India Real Estate: Funds, Developement, IT Park

Weekly news updates on trends in the Indian real estate market

The Indian property market is on a roll and no one wants to miss the bandwagon. The latest to join the fray are the Hindujas. Indian real estate players are tying up with global firms and the government is working on ammendments and processes to control black money movement and large volumes of FDI. Real estate mutual funds are on the anvil. Whether they actually meet the market expectations remains to be seen.

- Chillibreeze Business Research Team

Asiaa Property Development Ltd, a Hinduja Group company is entering the residential and commercial real estate market in India by developing 4000 acres of land held by its listed units. The company is also looking for equity partnerships in the venture.

According to a report by Grant Thornton India, private-equity investment in real estate has increased from a negligible amount in 2005 to about $1.1 billion in 2006, and $680 million between January and April 2007. Merrill Lynch says that the Indian realty sector is forecasted to grow to $90 billion (Rs3.7 trillion) by 2015 from $12 billion in 2005.

June1,2007
Livemint.com

Valuation blues for realty funds

Real Estate Mutual Funds (REMFs) will be a reality soon if the SEBI committee can finalise the guidelines for the same.

Experts are of the opinion that lack of uniform valuation and disclosure standards can be deterring factors for such a scheme in India. However, the funds are expected to bring more transparency and liquidity into the real estate market.

May31,2007
Business Standard

DLF to invest Rs 3,500 cr for acquiring land

DLF plans to invest Rs 3,500 crore for land acquisition and development rights in 60 major Indian cities.

DLF’s IPO offer opens on June 11. The company is offering 17.5 crore equity shares of Rs 2 each through 100 per cent book building process and has fixed the price band at Rs 500-550 per equity shares. The issue constitutes 10.26 per cent of the fully diluted post-issue capital of DLF. The promoters stake in the company would come down to over 87 per cent from the present about 97 per cent.

DLF has tied up with Hilton group, Dubai based developers Nakheel and Laing O'Rourke for its foray into hotel, townships and infrastructure sectors respectively.

May30,2007
PTI via Economic Times

Real estate watchdog after talks with developers

The Government of India plans to consult developers and housing banks prior to any decision on a regulatory authority for real estate sector in India. A national conference is being organized by the Ministry of Housing and Poverty Alleviation to deliberate on the issues.

May 29,2007
Financial Express

Beware of Benami property

The government is planning to amend the Benami Transaction (Prohibition) Act, 1988 to enable it to acquire and auction benami property. The government is of the view that this would help in driving out black money, improve government revenues and address lacunae in the existing law.

May 29,2007
Economic Times

UAE Realtor to develop IT park in Chennai

ETA Star is planning to invest USD 923 million to build an info-tech park in Chennai. The IT park is part of a 350 acre IT township project, in which residential components will be spread across 200 acres. The group has investments to the tune of Dh16.44 billion in India.

May 29,2007
Economic Times

Unitech to invest Rs 25,000 cr for developing property

Unitech Ltd, India's largest listed realty firm, plans to invest Rs 25,000 crore over the next four years for the development of commercial, retail, hospitality and residential properties. Sixty percent of investments would be in retail and hospitality construction, twenty percent for offices and another forty percent for residential properties. Hotels are already in construction in cities where Unitech has presence.

May28, 2007
PTI via Economic Times

Construction to build $120 bn industry by 2010

According to a study conducted by ASSOCHAM, India’s construction industry is expected to be a $120 billion industry by 2010. The sector's contribution to the country's GDP is expected to increase to four percent and manpower demand would increase to 90 million. As of now, the industry employs 30 million people.

The sector, which currently employs about 30 million people, would provide immense direct and indirect job opportunities requiring both skilled and unskilled workforce within the same period, according

May27, 2007
IANS via Economic Times