its portfolio of new property projects to more than USD 2.72 billion by 2012, says final home owners currently account for just 30 % of the market and only 5 % of them are UAE nationals.
“Motive for this phenomenon is investing in property in the UAE is seen as safe and rewarding and presently better than investing in bonds or stocks,” said MAG Group CEO Mohammed Nimer.
“Despite of many challenges, for example rising costs and shortage of contractors, the real estate sector in the UAE is still one of the most favored investment areas in the country. The return on the investment can reach as high as 40 %, an unbeatable figure,” he added.
Nimer said foreign investment by both developers and buyers, which represents 60-70 % of investment in freehold property, remains vital for the continued growth of the real estate sector.
Investors from Pakistan, India and China as well as other emerging markets such as South Korea and Brazil are increasingly showing interest in tapping lucrative opportunities in the UAE.

Milestone Capital To Invest In Tamil Nadu Real Estate

Milestone Capital Advisors will raise a fund of ten billion rupees to invest in the real estate sector in tier-II and tier-III cities of Tamil Nadu (TN).
The amount would be raised from high net worth individuals and financial institutions.
This fund would be primarily used for the construction and development of low-cost and green housing and also large warehousing across Tamil Nadu.
The company had so far floated two funds. The first one was for Rs 2.5 billion and the amount was disbursed for fourteen projects, of which nine were in Chennai.
The second one was for ten billion rupees, which was invested in readily available properties such as warehousing and office complexes.

Milestone Capital To Invest In Tamil Nadu Real Estate

Milestone Capital Advisors will raise a fund of ten billion rupees to invest in the real estate sector in tier-II and tier-III cities of Tamil Nadu (TN).
The amount would be raised from high net worth individuals and financial institutions.
This fund would be primarily used for the construction and development of low-cost and green housing and also large warehousing across Tamil Nadu.
The company had so far floated two funds. The first one was for Rs 2.5 billion and the amount was disbursed for fourteen projects, of which nine were in Chennai.
The second one was for ten billion rupees, which was invested in readily available properties such as warehousing and office complexes.

BSEL to float Malaysian arm to execute projects

Mumbai-based firm will invest Rs 18,000 crore in next twelve years. BSEL Infrastructure Realty plans to set up a company in Malaysia to execute its operations in that country.
The Mumbai-based company has signed a memorandum of understanding (MOU) with Malaysia’s Iskandar Regional Development Authority (IRDA) to develop properties in Johar Bharu region of Malaysia. The company has plans to invest Rs 18,000 crore in the next twelve years.
The new company will be either made a supplementary of BSEL Infrastructure Realty, or its UAE subsidiary BSEL Infrastructure Realty FZE.
Dharmendra Raichura, managing director, BSEL, said that the company will use the proceeds from UAE projects to finance the Malaysian projects. The company generated revenues of three hundred crore rupees in 2007-08 from the UAE operations and expects to make seven hundred crore rupees in the recent financial year. BSEL will borrow funds to finance the projects.
The company will develop seventy million sq ft of space in three phases with ten million sq ft in the first phase and double in every subsequent phase. It will invest Rs 2,500 crore in the first phase and Rs 5,000 crore in the next phase.
Raichura said the company expects returns of 35- 40 % from the project. Private equity companies invest in realty projects in India with expectations of 25-30 % rate on investment.
“Johar Bharu is a 25-minute drive from Central Singapore, where property prices are 25 times more than the rest of the country. The authority plans to transform Johar Bharu into the next hot spot after Singapore in five to seven years. That is why we chose that city,” Raichura said.
BSEL will get a tax holiday on land sales and premises sales till 2015 and exemption on rental income till 2020.

Stock To Watch

MUMBAI: Equities are seen opening flat-to-negative on Tuesday amid quiet global cues. Crude oil’s record high spike to the $127 mark will weigh on sentiment.

Essar Oil’s refinery expansion project at Vadinar may turn out to be the only such upcoming project to be denied a 100% tax holiday available to refinery projects. This follows the finance ministry’s decision which allows refinery projects to enjoy the tax holiday only if they have a joint venture with a public sector company that holds a 49 per cent stake. Shares of Essar Oil ended at Rs 257.75 on the BSE.

Italy is fast turning into a hunting ground for Indian auto companies and more so for Mahindra & Mahindra. The tractor and utility vehicle maker is learnt to have set sights on Italian motorcycle marque brands — Cagiva and MV Agusta — famed for designing high-end, high-performance superbikes that are a rage on the speed motorcycle circuit. Mahindra & Mahindra shares closed at Rs 662 on the BSE.

Parsvnath Developers may bag the development rights for one of India’s biggest infrastructure projects, the Rs 1,850-crore Nanocity to come up in Panchkula near Chandigarh. The project, spread over 11,138 acres, being jointly promoted by Hotmail founder Sabeer Bhatia and the Haryana State Industrial and Infrastructure Development Corporation is modelled on the Silicon Valley and will come up in two phases. Shares of Parsvnath Developers ended at Rs 222.35 on the BSE.

Tech Mahindra has paid British Telecom $110 million as ‘exclusivity fee’ for an impending mega-deal with the UK-based telco. The company is in exclusive negotiations with BT along with a consortium partner that is a large global IT player for a significantly large deal. Tech Mahindra scrip gained 2.42 per cent to Rs 956.05 on the BSE.

Champagne Indage took over assets of UK-based wine supplier, Darlington Wines for an undisclosed amount. This is company’s fourth overseas acquisition and a part of its strategy to strengthen its overseas presence. The stock ended at Rs 530 on the BSE.

BSEL Infrastructure Realty will develop about 70 million square feet in the Iskandar region in southern Malaysia. The company will be investing Rs 18,000 crore over 12 years to develop residential and commercial property in the area. The stock ended at Rs 50.55 on the BSE.

Tata Coffee is eyeing a distribution company in Russia which owns a couple of well-known coffee brands, reports DNA Money. Shares of Tata Coffee climbed 1.35 per cent to end at Rs 228.20.

Peninsula Land and Arrow Webtex will form a joint venture to enter hospitality business. A special purpose vehicle will be created which will be held 50-50 by both the partners to build business hotels. In the first phase, an equity infusion of about Rs 100 crore is envisaged by both the joint venture partners in equal proportion.

Bombay Dyeing is considering demerging its real estate business into a separate company, reports DNA Money. The hiveoff will be followed by an initial public offering. The stock gained 5.35 per cent to close at Rs 973.15 on the BSE.

Stock specific action is likely with a slew of corporate results from the likes of Suzlon Energy, Bharat Forge, GMR Infrastructure and Tata Teleservices Maharashtra.

Airport Upgrades Projected To Add 78 Million Square Feet Realty Space

Nearly seventy eight million square feet real estate space is expected to be added by 2015 due to forty seven airport modernization and upgrade projects.
The projects cover forty thousand acres across forty existing and seven new airports, according to the Airport Realty Report by global property consultancy Cushman & Wakefield.

The report says if the airports are modernized according to schedule, the non-aeronautical revenues may rise from the current 35- 54% by 2015. It is estimated that rent from retail, office and hospitality will constitute nearly 45 % of the airports’ non-aeronautical revenue by 2015. The rest will come from other non-aeronautical sources like trading concessions, public admission fees and miscellaneous income from advertising, car parking, etc.

Mr. Anurag Mathur, joint managing director, Cushman & Wakefield, said,”Globally, airports derive a large portion of their income from non-aeronautical revenue sources; Heathrow, San Francisco, Vancouver and Brisbane earn as much as 50% from retail and other non-aeronautical resources. With greenfield projects in Hyderabad and Bangalore taking their maiden steps, India is soon to replicate this potential revenue-earning model.”

According to estimates, retail space accounts for 18% of the total real estate space projections for airport projects. Most of this supply is concentrated in tier-III towns and cities as it comprises tourist destinations. The highest supply is, however, expected to be in Hyderabad, which accounts for 1.8 million square feet of the total projected retail space.

The study estimates office space to be more than 50% of the total real estate space projected for airport projects. With nearly forty one million square feet office space planned, the three tier-I locations are expected to add 14 million square feet office space, whereas the five tier-II cities expect 13.5 million square feet by 2015. Tier-III locations, which include over thirty five cities, would account for around 32% of the total office space supply amounting to fourteen million square feet.

Rental Prices Higher By 13% In Main Cities

After the fresh rise in real estate prices all over India, the reports are coming about rising rental prices in key industrial towns. A current report about rental prices in New Delhi has shown a 13 % rise in rental prices in year 2008.
Global real estate consulting company, Cushman & Wakefield has reported a rise of 7-13% in rental prices during the first quarter of this year. The demand is high and space for further development is limited. While in Gurgaon and Noida, the rentals have grown at 10-12 %.
Rental prices are higher in Bangalore, Mumbai, Chandigarh, Noida and Gurgaon as well. Real estate prices were lower during the first quarter of 2008. The prices had seen a good appreciation and there was a need for correction in the prices of real estate.
Small builders were having problem in selling their existing projects. According to recent reports, many small builders sold stake to real estate majors as they couldn’t bear the diminishing in prices of residential property. Real estate majors have lot of cash and can wait for the prices to stabilize. Home buyers and long term investors were waiting for reduction in prices while speculation based traders have reduced their exposure in most sectors.

Realty Needs Indices Similar To Equity Market

The Real estate industry in India has been growing by leaps and bounds in the past few years. However, the country still lacks a credible way to cross-check the price swings (real or reported) in the sector. For example, recent reports of residential prices cooling off in major cities of the country could not be verified.

There was no authentic data to indicate such a trend. Thus, property buyers remain confused, not knowing, for instance, whether Mumbai property prices fell more than that of Delhi in the last quarter?

The same does not happen with equity investors. At the end of the day, anyone wants to know the day’s market trend and for this he could take help of BSE/NSE website or see next day’s newspaper to know the exact rise or fall of Sensex or Nifty. Sensex or Nifty are taken as a barometer of market sentiment. With years of index publishing, a sort of credibility and association has been built with the equity investors by these financial institutions.

NHB made a beginning in this direction in 2005 when it launched a project for preparation of the real estate price indices for the residential housing segment, NHB Residex. To start with, the project envisaged compiling the indices for 10 cities — Greater Mumbai, Kolkata, Delhi, Chennai, Bangalore, Hyderabad, Ahmedabad, Kanpur, Jaipur and Patna. It also gave price appreciation figures for major cities at the time of the launch of the index. However, getting data from NHB has been tough for analysts.

With various mutual funds planning to soon launch real estate funds, it is imperative that a reliable index data, preferably from a government body like NHB, is made available to act as a benchmark.

Capturing real estate prices in India has its own challenges. Thanks to different types of housing that are made available by builders, there are large variations in property price in a single locality. It is difficult to put a single price to a locality which has different class of houses, say premium as well as low cost.

However, NHB with its wealth of information on loan disbursements and other crucial figures could do a lot for the industry. Since most financiers would have data on a city-wise basis, it could be shared with NHB for internal index calculation purposes. If NHB cracks the same, it could be one big step towards making the industry more competitive.

ICICI Venture may raise $3bn

ICICI Venture, the private equity wing of ICICI Bank, plans to raise three billion dollar from its 2 funds including equity and a real estate fund.
A senior ICICI Venture executive told that they will raise $1.5 billion from both these funds.
The ICICI Venture executive said the company expects to generate most of the investment for the fund from the US, Europe, Canada and West Asia.
“The equity fund will invest in all vital knowledge economy sectors. The real estate fund will invest in residential in addition to commercial properties,” he said.
The $1.5 billion real estate fund is the 2nd such offering from ICICI. The company has just closed a five hundred fifty million dollar real estate fund, the first in a proposed series of real estate funds by the firm.
Real estate is the hottest sector for private equity investment in the country, and accounts for 30- 40 % of the deals. At present, Goldman Sachs one billion dollar real estate fund is the largest fund investing in real estate in India. The US investment banking firm had set up this fund in 2006.
Credit Suisse had also announced plans to set up a one billion dollar real estate fund in India. However, the proposal was not cleared by the RBI.

Shree Precoated to hive off its steel business into separate co

MUMBAI: The Ajmera group-controlled Shree Precoated Steels, which has interests in real estate and steel, has taken a decision to hive off its steel business into a separate company. This will be a reverse merger as the Mumbai-based group had earlier merged its real estate assets with Shree Precoated Steels.
The group will rename Shree Precoated Steels as Ajmera Real Estate and Infrastructure, while the demerged entity will be known as Shree Precoated Steels, said Shree Precoated Steels CFO OP Gandhi. The group had mandated PricewaterhouseCoopers to advise it on the demerger, he told ET. The Ajmera family owns 62.5 per cent in Shree Precoated Steels, according to BSE data.
Post-demerger, Ajmera Real Estate and Infrastructure will hold the group’s five real estate projects — three in Mumbai (Wadala, Kanjur Marg and Ghatkopar) and one each in Bangalore and Bahrain. Shree Precoated Steel will continue to make colour coated galvanised steel sheets. On 16th may, the stock closed marginally down at Rs 189.20 on BSE. “The demerger will help the group give exact focus to both steel and real estate businesses,” Mr Gandhi said. The group is developing residential and commercial projects in Wadala and Kanjur Marg, while it is developing a residential project in Ghatkopar.
Mr Gandhi said the Kanjur Marg project is the biggest among its existing real estate developments. The project is being developed under a special purpose vehicle named Jolly Brothers.
The group also plans to develop a two thousand five hundred crore rupees, residential-cum hospitality-cum-commercial area in Kanjur Marg, comprising residential space of twenty six lakh sq ft and commercial space of fifty four lakh sq ft. The company intends to pump in Rs 500 crore and raise Rs 1,000 crore by way of debt.
Ajmera group has already developed 170 lakh sq ft in Mumbai, besides large format projects in Pune, Rajkot, Ahmedabad and Sura

Airports to emerge as business hubs

NEW DELHI: All new airports in the country will emerge as business nucleus with world class office, hospitality and retail space. The modernization and development of airports will not only provide the facelift to respective cities but also improve the real estate sector, said a report by Cushman & Wakefield.
To exploit the trend of rising city centers around airports, the Airport Authority of India has provided huge land for development of commercial realty and retail space. For airports in Mumbai and Delhi, the report said, 50 per cent of the total real estate space has been allocated for commercial development.
India has come into view as one of the most favored destination in Asia-Pacific region for strong performance of businesses, which led to an influx of MNCs. This has sustained the demand for commercial office space in large cities. The high economic growth across the country also made the smaller cities like Lucknow, Kochi, Coimbatore, Mysore, Jaipur and Indore among others attractive destinations to do businesses.
The report said apart from commercial office space supply, these airport projects will also allow time saving between business meetings during the transit/ waiting period with the proposed convention and business centers that form part of the overall development plan.
In the retail sector also, the report said, huge opportunities are awaited. It said, “With changes in airport security, passengers today are required to arrive early, consequently finding themselves with adequate time to spend before departing.” T

Delhi Metro generates Rs 600 crore revenue from surging realty

NEW DELHI: Delhi Metro has produced 600 crore revenue from the commercial use of its property during the first phase of the Metro project.
The real revenue generation is approximately double the target, thanks to skyrocketing commercial property prices and growing demand from retail sector and IT companies. Buoyed by the excellent response, DMRC officials expect that total revenue from property development would reach Rs 1,000 crore in a few years.
Earnings from commercial use of vacant land constitute around 30% of the total operating revenues generated by DMRC. In 2007-08, the company reported total operating revenue of Rs 327 crore, a 28% increase from Rs 256 crore in 2006-07.
“The revenue generated from the property development in the first phase of the metro project will contribute to our internal accruals, which will be used to finance the next phase of the Metro project. Still, there are some unoccupied areas that can be commercially used under the phase-I and we expect the total earnings from such commercial activity to reach Rs 1,000 crore. In the second phase, similar property development will be undertaken and we have targeted a revenue generation of Rs 405 crore from the same,” said a source.
Property development undertaken so far includes 6-12-year licence awarded for the spaces within station buildings for commercial related vendors such as ATMs, kiosks, refreshment and magazine stalls. Similarly, shopping malls have also been set up through developers on a license basis for the period of 12 years inside station buildings which have larger concourses.
Such malls have already come up at Inderlok, Netaji Subhash Place and Kashmere gate stations. DMRC has set up an IT park at Shastri park station which has been rented out to ITES operators. The company has undertaken some residential and commercial developments outside Shahdara and Inderlok stations through developers on a concession period of 30 years.

Pantaloon Will Open 110 big bazaar hyper Markets

Pantaloon Retail (India) Limited, a future group venture, will make an investment of more than Rs 1500 crore for opening more than 110 big bazaar hyper Markets in various cities across the country, Anand Adukia, Zonal Chief of the company said on Friday.

“With this launch, Big bazaar is now present in all the four major cities of Ahmadabad (five stores), Anand, Surat, Rajkot and Vadodara (one each) while the count for all India goes upto 90 stores in 55 cities in the country,” Adukia told reporters, after opening its ninth store in the city today.

The sprawling three floors of Vadodara Big Bazzar houses over 1.6 lakh products and is a destination store to cater to every single household needs of a family, he said.

“We are a consumer-driven company and we ensure that all our Big Bazzar stores fulfill the needs of the entire household under one roof,”Adukia said.

This store also houses, ‘Navras’, a national brand known for fine 22 carat pure gold and diamond jewelery.

The company intends to open one more store in Vadodara, and Ahmedabad in next couple of months along with Jamnagar, Bhavnagar and Vapi among others, Adukia added.

Besides, the company also intends to open 11 more stores in Gujarat later this year, he said adding, with this, the company has made a total investment of Rs 500 crore in the state.

At present, Pantaloons caters to the lifestyle segment through its 40 stores and seven central malls.

The company is a leading retailer with a turn over of over Rs 3350 crores and is targeting 50% growth this year, Adukia added.

Indian real estate Seeks Partnership With Israeli firm

The Indian real estate company Sigrun and a leading Israeli firm are in talks over a deal worth more than five hundred million dollar, as said by knowledgeable sources.
Most of Sigrun’s activities (95 %) are in residential property and the rest in office rentals, according to CEO and controlling shareholder Rajesh Nair. He said that the company’s profit in preceding FY was fifteen million dollar, and if everything goes as planned, this year it will be forty million dollar.
Sigrun is examining different possibilities for cooperating with Israeli companies. One main Israeli firm, which has not expanded into the Indian market so far, expressed interest in continuing the contacts with Sigrun, and the latter has hired a leading Tel Aviv law office to facilitate the proceedings.
In a discussion with TheMarker, Nair pointed out that his company has construction-ready building plots in India worth five hundred million dollar, in addition to 100 apartment units in different stages of construction. He said that the discussion here have not yet reached the stage of precise numbers and percentages.
Nair stressed that any Israeli partner must have international exposure, since Sigrun has not yet ventured away from India, while many Israeli companies are active in the world real estate market. He said he is looking for a company that can bring to the table technologies and planning capabilities that Sigrun lacks at this time, while Sigrun can contribute its proficiency in the Indian market to the Israeli partner.
Only a few Israeli developers - including Electra Real Estate and Azorim, and Elbit Imaging - are involved in construction in India.

Cash-starved Small Players Offer Investors Fixed Returns

With bank credit drying up and private channels of funding getting expensive, several small developers are attempting to mop-up funds from retail investors by offering them a 12% guaranteed return for 5-9 years. Under the scheme, a retail investor has to buy a minimum area in the project and make an outright payment.
Delhi-based Piyush group, which is developing a 4 lakh square feet IT project in Faridabad, is offering a 12% return for nine years, but investor will have to make a minimum investment of Rs 20 lakh for 500 square feet. Piyush Group JMD Mr. Amit Goyal said, “We are offering a minimum guarantee to investors to cover their risk as the project is not yet ready and so can’t be leased out”.
There are several other developers who are offering a similar return for a minimum purchase of 500 square feet. A buyer or an investor would get monthly return till the project gets completed.
Following which, the developer will lease out the space and the rentals, if it exceeds the guaranteed 12%, would either be given away to investor or shared between the investor and the developer depending on the scheme. However, if the rentals dip below the 12% mark, the developer is expected to compensate the investor.
Experts say 12.25% is a much cheaper rate in today’s cash-crunch times. Cushman & Wakefield India director (capital markets group) Mr. Sandeep Singh said, “Small developers are not getting bank loans. A private borrowing at 18% or more is quite risky. So it makes sense for them to borrow it from retail investors at 12%”.
He added that if the developer borrows from a bank, he will have to pay back, but under this scheme he removes risk from the very beginning.

Landmark Group Invests Rs 4000 Crore In North India

Landmark Group declared that it would invest approx four thousand crore rupees in developing twelve properties across the north India in the coming three to four years.
Mr. Amit Kumar, Director, Landmark Group, said, “Currently, our twelve projects are undergoing in the North, which will be completed in the next three to four years. We will be investing about one billion dollar in developing these projects”. Further he added that the company would fund the projects through internal accruals and funds from private equities.
He said, “We will try to fund our projects through our own resources, but also, we do not mind private equity players’ participation. Starting from twenty-five percent, we are ready to sell up to forty percent to private equity players in different projects”.
The NCR-based firm has planned to develop three hotels, 2 5-star and a budget hotels in the coming three years, which could entail an investment of about seven hundred crore rupees.
Mr. Kumar said that Landmark Group is developing a three thousand room 5-star hotel in dharuhera and a budget hotel in Gurgaon with more than hundred rooms. The other five star hotel would come up at Bawal in Haryana.

Realty Is Facing A Major Cash Crunch

Land prices in the national capital region (NCR), Mumbai suburbs, Bangalore and Hyderabad have corrected by up to 25% as property developers slow down their land purchases. Poor sales and lower availability of credit at higher cost have prompted property developers to end the mad rush to acquire land. Some of the developers have even backed out of land deals which were agreed upon as the slowdown hit the sector.
Prices have come down by up to 25% in Mumbai’s distant suburbs, including Thane and Belapur, and pockets of Hyderabad and Bangalore, according to property consultancy firm Knight Frank India. Prices in the NCR, with an exception of Faridabad and Delhi, too have witnessed a correction of up to 25%. Land prices in Faridabad have risen 10-30% in the past 3-4 months.
However, Faridabad is just catching up with its neighbouring locations. The prices in Faridabad are still lower than in Gurgaon or Noida and the current price rise is more towards building parity with them. Land prices in Delhi are said to be stable.
But a recent land deal struck in Delhi’s prime commercial centre Connaught Place indicates that prices in the capital too are cooling off. Parsvnath Developers bought 1.18 acre, jointly owned by Mahajan Industries and Videocon Industries, for Rs 200 crore. The deal came at a discount of almost 17% at Rs 169 crore per acre, compared to what hotel major Leela Group paid for acquiring 3 acres in Chanakyapuri last year for Rs 611 crore.
Mr.Vipin Aggarwal, Executive director, Omaxe, says “Real estate sector is facing a major cash crunch. That’s why the companies are focusing on completing the project at hand, instead of adding to their landbanks”.
Till recently, real estate players were in land acquisition frenzy, with some players even pledging their equity shares to acquire land. A large landbank was showcased as the biggest asset for a company tapping the capital market

CHB A Profit Making Agent For Real Estate Developers

The Chandigarh Housing Board, an autonomous body whose mandate is to provide housing to the middle class and economically weaker sections of the society, has indeed appeared as a money-making agent for the real estate developers.

Had the Chandigarh Administration or Chandigarh Housing Board (CHB) levied the same conversion charges to the real estate giant Parsvnath Developers Limited, which they are charging from the city industrialists, it would have earned the exchequer hundreds of crores more as compared to what they have earned now.

The prime commercial land, measuring 123.79 acres, which was earmarked to provide housing to Information Technology professionals, has been allotted by the Chandigarh Administration to Parsvnath for raising a huge housing complex next to the Rajiv Gandhi Technology Park.

The Chandigarh Administration allotted the land to Chandigarh Housing Board at the rate of Rs 308.77 for every square yard, i.e. Rs 18.5 crore for 123.79 acres.

The land was further sold to Parsvnath at Rs 829 crore. The actual value of the land, on the same formula, which the Chandigarh Administration is using in case of conversion charges of industrial land, would indicate that the Administration has lost approximately Rs 1.43 lakh per square yard.

According to information procured under the Right to Information Act, the ‘dubious’ role played by Chandigarh Housing Board has become quite evident.

When the CHB had to make houses for the middle class and economically weaker section, it got the land from the UT Administration at the rate of Rs 3,200 to Rs 5,900 per square yard.

The cost is bound to be automatically passed on to the consumer. The Income Tax department has already issued a notice to the CHB for the payment of tax on the amount already received from the developer.

Indian Postal Department Is Planning For SPV For real Estate

The face of Indian postal department is changing, under pressure from modern communication systems. Gone are the days when post offices were used for screening and distributing letters. Today, it is entering into every possible business segment, be it money exchange or logistics. With a network of 1,55,516 post offices in every nook and corner of the country, India Post is all set to conquer new frontiers.

Indian Post used to be one of the prominent pillars of the country’s communication infrastructure. This, however, is no longer the case with the emergence of telecom and Internet as the preferred mode of communication. Courier services have also made a dent into the revenues of the postal department. With an aim to revive its past glory, the Department of Post (DoP) has planned a series of initiatives including rapid induction of information technology, introduction of logistics post air, tie-up with commercial banks and launch of new mailing and money-order schemes.

The department also plans to strategically leverage its vast network of over 1.5 lakh post offices across the country, the largest in the world. From railway reservation to spreading education on the government’s social sector schemes, the neighborhood post office plans to become a single gateway for almost all official purposes.

Further, with an aim to leverage upon its vast real estate assets, the Indian post is also planning to form a special purpose vehicle (SPV). The SPV would be responsible for planning and execution of commercial utilisation of vacant plots of land and buildings. The special purpose vehicle would be a 100% subsidiary of the DoP.

“Commercial exploitation of the real estate properties would provide Indian Post the much needed revenue for taking the modernisation plans,” communications minister A Raja said.

Tamil Nadu Launches Portal For e-Processing Of Land

The Tamil Nadu government today launched a website for online processing of land documents, including registration.
State minister for Revenue and Housing I Periasami unveiled the website at regional review conference organised jointy by the Land Resources department and Union Ministry of Rural Development.
He said, "The website 'www.Eservices.Tn.Gov.In' will have all details such as patta pertaining to lands of individuals".
Further he said, "So far, 3.2 crores of land resources having full details of the owner/enterprise across the state have been registered on this website".
The website which is to be launched in interior districts of Tamil Nadu in a phased manner will be covering the entire state soon.
Mr. Periasami further said, "Initially, it has been launched in Dindigul, Vellore and Coimbatore". Elaborating about the project, Union Rural Development Secretary Rita Sinha said that e-processing would prevent tampering of documents and every individual registering on the website would have a unique identity number.
Already this kind of e-processing of land resources had been implemented in various states and also in other countries, including England, Australia, Thailand and Kenya.
Rita Sinha said, "Initially, we have planned to launch it in 11 states across the country and as of now, it has been completed in Karnataka, Haryana, Andhra Pradesh and now Tamil Nadu. We want to cover the entire country by the end of 12th Five Year Plan". Further she said that with this kind of development, accuracy and time reduction could be achieved.

LnT To Build Rigs, Semi-Submersibles, FPSOs

Engineering and construction major Larsen and Toubro today said it would build assets for the offshore segment that is facing shortage of assets.
L&T, which has a base in Oman, plans to build jack-up rigs, semi-submersibles and FPSOs (Floating Production and Storage Offloading vessels) for the offshore segment in Oman.
Mr. K Venkataraman, L&T Board Member, said, "We plan to build jack-up rigs, semi-submersibles and FPSOs for the offshore sector at our base in Oman".
He said that it plans to build two or three jack-up rigs, one or two semi-submersibles and one or two FPSOs.
The cost of a jack-up rig in the international market is estimated to be about $350 million. The cost of a semi-submersible is about $400 million. L&T plans to get a hull for a FPSO vessel from other player and would make the "top side" at its facility, which would cost about $400 million.
As a first step, L&T has bagged an order from a UK-company to refurbish a jack-up rig for $33.3 million.
There is a huge demand for refurbishment of jack-up rigs because the existing ones are at least 15 years old.
He said, "More and more rigs are being deployed in the Gulf region because of an increase in exploration activity in the region,"
From the Oman-base, L&T plans to attract players in the Gulf and Asia Pacific regions for refurbishment work.

Omaxe To Invest Rs 8000 Crore To Build 10 Lakh Low-Cost Houses

After low-cost airlines, budget hotels, cheap cell phones, low-cost computers et al, it’s now time for branded low-cost houses. Delhi-based real estate major Omaxe is planning to invest Rs 8,000 crore in next five years in affordable housing projects. The company has floated a subsidiary National Affordable Housing and Infrastructure which will be building the affordable houses. In all, Omaxe plans to build about 10 lakh low-cost houses.
Omaxe CMD Mr. Rohtas Goel, said, “We are investing from the internal accruals. Going forward, we will also look at SPV level equity from India and abroad”. The company is also looking at slum redevelopment model to build affordable houses. For this, proposals have already been sent to the state governments of Delhi, Madhya Pradesh, Punjab and Rajasthan. The company has earmarked Rs 200 crore for slum rehab projects. Such projects will help Omaxe in acquiring land at a cost which will make development of affordable or low-cost houses a feasible option.
For affordable or low-cost houses, it has already acquired land in Neemrana, Ghaziabad and Lucknow. Mr. Goel said,“The land for the affordable housing projects will cost us around Rs 100-200 per square feet depending on the city, while the cost of construction will be Rs 700 per square feet. The units will be sold at Rs 1000 to1100 per square feet”. The first project, in Neemrana, will be launched after three months and will be completed in a span of 2-3 years.
The company plans to build low-cost houses on slum land. However, analysts believe that it might not be a very feasible model. Mr. Anuj Puri said, “Slum rehab is very popular in Mumbai. Real estate developers are now eyeing a similar model in other cities too as land is becoming scarce and expensive. But it’s tough to make profits if low-cost houses are made on the balance land as slum dwellers need to be rehabilitated for free and developer needs to cover that cost which can be done only by making luxury apartments”.
In Mumbai realty developers such as HDIL and Akruti City have developed slum redevelopment projects. Omaxe has also launched an international design competition for efficient and economical structural design and optimum space utilization. It has also tied up with the London School of Architecture.

Bank of Baroda Signs MOU With Dubai Properties

A leading Indian public sector bank Bank of Baroda, has signed a memorandum of understanding with Dubai-based real estate company Dubai Properties for funding buyers of the latter’s products in the United Arab Emirates (UAE).

In a statement Dubai Properties declared that the contract has been signed between Bank of Baroda chief executive for Gulf operations A. K. Gupta and Dubai Properties chief executive M. S. Binbrek.

Bank of Baroda is the lone Indian bank providing complete banking services in the UAE.

It has 6 branches, in Dubai, Deira, Sharjah, Abu Dhabi, Al Ain and Ras Al Khaimah and an electronic banking service Unit at Jebel Ali near here. In Oman, the bank has three branches and in Bahrain one.

Property Market To Go Global

The number of major global investors in the GCC property market is expected to more than double this year, according to research by Jones Lang LaSalle, a property consultancy.

Until this year, few of the “global 100″ property investors had ventured into the Gulf, despite a decade of strong growth in several countries.

The arrival of the biggest names in the business – such as American International Group (AIG), the American insurance group, and Singapore,s Capita Land, which signed a joint venture deal with Abu Dhabi’s Mubadala ­Development Company last year – is a sign that global investors are gaining confidence in the legal and regulatory framework in the region.

But the newcomers will still be dwarfed by existing investors – mostly from the Middle East and other nearby countries such as Pakistan and India – so their arrival will have a limited impact on prices.

In Dubai, for example, investors have enthusiastically greeted the creation of the Real Estate Regulatory Authority, which weeded out many sub-standard developers.

The international investors are expected to come from a range of sectors, including banking, insurance and real estate development, and from all major economic zones including America, South Korea, Singapore and ­Europe.

DLF Assets files for IPO approval in Singapore

DLF Assets, the property fund of DLF Ltd, plans to launch an initial public offer of its office trust in Singapore by June to raise over Rs 8,000 crore. DLF is India’s leading real estate company in terms of market evaluation.
DLF Assets, which has been set up to obtain completed commercial projects of India’s most-valued realty company DLF, is setting up to file the updated prospectus soon for its planned IPO for the approval of Singapore authority. The earlier prospectus had financial information only till September 2007.
DLF Assets had planned to float the IPO in January, but due to poor market responses and a worldwide market slowdown, the company decided to holdup its public offer in Singapore. The company had previously received the regulatory sanction from Singapore authorities to launch the IPO of DLF Offices Trust, the real estate investment trust of DLF Assets.
Freshly, DLF Assets Ltd has received four hundred fifty million dollar worth of funding from a London-based investment firm, Symphony Capital. Previously, DLF Assets received two hundred million dollar from a fund sponsored by Lehman Brothers and four hundred million dollar from another global investment firm, DE Shaw. The three rounds of funding enabled DLF Assets to pay part of its dues to DLF.

DLF Limited has reported net profit of two thousand one hundred seventy six crore rupees and revenue of four thousand three hundred six crore rupees for the quarter ended March 2008

Dewan Housing Reports 11.78% Rise

Dewan Housing Finance Corporation reported a 11.78% rise in net profit to Rs 29.44 crore compared with Rs 13.51 crore during the corresponding period last year.The company's income went up 45.4% to Rs 148.02 crore during January-March 2008 as against Rs 101.80 crore during the same period last year.
The Dewan Housing board recommended a 10% final dividend in addition to a 15% interim dividend paid during previous FY. Profit before depreciation and tax rose 10.7% to Rs 36.74 crore in the fourth quarter. Provisions for taxes rose 98% to Rs 6.95 crore in the fourth quarter of previous financial year.
Mr. Kapil Wadhawan, Vice-Chairman and Managing Director, said that the money is a part of the $250 million the company plans to raise for the private equity fund by March of next year .
He further said that initial investors for the fund would be from West Asia and the UK and more than half the corpus would be allocated towards real estate projects in emerging real estate cities. It had earlier raised a hundred crore rupees for another private equity fund and the entire corpus has been invested in various real estate projects.

German Bank Invests Rs 607 Crore In Trikona Projects

German investment bank SachsenFonds (SF) has bought stake in four realty projects of London Stock Exchange listed, India-focussed realty fund Trikona Trinity Capital for Rs 607 crore ($150 million). Trikona has made returns of 115% in the transaction.
In the Delhi-based Uppal IT park, SF raised its stake from 8% to 33%. In the Hyderabad-based residential and retail project Manjira, SF picked up 41%, thereby completely owning the project.
In the MK Mall being developed by DB Realty in Mumbai, SF picked up 40% and now owns 100% of the mall. SF also took 15% stake in Delhi's Luxor Cybercity, owned by Trikona.
In another instance, Trikona and SF acquired 49 per cent in a redevelopment project in Bandra in Mumbai. The Mumbai-based Rustomjee Developers will undertake the development work, while SF and Trikona will contribute funds in the ratio of 55:45, Trikona said. Since SF is yet to set up its base in the country, Trikona is expected to manage all the assets.
Mr. Aashish Kalra, managing director of Trikona Trinity's fund manager, Trikona Capital, said, "This transaction supports the company's business plan and stated net asset value, and confirms our ability to deliver results. We have a solid, scalable investment and development platform and are confident that this transaction reinforces our leading position at the forefront of the Indian real estate and infrastructure markets."
Trikona Trinity Capital (TC), a fund created for investing in Indian real estate and infrastructure, has entered into a binding agreement with SachsenFonds Holdings, a subsidiary of leading German public sector bank Sachsen, to divest a part of its portfolio and co-invest in new projects, at a transaction value of £74.15 million.
The transaction, which was first outlined in a memorandum of understanding (MoU) on April 1 this year, follows the partial divestment of Trikona TC's asset portfolio to SF in December for an aggregate sale price of £32.11 million for a cash-on-cash return of 108%.
The current transaction has enabled Trikona TC to further divest a part of its portfolio for an aggregate sale price of €68.5 million (£54.10 million), realizing a gain of 115%.

Ritz, Nitesh to offer $1 million luxury residences

Ritz Carlton Residences, the benchmark in luxury homes for the rich and famous in busy metros and exotic retreats, may be ready to redefine the ultimate in apartment living in India.
It is believed to have chosen the stunning backdrop of the Kochi coastline and the posh Boat Club area in Chennai as addresses for the million-dollar residences it will offer in partnership with Nitesh Estates.
Domestic realty major Nitesh is scheduled to bring India’s first Ritz Carlton hotel to Bangalore. Nitesh would extend its association with Ritz Carlton Hotel to a few more markets and unveil Ritz Carlton Residences too. Apartment of 2500 to 4000 square feet are expected to be ensconced within the premises of Ritz Carlton hotels in Kochi and Chennai.
Carrying a price tag in excess of $1 million, they will come with dedicated concierge and house-keeping services, gourmet dining and valet parking. An outright buy could cost Rs 3 to 6 crore and they may also be available on long lease. What has fuelled the speculation is Nitesh’s recent acquisition of land in chennai and kochi.
The domestic real estate company bid seven hundred crore rupees to lease nine acres near the Boat Club for 66 years. It is also believed to have bought four acres next to Bolghatty Palace in Kochi for an undisclosed amount. The land in Kochi is surrounded by water on three sides, with the heritage palace on the fourth.
Nitesh Estates CEO RS Mani said, “We can only confirm that the company is looking at mixed-use developments in both cities. We are looking at iconic developments that will leave a lasting impression” . He declined to comment on speculation about whether the Ritz association would be extended to these markets.
Nitesh has already roped in New York-based architectural consultancy KPF to develop these properties. The mixed-use development in Kochi is estimated to be about five lakh square feet while in Chennai it could be a million square feet. KPF is credited with some of the most acclaimed mixed-use developments in the world, including Tokyo’s four billion dollar Rappongi Hills, built by realty tycoon Minoru Mori.

Builder Can't Deny Compensation For Delay In Flat's Delivery

The National Consumer Commission has held that a builder cannot deny compensation to a buyer on its failure to deliver a flat within a stipulated time.
The Commission rejected a contention of the builder, pleading that it should not be directed to pay any compensation for delay in delivery of flat as the prices of property had gone up.
The Commission said,"Such contention of any builder is unjustified and unreasonable because after sale of a property all the benefits accrue to the purchaser and not to the vendor. In any case, if it is accepted, the builders would earn crores of rupees by delaying the delivery".
The Commission Bench headed by Justice M B Shah directed Ansal Properties and Industries Ltd to pay a compensation of Rs 50,000 for "high-handed and rough behaviour" of its manager while dealing with a complainant Kunj Bihari Mehta.
Allowing a complaint of Mehta, the Commission also asked the real estate major to pay interest at 12% rate for 9 years on a sum of Rs 25.29 lakh deposited by him in 1997.
Mehta was delivered with the flat here in December 2007, 9 years after the promised date of the company.
The company, on the other hand, contended that it had sent a letter offering possession of flat to the complainant in 2003.
To this, Mehta submitted that the letter was received back by the company as he had shifted his residence.

Phoenix Mills to purchasing Rs 8 bn land

Phoenix Mills is in the final stage of acquiring three thirty acre plots in Ahmedabad, Hyderabad and Nashik for around eight billion rupees. The company plans to develop malls and entertainment zones on these lands.

It is learnt that the deal is likely to be sealed in the next few weeks.
The Mumbai-based real estate developer is developing Market City Projects, spread across 21.4 million square feet, in Mumbai, Bangalore, Chennai, Pune, Raipur, Agra and Indore.
The company is seeking to establish long-term relationships with developers in its bid to achieve a pan-India footprint in three years.

According to an estimate, the country is all set to have over 500 malls by 2010 from just three malls in 2000. Roughly 300 million sq ft of quality retail space will be accumulated by 2011.

Indiabulls in discussion with leading global retailers

Indiabulls group, a rising company with interests spanning from financial services to retail, on 12th may said it is in talks with some foremost global single-product retailers seeking a pan-India presence.

“The company is in early stages of discussions with some foremost international single-product retailers who desire to set up a pan India presence,” Indiabulls Real Estate (IBREL) on 12th may said while pronouncing its quarterly results.

In addition its real estate business that also caters to retail players with malls and other store-formats, Indiabulls also has its own retail venture, which has department stores, hypermarket stores and neighborhood stores.

The IBREL is currently building seventeen malls across sixteen cities with a shared leasable area of about fourteen million square feet. Indiabulls hyper-market stores and department stores are likely to be the anchor tenants in these malls.

The company said it expects majority of malls to be finished and leased out by late 2009. Full payment for the land of thirteen malls has already been made and these are in company’s control.

The proposed malls are coming up in cities like Hyderabad, Ahmedabad, Mumbai, Gurgaon, Chandigarh and Visakhapattnam. The company is expecting a monthly rental in the range of Rs 60-300 per sq feet in these seventeen malls.

The name of the company’s retail business subsidiary, Piramyd Retail Ltd, has been changed to Indiabulls Retail Services Ltd. The Piramyd stores has been accordingly rebranded as Indiabulls Megastore and Indiabulls Mart.

Now buy Dubai property from your Local Agent

Dubai-based luxury real estate developer DAMAC Properties has appointed local agents in Gujarat to harness the investment opportunities in the region. The company has signed up around 60 agents across India, mostly in metros.

These include two Ahmedabad-based and one from Baroda. The initiative has been taken by the company to market and sell its international properties to Indian buyers.

“We are proud to have appointed agents in India. Apart from three in Gujarat, we have signed agents in important cities like Mumbai, Delhi, Chennai, Bangalore and Gurgaon. As the potential is high here, we wanted to touch each corner of of the country through a network of experienced agents,” said founder & chairman, DAMAC Holding, Hussain Sajwani. “We will provide our agents all the necessary information and training to sell our properties.”

The company is also considering investment options in the subcontinent along with marketing its current projects. “We are looking at all the major cities in India and we will earmark investments as soon as the feasibility study is over,” said the CEO of DAMAC Properties.

Real Estate Growth Slows Down After Boom

Property is a lifetime investment. When a person makes decision to buy a house, he/she thinks for the market price of that locality and the existing rate trend. If we talk about the scenario these days, sales of real estate have crashed but prices have not come down considerably. Further downside is projected which will be healthy for the sector.
If prices rise, they must come down. It happened in equity and now it is real estate. After giving huge returns for more than two or three years the market has entered a slowdown period.
The slowdown today is result of prices having risen too fast and low interest rates further boosting demand. However, not only have home prices peaked, interest rates have also soared. This has weakened sentiment and buyers have turned more careful. Property is a long-term investment and you can expect 25 - 35% IR returns.
One reason why real estate sector has not crashed is because on an average, the sector has grown twice the GDP growth rate. So, if the economy continues to grow at 9%, real estate will grow at 15- 20%.High interest rates have been another bane. Homeowners who took floating loans have been hit the hardest.

CLSA sells shares worth Rs 35 crore in Indiabulls Real Estate

Foreign fund house CLSA Ltd on Monday sold shares worth about Rs 35 crore in Indiabulls Securities Limited on NSE.

Further, MindTree Consulting bought shares worth nearly Rs 2.2 crore in AztecSoft today on the NSE.

In a bulk deal, CLSA sold 31.8 lakh shares in Indiabulls Securities for an average price of Rs 110.15 per share. MindTree Consulting in another bulk deal acquired about three lakh shares in AztecSoft for an average price of Rs 73.55 per piece.

Township Rush Has Begun In Pune

Pune:- By the 2020 Pune will be nothing like what the city is these days. The small city’s boundaries are being stretched in all directions. Now, the city is gaining suburbia around itself. Adding another totally new dimension to the city is the rush of integrated townships into Pune.
The city is set to reap a rich harvest for those having the capacity to invest and develop large tracts of land and put in the physical and social infrastructure. This is what the new Special Township Policy Act of the Maharashtra government stipulates. A minimum area of 100 acre, investment in public infrastructure, such as roads, water, sewage—an integrated approach to development of townships to decongest municipal corporation areas and encourage new settlements in the periphery though higher FSI (floor space index) than what is normally allowed in the municipal limits.
There is a rush to develop all these in Pune. Three of these townships have already started taking shape. City Development Corporation’s Amanora Park Town took off first with its four hundred acre for ten thousand crore rupees township, followed by Paranjape Schemes Construction’s One hundred thirty eight acres for three thousand two hundred crore rupees Blue Ridge and Megapolis, a Rs 1,500-crore 150-acre project by Pegasus Properties Pvt Ltd, a joint venture between Kumar Properties and the Avinash Bhosale Group.
More are waiting to take off. HCC Real Estate, the 100% subsidiary of Hindustan Construction Co Ltd has announced plans to get into a township project in Pune. The company is in the process of acquiring land and is planning a five hundred acre township. It has indicated to analysts that it is in the process of acquiring two hundred thirty acre to create five million square feet of development.
Lalit Kumar Jain, promoter of Kumar Builders, said his company had received clearance from the state government for three townships in Pune. The first one coming up at Hinjewadi phase II will be spread over One hundred twenty four acre and will be launched in August 2008. Another Kumar township coming up spreads across One hundred twenty acre. The third township of One hundred ten acre is slated to come up in Kharadi in September 2008.
The recently listed Kolte Patil Developers has a four hundred fifty acre township at Hinjewadi with ICICI Ventures investing in this venture with a fifty per cent share in this project.

Retail sector to consolidate in medium term

KOLKATA: Rising retail industry in India would see a phase of consolidation in the medium term while ill-planned malls were likely to go out of business, an official of real estate management company Jones Lang LaSalle Meghraj (JLLM) said.
“There is a enormous potential for the retail sector in the country since India is a large economy and 97 % of the country’s retail trade is still in the unorganized sector,” JLLM Managing Director (Kolkata market) A. Das told reporters.
With the country’s economy estimated to grow at a rate of 9% per year, there would be steady shift of the retail business from unorganized to organized sector, he said.
Despite of this, retail sector would see a stage of consolidation in the medium term. According to Das, malls which are ill-planned and of below average standards would be under severe pressure.
Companies like Reliance Retail, Future Group’s Big Bazaar are expanding their network in the country while new players are entering the market, he said.
He said a small player with an terrific mall in terms of design, positioning, tenant mix and value proposition would always do better than a big player with a below average mall, ill-designed and poor value proposition.
The sector would continue to magnetize investments in the subsequent 5 years, he said, adding that there was no scope for deceleration in the development of the industry in the country.

Realty cos now offer EMI incentives

New Delhi:- Smarting under a correcting realty market and sluggish buying sentiments, real-estate players are scrambling to raise end-user demand through offers that promise to ease Equated Monthly Instalments burden until possession.
So, while realty companies together with Parsvnath Developers are broadcasting ‘No Equated Monthly Instalments until possession’, others such as BPTP and Gaursons are offering 2-yrs Equated Monthly Instalments holiday on specific projects.
“For those who are presently living on rent, the scheme makes logic as the Equated Monthly Instalments load kicks-off only after possession,” says Mr Amit Raj Jain. BPTP’s group housing project, ‘Resort’, in Faridabad offers a 2-yr ‘Pre-Equated Monthly Instalments interest’ to the bank on behalf of buyers.
Dr B.P. Dhaka, COO told that Parsvnath’s Sonepat project, ‘Parsvnath Preston’, reimburses the Monthly Instalments paid prior to possession. “Such value-addition is gaining popularity as the customer is motivated to make the down payment and can then relax till possession. From the point of view of the developer, it ensures timely completion of the project as the fund flow is assured.
KDP Infrastructure has announced that ‘No pre- Equated Monthly Instalments for 18 months’ upon payment of fifteen per cent of the booking amount on its ‘Grand Savanna’ project in Ghaziabad; Gaursons India makes a ‘No Equated Monthly Instalments till 24 months’ offer to buyers of ‘Gaur Grandeur’ at Noida; and JMD Gardens’ project in Gurgaon promises that Equated Monthly Instalments payment would start ‘only after house entry.

Deepika Padukone Endorses Aspire Real Estate

Deepika Padukone is now a brand ambassador of a foreign real estate company. Dubai-based realty development cum brokerage firm, Aspire Real Estate, has announced Deepika Padukone to be their brand ambassador and new face of their company. Aspire is highlighting its Dh5.5 billion portfolio of real estate developments at prestigious locations within Dubai.
Mr. Harshit Kantaria, Chairman, Aspire Real Estate, said that dubai has good investment opportunity for all kind of investors. He gave example of deepika and said that Deepika and Aspire both are rising stars of their respective era. He said that he is looking forward for giving aspiring service to real estate industry.

Past projects of Aspire Real Estate are Jehaan Residences in Jumeirah Village South, Sobha Ivory and The Sanctuary at Business Bay and Al Dua’ Marina at Dubai Marina.

Realty Is Facing Prices Fall

The transaction level has gone down drastically in various markets. It has resulted in price fall in realty market. This is also because residential capital values in some micro markets in the metros have shown a negative growth in the last 3 months. After tracking capital values in metros such as Mumbai, Chennai, Bangalore as well as Pune and the National Capital Region (NCR), the result was that either there has been a fall in prices of residential values or they have not increased in the last three months. In fact, places like Gurgaon have seen a down of 15 percent, while the plot rates have come down by 20 percent in Noida. In Greater Noida, the plots which were selling at Rs 55000 to 60000 are now available for Rs 40,000 to Rs 45,000. In Indirapuram, rates of flats have come down to Rs 2500 to Rs 2700 per square feet from Rs 3000 to Rs 3200 per square feet.
Even prime areas in Delhi such as Friends Colony, Maharani Bagh, GK I & II, Prithviraj Road and Hauz Khas have witnessed a 5-10 percent fall in the prices.