Distressed Realty major from Bangalore / Bengaluru, Sobha Developers Ltd [SDL] is now seeking funding from VCs and PEs to keep its cash register ringing on the backdrop of slowing residential sales.
We have some Insider Information on the deal Pan Atlantic LLC's investment in Hoshalli, Bangalore project of Sobha. SDL will sell this land bank to SPV at consideration of Rs 670 mn while the cost of this land bank for SDL is Rs 420 mn resulting in a profit of Rs 250 mn on sale of this land. SDL will continue to benefit from the development of this property since it will hold 60% in this SPV.
The SPV is likely to spend Rs 1,900 / sft on the entire development of the project and SDL has set very high expectations of Rs 3,500 / sft as the selling price which we are really skeptical about.
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