Real Estate Discussions in India

Ishaan strikes Rs 1,082-crore deal with K Raheja

2007-10-23T22:42:00.000-07:00

Ishaan Real Estate, the first India-focused real estate fund listed in the Alternative Investment Market (AIM) in London, has acquired 40% stake each in eight real estate projects promoted by K Raheja Corp, for Rs 1,082 crore (£133 million). The properties in which the fund has invested include three IT parks, two Inorbit shopping malls and one hotel property. The Ishaan-K Raheja Corp’s deal could be the first investment by an AIM-listed property fund in the Indian realty space.

Last November, Ishaan had raised about £180 million in its first phase from the AIM market of London Stock Exchange. The entire fund was to be invested in K Raheja’s properties in India. It may look at raising further funds from AIM market , and may look at investing other properties in India, said sources.

Ishaan picked up equity in K Raheja Corp’s Inorbit shopping mall in Hyderabad, Inorbit shopping mall and IT park in Pune, Mindspace IT park in Hyderabad, Mindspace IT park in Navi Mumbai, two Mindspace IT parks in Hyderabad, Commerzone IT park, hotel and retail development in Bangalore, and Viverea residential development at former Hindustan Spinning & Weaving Mills site in Mahalaxmi at Mumbai.

Confirming the development, Ishaan Real Estate chairman Ian Hendersen said: “Investment in the initial portfolio of assets is being completed largely according to a plan and the increased net asset value reflects the strong demand for our properties and the enormous potential of the Indian property market.”

Sources said Ishaan’s current portfolio in India covers a total of 15.4 million sq ft. Ishaan has also secured leasing agreements for over one million sq ft. Currently, in the AIM market , Ishaan shares are trading at around £104.

From the beginning, Ishaan Real Estate works in partnership with K Raheja Corp entities in the western and southern markets. It has also secured leasing agreements with two leading multinational companies for 7,66,000 sq ft of the projects in the initial portfolio.

Source: The Economic Times

World's Most Expensive Homes

2007-08-27T03:27:00.000-07:00

Rome landed at No. 2 with a P/E of 50.51; it's a slow growth market, which remains very expensive. Representing North America in the world's top 10 were Los Angeles (5th place at 26.88) and Vancouver (6th at 26.81). For a list of America's most overpriced real estate markets, click here.

The relationship between rental yields and housing costs matters because a low rental yield is a good indication of a stretched market--one that has a bubble--since these markets are more likely to face downward price pressures or grow at a slower rate. Possible higher returns attracts more buyers and pushes up prices. India's disparate markets illustrate this. Bangalore has a 9.7% rental yield helping it to an 8.74 P/E, a good sign the market has room to grow. Last year prices climbed there by 16.5%. Mumbai, which posted a P/E of 17.21%, saw prices grow 6.6%.
,
Behind The Numbers
To arrive at our numbers, we inverted the effective annualized rate of return so each figure resembled a price-to-earnings measure that was easier to read. Think about each market like you would a stock: the higher the price-to-earnings figure, the more you have to pay to get one dollar of return. Many of the world's most expensive markets, such as London and New York, didn't make the top 10, and were beaten out by less expensive markets that had lower yields and smaller rates of appreciation.

We measured 50 financial capitals in every continent except Antarctica. For the most part this meant one city from each country--London for Great Britain, Bangkok for Thailand, Warsaw for Poland--but for countries like India, China, the U.S., Australia, Canada and Switzerland where there were multiple, distinct financial centers we measured a variety of cities: Geneva and Zurich in Switzerland and Shanghai and Beijing in China, for example.

Our valuations were based on data from GlobalPropertyGuide.com, an international real estate research firm. For each market, it assumed no debt financing; a constant cost of capital as the buyer wouldn't shift funds based on where they buy; a 10-year hold of the property and that the property would be a nonprimary residence.

Pricing data were based on city center properties of equivalent size. An investor looking to buy in Rio de Janeiro likely doesn't consider Rio's favelas viable options, so data skewed by that cut of the housing stock isn't useful. In basing the numbers on the prime cut of housing markets from Kiev to Manhattan, the resultant valuations are more comparable as investment options.

Purchase costs included transaction costs. In Geneva, that represents an effective 0.36% hike on the paid price, while in Seoul, buyers pay 20.88% above the property's base. Here, for example, transaction fees include housing bonds, legal fees, registration tax, acquisition tax, estate agent's commission, education tax, stamp duty and a special tax for rural development. Suddenly, a $500,000 apartment has a real cost of $604,400.

Yearly operating costs and maintenance were valued at 10% of rental yields across markets, a standard estimation in pricing calculations. Projections for the future value of the home were calculated by annually compounding the original capital value based on each respective country's five-year average trailing gross domestic product growth rate and inflation, as calculated by the International Monetary Fund, which has a good rate of correlation to housing price growth.

Cash flows were predicted by the annual rental yield minus operating costs and maintenance. Bangalore had the highest rental yield. There, landlords can command a 9.7% return per year on the value of their property something that undoubtedly stokes the jealousy of countrymen in Mumbai, where the strict rent controls of the local Maharashtra Rent Act beat rental yields down to 3.27%.

After 10 years, when it came time to sell, we tacked on capital gains taxes and sellers' costs--something that's a serious headache in Moscow, where sellers' costs amount to 18% of the sales price; far better to live west of Russia in Latvia, where sellers' costs are 3% and capital gains nil.

As N.Y.U. Stern School of Business finance professors Anjolein Schmeits and Stijn Van Nieuwerburgh point out, this system of calculation doesn't discount for risk and volatility. For the purposes of this article we decided not to adjust for these elements in part because many of the markets have undergone such dramatic transformations in the last 10 years that calculating a beta rating--what an economist would use to measure an asset's volatility against the market--wouldn't accurately represent the housing markets of rapidly developing countries like India or Latvia, for example.

Source:forbes.com

Govt will free the disputed NCR land

2007-08-22T23:39:00.000-07:00

Now apparently the NCR government has started considering something to curb the high-flying property prices in the region by planning to bring over 30,000 acres of additional land in the National Capital Region (ex Delhi) to the market by resolving disputes over titles, thus making the land available for sale. Good news...isn't it??

The land in question does not have clear title records, because of which developers are wary of laying their hands on them. If the proposal of the Union urban development ministry’s NCR Planning Board goes through, it will release fresh supply of more than 2 million mid-segment housing units, putting a check on soaring real estate prices. The government hopes to kick off the exercise by the year-end.

The unlocking exercise will be carried out across 8 districts of Haryana — Gurgaon, Rewari, Faridabad, Sonepat, Rohtak, Panipat, Jhajjhar & Mewat; 5 districts of UP — Ghaziabad, Bulandshahar, Meerut, Baghpat & Gautam Budha Nagar and Alwar in Rajasthan. The government plans to take help from local bodies to identify and verify the ownership of land.
“In any large-scale transaction, the problem of ownership deed does arise at some point of time. We are trying to work out a formula. Various suggestions have come in. The exact strategy will be worked out in some time,” an urban development ministry official said.

One of the suggestions doing the rounds is of creating an ad hoc title deed in the name of the claimant to facilitate transaction with a buyer. This will be done only in cases where all authorities concerned as well as independent surveyors are convinced about the land ownership. “This should not be difficult, as in case of villages and small towns, every local person is aware of who owns which land. The only problem in some cases is that official records are not available. This exercise will help do away with this problem,” Haryana housing board chief administrator SP Gupta said.

Real estate developers operating in the area say the exercise will be a win-win situation. TDI MD Kamal Taneja said: “For developers in the NCR, land acquisition is the biggest challenge. Among whatever property comes up for consideration, only 10% get converted into a final deal. The other 90% inevitably deals with the problem of unclear titles. Obviously, the asking price for clean land is unimaginably high. This gets converted into much higher costs as far as built-up property is concerned. The only way to make real estate affordable is by creating fresh supply.”

Clear land records is of prime concern for the ministry. The department has also asked local bodies and district administrations to go in for mandatory computerisation of land records and get them duly audited to avoid litigation.

You may exchange your views on on this topic @ Real Estate Discussion Forum, which is a common platform for real estate community of India.

Real Estate during 60 years of Independence

2007-08-13T21:13:00.000-07:00

The evolution of the real estate sector in India since independence reflects what happened to the Indian economy as a whole — the government becoming a monopoly provider in the 1950s; shortages and abysmal quality during the 1960s, 1970s and 1980s; and finally, the government loosening its grip on the economy and allowing a role to the private sector in the 1990s. In this decade, while supply has improved, Prices of Properties in India have skyrocketed in most major cities, posing a fresh set of challenges to policymakers.

At the time of independence, India’s population was 35 crore, of which only 14 per cent lived in urban areas. In the years that followed, rural to urban migration increased so that the pressure on existing urban housing and infrastructure became immense. The government then decided to take charge.

Till the 1950s, private developers were allowed to operate in cities. Following the Delhi Development Act of 1957, they were forced out. Government agencies like Delhi Development Authority (DDA) became the sole developers in the city. Many also established their own development agencies.

This Left turn in the economic management of the country was accompanied by the promulgation of several laws that were meant to safeguard people’s interests, but which ended up having the opposite effect. The motive of the Rent Control Act, 1958, for instance, was to prevent landlords from exploiting tenants. But so heavily was this Act skewed in favour of tenants that it killed all incentive for investment in rental housing.

In 1976, the Urban Land Ceiling Regulation Act (ULCRA) was enacted, which curbed individual holding of vacant land to a mere 500 sq m. The goal was to free up land lying with large landowners and use it for developing mass housing. In reality, owners took advantage of the exemptions in the Act, or went to the courts, so that the government could obtain very little land. It was in the 1980s that Haryana took the step of allowing private developers to accumulate land banks and develop integrated townships.

The reforms of the 1990s, by increasing the pace of industrial and service sector growth, enhanced income levels and, thereby, the demand for housing. Falling interest rates on home loans and liberal tax exemptions too helped. However, between 2003 and today, property prices in most large cities have risen 100-300 per cent, taking housing away from the common man. The only way to change this: “By increasing supply,” said CB Richard Ellis MD Anshuman Magazine.

Three steps need to be taken - One, increase floor space index (FSI) and allow high rises within cities (after providing the infrastructure). Two, provide better infrastructure and connectivity to suburbs, where affordable housing can be developed. And three, government agencies, which have been hoarding land, need to release more of it.

Source: http://www.indianexpress.com/story/210302.html

FIIs raise stake in real estate stocks

2007-08-12T23:33:00.000-07:00

While many analysts think that Indian stocks are among the most expensive in the world, the booming real estate market has caught the fancy of foreign investors and they have raised their stake in a majority of realty firms listed on the bourses.

An analysis of the holding pattern of foreign institutional investors (FIIs) in 22 major realty firms shows 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 real estate in India has witnessed a boom in recent times led by an increase in purchasing power of people, relaxed lending norms by banks and housing finance companies and the growth in retail and IT sectors.

The buying of shares by FIIs in these companies comes at a time when a few analysts believe the country’s realty stocks are among the costliest in the world.

Global investment services firm Standard & Poor’s has said real estate stocks in India are the most expensive and give lower returns than most emerging and developed markets such as China, Singapore, Hong Kong and Australia.

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.

The P/E ratio is considered a valuation benchmark of a stock, where a higher ratio indicates an expensive stock, while a lower P/E ratio signifies a cheaper stock.

FIIs consolidated their stake by an average of 1-2 per cent, except Indiabulls Real Estate, in which their holding jumped 6 per cent to 44.96 per cent as on June 30 from 37.34 per cent at the end of the previous quarter.

FII holdings in Ansal Housing increased by more than 2 per cent to 17.53 per cent, while in IVRCL Infrastructure their stake jumped by 3 per cent to 61 per cent.

Other realty companies such as Unitech, Simplex Infrastructures, Nagarjuna Construction, MSK Projects and GMR Infrastructure witnessed a marginal rise in FII holdings.

FIIs generally sold shares of that company, which is around its all-time high, while they purchased shares around their low levels, an analyst said.

The current analysis confirms the trend as the seven companies, where FIIs decreased their stake, were trading at higher levels than their March quarter price, except Mahindra Gesco, whose price decreased in the June quarter.

FIIs poured in over Rs 200 crore during the April-June quarter this year, according to the data available on the Securities and Exchange Board of India (Sebi) website.

ECB norms restricted

2007-08-08T01:53:00.000-07:00

The government has announced fresh restrictions on external commercial borrowings (ECBs), limiting their use for rupee expenditure. Companies will now be able to raise only up to $20 million abroad for rupee expenditure and only with prior RBI approval.

All external commercial borrowings above $20 million will be allowed only for foreign currency expenditure. This means, companies can, at best, raise Rs 80 crore abroad via debt for domestic expenditure. For the rest, they will have to look for local financing. The funds raised abroad will have to be parked overseas till the actual requirement in India, an official statement said.

The overall goal is to prevent the external borrowing window from weakening the financial discipline sought to be imposed by the central bank’s monetary policy. Restricting the use of foreign borrowings for domestic expenditure had been one of the measures recommended by the Prime Minister’s economic advisory council headed by Dr C Rangarajan last month, to insulate the economy from excessive capital inflows.

This comes at a time when companies are facing higher interest rates at home and there is a growing demand for external funds to take advantage of the interest rate arbitrage. In May, the government had barred Indian real estate companies setting up integrated townships from raising ECBs. It had also lowered the ceiling on interest rates to be paid on such borrowings, making it difficult for small and medium-sized companies to raise ECBs.

However, there has been no change in the provision allowing individual companies to raise up to $500 million through the automatic route. But now, they will be required to take RBI approval for raising funds above $20 million for rupee expenditure, an official said, adding that the move was aimed at restricting non-serious players going for such borrowings.

“ECB policy is constantly reviewed by the government in consultation with RBI to keep it in tune with the evolving macro-economic situation, changing market conditions, sectoral requirements, the external sector and the lessons of experience. Based on such review, it has been decided to modulate capital inflows through ECBs by modifying some aspects of the policy,” the statement said.

“The move is aimed at containing the huge inflow of dollars, which puts inflationary pressures on the economy. RBI has to release the equivalent of rupees to absorb the dollar inflow, so as to neutralise its effect on the money market. This leads to an increased money supply in the economy, adding to inflation,” PricewaterhouseCoopers executive director Sanjay Hegde said.

The dollar flow also drives up the value of rupee by creating more demand for it, he added. It may be pointed that companies raised ECBs amounting to $21 billion in 2006-07.

Source: http://economictimes.indiatimes.com/articleshow/2263927.cms

DLF Story - All the way to Real Estate

2007-08-06T23:30:00.000-07:00

From the window of his ninth-floor office, Kushal Pal Singh looks down over New Delhi's Jantar Mantar, an elaborate astronomical observatory built by a far-sighted 18th century Hindu ruler renowned for his diplomacy and the monuments he left behind. The stone curves and pillars of the observatory worked in conjunction with its massive sundial to create one of the most reliable and accurate scientific instruments of the day, allowing astronomers to measure time, forecast eclipses and determine the positions of stars and planets. The Jantar Mantar "gave me inspiration," says Singh, the chairman of DLF, India's largest real estate company. "And the inspiration was that if this guy who conceived and made the Jantar Mantar centuries ago could be a forward-looking man, why is it that we can't be forward looking in our development and start to do something ahead of the time?"

If you listen to Singh tell it, DLF is doing just that. Barely known outside its north Indian base a few years ago, the company is building houses, apartments, office towers and shopping malls across India. It has plans for airports, hotels and cinemas. Singh, 75, doesn't just want to cash in on India's economic boom, he wants to be a prime mover in the country's drive to erect modern cities where India's new middle class can live, work, shop and play. To do all that, though, DLF needs a lot more money, which is why on July 5 the company listed on the Bombay and National stock exchanges. An initial public offering for just over 10% of the company closed in mid-June and brought in some $2.24 billion. In the three weeks after it listed, DLF's shares rose nearly 9%, giving it a market capitalization of $24.5 billion — roughly $3 billion more than General Motors. The IPO, which was about twice the size of India's previous biggest, netted Singh and several family members, who together hold 87% of DLF, nearly $20 billion — enough to make them one of the richest clans in the world. But Mr Singh says "Frankly that is embarrassing to me,” “That is not the yardstick by which I want to be known. I feel proud that what I championed 25 years back has blossomed into something good for the country. That is what I want to be known for."

Whether he likes it or not, the fortune Singh has amassed is bound to attract attention. DLF is, after all, the hottest property developer in one of the hottest markets in the world. India's economy has grown at an average annual rate of more than 8% over the past four years, bestowing prosperity upon millions of Indians and boosting demand for houses, offices, megamalls and hotels. Real estate prices have skyrocketed. A 2006 study by the Federation of Indian Chambers of Commerce and Industry and professional-services firm Ernst & Young found that total revenue from sales of commercial and residential property throughout India had grown 30% a year for the previous three years. Land prices in some areas have tripled in value since 2004, while office rents in Mumbai and New Delhi are now more expensive than those in Paris, Hong Kong or midtown Manhattan, according to a 2007 survey by real estate consultant CB Richard Ellis. Yet the boom may still have room to run. Merrill Lynch forecasts India's property industry will grow to $90 billion by 2015, up from $12 billion in 2005.

During an interview in late May, Singh, who is widely known simply by his initials, K.P., espouses a similarly optimistic view. "As prosperity comes through I see massive opportunities," he says. "You will need 100 DLFs, there will be so much work." DLF, though, has a big head start on the rest of the industry, thanks largely to Singh. The amiable septuagenarian, who this day is dressed in a white suit with a polka-dot handkerchief poking from his breast pocket, recalls how prescient strategy — and a stroke of luck — turned DLF into a property powerhouse. Founded by Singh's father-in-law, Chaudhury Raghuvendra Singh, DLF (originally Delhi Land & Finance) got started in 1946, a year before India won its freedom from Britain. A former civil servant, Raghuvendra bet that hundreds of thousands of refugees, who were expected to settle in India's capital when partition split Hindu and Muslim India, would need places to live. He convinced farmers around New Delhi to hand over their land on the promise of future payment, borrowed money to develop residential neighborhoods and then sold at considerable profit to the influx of newcomers.

But the good times ended in 1957 when New Delhi's socialist government granted itself sole development rights for the city, forcing private firms out of the business. By then, K.P. Singh had married into the family and would soon join his father-in-law's firm. The son of landlords himself, K.P. had studied science and then moved to Britain to train in aeronautical engineering before returning home as an officer in the Indian army. Military life was tough and family legend has it that Singh planned to return to his engineering studies in London when he was dragged before a colonel who had learned of his intentions. "You can leave," the senior officer told him, "but you will always be known as the coward who ran away." Singh stayed, serving in the Deccan Horse, a celebrated cavalry regiment, in the early 1950s, and learned the discipline that he says would help him in business years later.

Source: time.com

Save this to your Favourites:

Government's green signal to foreign investments in REALTY

2007-07-30T20:55:00.000-07:00

Foreign investors are once again queuing up to pour money into India’s red hot property market as the government has given some relaxation in the norms. At least half-a-dozen deals worth $1billion are being finalised by Citigroup, Deutsche Bank, The Carlyle Group and Blackstone, among others, with unlisted real estate companies, as pre-initial public offering (IPO) placement.

The department of industrial policy & promotion (DIPP), under the ministry of commerce and industry, has cleared the air for investments by foreign institutional investors (FIIs), foreign venture capital funds (VCFs) and private equity players.

FII investments in companies pre-IPO will be treated as foreign direct investment (FDI), as per the clarification, and the investment will have to be channelled for FDI-compliant greenfield projects only.

Now foreign investors will have to wait three years before exiting the company completely. DIPP has clarified that the investor will have to lock in a minimum of $5 million, in case of a joint venture with an Indian real estate player, or $10 million, in case of a wholly-owned subsidiary of a foreign investor.

The existing rules for foreign investors regarding the lock-in period is applicable for real estate sector as well. Hence, investments by FIIs, foreign VCFs and PE investors will have a minimum lock-in period of one year, if the investment occurred during the preceding 12 months before the IPO date.

This has paved way for a large number of foreign investments at the entity level. This is a complete departure from the past, when equity investments used to be all project-specific. Industry officials said leading property players are sewing up equity deals at the entity level, with greater clarity in foreign investments in the sector.

A majority of real estate companies planning an IPO are currently in talks with foreign investors. The leading players planning an IPO are Hiranandanis, Lodha Developers, Runwal group, Kolte Patil Developers and Paranjpe Schemes (Construction). “There used to be some kind of confusion in the market as far as FIIs’ pre-IPO investments in real estate companies are concerned.

With the clarification issued by the government, foreign VCFs and PE funds can now invest in the real estate firms with a lock-in period of minimum one year. It will definitely boost investments in the sector,” said Akhil Hirani, managing partner of Majmudar & Co.

According to investment bankers, the change in rules would pre-empt any further speculation in the real estate market, and that FIIs would not be allowed to cash in immediately in the IPO.

Earlier, DIPP and the stock market regulator Sebi were not in favour of a lock-in period and had instead suggested pre-IPO placements by FIIs be considered as portfolio investments. However, the recommendation was not accepted by the finance ministry, which, in turn, asked Sebi to put in place the lock-in on FII investments in real estate.

Leading real estate players, eager to cash in on investors’ appetite for realty stocks, were seeking FDI status for their pre-offer placement since many of their existing projects were not meeting the tough FDI norms. For instance, a project needs to be at least 25 acres to be notified FDI-compliant.

Save this to your Favourites:

Indian developers focussing on Dubai and Singapore!

2007-07-30T02:51:00.000-07:00

India’s big real estate developers are heading for new horizons. After raising funds from UK’s Alternate Investment Market (AIM), they are now moving to the Dubai International Financial Exchange (DIFX) and the Singapore Stock Exchange to float Real Estate Investment Trusts (Reits) as an "Alternate strategy to raise funds".

Unitech, DLF, Hiranandani Developers, Housing Development and Infrastructure, DS Kulkarni Developers, Orbit Corporation, Embassy group and Nitesh Estates are among real estate majors exploring options for listing their respective Reits at DIFX or the Singapore bourse. DIFX and Singapore market have emerged as the two new venues for Indian developers to raise funds. Both these markets have favourable regulations to float Reits

Indian developers are focusing to Reits because their traditional funding sources are restricted to the primary market and private equity. A Reit helps developers securitize their rental yields - lease income - from their commercial properties by issuing shares to financial institutions or retail investors. Currently, many Indian developers are working to bring their income generating commercial properties under a special purpose vehicle (SPV) or a subsidiary company, which will then be listed in the overseas market in the form of a Reit.

Source: Real Estate Discussion Forum

Save this to your favourites:

Delhites may now pay lesser stamp duty

2007-07-25T23:46:00.000-07:00

Delhi Government has recently announced to reduce the stamp duty on property prices by 2%. The move has been decided to access funds under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) as the programs need states not to exceed the stamp duty than 5%.

The stamp duty on properties registered in the name of men will now stand at 6% whereas it would be 4% for women. ;)

This will pave the way for considerable savings for an individual buying property. With respect to new stamp duty, he/she will now be able to saves at least Rs 60,000 for a property worth Rs 30 lakh. Likewise, the savings will go on increasing with the increase in property price. It would be to the tune of Rs 1 lakh for one that is worth Rs 50 lakh and Rs 2 lakh for a property worth Rs 1 crore.

The first installment including Rs 298 crore from the JNNURM funds has been allocated to Delhi by the Union Urban Development Ministry.

The cut in stamp duty is not likely to affect the entire revenue collection. For that reason, the government on Thursday night issued a notification for circle rates in the Capital. The circle rates will, however, help avert the treachery and wrong practices in property deals and register their properties at a higher amount.

The government is considering doubling its collections from stamp duty in 2007

Save this to your Favourites:

DLF’s KP Singh Becomes Third Indian Trillionaire

2007-07-25T23:24:00.000-07:00

Kushal Pal Singh, Chairman of DLF Group, has become India’s third trillionaire in rupee terms as the share price of DLF, his flagship company, increased and witnessed stunning profit numbers.

DLF made a net profit of a whopping Rs 1,524 crore in the first quarter. However, the figure stands for only ‘accounting profits’ and have not been translated into an equal amount of ‘cash flow’ into company’s books. And, the company continues to work on negative cash flows.

During the quarter, DLF reported a negative cash flow worth Rs 2,270 crore, on account of sundry debtors and rise in inventory.

As per the company’s quarterly filings, sundry debts rose to as much as 150% during April-June in 2007 and stood for over nearly three-fourths of its consolidated net sales during three month period.

This clearly underlines that the DLF has been following a policy of advance booking for its properties. As such, almost all builders take up the same strategy to show a higher top line. In case of DLF, the range seems to have exceeded the normal limit.

DLF’s IPO has actually come to its rescue as the proceeds compensated for almost the company’s complete closing cash balance at the end of the first quarter. The company had raised Rs 9,625 crore from the primary market in June’07.

DLF averred a 100% dividend for all its shareholders as well as the new IPO allotees. Sundry debtors and the rise in inventory account for around 85% of the reported net sales of Rs 3,074 crore. Now, the question is whether DLF has been managing the payout from the IPO proceeds.

In the meantime, the stock continues to make headlines. DLF’s successful bid for the Dwarka convention centre gave a push to the scrip by about 5%. It would account for the growth by the fiscal years 2010 and 2011.

DLF enjoys the status of being India’s largest real estate company and owns development rights to 574 million square feet of real estate. Of this, 51% falls in the NCR and 23% in Kolkata.

Save this to your Favourites:

Property rates headed south!

2007-07-18T23:42:00.000-07:00

Realty rates are sliding all over the country. There is already a down in property prices by 15 per cent in Chennai, for instance. In Mumbai, the market is sluggish — sales have slowed down — but it is holding out bravely.

Global realty firm Knight Frank’s latest residential market review says there has been a price correction of nearly 15 to 20 per cent across the National Capital Region, particularly in Gurgaon and Noida, due to inflation and high interest rates.

Pranay Vakil, Knight Frank’s India head, says, “The price slash is also due to the problem of oversupply in this area and the decrease in the number of buyers.”

Areas like Greater Noida and Faridabad will also face price correction on account of the large number of houses/flats expected to be available soon.

Ankur Srivastav of DTZ, a leading real-estate consultant, says there is going to be a surplus of accommodation in the premium-segment brand — in the price bracket Rs 75 lakh and above — in the next 18 months.

"There are a dozen premium projects coming up in Gurgaon and Noida," he says. "Once they are completed, they will increase the pressure on prices."

However, many industry people don't think the market is going down.
According to them it happens every year around this time.

The buying season starts in September, around Diwali. If prices start climbing again, the current correction would be just that: a correction. But if the slide continues, that would be end of the big property boom.

Save this to your Favourites:

DLF bags 112 acre DCM land in Delhi

2007-07-13T01:46:00.000-07:00

The realty major has begun to make good use of the proceeds from its IPO.
DLF has just bagged close to 112 acres of land in west Delhi for about Rs 1,750 crore from DCM Shriram, beating archrival Unitech. DLF outbid Unitech by Rs 150 crore, part of the cost will be funded by IPO proceeds. The only rider could be the Supreme Court order that may restrict its construction plans on this property in Delhi

Analysts say that DLF might have overpaid, the Supreme Court says that only one third of the land can be developed and the rest has to be green, which means DLF can only build on about 38 acres of the 112 acres it had bought.

There is hardly any stretch of land of this size in central Delhi and DLF having exhausted its options in Gurgaon is looking to establish its space in central Delhi. Having paid so much of money, the company will look to multiply its investments through property development.

The DLF stock has risen nearly seven per cent in last two trading sessions, making it the eighth most valuable company in the country. Analysts say that with interest rates peaking out and rising middle class incomes, DLF is headed for good times ahead.

Add this to your Favourites:

TSI Ventures to raise 2nd realty fund

2007-07-10T02:24:00.000-07:00

TSI Ventures, a Tishman Speyer and ICICI Ventures joint venture, may look at raising resources from the overseas markets for setting up a second realty development fund for building office and residential space in India.

On its own part, ICICI Ventures may be looking at raising up to $5 billion from global markets by 2012. TSI Ventures’ mandate is to develop properties with cumulative asset value of over $2 billion over the next five years.

TSI Ventures, which announced plans to set up its first office space project spanning 2.2 million sq feet in an IT/ITeS special economic zone in Hyderabad, is working on a project pipeline armed with an investment corpus of $700 million. TSI Ventures says, it is putting the money into projects very rapidly.

Addressing a press conference, Tishman Speyer president and CEO Jerry I Speyer said: “Every major global company is looking at locating in India. There is a huge demand for high quality commercial and residential space. TSI Ventures will be creating mixed use, residential and integrated townships in major cities.”

ICICI Ventures CEO Renuka Ramnath said: “The real estate practice of ICICI Ventures has assumed significance. There is a huge demand for institutional capital and framework in realty development.” In fact, ICICI Ventures will be looking at raising funds to the tune of $5 billion by 2012 from the overseas markets, she said, on the sidelines. ICICI Ventures is currently investing out of its $500-million real estate fund for realty development projects.

TSI Ventures is working on projects in cities like Mumbai, Delhi, Bangalore, Hyderabad, Pune and Chennai. TSI Ventures is also working on a high-end integrated township project in Tellapur, Hyderabad. The capital outlay of Wave Rock, TSI Ventures’ first project in India, was not disclosed.

TSI Ventures will leverage on Tishman Speyer’s large global customer base to get anchor tenants and customers for the office space project. Wave Rock will be able to offer 15,000-20,000 sq feet of contiguous space to large tenants in an SEZ environment in Gachibowli, the emerging financial district of Hyderabad. The first phase of Wave Rock will be completed by the fourth quarter of 2008 and the entire project will be ready by the third quarter of 2009. When completed, it will have the capacity to seat 20,000 people.

Tishman Speyer is looking at developing an iconic landmark in Hyderabad with Wave Rock much like its other commercial properties like Rockefeller Centre and Chrysler Building in New York, Torre Norte in Brazil and the Sony centre in Berlin.

The architects firm for the project is Pei Cobb Freed and Partners, known for landmarks like the Grand Louvre Pyramid, Paris and the Bank of China Tower, Hong Kong.

Source:http://www.indianrealestateforum.com/real-estate-updates/t-tishman-icici-venture-to-raise-2nd-realty-fund-1402.html

Unitech to develop India's largest residential township in Noida.

2007-07-04T22:25:00.000-07:00

Unitech is ready to make a with the launch of India's largest residential township in Noida.

The Unitech Grande will come up at an area that is spread over 340 acres on the Noida-Greater Noida Expressway.

Last year, Unitech managed to outdo DLF when it bagged the land for Rs 1,583 crore, making it India's largest land deal. Around three-years from now, Unitech completes its project and the residential township will have a 9-hole golf course and 80 highrise buildings with the tallest being 50 storeys high.

But what's surprising is that at a time when most analysts are talking about a price correction in the real estate market. Unitech has gone ahead and launched the project at a 50 per cent premium over the going rate in this area.

Unitech to launch Noida project at Rs 7,750/sq ft. Omaxe, and Eldeco are selling at Rs 5,000/sq ft. While three years back, going rate there was Rs 1,700/sq ft.

But with each flat in this project costing a minimum of Rs 1.5 crore, is there a market for such super luxury projects? Experts say that going ahead it is quality that will drive the market.

As the realty space gets more and more competitive, what remains to be seen is how long will the DLF euphoria grip the stock markets and with bigger and bigger projects being rolled out, how will valuations change for these real estate players in the months to come.

Source: www.ndtvprofit.com

JLL Meghraj identifies “India 50”- the Emerging Cities for Retail sector

2007-07-04T22:15:00.000-07:00

Highlighting the growth opportunities and the emerging geography of Indian retail and property market activity, Jones Lang LaSalle Meghraj released its World Winning Cities report on Indian Retail. The report entitled “The Geography of Opportunity -- The India 50” is the first report in a series on Indian Retail Futures. It highlights the significant opportunities for both domestic and international retailers and property investors across a broad range of geographies and formats.

“The Geography of Opportunity – The India 50” paper highlights that India’s retail sector is evolving at a swift pace, fuelled by a strong economy, favourable demographics, rising wealth levels and rapidly changing lifestyles and consumer aspirations of an ever burgeoning middle class. The real estate sector has responded well to this retail growth. The total retail mall stock has been doubling every year, from a meagre one million square feet in 2002 to a staggering 40 million square feet by end of 2007 and an estimated 60 million square feet by end of 2008.

Jones Lang LaSalle Meghraj’s research identifies 50 cities across India that are ideally positioned to benefit from the booming retail sector. The report launches a new retail city classification based on socio-economic characteristics, retailer activity and shopping mall development. The research identifies five types of cities (Maturing, Transitional, High Growth, Emerging and Nascent), each of which is at a different stage in its retail market evolution and offers different types of opportunities for retailers and the property sector.

Organised retail activity is still overwhelmingly concentrated in Delhi and Mumbai (the Maturing Cities) and considerable opportunities still exist in these two vast and diverse metros. We expect these two metros to contribute 40% of national organised retailing by year 2008. Delhi and Mumbai lead the Indian mall culture with estimated total mall stock of 22 million and 15 million sq ft respectively by 2008-09. Nonetheless, the report concludes that increasing competition in the NCR and Mumbai markets, combined with growing opportunities in India’s regional markets, is encouraging both retailers and property developers to move into new and potentially more rewarding markets further a-field. Organised retailing in India’s other main cities, such as Bangalore, Kolkata, Hyderabad, Pune and Chennai (the Transitional Cities) is growing rapidly however such is the pace of change, that many smaller Tier III cities are now firmly on the radar of the retail sector and mall developers.

Vincent Lottefier, CEO, Jones Lang LaSalle Meghraj, says, “India’s 50 cities identified in our report clearly offer substantial and compelling opportunities for India’s growing retail sector. With a population of over 1 million each, these cities will form the very core of India’s emerging retail hierarchy. Interestingly, the top 15 cities (Maturing, Transitional and High growth) from the 50 retail destinations are expected to contribute more than 80% of the total national retail business by 2008. India’s retail awakening is characterised by rapidly changing customer behaviour, new market entrants and evolving government policy. It is imperative to comprehend India’s enormous cultural and regional diversity to get a realistic perspective on the opportunity at hand.”

The report highlights tertiary cities such as Chandigarh, Ludhiana, Jaipur, Lucknow and Kochi (the High Growth Cities) as leading the pack, attracting considerable retailer interest due to high incomes and strong brand awareness. The “next retail destinations” over a three year horizon are likely to be “Emerging Cities” such as Nagpur, Coimbatore and Thiruvananthapuram, where IT/ITES companies are expanding their workforces, which in turn is stimulating retailing activity. The more pioneering retailers and mall developers are now seeking to benefit from first mover advantage and are moving into “Nascent Cities” such as Aurangabad and Rajkot, which are likely to provide good long term opportunities.

“Emerging City Winners” is Phase IV of Jones Lang LaSalle Meghraj’s World Winning Cities research. It brings to the fore cities that are already buzzing with retail activity and those which are catching up rapidly to be the next retail hot spots. Many of these Indian rising urban stars offer significant retail opportunities and have not traditionally been on the radar screen on the property sector.

About Jones Lang LaSalle Meghraj

Jones Lang LaSalle Meghraj is the Indian operations of Jones Lang LaSalle's Asia Pacific business, which established over 45 years ago and currently has 60 offices across 13 countries. Globally, Jones Lang LaSalle Inc. (NYSE: JLL), the only real estate money management and services firm named to FORTUNE magazine's "100 Best Companies to Work For" and Forbes magazine's "400 Best Big Companies," has approximately 160 offices worldwide and operates in more than 450 cities in over 50 countries. With 2006 revenue of over USD2 billion, the company provides comprehensive integrated real estate and investment management expertise on a local, regional and global level to owner, occupier and investor clients. Jones Lang LaSalle is an industry leader in property and corporate facility management services, with a portfolio of over 1 billion square feet worldwide. In 2006, the firm completed Capital Market sales and acquisitions, debt financing, and equity placements on assets and portfolios valued at USD 70.9 billion. LaSalle Investment Management, the company's investment management business, is one of the world's largest and most diverse real estate money management firms, with approximately USD44.3 billion of assets under management.

In India, the Jones Lang LaSalle Meghraj geographic footprint covers ten cities of Delhi, Mumbai, Bangalore, Pune, Chennai, Hyderabad Kolkata, Kochi, Chandigarh & Coimbatore. With a staff strength of over 2800 employees and deep geographic coverage, this is the premiere and largest real estate services company in India. Jones Lang LaSalle Meghraj has been successfully providing quality advice on services such as research, consultancy, transactions, project and development services, integrated facility management, property management, capital markets, residential, hotels and retail advisory to investors, local corporates and multi-national companies since 1995.

Source: http://www.indianrealestateforum.com/real-estate-updates/t-jll-meghraj-identifies-india-50-the-emerging-cities-for-retail-sector-1318.html

Millionaire club expands to 1,00,000 - World Wealth Report

2007-06-28T20:37:00.000-07:00

India has added over 17,000-dollar-millionaires in 2006, recording the highest growth in high net worth individuals (HNIs) after Singapore. At the end of the year, the number of millionaires in India rose to 1,00,000 from 83,000 in the previous year.

This comes in the back of a record 8.8% real growth in gross domestic product, second only to China. Also, there has been a sharp increase in the asset values with the Sensex being among the best performing in emerging markets. According to the 11th annual world wealth report brought out by Capgemini and Merrill Lynch, Singapore, India, Indonesia and Russia witnessed the highest growth in HNI populations. The report is not fully indicative of the wealth among Indians.

The net worth taken into account here is the investment in financial assets, which excludes self-occupied housing, but includes real estate investments. It also excludes jewellery and art. “India has been one of the fastest wealth creators. The report reflects the increase in wealth among Indians,” said Pradeep Dokania, MD, global private client, DSP Merrill Lynch.

In 2006, investors increased their allocations to real estate, capitalising on the success of commercial real estate and real estate investment trusts (REITs). As the global real estate market has increased transparency and improved liquidity, it has become a less risky investment. Global direct real-estate transaction volumes reached $682 billion in 2006, up 38% from 2005.

Global real estate investment (including direct real estate and REITs) totalled $900 billion in 2006 — the strongest-ever performance by global real estate markets. In 2006, millionaires across the world shifted more money into real estate, at times liquidating some of their alternative investments to fund these real estate opportunities. The trend was most dramatic in Asia-Pacific where a full 29% of their assets were in real estate compared to 16% a year earlier.

The annual report studies arrive at the number of the rich ($1m plus) which are referred to as HNIs and the super rich or ultra-HNI ($30m plus) and it tracks how they invest their money. A study of past reports show the rich are investing more overseas, driven by an expanded awareness of international development, better portfolio performance and risk mitigation. Historically, North Americans have held the largest portion of their assets in domestic markets.

For example, in 2005, 78% of HNI assets were held domestically. In 2006, the number dropped to 73%, as wealthy North Americans increased their allocations to overseas investments in Europe, Asia-Pacific and Latin America. In 2006, as in previous years, North Americans held the most unbalanced portfolios, with 41% allocated to equities, a slight decrease from 43% in 2005. In 2006, North Americans reduced their allocations to alternative investments and shifted to real estate. Following their shortage in office space, North Americans increased their real estate allocations from 12% to 20% of their portfolios.

HNIs in Asia-Pacific nearly doubled their allocations to real estate, from 16% in 2005 to 29% in 2006. Consistent investor behaviour, often seen in emerging economies, HNIs in Asia-Pacific tended to invest in tangible assets. The number of dollar millionaires may have gone up significantly in the current year considering the sharp appreciation in the value of the rupee. In 2006, the rupee had appreciated marginally from 45.19 to 41.12 against the dollar. Since then the rupee has firmed up even more and is currently trading at 40.83.

Source: http://economictimes.indiatimes.com/News/Economy/Indicators/Millionaire_club_expands_to_100000/articleshow/2158958.cms

Bombay Dyeing now aiming at Real Estate Industry

2007-06-27T01:26:00.001-07:00

Bombay Dyeing is one of the few companies that own prime land of 60 acres in the heart of Mumbai.

Analysts have however been uncertain about when the value is going to be unlocked. Ness Wadia- Joint MD, Bombay Dyeing & Manufacturing says that the company is in it for the long term and that development is on track for both his gold mines Dadar and Worli.

"In Dadar it is a mid to upper segment development and in Worli it is luxury. In Dadar, construction is well under way and the residential building is almost complete. In Worli, also we have started right next to hard rock cafe. You'll see shopping complexes, commercial and office development and service apartments. The construction will happen over the next 3-5 years," - Ness Wadia.

Bombay Dyeing has also recently entered for the first time the middle-income segment of real estate development.

"We just got awarded a middle income re-housing project and we are starting on that. We are looking at joint ventures in that space," said Ness Wadia.

Manufacturing

Known more for real estate and less for its 180 year old business, textiles is about to change. Bombay Dyeing has finally shifted its manufacturing out of the city. And the company is revamping its brand and ramping up retail presence.

"On the manufacturing front we are looking at joint ventures with European players, so partly we will be outsourcing and we will also be selling our brand through them. On the retail side, we will be opening about 60 stores in the next two years and the investment will be about 50-60 crores," said Ness Wadia.

Bombay Dyeing still seems to have a lot of value unlocking to do on both the real estate and textile fronts. For both businesses the company seems to be focusing on the higher end of the market. One thing is for sure, the vast amount of prime land in possession of the Wadias gives them an edge over many others.

So it is not unfair to say that 'Real Estate Industry' is the next focus of each businessmen of the country.

Source: Indian Real Estate Forum

Serviced Apartments in NCR - The National Capital Region

2007-06-22T01:21:00.000-07:00

Commonwealth games has become the current reason for much awaited dream of delhites to come true. All major real estate developers based in nothern India, like DLF, Parsvnath, Ansals, TDI and Vatika are lining up serviced apartment projects in the national capital region (NCR).

According to sources in the Delhi Development Authority (DDA), expressions of interests (EoIs) for developing over 25 serviced apartment projects in various parts of the capital have already been received. An official in the Noida Authority says close to 40 projects have already been cleared in Noida and Greater Noida.

Similarly, in Haryana, HSIIDC estimates about 50 such projects in Gurgaon, Manesar and Sonepat. In fact, the corporation is even playing a pro-active role to incentivise developments of serviced apartments, and had recently announced sale of plots in Sonepat for building serviced apartments. “Existing as well as the under construction hotels will not be able to cater to the tourist rush that the Commonwealth games will generate.

This will emerge as a great business opportunity for developers of such projects, not only in Delhi but also in the neighbouring states. Moreover, in case of Haryana, the presence of so many multi-national companies will be an added demand driver,” an HSIIDC official said.

With so much of business and long tourism activities going on in India, there is sustainable long-term demand for good service apartments- says Parsvnath Developers (PDL) chairman Pradeep Jain. At present, the company develops serviced apartments as part of its hospitality business, but is now planning exclusive serviced apartment projects in major cities and townships. “We are already in a process of executing our first Serviced Apartment complex in Bhiwadi,” said Mr Jain.

According to TDI managing director Kamal Taneja, in the next 2-3 years, serviced apartments will emerge as a potential alternative to even high end hotels. “It’s a global phenomenon. Travellers accross the world, whether for business or pleasure, have started preferring serviced apartments over hotels.

A serviced apartment offers the characteristics and feel of a home while providing recreational facilities that exist in hotels,” he said. The company plans to develop serviced apartment projects mainly in tier II and III cities in Haryana.

Worldwide, the concept of serviced apartments was introduced in 1950s in the United States, with the extended-stay hotels for long staying travellers. Till now, in India, most serviced apartment projects have been undertaken by major hospitality chains.

Taj hotels has serviced apartments in Mumbai and plans to expand it to other metropolitan cities. Similarly, Oakwood is developing properties in Pune, Bangalore, Mumbai and Chennai. Starwood Hotels and Resorts has signed up with Gurgaon-based real estate company Vatika Group for building serviced apartments in and around Gurgaon.

Now, with more and more real estate developers joining the bandwagon, the sector is likely to witness major action.

Source: The Economic Times

India's 1st Real Estate TV Channel Launch in July

2007-06-14T22:49:00.000-07:00

India’s first 24-hour premium TV Channel dedicated completely to real estate---is all set to be launched next month. This channel promoter is Alliance Group - a Rs.4400-crore enterprise.

According to the promoters, the pan-India English-language channel was being put together under the advice and guidance of well-known media personality, Sashi Kumar, by a team of seasoned media professionals led by COO, T.K. Vibhaker. As the channel involving an investment outlay of Rs 100 crore will exclusively offer real estate related programmes, its launch will mark yet another first by the IT Capital of India.

It will provide comprehensive, latest and authentic updates on all aspects of real estate, including infrastructure, to viewers all over the country, the south and south-east Asian region and Gulf states where there is a strong NRI presence, Mr Namburu said.

With news bureaus and state-of-the-art studios in Mumbai, Delhi-NCR, Chennai, Bangalore, Hyderabad and Kolkata, a wide information-gathering network across India, and a dedicated research and analysis facility in Delhi, Real Estate TV will be the one-stop shop for anything and everything connected with this industry and the large number of other industries connected to it, says Mr Sashi Kumar.

By continually tracking and highlighting the significant emerging trends in this important sector, the niche channel, he said, will become the most authoritative and sought-after source for real estate information and analysis.

COO T.K. Vibhaker expressed confidence that the channel would break even in a relatively short time as there were as many as 261 industries directly connected to the real estate industry, which itself had now emerged as the largest advertiser. The free-to-air channel will be available on cable as well as the DTH platforms across the country.

Its main studio in Bangalore, he said, was being manned by hand-picked media professionals with proven track-record as were its studios in other metros of the country. Real Estate TV will put out 16 top of the hour ‘Realty Check’ programmes live in English every day.

Most of the channel’s key programmes have been innovatively designed to showcase Indian real estate as never before and provide unique infotainment of a high order. The programming is geared to meet the expectations and tastes of the players in the sector as well as the common householder.

Ajit Bhaskaran, a media professional with a 15-year track record, is the Creative Head of Real Estate TV. Pankaj Saxena, a TV producer and programmer with over 20 years’ experience, is Head - Programming & Production. M. K. Shankar, a senior journalist with over 25 years of international experience is the channel’s News Editor.

Great going :)

Source: indiaprwire.com

Largest real estate consultancy

2007-06-12T21:33:00.000-07:00

Leading real estate consultancies Jones Lang LaSalle (JLL) and Trammell Crow Meghraj (TCM) announced their merger yesterday forming the largest real estate services firm in the country under the name, Jones Lang LaSalle Meghraj.

While the market share of the new entity will be 35% (taking into account all property consultants), it would be 50% of the international property consultants sector.

The top official at JLL Meghraj says that the new entity will offer some new services too like a hotel division, new capital markets as well as asset and shopping center management.

TCM is already powerful in the domestic market and JLL posses its international expertise in the industry, the new merged entity is surely going to have dominance in the Indian real estate sector. Actually a good step especially for Indian real estate

FDI groups dominent in Indian Real Estate

2007-06-06T03:45:00.000-07:00

'Foreign Direct Investments ' have performed a dominent role in Indian real estate market, many Groups from different corners of the world who have already played an important role in shaping real estate discussions in India. Let's check these groups as they are part of Indian Realty now.

Following are the FDI groups active in Indian real estate sector.

1.Emaar MGF has brought in the largest FDI of over US$1 billion in the Indian real estate sector. In addition, the company is focusing on pan-India projects in residential, commercial, infrastructure and hospitality sectors in integrated master plans and SEZ

2.Keppel land , a singapore based group has aleady signed JV agreement with M/S Purvankara group, banglore based group for residential and commercial project

3.DSP Merrill Lynch, Barclays Bank and Mauritius-based TH Holdings and groups have do far invested Rs.11, 460 crore in the first half of this The collective investment that got parked in real estate and construction sector was to the tune of Rs. 1,252.79 crore

4.AEA Holdings is searching for the efficient partners to expand its business horizons and wants to grab the deals and opportunities aggressively and quickly, says industry source.

6.RREEF, the real-estate investment arm of Deutsche Asset Management, is planning to invest over $200 million in a joint venture with realty major Emaar-MGF

8.Capital Land, Hong kong based group is also planning to invest in India.

7.Royal RaJ Indian, A candian group has laready has aleady signed JV agreement for residential and commercial

9.Morgan Stanley Real Estate Fund is known to have made the largest private equity transaction in property market till date and invested $125million Mumbai based Oberoi Constructions;.

10. Mauritius-based IREO Investment Holding grabs the honor of making the highest FDI in the secto With the whopping investment of Rs. 321.70 crore.The company also has plans for related projects and heavier inflows.
11.Emaar MGF Land Private Limited is India’s pioneering joint venture in real estate with projects being implemented on a pan-India basis across top 30 cities.

12.DSP Merrill Lynch Limited, India’s leading investment bank and broking firm that pump in more than Rs 2,230 crore between April 2006 and October 2006.

13.Barclays Bank made an investment totaling Rs 1,711.23 crore pitching itself to the second investor slot.

14.Mauritius-based TH Holdings has invested of Rs.1697.35 crore.

15.French firm Carrefour has been showing interest in entering Indian retail industry

16.world’s largest financial services group, Citi, which has sewed up property deals of around $400 million in the past few weeks. This prestigious group is also looking forward to enter into a joint venture with HDFC and US based Portman Holdings.

17.Citigroup is all set to enter in the red hot property market through Citigroup Property Investors (CPI) India;

18.A Mauritus based company financed by a fund in Cayman Islands, was recently in the news to have raised $500 million through an India-dedicated fund. The conglomerate is likely to raise more money to invest in realty.

19.Hong Kong based AEA Holdings announced that it plans to invest more than $2 billion over the coming years in Indian realty projects.

20.Walt Disney a entertainment major, is investing Rs 141-crore

21.Italian firm Rino Greggio’s plan to set up a joint venture for selling silverware and UK-based Alpha Airport Group’s proposal to establish a wholly-owned subsidiary for setting up duty-free shops, flight kitchens and food and beverage outlets at airports in the country at an investment of Rs 22.5 crore was also approvedother allied products.

22.A proposal by the Netherlands-based Diageo Highlands Holdings to set up a joint venture has received clearance as well from Indian Government.

23.Solitaire Capital Investments Pte and Solitaire Ventures Pte, a Singapore-based group are investing Rs 511-crore of in India’s booming real estate sector.

24.Mauritius-based power producer Bijlee Bharat Holdings’ plan to set up a subsidiary in India with an initial investment of Rs 308 crore,

25.NSK Limited of Japan which has committed Rs 41.25 crore to set up a new JV in Chennai

26.Spain-based Lladro Commercials S.A. will pump in Rs 5.85 crore for increasing its equity in Spa Agencies (India) from 26 per cent to 49 per cent

27.Sri Lanka-based Damro Exports Pvt Ltd’s proposal to sell furniture under the single brand name ‘DAMRO’ and Italian firm Rino Greggio’s plan to set up a joint venture

28.UK-based Alpha Airport Group’s proposal to establish a wholly-owned subsidiary for setting up duty-free shops, flight kitchens and food and beverage outlets at airports in the country at an investment of Rs 22.5 crore was also approved

29.Hong Kong based AEA Holdings announced that it plans to invest more than $2 billion over the coming years in Indian realty projects.

great investments is'nt so :)

Southern retail market set for growth

2007-06-05T01:08:00.000-07:00

The southern Indian states of Karnataka, Tamil Nadu and Andhra Pradesh, with their relatively lower real estate costs, peaceful social environment and stable governments have helped organised retailers expand their businesses faster in the region.

The retail market in South India was valued at Rs 2,62,930 crore at 2006 prices.

Only 4.6 per cent of the Indian retail market was organised in 2006 and only 0.8 per cent of the Rs 743,900 crore food and grocery (F&G) retail in India was organised.

About 1.4 per cent and 1.3 per cent of the retail segment was organised in Andhra Pradesh and Karnataka respectively.

According to 'The South India Retail And Realty Report: 2015 and Beyond' brought out by international real estate consultants Cushman & Wakefield for 'Images Retail', quality real estate space is a key concern of the retail sector in India.

With the changes in the regulatory environment, the opening up of the market and the growth of private equity, and the rising demand for high-end residential and commercial premises is gradually transforming the traditional real estate sector into a more transparent and accessible market.

The same held true for real estate sector in southern India.

In the south, capital values saw a sharp rise in the rates throughout the review period across all centres.

The rates were the highest in Bangalore at Rs 17,083 per square feet, with Hyderabad second with Rs 16,388 per square feet while Chennai stood third with Rs 11,014 per square feet.

Bangalore indicated the highest retail rentals, followed closely by Hyderabad, with Chennai with the lowest retail rental rates of the three.

Cushman & Wakefield said in its report that by 2007-08, an estimated 100 million square feet of quality shopping centre space was expected to generate retail sales of over Rs 50,000 crore ($11 billion).

In tandem with the growth in organised retail, the present two square feet-per capita retailing space would rise 15-20 per cent by 2010.

By 2011 roughly 300 million square feet of additional retail space was likely to be generated. At present, there were about 200 operational malls and this number was expected to rise to 600 by 2010-11.

Of the new malls coming up, about 40 per cent would be located in the country's smaller towns and cities.

The supply of shopping centre space in South India was at 14.1 million square feet in 2006-07, accounting for an increase of about five million square feet space in 2004.

On the basis of the projects announced, by 2007-end, the north zone would account for 41 per cent of the shopping space in India, followed by the west zone, accounting for 35 per cent share, with the South enjoying 16.8 per cent share and eastern India the remaining 7 per cent.

Reference: Business Standard

A Race of Malls

2007-05-25T01:27:00.000-07:00

A report on Real estate trends by Merrill Lynch said that the number of malls in Mumbai, Bangalore, New Delhi, Hyderabad and Pune was expected to grow to about 250 by 2010 as against 40 now. In terms of total area, there was 12.40 million square feet (mnsqft) of mall space available in these cities, the report said, quoting a survey by Knight Frank India.

As the competition in the market is intense, builders are going out of their way to be different. Specialized malls have become the order of the day. Gurgaon, on the suburbs of New Delhi will soon have an auto mall, while Bangalore is about to get an exclusive furniture mall. Gurgaon is set to get the biggest mall of the world — a large US$ 89.78 sq ft sprawling property that is being developed by DLF Universal to be known as the Mall of India.

Retail cum office complex concept in India

2007-05-18T04:26:00.000-07:00

The retail cum office complex concept is relatively new in India but is fast gaining in popularity because of the retail boom along with the increasing demand for quality office spaces across cities. The concept offers right mix of style, entertainment, shopping as well as a relaxed environment. Other than to regular shoppers, it also serves as a boon for people working in the complex as their retails needs are met without actually stepping out or driving to a mall.

Globally, too, the concept of mixed development of office complexes and retail space is popular. London’s Canary Wharf, for instance, which is home to some of UK’s most prominent offices, has malls with premium brands jostling for space located within the same buildings.

No wonder then that a number of Indian players have invested in such mixed use projects in various cities. Taneja Developers and Infrastructure (TDI) has two office cum retail projects lined up in the capital.TDI Centre,located in Jasola, has its shopping space on the ground and first floor and office premises on the upper level.

TDI Southern Park, located in south Delhi at Saket District Centre is the second project, which is operational and also features an independent central leisure area. Top retail names such as Pepe, Reebok, Costa Coffee, Candico, Cantabil, Archies, VIP, Lee Cooper and Numero Uno are some of the major brands that have already signed up with them.

Although this is new concept in India, it has started in metro cities and will soon move to tier-II & III cities as well. Taneja Developers and Infrastructure (TDI) plans to develop such complexes in cities like Sonepat, Panipat, Agra, Mohali, Meerut, Moradabad, Mohali, Chandigarh, Indore also in the near future. These complexes provide an impressive array of offices. Moreover, with the IT boom and BPO culture seeping into the country, there is a trend of working in shifts. With these kinds of complexes, people working in shifts will have the flexibility of shopping till late within the office premises or grabbing a quick bite anytime at any of the coffee shops or food outlets.

source: The Economic Times