Indian Property News on 'April, 2007'

Landmark Group to Foray into Indian Hotel Industry

Making rapid strides within short period, the hotel industry in India is the next common hunting ground for major retail players. The trend is to be set by the Dubai-based Landmark Group, planning to invest over Rs. 500 crore in development of 12 budget hotels across India.

The group will operate its hotel chain in India under its value brand – CityMax and may opt for contract management route eventually.  Landmark envisages coming up with 20 hotels across India by 2009. Read More »

RBI Bring a Time to Rejoice for Property Developers

The RBI’s latest stand on the risk weightage for sub – 20 lakh loans has given a push to a number of real estate stocks which has resulted into a sharp upswing in prices. A number of property developers are seeing a rapid increase in their realty stock prices which are believed to move by 4-9%. The rise is witnessed by Ansals, Mahindra Gesco, Parsvnath, Sobha and DS Kulkarni.

Real estate developers are largely benefited from the reduced risk weightage as it will allow banks to increase their exposure to the sector on the same capital base. The profits will be limited to small towns and cities as there are many home loan borrowers looking for the loan exceeding the amount of Rs 20 lakh. The reduced risk weightage may lead to any significant reduction in the interest costs for the consumer. Read More »

No Reduced Risk Weightage Benefits for Home Loan Borrowers

The Reserve Bank of India (RBI) has brought a drop in risk weightage on residential housing loans up to Rs. 20 lakh to 50 per cent from the existing 75 per cent.

Since the bankers seem perplexed regarding passing the benefits of lower risk weightage to consumers, there are no signs of relief for home loan borrower. Read More »

Lehman to Invest $300m in R&D SEZ

One of the leading US based investment banks and global financial services, Lehman Brothers is all set to carve a niche for itself in Indian real estate. The firm will make its first move with a handsome investment of $80 million in a Bangalore based 404 hectare research and development of SEZ Gandhi City.

ILFS Investment Managers, the private equity arm of IL&FS is also drawing plans to co-invest $20 million in the SEZ along with Lehman Brothers. Read More »

Investor’s Dreams Turn Sour with Falling Property Prices

Property prices are seeing a sharp fall in their prices. With such a prevailing scenario in Indian real estate, private equity players are pondering over whether to strike deals in India or not. A real baffling situation for property enthusiasts.

Prospective investors who were earlier bullish on making large investments are experiencing jitters in a cooling market. They are off-loading stock at as much as 25% lower than what property developers have to offer the buyers. For that reason, it makes sense for any residential property seeker to buy a flat on re-sale value with a sizeable discount. Read More »

Noida Development Authority Nod to Reliance SEZ

With the Centre revising the norms on SEZs, there are no more obstacles for Noida’s biggest information Technology Special Economic Zone (SEZ) and a multi-product SEZ of the Reliance Group that is planned to come up along the Noida-Greater Noida Expressway.

The land has been allotted to nine IT companies and the Reliance Group for development of the SEZ Project. With these allotments falling under the legal purview of the Centre’s recently revised policy, the SEZs will be registered soon. Read More »

Hotel Prices Push Demand for Serviced Flats in Bangalore

As a substitute for highly prized hotel rooms, builders in Bangalore have come up with a new trend – ‘Serviced Apartments’ which promise to offer cost effective accommodation solutions. The concept sounds good for business travelers coming to the city.

Like hotels, these apartments will offer short-term stay and cater to the demanding requirements of corporates, businesspeople, tourists, and expatriates. Although, the city already has 600 to 800 serviced apartments, but there seems an extra need for the same. For that reason, another 800 to 1,000 serviced apartments are to come up soon. The work is in progress, says a property consultant. Read More »

Citigroup to Invest $400 mn in Indian Real Estate

The real estate investment arm of Citigroup is planning to invest around $400 million of equity from a recently raised fund in India and $600 million in China. The fund envisages developing hotels, technology parks, and housing estates.

Citigroup property investors closed a $1.29 billion Asia opportunities fund in February. Of this total amount, 40% was allocated to the real estate projects it has already begun. Read More »

RBI Refuses FII Status to FDI in Real Estate

Foreign Direct investments (FDI) received by property developers through private placement of equity has been denied the FII status. And the government has no issues with such a decision of the Reserve Bank of India.

Since an element of discretion was present in pre-IPO private placement, it cannot be regarded the same as other portfolio investment and must comply the FDI norms. Also, the Department of Industrial Policy and Promotion (DIPP) in the commerce and industry Ministry has decided to go with the RBI’s view. Read More »

Discount Malls Trend to “Take-off” in Small Cities

Undoubtedly, Indian retail industry is turning milestones into stepping stones. The mushrooming mall culture has embraced another trend of discount malls. The renowned realtors and local retail chains are taking large interests in constructing shopping malls in regional boroughs, specifically to sell premium branded goods at the rates less than the maximum retail price (MRP).

Around 50 malls are likely to come up in the next two years across the country, targeting middle to premium end of the market. The famous Royal Palms is soon to construct one of the largest discount malls, Orchard Road Mall in the western suburbs of Mumbai. The project is likely to be over by Diwali this year. The project will feature 3 lakh sq ft of mall space for factory outlets and the remaining will be dedicated to private labels. Read More »