Do you remember the days when Morgan Stanley was the first FII to operate as a Mutual Fund in India ? I was barely 15 then and remember people investing in its issue standing in long queue. My stock broker was already selling Morgan Stanley units at Rs10 even 2 months before listing. He made a killing, the unit started trading on BSE below par. :)
Now Morgan Stanley has set up an ambitious real estate investment strategy in India. It is investing close to Rs5000 crores in 5 years. The first project where it is investing is a service apartment in Pune and the investment is close to Rs700 crores.
Morgan Stanley picked up stake in Mantri Housing and Alpha G at around Rs300 crores each. It has 10-15 retail clients in its portfolio as well. Indian realty with semi transparency is attracting attention of global real estate funds. Merrill lynch puts the Indian realty business to grow to $90 billion in 2015.
Friday, July 28, 2006
Wednesday, July 26, 2006
Raheja Builders and Unitech head to London
Due to high volatility and lesser appetite from retail investors, Rahejas have appointed Enam financial consultants to list them on London under the Alternate Investment Mechanism(AIM). They are planning to raise $500 Million for a particular project which will be under a Specia Purpose Vehicle(SPV).
Unitech a shady realty firm which is operator driven(atleast appears to be, why not when the stock is locked for 10 days in upper circuit and 15 days on lower circuit) is also planning to raise $500 Million under similar arrangements as that of Rahejas.
London beware, Indian Real estate was controlled by the underworld not too long ago. Their is a atleast 50% of black money involved.(What the Hell ? Yes if I buy an apartment/home, I have to pay some part of the deal in CASH which goes into the realtor's pocket and doesn't come on books at all. Ranges from 60% to 10%).
Unitech a shady realty firm which is operator driven(atleast appears to be, why not when the stock is locked for 10 days in upper circuit and 15 days on lower circuit) is also planning to raise $500 Million under similar arrangements as that of Rahejas.
London beware, Indian Real estate was controlled by the underworld not too long ago. Their is a atleast 50% of black money involved.(What the Hell ? Yes if I buy an apartment/home, I have to pay some part of the deal in CASH which goes into the realtor's pocket and doesn't come on books at all. Ranges from 60% to 10%).
Tuesday, July 25, 2006
Real Estate bug bites Department of Posts(IndiaPost)
With skyrocketting real estate prices in the country, the bug has now bitten Indian Postal department. Department of Post(DOP) is the second larget real estate owner in the country after Indian Railways.
In Mumbai alone, DOP holds 22 vacant plots in prime locations. It has tied up with TrammellCrow Meghraj to unlock its real estate value and maximize the holding value by renting or leasing spaces in post-offices at prime locations(First improve your service and look & feel of your buildings, they are so 80ish, hardly any person wants to visit your premises today) DOP plans to conduct a feasibility study in Delhi, Mumbai, Chennai and Karnataka.
In Mumbai alone, DOP holds 22 vacant plots in prime locations. It has tied up with TrammellCrow Meghraj to unlock its real estate value and maximize the holding value by renting or leasing spaces in post-offices at prime locations(First improve your service and look & feel of your buildings, they are so 80ish, hardly any person wants to visit your premises today) DOP plans to conduct a feasibility study in Delhi, Mumbai, Chennai and Karnataka.
Indian realty gets clean chit
India's real estate industry has made impressive strides in becoming a more transparent sector over the past 2 years said Jones Lang LaSalle's in its latest edition of Real Estate Transperency Index(RETI). India has moved up from low transparency market to semi-transparency market. India's legal regulatory framework, professional standards and transaction process have been counted as positives. Jones Lang laSalle's RETI places India among the top 10 globally improved real estate markets.
Friday, July 21, 2006
Is Himachal Pradesh the next realty destination ?
The state of Jammu and Kashmir enjoys many privileges under Article 370, one of which is that an individual not domiciled in the state cannot buy property there. Much is made about this but states like Arunachal Pradesh, Sikkim and Himachal Pradesh too have similar restrictions. This is going to change. Himachal Pradesh will soon allow real estate developers to invest in commercial, industrial and residential property, making it possible for those outside the state to sell and buy property. Today, it’s easier for an Indian to buy property in Dubai, Switzerland, United Kingdom or Australia than to buy in the above mentioned Indian states. Of course, properties were being bought in these restricted states by entering into a partnership with locals. The law was circumvented anyway, legally. So Himachal has decided to do away with the archaic restriction. With a new law in place, property deals will be transparent and command a higher price.
Originally, the restrictions were based on noble intents of protecting the socio-economic characters of the states and not allowing outsiders to dispossess locals. But economics seems to have won the day. Himachal is aware that locals do not have the financial wherewithal to fully exploit the tourist potential the state has. The lack of development of tourism and consequently the lack of job opportunities forced a young workforce to seek employment elsewhere. The state government reasons that opening up the real estate market will bring in huge amounts of investment and pump in money into the state economy. With property prices shooting through the roof all over India and the state being an acknowledged tourist and holiday destination, Himachalis can expect to sell real estate at prices they could never imagine. Of course, development has to be tempered by environmental protection but these laws could be tightened further. Developers do realize the potential of selling holiday homes to an ever expanding list of billionaires. With rising incomes, the universe of property investors too is growing.
But the environmentalists are up in arms. Already 53 builders and developers have thrown in their hats with the state authority to develop properties. Development rules, the environmentalists claim, have a strange habit of leaning towards circumvention. As evidence, they cite Shimla, the charming hill station of yesteryears, now criss-crossed with concrete in all its inelegance. Unplanned development, flouted rules, environmental degradation and the rapacity of developers, say the critics, will prove disastrous to the state and kill the goose that lays the golden egg of one of the most scenic and ecologically rich region.
One can’t paint all developers with a single brush. But will they rise up to the challenge and prove that for once the environmentalists are wrong?
Originally, the restrictions were based on noble intents of protecting the socio-economic characters of the states and not allowing outsiders to dispossess locals. But economics seems to have won the day. Himachal is aware that locals do not have the financial wherewithal to fully exploit the tourist potential the state has. The lack of development of tourism and consequently the lack of job opportunities forced a young workforce to seek employment elsewhere. The state government reasons that opening up the real estate market will bring in huge amounts of investment and pump in money into the state economy. With property prices shooting through the roof all over India and the state being an acknowledged tourist and holiday destination, Himachalis can expect to sell real estate at prices they could never imagine. Of course, development has to be tempered by environmental protection but these laws could be tightened further. Developers do realize the potential of selling holiday homes to an ever expanding list of billionaires. With rising incomes, the universe of property investors too is growing.
But the environmentalists are up in arms. Already 53 builders and developers have thrown in their hats with the state authority to develop properties. Development rules, the environmentalists claim, have a strange habit of leaning towards circumvention. As evidence, they cite Shimla, the charming hill station of yesteryears, now criss-crossed with concrete in all its inelegance. Unplanned development, flouted rules, environmental degradation and the rapacity of developers, say the critics, will prove disastrous to the state and kill the goose that lays the golden egg of one of the most scenic and ecologically rich region.
One can’t paint all developers with a single brush. But will they rise up to the challenge and prove that for once the environmentalists are wrong?
Prajay to set up automobile mall
Prajay Engineers Syndicate Limited (PESL) has informed that it will be launching ‘Prajay Autopolis’, an automobile mall, in Hyderabad. The mall will be set up on a 35-acre site adjacent to Mumbai highway (NH 7), about 2 km from the proposed outer ring road. It will have over 30.87 lakh square feet of constructed area. The company is currently finalising the layout plans and the concept designs for the project. It has appointed international architects and planners for the assignment. The construction is expected to begin by the end of the year and the mall is expected to open in the second half of 2008. PESL stated that it was in talks with several leading automobile companies in India to finalise space bookings in the mall. The company expects revenue in excess of Rs 670 crore over the next three years from this venture against an estimated cost of Rs 400 crore. According to the company, Prajay Autopolis is a novel initiative in auto retailing in India, where consumers will have the convenience of buying automobiles in a multi-brand retail space. It will be an end-to-end automobile solutions location comprising sales, servicing as well as warehousing.
The project will combine mega automobile showrooms with administrative, servicing and warehousing area across more than 18 lakh sft. This will also include facilities for automobile financing institutions and insurance services to create a complete range of services required for automobiles, for both automobile companies and their customers. It will also have a multipurpose convention centre measuring 1.61 lakh sft for auto fairs and product launches, in addition to having a multi-level car parking facility and civic conveniences. PESL also envisages to build three towers comprising an Information Technology Park at the same venue. The IT Park will have a total constructed area of 15.08 lakh sft. In addition to the IT Park, the mall will have an office block above the showroom space for administrative offices and warehouses for auto companies.
The project will combine mega automobile showrooms with administrative, servicing and warehousing area across more than 18 lakh sft. This will also include facilities for automobile financing institutions and insurance services to create a complete range of services required for automobiles, for both automobile companies and their customers. It will also have a multipurpose convention centre measuring 1.61 lakh sft for auto fairs and product launches, in addition to having a multi-level car parking facility and civic conveniences. PESL also envisages to build three towers comprising an Information Technology Park at the same venue. The IT Park will have a total constructed area of 15.08 lakh sft. In addition to the IT Park, the mall will have an office block above the showroom space for administrative offices and warehouses for auto companies.
DLF in Dankuni township race
Land acquisition for the proposed 5000 acre township in Dankuni is still several miles from completion, while the financial bid for the same has already been opened and the DLF consortium is on top, the top rung with a bid value of Rs 2,713 crore for the land. The company has also made its technical presentation along with five other parties. Second in place is Emaar-MGF, who had bagged a Kolkata Metropolitan Development Authority plot in April this year at Rs 213 crore for six acres. Emaar-MGF's bid value stands at Rs 2,013 crore. "It has been a six-party bid and DLF's financial bid is the highest. Our technical presentation has also been made and the plan submitted. We are quite confident of bagging the deal, however, till the time the government consolidates its own recommendations, the deal will not be finalised," said a DLF representative. The project is still several months away from taking off as the government is yet to complete land acquisition in the Dankuni area for the township. On completion, it will house an industrial park spread over an area of 1000 acres, with the rest housing the integrated township.
Apart from residential quarters, the township will also have hotels, health centres, a sports complex and an entertainment zone, shopping malls and lakes, said the DLF representative. DLF already has preferred partners for this project. However, for some of the development on this land, it will also invite partnership offers from others. With this deal, land prices in the Dankuni area will shoot upward of Rs 80,000 per cottah, much higher than the estimated Rs 35,000 to Rs 40,000 a cottah. Among the others short-listed for the financial bid were the Ambuja Group and Zee Television promoter, Subhas's Chandra's Suncity. Two local bidders were also a part of the race. If the deal is sealed in favour of DLF, this will be the second township project undertaken by the group. DLF's first project was the Gurgaon megacity developed over 3000 acres.
Apart from residential quarters, the township will also have hotels, health centres, a sports complex and an entertainment zone, shopping malls and lakes, said the DLF representative. DLF already has preferred partners for this project. However, for some of the development on this land, it will also invite partnership offers from others. With this deal, land prices in the Dankuni area will shoot upward of Rs 80,000 per cottah, much higher than the estimated Rs 35,000 to Rs 40,000 a cottah. Among the others short-listed for the financial bid were the Ambuja Group and Zee Television promoter, Subhas's Chandra's Suncity. Two local bidders were also a part of the race. If the deal is sealed in favour of DLF, this will be the second township project undertaken by the group. DLF's first project was the Gurgaon megacity developed over 3000 acres.
Thursday, July 20, 2006
Reliance Plans Rs2,000 Crores IT SEZ
Reliance is planning a mega IT SEZ in Mumbai on 450 acres of land owned by Nocil, a part of the Reliance group. The company is in the process of securing necessary approvals from the Maharashtra Industrial Development Corporation to set up this project. The company is also developing its headquarters in the same area.
RIL would have to obtain a no-objection certificate from the MIDC to convert the Nocil land, which was meant for chemical production, for developing it as a dedicated IT city. Reliance is developing a special economic zone in Navi Mumbai near the Jawaharlal Nehru Port Trust. Sources said the proposed Navi Mumbai SEZ would also have IT units operated by other companies.
RIL would have to obtain a no-objection certificate from the MIDC to convert the Nocil land, which was meant for chemical production, for developing it as a dedicated IT city. Reliance is developing a special economic zone in Navi Mumbai near the Jawaharlal Nehru Port Trust. Sources said the proposed Navi Mumbai SEZ would also have IT units operated by other companies.
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