Will HDIL Compete with Mukesh Ambani ?

We have reliably learnt from insiders on Dalal Street that Wadhawan group promoted Housing Development and Infrastructure (HDIL) has already received an in-principle approval from the state government for the special economic zone (SEZ) project. After Bandra-Kurla complex, the Maharashtra government is planning to develop the Kanjurmarg and Vasai-Virar regions as the next business districts, reports suggest.

This will be the second-largest special economic zone (SEZ) around Mumbai after Mukesh Ambani’s 25,000-acre development, which spreads from Navi Mumbai to Alibaug.

Holiday Inn - Bangalore International Airport

Brigade Enterprises has informed us that Brigade Hospitality Services, a 100% subsidiary of the company a Bangalore-based real estate company focusing on the development of residential, commercial and hospitality properties has signed a management contract with Inter Continental Hotels Group for a new Holiday Inn Hotel called Holiday Inn Bangalore International Airport. Earlier, Brigade Hospitality Services Pvt Ltd entered into a letter of intent on 27 April 2007 with IHG to manage a proposed hotel of approximately 250 keys to be developed near the Devanahalli International Airport at Bangalore.

Holiday Inn Bangalore International Airport will be developed by Brigade Enterprises Ltd and will be managed by IHG. Well connected to the new international airport. Holiday Inn Bangalore International Airport will be laced with around 250 rooms along with restaurants, swimming pool and a gymnasium. The Holiday Inn Bangalore International Airport will be slated to accept bookings by the beginning of year 2010.

DLF Akruti Pune bags BAI Universal Award 2007

DLF Akruti Info Parks (Pune), a joint venture SEZ project between Akruti City and DLF has bagged the prestigious Builders' Association of India [BAI] Universal Award 2007 for best equipped and mechanized site. In the present era, machines and mechanized part of the constructions run upto 35% of the entire project cost.

Since the last decade, the BAI has been instrumental in initiating awards for 'Well Built Structure' under various categories. The key objective of these awards is to create an awareness amongst construction professionals on the importance of quality, time and economy, thus helping industry in upgrading and innovating from current standards.

Akruti Developers Projects in Mumbai

We have an exclusive coverage about the ongoing and forthcoming projects from Akruti Constructions, a Mumbai based realty developer.
The expected realization from the above projects is as tabulated below [Rs / Sft]
Worli-Tardeo 30000-45000
Bandra & BKC 20000-30000
Andheri 12000-20000
Jogeshwari 8000-14000
Sion-Matunga 12000-18000

Other projects in Mumbai is as shown in the Map below.

Omaxe to Develop Kokapet, Hyderabad

North India's realty company Omaxe has won a bid to foray into the southern market starting at Hyderabad. The bid of Eden Buildcon [Omaxr's subsidiary] to develop land at Kokapet area in Hyderabad for residential and commercial purposes has been accepted by the Hyderabad Urban Development Authority (HUDA).

Omaxe said the project is expected to cost between Rs 1,600 crore and Rs 1800 crore. The company received the project for 25 acres of land in Hyderabad through an open auction-cum-sealed tender basis.

Realtor Moves to Jammu - Parsvnath

Parsvnath Developers, India's leading real estate company, is all set to come up with its maiden project in Jammu. The company has announced the launch of residential project, Parsvnath Passion duly approved by Jammu development authority (JDA) in the region with an approximate realization value of over Rs 100 crore in next three years including this financial year.

Parsvnath Passion is the first integrated group housing project being developed in Jammu by a national real estate player, situated over 11 acres of lush greens having a saleable area of over 7 lakh sq.ft, the project has 75 % of the total property area as open space for comfort and ease of its residents.

DLF denies Pantaloon space in South Point Mall

Pantaloon Retail India Ltd which is facing tremendous pressure from Dalal Street over slow growth in retail space, has pulled in India's largest realty company DLF Retail over possession of property at Gurgaon's South Point Mall.

Pantaloon Retail India Ltd had booked 110,000 sft space in South Point Mall 3 years ago and an agreement was also signed. In the interim, real estate prices sky rocketed and DLF known for cheating investors decided not to allow Pantaloon Retail occupy the space in the mall. Pantaloon Retail moved to the High Court of Delhi and has filed an injunction against DLF.

In the past 3 years, retail rentals are up by more than 70% and we shall wait to see if just will prevail or K.P.Singh's corrupt practices will rule.

Funding the Maha + Navi Mumbai SEZ

As on today only one thing is certain about the funding for Reliance Maha and Navi Mumbai SEZ. Jai Corp a manufacturing company promoted by Anand Jain's family will have a 10% stake in various segments of the SEZ. Here is what we have got to know.

The total cost of SEZs which includes land Acquisition and Development is estimated at Rs 22,800 crore [$5.5 Billion]. Jai Corp will invest Rs 2,280 crore.

Jai Corp is eligible to bid for International Airport, Metro Rail and Trans Harbour Sea Link. Developers for these projects is not yet finalized. Expansion of Rewas Port and establishment of a power plant to fulfill the needs of Mukesh's dream city :-) . A debt equity of 2:1 is assumed for the project.

When completed the Navi Mumbai and Maha Mumbai SEZ together are likely to be valued in Bear Case, Base Case and Bull case as follows - [$22.5Billion] or [$27 Billion] or [$29.5Billion] Stake holders in the project will get a fixed income of 10% of their investment as Income from asset management every year. This is just the valuation for SEZs excluding Airport, Power Plants, Ports etc.

Nitesh Estates + Citi to Scale new Highs

Bangalore based YoungTurk, Nitesh Shetty, Promoter of Nitesh Estates has roped in Citigroup for an ambitious $300 million retail roll out. Nitesh Estate will mark its presence with world class structures in the cities of Chennai, Kochi, Thiruvananthpuram and ofcourse Bangalore.

In Bangalore, the company is building a 800,000 sft mall in Indiranagar and 200,000 sft of serviced apartments. This project is just off the 50+ International retailers landmark @ Indiranagar just off the 100 ft road. The company has roped in Seattle,WA based architects for the design of the mall.

The JV company is also developing a 350,000 sft mall on Boat Club road in Chennai. The projects in Thiruvananthpuram and Kochi will be around 600,000 sft and 300,000 sft respectively.

Parsvnath's Gem and Jewelley, Jaipur SEZ

Parsvnath Developers has told us that they have signed a Memorandum of Understanding (MoU) by the company's subsidiary viz. Parsvnath SEZ Ltd(PSL), with Government of Rajasthan to develop 112 acres SEZ in Jaipur. The SEZ envisage an investment of Rs 1400 crore and will focus on giving a further boost to gems and jewellery industry.

The MoU entails that the State will provide necessary support for infrastructure facilities in SEZ. The agreement will also ensure smooth implementation towards the development of the SEZ by providing single Window Service through the Bureau of Investment Promotion (BIP). It will also help PSL to avail various incentives and facilities under various schemes announced by the State / Central Government, which will ensure that its development remains on the fast track.

Navi-Maha Mumbai SEZ - Maps

Mumbai, the financial hub of India is located that it can neither grow North nor South, hence the development started moving towards east[Navi Mumbai] and then Mukesh Ambani wants to extend it south-east so that he can still touch base with Mumbai.Mukesh Ambani bought controlling stake in short sighted Nikhil Gandhi's Navi Mumbai SEZ as well in his company Sea King Infrastructure Ltd (SKIL). Reliance also wants to extent the same and here is the map of Navi Mumbai SEZ.Unsatisfied with the tiny area of Navi Mumbai and scaling global ambitions of Mukesh and Anand Jain, made them propose the Reliance Maha Mumbai SEZ as shown below.
According to insiders, Reliance Maha Mumbai SEZ will challenge the Chinese supremacy of Shenzhen and HongKong. Connecting to the financial districts of Mumbai [Dalal Street] from SEZ is so important that here is the proposed SEA Link which Reliance wants to build. In our next issue [December-8th] we will cover the investments that are going into Reliance SEZ. Questions, Comments and Critics are most welcome.

Omaxe Multi-Product SEZ- Alwar Rajasthan

Omaxe has entered into memorandum of understanding with State of Rajasthan for facilitating the setting up of multi product special economic zone at District Alwar Rajasthan.

Further, the company has promoted a wholly owned subsidiary by the name of Omaxe Rajasthan SEZ Developers by making an investment of Rs 5,00,000. The proposed multi product special economic zone (SEZ) project is likely to be built in 5000 hectares area and is to be executed within a period of 5 years.

Mumbai's Bandra Kurla Property Prices Sky Rocket

Our analyst in Mumbai just told me that a Record deal has been struck in Mumbai. Wadhwa Builders mopped up plot number C-70 in Bandra Kurla Complex at a whopping Rs 46,806 / sft. They will develop a commercial complex there.

Mukesh Ambani controlled Reliance Industries mopped up 30,550 sq meters plot in BKC for Rs 918 crore for a commercial center and a car park.

Bangalore + Chennai + Hyderabad Real Estate Review

Exclusive survey of South Indian Real Estate Market. What is common in the Tri-Cities of South India is , IT/ ITeS is still the key demand driver in these markets, though Retailing is fast catching up.

• supply across asset classes gets more visible, while most of this is pre-leased/sold; risks remain.
• residential prices are holding /stabilized after some correction, while rentals are firm/increasing; land prices spiraling; Owning a Bungalow is now a dream for a middle class Indian.
• Infrastructure development is slow compared to Realty

Bangalore Real Estate:
Strong demand for IT space has led to 4-5% increase in rentals (Rs.42-45/sq ft); residential sale prices (Rs 3500/sqft) are holding with yields of 3-4%, relatively better than 1-2% in North. Potential supply risks, however, remain. We see good progress on infrastructure projects; new airport (Apr'08), peripheral road network (large parts complete) to enhance value ahead.

Chennai's Realty Reality:
While Chennai is a growing IT destination, Sriperumbudur near Chennai is an emerging manufacturing hub. This has led to land prices spiraling and greater thrust on infrastructure. IT space rentals (Rs.38-42/sq ft) are on the rise; residential prices are also firm at Rs 3600/sqft. Supply risks are relatively lower vs. other southern markets, barring some pockets.

Hyderbad Emerging IT Hub:
Madhapur (Hi-Tech City) and Gachibowli are the IT CBD of Hyderabad. Land availability/clear titles and spiraling land prices are key challenges. Potential supply risks have kept IT space rentals (Rs.36- 40/sqft) in-check; residential is a relatively (Rs 4000/sq ft) better market. Progress on road/airport projects and the pace of construction is encouraging.

Puravankara sends DLF Packing in Hydrabad Deal

Puravankara Projects has won the tender bid from APIIC (Andhra Pradesh Industrial Infrastructure Corporation) for development of massive project at the prestigious Hi-tech City, Hyderabad, involving an investment of over Rs 3,500 crore. High-Tech City is the new IT destination for many in the world and the area has developed rapidly with world class infrastructure facilities.

Purvankara punched out DLF in the race to bag this piece of land. Purva is at a definite advantage now because their is no fixed floor space index for this land and the vicinity areas paving way for real sky scrappers.

DLF Emporio Luxury Mall in Delhi

Luxury and premium retailing is a taste and only the elite few in India really have to background and passion to do it. Vijay Mallya from Bangalore was the first and now K.P.Singh of DLF is following in his footsteps unveiling DLF Emporio, the biggest Luxury mall in India. [Other smaller destinations include Taj in Mumbai, Khan Market Delhi etc] The mall is 350,000 sft in size.

The mall will open for business on March-1st next year. Armani, Versace, Hugo Boss, Louis Vuitton, D&G etc will all be available under one roof. Ms Kajal Aijaz of DLF Luxury Mall said,

The mall would reflect retro Indian opulence. From architecture and interior to ambience and tenancy mix, we have tried to retain the stamp of Indian luxury. We also have 34 Indian designers for the first time under one roof. Indians are well travelled, so we have to offer the best in Emporia.

30% of DLF Emporio would be occupied by men's exclusive brands. At least 12 international watch brands would occupy 18,000 sft. The luxury retail market is expected to grow 27-30% and Bangalore, Delhi and Mumbai are the hottest cities for the same. Ms. Aijaz also wants folks from Bangalore an Mumbai to travel to Delhi to shop at Emporia :-)

Bangalore + Chennai + Hyderabad - High Rental growth

Bangalore, Chennai and Hyderabad are witnessing high rental growths according to a study by Cushman and Wakefield [Cushman's survey is mostly for upscale properties in elite areas].

In Bangalore, Commercial Street and Brigade Road vicinity continue to be prime retail locations. Kormangala and Indiranagar are also witnessing small brand retail operations.

In Chennai, Khader Nawaz Khan road has witnessed 100% jump in retail rentals YoY. This region has presence of retail brands such as Benetton, B&O, Wills Lifestyle, Atmosphere, Movenpick etc.

In Hyderabad, Banjara Hills and Jubilee Hills are preferred by new-age retailers. Demand far supersedes supply in these areas and hence Begumpet is witnessing hectic activity with 100% rise in rentals YoY.

Retail Space of Big retailers in India

We have obtained an an exclusive chart from OctaMedia India Retail Research on the number of stores and area the big retailers of India occupy. At the end of March-2007, Pantaloon Retail was the leader with 5 mn sft under operations and plans to multiply by 6 fold to 30 mn sft by the end of 2010.
Vishal Retail stood second followed by Shoppers Stop and Lifestyle retailer Trent. Reliance Retail details were not available but in any case it is not very significant at the end of FY2007.

DLF invites PE funds for Affordable Housing

DLF has attracted participation of private equity real estate funds in its township projects by diluting 49% equity stake at a premium, in seven residential projects to a Merrill Lynch & Co entity for a consideration of Rs 1481 crore.

The mid-income housing projects, located in Chennai, Bangalore, Kochi and Indore would get fully developed in about 7 - 8 years time frame. In a related but separate transaction, the company has also diluted 49% of its equity stake at a premium, in another middle-income housing project in Panchkula, Haryana to Brahma Investments, for a consideration of Rs 194 crore.

DLF began trading as SENSEX stock from today, replacing Dr. Reddy's Labs.

A V Birla Retail + Parsvnath in Talks

Aditya Birla's Retail Venture is in talks with Delhi based real Estate Developer - Parsvnath Developers to setup a Hypermart and a super mart in Delhi and NCR.

The hypermarket is expected to come up in the Sreelampur Mall and will be sperad on 100,000 sft space. A V Birla retail has launched its first hypermarket in Mysore, near the silicon valley of India. One of Parsvnath's metro malls is likely to house a supermarket for Aditya Birla Retail.

Parsvnath Developers is constructing 35 malls across India and 20 metro malls. The metro malls are all located on land adjacent to metro stations in Delhi. Retail India is hungry for real estate space and has evolved a new model of retailing for Land Lords in upscale locations of Tier-I cities.

Parsvnath SEZ MoU with Madhya Pradesh Government

Parsvnath SEZ (PSL), a subsidiary of Parsvnath Developers has signed a MoU with Government of Madhya Pradesh to provide facilities and incentives at the 76 acres SEZ being developed, by the company at Indore.

The agreement will ensure that the rules and policies of the state for providing and promoting single window clearance are made available to the SEZ, which was notified recently. This will also help PSL to avail various incentives and facilities under various schemes announced by the State / Central Government, which will ensure its development is on the fast track.

An important highlight of the MoU is that the State government will facilitate an approach road to the SEZ site as per the master plan and will provide requites like electricity and water to the SEZ on priority and PSL will start work to develop and construct the proposed built up area of 18.74 million square feet.

Unitech BUYs 1750 Acres in Vizag

Just couple of weeks ago we had covered the real estate market of Vizag. Unitech, the first real estate company that made it to the BSE SENSEX has announced that it has bought 1,750 acres of land from Andhra Government promoted APIIC for a whopping Rs 3,328 crore. This is the largest real estate deal in the country. Unitech will develop this land at an estimated cist of Rs 30,000 crore over the next 10 years.

DLF's Bangalore deal maybe scrapped as it is under investigation and may face a Nandigram like situation during land acquisition.

Biggest Housing Venture in India - Satyagriha

Satyagriha - if executed will be the largest housing venture in India. The project involves building 3,42,000 homes in 634 acres of land at a tentative cost of Rs 62,000 crore. The project is spread across 15 Indian cities. The homes will be priced between Rs 800,000 and Rs 2,500,000.

The project is being marketed and managed by Bangalore based Asiapac projects and 20 other realty developers are also involved in the same project.

Global PEs - Goldman Sachs, Warburg Pincus, AIG, Lightspeed Ventures and Barings Asia have evinced interest in being equity partners in the project according to our sources. Each of them are likely to invest $300 million.

South India's Largest Mall in Yelahanka- Bangalore

North Bengalooru is all set to get the face lift in Realty deals when the first international flight will take off in March-2008. RMZ Corp is building South India's largest mall in Yelahanka, North Bangaluru. The Mega Mall will be 1.2 Mn sft in size and will house 200 retailers and the largest number of multiplexes under one roof. Singapore based DP Architects will work on this project for RMZ.

The project is coming on a massive 12 acre plot that belonged to an old factory. Sonali Lalvani of RMZ group confirmed the same but refused to give any details on the project.

Right from Mekhri Circle to Bangalore International Airport, this will be the only mall and its a fantastic idea to build it on massive scale in the Retail Capital of India. Apart from the Yelahanka Mall, Bangalore International Airport is also expected to be a host for Big Retailers, but will only cater to Travellers :-)

Parsvnath Royal Villas - Jodhpur

Parsvnath Pride Asia, is kicking the housing revolution in India. Parsvnath Developers just a while ago announced that, the company is building Parsvnath city, a self-contained mega township spread over 110.4 acres in Jodhpur. Bookings for Parsvnath Royale Villas, limited edition, exclusively designed, independent villas which are an integral part of Parsvnath city will begin at 10:00 AM this morning.

The company is offering villas in the variant sizes of 200, 250 & 300 Sq. yards in the first phase. The independent villas have been constructed to offer scope for further expansion of the building to suit every individual's growing family requirements.

Strategically located near Basni, Sangaria and Boranada industrial area, Parsvnath city is well connected to pali road by pass & 100 feet Sangaria road. The township is self-contained with all the basic amenities for comfort within the range of accessibility. The project will be ready for occupancy in next 24 months.

Related Reading:
Parsvnath Pride Asia Megacity, Chandigarh
Parsvnath City - Indore

Vizag - Residential Real Estate Market

Our Realty Reporter was recently in Vizag, Andhra Pradesh [Visakhapatnam] and did a survey of the city's residential real estate market. Here is his report, [Property Prices per SFT. Rental is for a 2BHK Good Apartment, Semi-Furnished upto 1200 SFT in size]

• Beach Road: Rs 2300- Rs 2800 / sft. Rental is Rs 15000 to Rs 18000
• Sripuram Junction: Rs2000 - Rs 2500. Rental is Rs 10000 to 15000
• Lawson Bay: Rs2000 - Rs2300. Rental is Rs 10000 to Rs12000
• M.V.P Colony: Rs2100 to Rs 2700. Rentals is Rs 8000 to Rs 15000
• Dwarka Nagar: Rs1500 -Rs2100. Rentals are Rs 8000 to Rs12000
• Akkyapalem: Rs1200-Rs15000. Rentals are Rs5000 to Rs10,000

The retail action has picked up in Vizag and is better than expected. Waltier up-lands and Dwarkanagar command Rs 80-Rs90/SFT/Month in rents for a Ground Floor store. Srirampur Junction and Dhaba Gardens - Rs 60-70/sft/month in rent. Jagdamba and Station Road command Rs 50/sft/month in rent for retail showrooms.

Farm Land not for SEZ - Supreme Court

In a truly Landmark judgment to end the greatest Land Scam in India, the Supreme Court of India presided by Justice S B Sinha and H S Bedi ruled that "Agricultural Land should not be acquired for setting up a factory or any other corporate purpose".

They have also made it mandatory for the government to make it clear weather the land being acquired by the state is being meant for public purpose or private purpose. They made it clear that the Government's land acquisition notifications can't claim both purposes simultaneously. The order came in the case of Punjab Government and an Automobile Company.

The court also said that Agricultural land can be acquired only after an affidavit by the District Collector stating that the land being acquired is unfit for agriculture. The collector is also responsible for the compensation.

The Impact of this Judgement is likely to be felt on Reliance Haryana and Maha Mumbai SEZ. DLF's mega township and land scam in Bangalore's Bidadi Village.
Infosys SEZ plans near Bangalore. Almost all the SEZs where farm land is forcibly acquired.

Parsvnath City - Indore Booking Launched

Parsvnath Developers which successfully completed the booking of Megacity project Parsvnath Pride Asia just a while ago announced the launch of yet another iconic residential development Parsvnath City at Indore, sprawling over 200 acres, the township will offer multistory condominium, villas & plots for cosmopolitan community living.

The company will offer four categories of plots ranging from 1548 square feet to 3825 square feet in the first phase of launch. The entry point has been kept affordable to enable people staying at Indore opt for a modern lifestyle at attractive prices starting from Rs 8 lakh onwards.

The first gated mega township at Indore, Parsvnath City will provide a unique ergonomic environment to all its residents and will offer magnificent features & amenities in line with international standards. The project will have three group housings sprawling over approximately 9.5 lakh square feet that will epitomize sophisticated living. The township will also offer an exclusive mall cum multiplex cum hotel spread over approximately 5 lakh square feet, sports grounds and full-fledged fitness clubs.

The project is being constructed along the Rs 2100 crore IT / ITES special economic zone (SEZ) sprawling over 78 acres. The SEZ will have a built up processing area of 7.47 million sqare feet and will ensure 40,000 potential direct employments.

Parsvnath City will have a realisation value of approximately Rs 800 crores spread over the next three years. The project will be ready for occupancy within 3 years from the commencement of construction.

Mantri Township - Bangalore + Hyderabad + Chennai + Pune

Mantri Developers has set a Billion Dollar aggressive township development plan in Bengaluru, Chennai, Hyderabad and South Pune. This is a 5 year plan to develop aggregate space of 100 million sft.

Mr. Mantri said,

We intend to float special purpose vehicle to execute each project. We are looking at foreign direct investment in the SPV and will invite PE majors to invest in the same as and when necessary. City outskirts are witnessing exponential growth owing to improving social infrastructure. With cities getting choked, developing townships outskirts is the only way for de-congestion.

Mantri has a huge land bank in Bangalore - 1,500 acres. While in Hyderabad its 350 acres. In Pune and Chennai they have 200 acres in each city.

Citi + Carlyle + Kotak Investments in Indian Real Estate

Their is no shortage of fund to pump the Real Estate bubble in India even after the sub-prime mortgage crisis. Citigroup's Real Estate arm has confirmed investment ot $250 Million to Bangalore / Bengalooru based Developer, Nitesh Estates. Citi will get a stake in SPV floated by Nitesh Shetty to develop Luxury Hotels and Shopping Malls.

PE giant, Carlyle group is in advanced stages of negotiations to invest in Indian Real Estate companies. Carlyle is looking to BUY minority stakes in number of ventures. Carleyle's biggest investment so far in India has been in HDFC - $650 Million.

Kotak Realty Fund has picked up 11.5% stake in Pride Hotels. Pride Hotels is developing 5 star hotels in Mumbai, Goa and Hyderabad.

Our internal research team after taking to various industry sources, suggest that the Indian Real Estate market is currently $12 Billion and is expected to be $90 Billion by 2015. Part of this will also come because of the depreciating USD. Foreign Funds are willing to commit $30 Billion for Indian Real Estate.

Realtors responsible for Mall Failure in India

Shopping @ Malls is a new craze in the Indian society. But according to the a recent survey by retailers association, retailers admitted that they have not performed well in the Indian malls and has led to widespread failure of merchants at malls.

Experts and Analysts attributed the sharp rise in Real Estate prices which is compelling developers to charge high rentals. Unplanned development of malls in most cases has failed to attract "enough business" for retailers putting their bottomline under severe pressure.

Mr. Kishore Biyani, MD of Pantaloon Retail India Ltd said,

There is a defnite clash of interest between mall developers and retailers. It's a big problem in India as barring a few, most developers are charging high rentals without really creating enough business opportunity for the retailers. This is hampering the success of malls.

Mr. Hars Neotia of Ambuja Realty said,

Retail margins are not as high as they were. Besides real estate prices are also rising.. This can hamper the success of the malls unless developers and retailers plan the project well.

Mr. Biyani's Future Group runs the Central Malls across many cities in India.

Coverage on Purvankara Builders - Citi

Puravankara has a strong brand and a proven record. Citi has initiated coverage on the stock with a Buy/Medium Risk rating and a target price of Rs536, based on a 5% discount to estimated core NAV of Rs564. The discount to the stock for the company's over dependence on Bangalore (~73% of Gross NAV) and residential projects. [Citi doesn't discount DLF and Unitech though they are over dependent on Delhi NCR region, which doesn't have as much growth potential as Bangalore has]

Quality landbank of 107m sq ft, largely within the city limits of Bangalore; A direct sales model, which tends to reduce speculative activity; and in-house construction expertise. These factors should drive a 3-year EPS CAGR of 65%, positioning it as a quality midscale.

Most houses in Bangalore are sold in the range of Rs 3,000 to Rs 3,500 / sft in Bangalore. [Less than Guragon Rs 4,000 to Rs 4,500 / sft] Bangalore has 978 IT Companies employing 341,374 people. Delhi / NCR has 633 IT companies employing 282,708 folks.

Parsvnath to get Foreign Funds for SEZ

Two of Parsvnath Developers'(PDL) proposed special economic zones (SEZ) in Indore and Gurgaon have already been notified. Report suggests the company is looking to divest about 30%-40% equity stake in both the SEZ projects to financial institutions. The deal size is expected to be in excess of Rs 2,000 crore for both the SEZ projects put together.

The two notified SEZs will have a total developable area of about 17 million square feet (sq ft). In addition, the company also has three formally approved SEZs at Dehradun, Kochi and Hyderabad with total developable area of 11.70 million sq ft and seven SEZs with an in-principle approval.

Delhi-based Parsvnath Developers currently derives most of its revenue from residential and integrated township projects in Harayana and Uttar Pradesh. It has presence in 17 Indian states.

Parsvnath Developers' net profit rose 131.1% to Rs 84.46 crore on a 40.2% increase in sales to Rs 346.16 in Q1 June 2007 over Q1 June 2006.

DLF bags Mega Development Project in Bangalore

DLF has secured a major order from the Government of Karnataka for building Bidadi Knowledge City in 9,1870-acres for positioning it as New Bangalore. The project will entail an investment of over Rs 60,000 crore. The company will join hands with Limitless Holdings, Dubai, a sister company of Nakheel and a part of the diversified Dubai World group in this project.

Karnataka Government, headed by Devegowda family have also secretly joined hands with Mukesh Ambani promoted SKIL [Sea King Infrastructure Ltd] and are using all means to kick off current promoter NICE to takeover the Bangalore-Mysore corridor.

Last week, DLF said it plans to invest nearly Rs 700 crore to develop its second information technology (IT) park in Kolkata. The proposed IT Park will come up on 25 acres of land offering 2.5 million square feet of IT/ITES workspace.

The current price of Rs 856.50 discounts in Q1 June 2007 annualized EPS of Rs 13.59 by a PE multiple of 63.02.

Real Estate Hits The Ceiling - Kotak

Current street expectations of high volume growth along with high prices of real estate are unlikely to pan out. Expect prices of residential property to correct to the tune of 10% over the next few months.

The slowdown in home loan disbursements, among other factors, underpins our view that
the residential real estate market has slowed down considerably.On the pricing front, we forecast a correction of 10% from current prices in the next 12 months but do not rule out steeper correction.

Kotak is not very bullish on the sector. Uday Kotak @ India Incredible at 60 in New York said that Equity is the best asset class for Indian investor to be in today.

Unitech's residential division has the largest volumes under development amongst Indian listed real estate companies with more than 25 mn sq. ft under construction in National Capital Region and Kolkata. Unitech has access to a low-cost land bank of 480 mn sq. ft across 14 cities.

NAV estimate for Sobha and DLF for a 10% reduction in selling price in the next 12 months. New fair price for Sobha Developers, based on March 2009 NAV, is Rs870/share and the rating is changed to In-Line (Outperform previously). Revised target price for DLF is Rs750/share (Rs705 previously) based on a 15% premium (5% earlier) to March 2009-based NAV of Rs646.

DLF creating new generation workspaces

DLF has announced its second IT park in Kolkata. The company is developing this state of the art, world-class facility on 25 acres of land offering 2.5 million sq.ft. of IT/ITES workspace.

DLF IT park spells success. It will present an ultramodern integrated tech city that offers a modem workspace and is fully-equipped to operate any IT/ITES major 24X7. The IT Park space is spread over an area of 25 acres and will offer developed workspace clubbed with serviced apartments, retail and recreational, all set to revolutionize IT workspace in n00ew IT corridor. Efficiently designed by the renowned architects, it is a ready-built IT workspace to offer unmatched scalable advantages.

This IT Park will involve an investment of Rs 700 crore approximately and will be developed in phases. The first phase of the said development is expected to get operational by the end of this year or early next year. It would cater to all the international and national IT/ITES companies and will be surely the first choice for IT-ITES companies in times to come.

The location advantage of DLF IT Park is not found elsewhere in Kolkata. It is located in the new IT corridor of new town, Rajarhat and in close proximity to key residential areas and salt lake. The project is just 10 minutes drive from CBD and airport.

Over the past decade DLF properties have emerged as the preferred destination for both Indian as well as multinational conglomerates apart from leading IT/ITES firms due to its cost effective office space and best in class infrastructure. DLF is also responsible for triggering the corporate shift from Delhi to Gurgaon in 1990's based on the walk to work culture. This culture implied that corporates could now co-locate their offices and residential places in order to save time in commuting.

UBS + IL&FS Realty Funds

UBS Global Real Estate is expected to launch India specific Real Estate fund by the end of this year. We have reliably learnt that the company has tied up with Mumbai based property developer K Raheja to finance various real estate projects. UBS Global Real Estate Management has assets of $50 Billion under management across the globe. The proposed fund will have a lock-in period of 7 years with the option of 2 one year extensions.

Realty market has wide speculation that this fund will support K Raheja's retail venture by providing necessary and prime commercial real estate for Shopper's Stop, Crossword, Inorbit Mall and Hypercity super bazaar.



In another development, IL&FS Investment Managers and Milestone Capital Advisors launched a real estate investment fund to raise Rs 1,000 crore to invest in leased or rented properties. This fund is for people who are risk-averse. The fund would be invested in under developed or under construction properties. The funds would be invested in office buildings, hospitals, hotels, warehouses and shopping malls. The managers would invest 30 per cent each in retail and office properties, 20 per cent in IT and ITeS and 10 per cent each in warehousing and office properties.

DLF Assets to List on Singapore

Goldman Sachs and Lehman Brothers are advising DLF Assets, a Singapore based unit promoted K.P. Singh, chairman of DLF, for its proposed public issue in Singapore.

Earlier, DLF had reportedly sold some of its leased commercial properties to DLF Assets to separate its development and asset ownership businesses. DLF Assets has already paid about Rs 2400 crore to DLF against a total consideration of Rs 4000 crore.

DLF Assets has a portfolio of IT parks in New Delhi, Hyderabad and Chennai and two large office complexes in Gurgaon, the report added.

DLF reported a net profit of Rs 579.27 crore on sales of Rs 1121.87 crore in Q1 June 2007.

Ansals Woodbury apartments at Zirakpur

Ansal Housing & Construction on 15 September 2007 has launched a new Project named Ansals Woodbury apartments at Zirakpur (Punjab). This is a residential group housing project located near PSEB Grid, Nabha Road, Babhat, Zirakpur (Punjab).

This residential project will have in-house amenities like designer gate, boundary walled complex, designer external lighting, rain water harvesting, beautifully landscaped parks & gazebo, children play area with swings, club with swimming pool & gymnasium, convenient shopping facility, ample still parking, piped gas supply etc. The company will now undertake all the development and marketing work of the project. The Project is expected to have a turnover of approximately 50 crore and will be completed in the period of 3 years approximately.

We will also have an exclusive coverage on affordable housing in India very soon.

Sarup multiplex cum shopping mall

Sarup Tanneries has tied up with metropolitan MGF for setting up a multiplex cum shopping mall at a prime location in the heart of city at Jalandhar. Bhumi Pooja for this project was done on 10 September 2007 and construction of the project has been started. The total land for this project is about 4 acres and the built up area will be around 6 lakhs sqfts. The construction work has been entrusted to Leighton.

IL&FS banks on new realty fund

The IL&FS - Milestone Fund-I is a four-year close-end fund with an option to extend the term by two more years, if required.

The fund is looking at an initial corpus of Rs 1000 crore, including a greenshoe option of Rs 500 crore. It is looking at an annual yield of 11% and an annual return of 18-20% with the property price appreciation, reports suggest.

The minimum investment in this fund is Rs 10 lakh for individuals and Rs 1 crore for corporates. It opened for subscription on Monday, 11 September 2007 and will close on 30 October 2007.

Residential Real Estate Supply in Indian Cities

Merill Lynch report on the Indian Residential Real Estate sector says, Long-term growth factors for the industry remain strong. Short-term oversupply could lead to price correction. Signs of consolidation in the industry are beginning to emerge. Most developers' targets for development seem to be stretched and might not be met in the time span stated.
Here is the Supply Position for Bangalore, Chennai, Hyderabad, Kolkatta, Delhi NCR, Pune and Mumbai.

DLF Hotels ties with Four Seasons Hotels and Resorts

DLF Hotels, the hospitality arm of DLF, has reached an agreement with Four Seasons Hotels and Resorts to operate a proposed luxury hotel at DLF Golf Links, in Gurgaon.

Targeted to open by end 2010, Four Seasons Hotel Gurgaon will be located at the DLF Golf & Country Club in DLF City, Gurgaon. The 230 room Hotel will overlook the picturesque 18 - hole, Arnold Palmer Signature Golf Course, and will feature several dining options, a full feature spa, as well as facilities for meetings and functions.

Four Seasons is dedicated to perfecting the travel experience through continuous innovation and the highest standards of hospitality. Currently with 74 hotels in 31 countries, and more than 25 properties under development, Four Seasons continues to lead the hospitality industry with innovative enhancements, making business travel easier and leisure travel more rewarding.

Man Industries + Phoenix Mills

Man Industries India has received in principle approval from the board of approvals for setting up of IT SEZ at Indore (Madhya Pradesh).

Phoenix Mills through its wholly owned subsidiary (Pallazzio Hotels & Leisure) has signed a hotel management agreement with Shangri-La Hotels and Resorts to operate and manage their upcoming hotel at lower parel in Mumbai.

This project will be the first of its kind in the island city, centrally located in the rapidly developing lower pare1 area. Shangri La Hotels and Resorts are regarded as one of the world's finest hotel management companies, garnering awards and recognition from prestigious publications and industry partners.

Parsvnath launches Prideasia - Chandigarh

Parsvnath Developers has announced the launch of Parsvnath 'Prideasia', a strategically located project in Chandigarh. With a realization value of approximately US$ 1 billion (Rs 4100 crore), Parsvnath 'Prideasia' is an exquisitely designed luxurious township providing for aristocratic living. Located amidst Sukhna lake, golf course, an upcoming five star hotel and in the backdrop of Shivalik range, an investment in this project would provide much more value to its resident than just a luxurious and comfortable living.

The revenue from this project would be realized over a period of three years, including current financial year. Parsvnath 'Prideasia' is a joint venture between the company and Chandigarh Housing Board. The project has a saleable residential area of 38.5 lakh sq.ft a commercial area of 2.7 lakh sq.ft and a club, sports centre and a water sports complex of 2 lakh sq.ft.

The project is being jointly marketed through marketing arms of the company and various banks and the amount would be collected in an escrow account. 30% of the gross receipts from the residential segment would go to Chandigarh Housing Board and balance 70% would come to the company. The realisations from segments other than residential would come entirely to the company.

Enveloped with large stretches of green precincts and surrounded by water bodies, Parsvnath 'Prideasia' is a premium accommodation ranging from one to five bedroom air-conditioned apartments with their cost ranging approximately between Rs 52 lakh to Rs 3.8 crore. The project will be launched phase wise with 359 units out of a total of 1314 units being launched in Phase 1. The estimated sales value of Phase 1 of the project is Rs 750 crore. It will also showcase exclusive high-end villas of 8660 sq ft costing approximately Rs 6 crore each.

HDFC International Real Estate Fund

Housing Development Finance Corporation has announced the closing of its first sponsored international real-estate fund, HIREF International LLC at US$ 800 million. This shall make it one of the country's largest international real estate funds. The 9-year close-ended fund, open for subscription from only foreign investors was privately placed and was subscribed to by 28 investors.

With this international real-estate fund, HDFC will be the largest player in the real estate private equity space in India.

List of Best Housing Finance Companies in India

We have compiled a list of Approved Housing finance Companies in India with whom you can do business in peace. Their are many others but we recommend the following after a careful research.

• Can Fin Homes Limited No. 29/1, 1st Floor, Sir M.N. Krishna Rao Road, Basavangudi, Bangalore-560 004. KARNATAKA.
  
• Cent Bank Home Finance Limited 9-Arera Hills, Mother Teresa Road, Bhopal-462 011. MADHYA PRADESH
  
• Dewan Housing Finance Corporation Ltd. Warden House (2nd Floor), Sir P.M. Road, Fort, Mumbai - 400023. MAHARASHTRA.
  
• DHFL Vysya Housing Finance Ltd. S-401, 4th Floor, Brigade Plaza, Anand Circle, Bangalore - 560 011, KARNATAKA
  
• GIC Housing Finance Ltd. Universal Insurance Building (3rd Floor), Sir PM Road, Fort, Mumbai-400 001. MAHARASHTRA. GUJRAT.
  
• GRUH Finance Ltd. "GRUH", Netaji Marg, Nr. Mithakhali Six Road, Ellisbridge, Ahmedabad-380 006. GUJARAT.
  
• Housing and Urban Development Corporation Ltd. ( HUDCO ) HUDCO Bhawan, India Habitat Centre, Lodhi Road, New Delhi-110 003.DELHI.
  
• Housing Development Finance Corporation Ltd. ( HDFC ) Ramon House, H.T. Parekh Marg, 169 - Backbay Reclamation, Church Gate, Mumbai-400 020. MAHARASHTRA.
  
• ICICI Home Finance Company Ltd. ICICI Bank Towers, Bandra Kurla Complex, Mumbai-400 051. MAHARASHTRA.
  
• IDBI Homefinance Ltd Kanchenjunga Building, 18-Barakhamba Road, New Delhi-110 001. DELHI
  
• Ind Bank Housing Ltd 66-Rajaji Salai, Chennai-600 001. TAMILNADU.
  
• LIC Housing Finance Ltd. Bombay Life Building, 45/47-Veer Nariman Road, Mumbai-400 001. MAHARASHTRA.
  
• PNB Housing Finance Ltd. Antriksh Bhawan-9th Floor, 22-Kasturba Gandhi Marg, New Delhi-110 001. DELHI.
  
• Sundaram Home Finance Ltd. 21-Patullos Road, Chennai-600 002. TAMILNADU.
• Weizmann Homes Ltd. 26-Gobind Mahal, 86B-Netaji Subash Road, Mumbai-400 002.MAHARASHTRA.
  

Do let us know your experience. Thanks.

Real Estate Stocks Crash on Dalal Street

We have been telling that the Realty price have to correct and the correction is far more than we had expected. Analysts on Dalal Street have recommended an Aggressive SELL on the Indian Real Estate Sector. IPOs of day time looters such as Purvankara and IVR Urban Prime barely managed to subscribe and are quoting way below their issue prices.

The problem with these real estate companies is they behave like they are the King and land lords. That will not work in Free Markets. The street wants companies to generate cash. You cannot be an arrogant land lord, if so then just stay private. Look how Bangalore based Sobha Developers was hammered downwards after its QoQ growth fell - implies the company is not able to sell as many apartments as it used to. [Stock Down to Rs 730 from Rs 1,000]

Parsvnath Developers, Akruti and Omaxe - Delhi NCR Developers. Their stocks are also quoting below their IPO prices. Ansal Properties and Infrastructure has hit a new low. Unitech is down 30% to Rs 440 while DLF is managing just above its IPO price at Rs 539.

DLF also launched its first IT SEZ at Nagpur, Maharashtra on 140 acres of land. This SEZ project will involve an investment of about Rs 1000 crore. The IT Park is expected to be operational in a period of 3 years and being an IT SEZ, it would cater to all the international and national IT/ITES companies.

All this means, more and only more downside to the artificial Real Estate Saga in India. Commercial Real Estate will not correct as much as Residential due to Retailers demand.

DLF Completes India's Largest Real Estate Deal

DLF is set to buy about 38 acres of land in New Delhi for more than Rs 1600 crore. The deal to buy Swatantra Bharat Mills from DCM Shriram Consolidated, about 4-5 km from Delhi's central business district, will be the largest private sector land deal in the country.

The real-estate developer has already bought about 25 acres of land adjacent to the plot and may invest Rs 11000-12000 crore to develop an integrated township.

Indian Realty stocks have taken a severe beating along with global indices which are bleeding due to American Mortgage crisis. IVR Prime Urban Developers, another Shady Real Estate Developer from Hyderabad, which looted retail investors money at Rs 550 / share is now quoting at mere Rs 410. Orbit Corp, IndiaBulls Real Estate, Sobha Developers, GMR Infra all the stocks have lost more than 6% in today's trading.

Corporate Looters Hijack Government's Panel

The Government of India has vested interest in getting the SEZs approved to rich private players like Reliance and DLF. Look at the Government's hypocrisy here - They put a Pro-Poor and Citizen friendly face in the parliment and outside they encourage corporate raiders like Ajay Nijhawan of Reliance SEZ to form panels under export promotion council.

Infosy Technologies a Slave Trading IT Company from Bangalore has secured approvals for 2 more IT SEZs near Hyderabad. This is the same company which is on recruitment freeze as soon as the dollar depreciated against Indian rupee. When HP can hire and get better work done from India without SEZ, why does Naryana Murthy want LAND ?

From Naryana Murthy to Mukesh Ambani in Corporate India and H.D.Devegowda to Lalu Yadav, every Politician, Bureaucreat utter only one word - Land to which our Honorable and esteemed PM Dr. Manmohan Singh is a mere spectator.

Opto Circuits India receives formal approval

Opto Circuits India has received formal approval from the ministry of commerce and industry, department of commerce, Government of India for developing a SEZ at Nanjanagud near Mysore.

The company is likely to establish its new manufacturing facilities in the proposed SEZ. It will also focus on establishing manufacturing facilities for various health care related hardware electronic products.

The Land Bank between Bangalore and Mysore on the Nandi Infrastructure Corridor is eyed by Devegowda and family who have not got SKIL Infrastructure to back them.

SKIL - Sea King Infrastructure Limited is Nikhil and Bhavesh Gandhi promoted company which developed the Navi Mumbai SEZ. However, SKIL is now being remotely managed and controlled by Mukesh Ambani and Anand Jain.

Rising Rupee will Correct Bangalore Residential Real Estate

Dirty and Polluted Bangalore will see an en end to increasing Real Estate prices. I have said this in the past [Search or Go Through the Archives] and I will will say this again - Property prices are exuberant and the correction which was very very essential has just begun.

You have to think outside the box.

• RBI restricted credit to cool down the housing market. Raised Interest Rates on Home Loans.
  
• IT companies in India as famously known as Slave Traders have lost their advantage of differential currency. They are now on a hiring FREEZE or JIT [Just in Time] Hiring. If you write managed code then you know about JIT compilers :-)
• IT companies won't give that liberal hike this year. It will be highly restricted.

In a way of speaking, the consumers of Real Estate Developers are choked. Bangalore is just not about IT Pros, Political Mafia and Corrupt Bureaucrats, it also has School Teachers, PSU and Defence sector Employees, Bankers etc who all have moderate to low income.

More than Bangalore, you will see big corrections in places like Sonepat near Delhi where prices had run up on pure speculation.

Indian Realty Companies Most Expensive in the World

Standard & Poor's, just a while ago released a report in which they reveal that Real Estate stocks in India are the most expensive in the world even as they give lower returns than most of the emerging as well as developed markets including China, Singapore, Hong Kong and Australia. This revelation has come in the backdrop of a seven-year bull run in the global property stocks coming to an end in the second quarter of 2007.

P/E ratio for Indian stocks was highest among all countries, while return on equity (ROE) was second lowest among all emerging markets and lower than most of the developed markets.

The S&P study put the last 12-month P/E for Indian stocks at 209.30, against just 29.69 in China, 39.90 for the US and 3.18 for the UK. On ROE front, Indian stocks gave a 7.15 per cent return, lower than the global average of 7.3 per cent.

The rally in the emerging market realty stocks, appears to be mostly driven by the Chinese stocks with top five global gainers for the quarter coming from China.

Globally, property stocks fell by 4.5 per cent on an average in the quarter as measured by the S&P Citigroup Global Property Index with sharp falls being registered by the stocks from the US, Europe and other North American markets.

Top five performers were Medinet Nasr Housing from Egypt, China Vanke Co, Beijing North Star Co and Shg Lujazui from China, besides Amata Corp from Thailand.

Standard & Poors Index Services Vice President Alka Banerjee [An Indian] said,

A prolonged seven-year stretch of continuous gains, leading to excessive valuations, decreasing yields and a legitimate desire for profit taking caused a sell off in the sector.

REIT indices for Europe, US and the rest of the world fell. Also in such market conditions, Bangalore based Purvankara Projects is planning to raise $250 Million at a P/E Valuation of more than 80.

Realty Index Crashes with Dalal Street

As the Bears hug the Indian Stock Markets, taking the BSE Sensex down 549.27 points, or 3.48%, to 15,227.04, BSE Real Estate Index crashed too.

All the 11 stocks in the BSE Realty index were trading in the red, including sector heavyweight DLF. DLF was down 4.39% to Rs 605. The stock had plunged to a low of Rs 578 earlier in the day.

The other major losers were Unitech (down 5.32% to Rs 562), Indiabulls Real Estate (down 5.49% to Rs 565), Parsvnath Developers l (down 5.17% to Rs 367), Mahindra Gesco Developers (down 3.02% to Rs 577), and Ansal Properties & Infrastructure (down 4.62% to Rs 267.40).

In the Realty index, DLF holds the major weightage of 35.16%, followed by Unitech (31.65%) and IndiaBulls Real Estate (16.49%). All other scrips hold weightages between 1% to 3% in the index.

It is time to exit DLF, Unitech and India Bulls Real Estate because all of them are extremely speculative and are quoting at absur valuations of more than 60 forward P/Es.

Land Banks Approved as SEZs for Real Estate Scam

Here is a list of Land Banks approved by the Government of India. Or can we call it a Govt authorized Real Estate Scams which is all set to ruin the Indian economy.

• Rudradev Township Private Limited Solankurini, Madurai
• GP Realtors Pvt. Ltd. HR Phase II in the villages of Ghata & Behrampur in district Gurgaon, Haryana
• DLF Limited (DLFL) Industrial Estate, Rai, Sonepat, Haryana
  
• GMR Hyderabad International Airport Limited Shamshadbad, Hyderabad, Andhra Pradesh [100% Land Bank Scam]
• Mohan Investments and Properties Private Limited Shijra Kilabandi, Village Badshahpur, District Gurgaon, Haryana [Do you know which Politician is behind this ?]
• Mayar India Limited Rakha, Rani Ka Singolla, Nimoth, Tehsil Sohna, District Gurgaon, Haryana
  
• Raheja Haryana SEZ Developers Private Limited Village Hamirpur, Khatawas, Saidpur, Dhanawas and Wazirpur District Gurgaon
  
• Zoom Developers Private Limited Bada Bangarda, Indore, Madhya Pradesh
  
• Navi Mumbai SEZ Private Limited (Kalamboli - Bio-Technology Division) Kalamboli - Navi Mumbai, Maharashtra
  
• Navi Mumbai SEZ Private Limited (Kalamboli - Light Engineering Division) Kalamboli - Navi Mumbai, Maharashtra
  
• Navi Mumbai SEZ Private Limited (Kalamboli Pharmaceutical Division) Kalamboli - Navi Mumbai, Maharashtra
  
• Reliance Infocom Infrastructure Private Limited Dhirubhai Ambani Knowledge City, Koper Khairne, Navi Mumbai, Maharashtra
  
• Canton Buildwell Private Limited Gurgaon, Faridabad Road NCR of Delhi
  

We all know that Reliance Infocomm is a Indian Telecom Service Provider and why is it seeking SEZ and 20 acres of land in Navi Mumbai ?

Israel's Elbit Medical Imaging invades Bangalore Real Estate

Elbit Medical Imaging Ltd of Israel has signed a Memorandum of Understanding (MoU) with an Indian real estate developer to build luxury apartments and commercial centres in Bangalore. The two companies will acquire the rights to develop approximately 190 acres of land situated in a luxury neighborhood of Bangalore.

The Indian partner will transfer part of the development rights of 100-acre plot to the joint venture. The NASDAQ listed company will invest $180 million for purchase of land for the venture. The companies will build villas and luxury apartments, a hotel and 300-400 room apartment hotel, a shopping center, golf course, and various amenities including country club, swimming pool, sports facilities, and recreation areas in 2 million sq meters of space. The project is expected to start within 12 months and will be executed in stages over a period of three to five years.

SPACs - Enron Like Companies

Deepak Parekh, Chairman HDFC and IDFC group, has expressed concerns about companies raising hundrerds Millions of Dollars abroad using Special Purpose Vehicles and Special Purpose Acquisition Companies without any business plan or core strategy.

Mr. Parekh said,

They are essentially blank-cheque firms which do not have a strategy or a business plan... There are at least ten India-dedicated SPACs that have raised between $350 and 500 million and are now on the prowl to acquire Indian companies. This is just the beginning of sophisticated investment vehicles but investors must realise that the India party with extraordinarily high returns cannot go on forever. It is easier to raise money because of global liquidity and besides, the returns are as high as 40%. But how long will it last?

Most of the shady companies raising through this means are in the Real Estate Business in India. If you haven't seen the movie, Enron, then you must check it out because it was the biggest corporate bankruptcy in the US.

Nandigram - Politicians Sponsored Massacre

The ruling Government of West Bengal headed by Buddhadeb Bhattacharjee ordered a Massacre in Nandigram. Here is an uncensored video. Thanks to Dare Devil Journalist - Anindita Sarbadhicary and also BishnuS for the translations

Nandigram - Part - 1


Nandigram - Part - 2


Nandigram - Part - 3

Prime Minister admits Mistakes in SEZ

Prime Minister of India , Dr. Manmohan Singh today admitted about the mistakes in SEZ policy. Indian SEZ policy is the largest REal Estate Scam in the world. Dr. Singh said,

There are some cases of mistakes. People have been dispossessed. No developed country can do without industry.

This means that Dr. Singh is morally accepting his guilt for hundreds of deaths in Nandigram, West Bengal. It was a state sponsored Terrori*sm. You can check out all the uncensored videos on YouTube. I wonder if we are in a Democracy.

Fight Corruption and Land Mafia in Bangalore

An innocent IAS officer[M.N.Vijaykumar] who exposed the highly corrupt Government of H.D.Kumarswamy has been transferred 6 times in 6 Months. Help fight corruption in Bangalore by Devegowda family - the largest Land Mafia in the world.

New York Times wrote about the IAS office fighting against Bangalore's Land Mafia and Corruption.

Fight Corruption Now is run by Jayshree, wife of IAS officer M.N.Vijaykumar.

Mukesh Ambani's Residential Land - Illegally Grabbed

In a landmark order, the Maharashtra Government has termed Mukesh Ambani's Dream House Land as being illegally pouched from various state government bodies.

A notification issued by Revenue and Forest Department has directed the state Wakf Board to 'take back possession' of five wakf board properties, including the 4,532 sq metre land where Ambani is building the 27-floor skyscraper.

Maharashtra Revenue Secretary, Avinash Hazare said,

An inquiry into the land transfer deal has found truth in allegations that the transfer was illegal.

Other properties grabbed by Mukesh Ambani are located in Nanded (26 acres and 11 hectares), Kej in Beed district (10 acres) and at Satara village in Aurangabad district (24 hectares).

Tags: Real Estate India, Mukesh Ambani, Reliance, Realty India

Bangalore - Nandagudi SEZ - Politicians are Land Grabbers

The H D Devegowda family is grabbing land as if their is no tomorrow. They have sanctioned a controversial SEZ at Nandagudi, Hobli in Hoskote Taluk, 50 Km from Bangalore. Here is what is happening.

D K Shivakumar - H D Deve Gowda and Chief Minister H D Kumaraswamy are planning to acquire 80,000 acres of land in the State in the name of SEZ, townships, etc.

A Krishnappa - H D Deve Gowda family will get kickbacks of Rs 20,000 crore from various SEZ dealings.

H D Kumarswamy's Defence - All the Congress leaders [D K Shivkumar, A Krishnappa, M Kharge, Dharam Singh, H K Patil, etc ] have acquired 25,000 to 30,000 acres in Sathnur and Varthur assembly constituencies in the name of development, are now championing the cause of farmers. They are like wolves guarding a flock of sheep.

Kumarswamy continued his attack.... My government need not learn from Congress leaders, whose party government acquired vast tracts of land for Bangalore Mysore Infrastructure Corridor project and transferred it at throwaway prices to Nandi Infrastructure.

Income Tax Authorities Raid Realtors in Bangalore. At least Rs 100 crore cash is being confiscated from Realtors close to Gowda family. The amount could be much more :-)

Our Views: All the allegations are True. Both the Congress leaders and Gowda family members are interested in their own welfare and Bangalore is being turned from IT Capital to Dirty and Polluted Capital of the world.

Sunway City + Opus Developers Hyderabad Township

Sunway Ciity of Malaysia and Opus Developers of Hyderabad are in a joint venture to develop a mega residential township near Hyderabad.

They will build luxury deluxe homes of 1,600-1,800 sft in the range of Rs 50 to Rs 60 lakh targeting the IT and Pharma sector employees.

The total township will have 5 Million sft of developed area involving a cost of Rs 800 crore. They expect to complete the first phase of 1.7 million sft within the next 24 months.

Developer Shakeout Begins - Small Players Out

The shake out in the real estate market has begun. Small Players who do not have any means of finance and who have desperately bought land at highly abnormal prices are feeling the heat and are selling themselves to large developers.

Pradeep Jain, Parsvnath Developers, said,

I am sitting on, at least, five-six such proposals. Some deals are at an advanced stage. The small-time developers are mainly offering land that they had acquired earlier.

Mr. Vakil of Knight and Frank Said,

Small developers are under pressure now. Fund flow into this sector has begun to dry up. Selling incomplete projects to big developers or private equity firms is an option explored by many such developers. A sharp fall in sales would force them to cut the price in the coming months. The trend is visible in many suburban markets.

RBI has cut all sources of finance for this segment of industry which is largely dominated by Politicians and Black Money with muscle power. RBI along with SEBI have also proposed 3 year lock in for Foreign investment in Indian Real Estate to curb speculation.

Source: Economic Times, June 27-2007.

Parsvnath Bags Prestigious Delhi Metro Mall

Parsvnath Developers has bagged another DMRC project for developing an ultra modern fully air-conditioned shopping mall outside Netaji Subhash Place Metro Station in North Delhi.

The prestigious project located at a prime location on the Ring Road, slated to attract huge footfall, would cost approximately Rs 150 crore. The company bagged the project through a competitive bidding process.

The project sprawls over an area of 19,400 sq.mtr with a developable area of 2,50,000 sq.ft. The project aims to gratify the shopping needs of public traveling by metro.

The company has already entered into concession agreements to develop shopping malls on 12 stations owned by the Delhi Metro Railway Corporation (DMRC) on a build-operate-transfer basis. Of these, construction of 6 is already completed.

The Netaji Subhash Place mall is expected to be fully operational within 3 years. ENAM Securities has a BUY on Parsvnath Developers Limited.

Land Scams by Devegowda and Kumarswamy family

The Chief Minister of Karnataka, H D Kumarswamy and Family are involved in massive Land Bank and Real Estate Scams according to insiders. Previously we have covered the Land Bank Scam in which Karnataka Government acquired land using KIADB and transferred to vested interest parties.

Yet in another move, the Karnataka Government under Kumarswamy auctioned land near the new Bangalore International Airport acquired from poor farmers at throw away prices. This was done against the directions of Civil Aviation Ministry which had earmarked the land for future expansion.

Today, the Karnataka Government under Kumarswamy is involved in a massive 13,500 Acre Land Bank Scam for Nandagudi SEZ which will get 4,500 acres of excellent farm land from the Government of Karnataka at throw away prices. Senior Bureaucrats and Planners in the Government are openly opposing the move.

Nandagudi is located 20 Km from the upcoming Bangalore International Airport at Devanhalli and 55 Km from Bangalore city. It is also rumored that Devegowda and family have bought vast stretches of land near Devanhalli. In 1994, Devegowda had burnt his finger venturing into Bangalore's Lloyd City which was 100% illegal construction and later went bankrupt.

Real Estate Slowdown now a Reality

We were the first one to tell that slowdown in Real Estate is imminent. Simple Reason - Unrealistic Realty Prices hurt Economic and Industrial Growth.

6 Months ago when RBI tightened lending to Real Estate, greedy developers started moving towards Foreign Money. Just 2 days ago, RBI tightened foreign money supply in real estate.

Today, ICICI Bank Executive Director, V Vaidynathan said,

The real estate business, which was earlier growing at 45 per cent, is now growing at 20 only per cent.

In another release, the Mumbai Chapter of Builder Association fo India confirmed slowdown in housing stock sale in the past 3 months. The sales drop is as high as 27%. Mid-Size builders are now offering free car parking and discounts. They expect a price correction of 10% in the next quarter.

Inputs from Business Line, 15th June, 2007

Avoid DLF IPO. Housing Loan Rates to Go Up

Avoid investing in the IPO of DLF Limited. Here is a detailed research and review of DLF IPO and why should you avoid it.

In a separate move, Deepak Parekh, Chairman of HDFC has asked the Indian Home BUYER to be prepared to pay more for home loans in couple of months as he sees housing loan interest rates rising further.

Kenmore Real Estate in India

Scottish Property Giant, Kenmore has bought 20% stake in Indian Ocean Ventures - Real Estate Investment firm for an undisclosed amount. Kenmore has a portfolio of more than $2 Billion and have projects in pipeline worth more than $1 Billion.

Mr Rob brook of Kenmore Europe said,

We have acquired 20% stake in Indian Ocean Ventures to build up knowledge base about India. We are investing in several opportunities and by 2008-09, we plan to enter the Indian market.

Kenmore is interested in Retail and Commercial Real Estate in India.

Government Bans Overseas Borrowing for Realty Companies

In a move to curtal speculation in Real Estate, the Government of India under the guidelines of Finance Ministry just a while ago banned all Real Estate companies from raising capital from overseas markets directly hitting to their bottomline and ambitious projects.

Indians had forgotten that economy can grow only when you create wealth and not simply by unreasonable REAL ESTATE prices which hurt manufacturers, industrialists, service providers and IT/ITeS companies to establish and execute projects employing millions of Indians.

Realty Companies like Unitech and DLF will be the worst hit it due to their large portfolio of loans. Mr. Chandra CEO of Unitech said,

More than interest rates, the concern for developers is the availability of funds. Indian banks are not in a position to meet the funding requirements for large projects being undertaken by the bigger developers for various reasons, single borrower limits, high risk weights for real estate lending.

Way back in 2006, India's Central Bank, RBI had raised lending to Real Estate projects citing they are risky portfolios for a bank. The ban will have an impact on the real-estate companies as the Reserve Bank of India has blocked all the avenues for real-estate developers to raise the funds. In March-07, RBI had refused Citigroups investment in Ansal Properties.

Sahara's Subroto Roy's Land Bank Scam

Sahara Group's Chairman, Subroto Roy is involved in a 100 acre prime land bank scam. India Housing Ltd in upscale Sahara Shaher Gomtinagar area of Lucknow is the property which Mr. Roy managed to lease at mere Rs 1.0 Lakh rental per annum when Mulayam Singh was the CM of UttarPradesh. This definitely looks like a scam because no where in India you can get land at such a cheap rate.

The Lucknow Development Authority has further alleged that Roy doesn't have the necessary approvals for Multi-Storey buildings constructed there. LDA Vice-Chairman has ordered an inquiry into the Land Grabbing by Subroto Roy.

Dear Readers, Please do not BUY your dream home in controversial projects such as Sahara Shaher Housing in Lucknow.

Ansal Properties launches integrated township in Agra

Ansal Properties & Infrastructure has launched an integrated township at Agra.
The township will be spread in excess of 460 acres of land and is named as "Sushant Taj City".

Sushant Taj City will have in-house amenities like educational institutions, hospitals, clubs, hotels and multiplexes.

Parsvnath Developers Launches Parsvnath Exotica

Parsvnath developers offers high-rise exclusive air-conditioned luxury condominium in Ghaziabad. The Company performed the Bhoomipujan and launched the project on June 03, 2007. The revenue from the project is approximately Rs 600 crore in next 3 years including this financial year.

Parsvnath Exotica will have 858 ultra-modern air-conditioned multi-storeyed condominiums ranging from 10 to 13 storey offering three-bedroom, four-bedroom and five-bedroom apartments.

The Great Scam of India

Formal approvals granted till date : 234

Total land requirements for the above : 33,308 hectares

Of 234 SEZs, state govt. ventures in :60
Involving :17,800 hectares

SEZs where operations commenced :63
Involving :8,051 hectares

Land in possession of 63 notified SEZs :67 sq. kms.
Land requirement for 234 SEZs :350 sq. kms.
63 notified SEZs will involve
Investment :Rs. 53561 crore

All the SEZs have grabbed land near existing big cities such as Mumbai, Delhi NCR, Noida, Kolkatta, Bangalore, Hyderabad, Pune, Chennai etc.

Indian Realtors on Advertising Spree

With the slowdown in demand for Real Estate in India due to abnormal prices, Realtors like Parsvnath Developers, Unitech and Ansals are on an advertising spree to spend their excess inventory. They are heavily dependant on the print media and are extremely aggressive on the Web as well. Ansals had an Ad budget of Rs 15 crore.

Mr. Sanjay Dutt of Cushman & Wakefield said,

The Ad spend of most developers has gone up by 100-200 percent on the conservative side in the recent past. A slowdown in the real estate scenario in the last 3 months has necessitated companies to advertise aggressively.

include Gated Community, 9 Hole Gold Course, Realtors like Ansals are going overseas to sell their inventory. Some of their flashy tag linesWi-Fi availability, Food Plaza, Shopping Complex etc. Sure its true to some extent, but most of it is a straight forward lie. For instance, in Bangalore, SJR Park Vista on Ring Road promised so many things but the developers handed over the apartments with no water supply :-)

10 Billion Private Equity in Indian Real Estate

Foreign Private Equity players have lined up $10 Billion investments in the Indian Real Estate Sector. Its a pity none want to invest in India's infrastructure and our Finance Ministry and RBI are sleeping instead of banning the money and sending the prices through skies.

The cash-strapped developers overcome conservative lending by banks, stricter rules for placements before share offers and tougher guidelines for overseas borrowings or IPO has led to go for Private Equity.

Siddhartha Gupta, an analyst with Macquarie Research, said,

Real-estate funds will look at an investment of $10 billion this year. This is the best time for PE players to enter the real-estate market.

Wachovia Corp., a US-based diversified financial group, invested about $57 million in Vipul Ltd, a Gurgaon-based real-estate group, for buying a 15% stake. Inspite of unclear Land Titles and Land mafia operating in Real Estate, greedy FIIs are flocking to India as if their is no tomorrow. Hopefully, a political shakeout will cool down the entire Real Estate market and the economy which has made living a HELL for common man in India.

Navi Mumbai SEZ Proposal on Hold

SEZ Board of Approvals gave formal approval to 17 Special Economic Zones, including those of Vedanta and DLF. Decision on Reliance, Mukesh Ambani promoted Navi Mumbai SEZ has been deferred for want of more information on measures proposed by the promoters to plug revenue leakages.

Apart from Navi Mumbai, five other SEZs that came for formal approval were deferred because of land issues.

The ones that secured approval are Vedanta Alumina and DLF's SEZs in Orissa, Suzlon’s two zones in Gujarat and Karnataka and Unitech’s IT SEZ in West Bengal.

Pre-Launch Real Estate Sale down 60%

Due to higher borrowing costs and abnormal inflation, Pre-Launch Real Estate sales have taken a back seat within the last 2 months and is down by a whopping 60%.

Pre-launches enabled builders to take advance bookings for a project after getting the requisite building permits, but much before starting construction, providing them with virtually free cash.
Sanjay Chandra, MD of Unitech Ltd, India's leading real estate company which is also part of the Morgan Stanley Capital Index, said,

Almost 60 per cent of home buyers are staying away from pre-launches. They want to wait and buy an apartment once they see the apartment building actually being constructed.

Builders and Developers have no deadlines unlike us where we lose the project / client. For instance, SJR Builders of Bangalore who developed SJR Park Vista delivered the homes to pre-launch buyers 9 months after the scheduled date. For 9 months, the BUYER lost an opportunity of at least Rs 200,000. [Avoid SJR]

Citigroup India Equity Research has downgraded all the Real Estate Stocks in India.

Rahul Bajaj Declares SEZ as Land Bank Scam

India's leading Industrialist and Bajaj Auto Chairman, Rahul Bajaj who is also a member of the upper house [Rajya Sabha] just a while ago declared in the Parliament that SEZs in India are the biggest Land bank Scams in the World.

Advocating direct interaction with the farmers, he said, if vast stretches of land have to be acquired to set up SEZs the companies must get them by paying the right value, and not the subsidised rates and not by taking innocent lives like the communist leaders in Bengal did.

He also said it would not be fair to compare the SEZs in India with that of China, as in case of the latter the land is owned by the state and the benefits go directly to the people. But, in this case it is the developer who is benefiting the most.

Bajaj said development of an industrial area does not mean it has to be near an existing city. It would be of more significance if the infrastructure creation takes place at a distance providing an opportunity to promote auxiliary settlement, he added.

Indians who have lost Independence

Everybody on the earth knows that why Indians lost their independence to the British. The same time has come in the communist ruled state of West Bengal in India. As I write this post my head hangs in shame to be a citizen of the so called "Republic of India".

The communist rulers in West Bengal are sold out just like your Multiplex Blockbuster ticket. Their vested interest to help a controversial Indonesian company has claimed dozens of lives and minor clashes and Murd*rs are the orders of the day in Nandigram. Independent citizen journalists who visited the area were attacked and threatened by miscreants acting on behalf of ruling party.

Is India still a FREE and Democratic country ? If the answer is yes, why do we see people being K*lled mercilessly for LAND ? Aren't Land and the Natural Resources of the nation citizens rights ? Do we need a government which can't protect its own citizens but orders to K*ll them ? Raise your voice and Save Citizens of Nandigram. Jai Hind!

Tags: Land Bank Scam, Real Estate, Communist, India