Indian Property News on 'January, 2008'

PE Investment to Benefit Real Estate India in the Next Two Years: ASSOCHAM

With a profit margin of around 35% to 50%, PE landscape in India is one of the best beneficiaries of the Real Estate Sector of the country.

Within the coming two years Private Equity (PE) overseas firms investment in Indian market is likely to touch US$48bn. More than 400 such firms are operating in Indian market whose number would further scale up by another 69 or 70 by 2010, according to reports by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) Read More »

RBI’s Decision may hit Real Estate Companies

The Reserve Bank of India’s (RBI) decision not to cut interest rates has spooked real estate companies facing the brunt of a housing industry slowdown caused by the high cost of mortgage financing. RBI, on Tuesday, decided to keep interest rates unchanged in its third-quarter monetary policy review. Real estate companies were expecting a cut, especially in the backdrop of slowing home sales in major cities in the past few months.

Buyer resistance and a series of interest rates hikes last year put the brakes on home sales last year. Middle-class households put off purchases after seeing prices break all records in most major metros. ET’s report, on Tuesday, cited RBI data to show that home loan sales fell 39% in April-November 2007 while loans to developers eased by a fourth to Rs 12,563 crore. Read More »

Rising rates hit home loans growth

Rising interest rates have hit banks’ consumer finance business, particularly the housing loan segment. The dip in growth is led by a slowdown in housing loan portfolios of banks. Interest rates on home loans have increased to over 10 per cent, affecting demand. The rising real estate prices have also had an impact on the loan growth.

Credit flow to the real estate sector has also seen some drop. Despite the dip in credit growth to the sector, the Reserve Bank of India (RBI) views the 33 per cent growth to be high. Read More »

Red Fort Capital Plans Rs 2,700 cr Investment in Indian real estate

Private equity firm Red Fort Capital plans to invest about Rs 2,700 crore in the Indian Real estate. The firm plan to do this by 2009, the plan is also inclusive of an acquisition of 2,500 acres of land in over 20 cities across the country.

According to the managing director of the firm the firm will be investing Rs 2,700 crore in development projects in Indian real estate by 2009, about 70 per cent of which will into acquiring 2,000-2,500 acres of land in suburbs of metros and Tier II cities. Read More »

DLF Sells Stake to India Bulls Real Estate

India’s biggest real estate developers, DLF Ltd. Has sold its stake in Kenneth Builders and Developers Ltd. to its equal partner in the venture, India bulls Real Estate Ltd.

The two companies came together in 2006 to develop high-end residential apartments at Okhla in New Delhi. The unit bought its only holding, 35.8 acres (14.5 hectares) of land, for 4.5 billion rupees ($114 million) from the Delhi Development Authority in the same year. Read More »

Postal Dept Considers Real Estate to Overcome Financial Loss

Undergoing severe financial debacle, the postal department is all set to discover new areas for revenue generation, which even includes commercial use of huge real estate at its disposal to guard against any debt trap.

The sector is witnessing an annual loss of more than Rs 400 crore which is the major factor for the shift over of a chunk of postal business going to private competitors. At present the government is taking serious steps and is working on different proposals including commercial use of land, to make this over 100 year’s old institution financially viable. Read More »

REBI Plans India’s First Property Shops Chain

REBI is prepared to make things and transactions in Real Estate transparent for both buyers and sellers. This win-win formula comes as whiff of fresh air as REBI has already commenced its operation in Karnataka, Kerala, Tamilnadu. Now expands to Andhra Pradesh and are planning to get all over India very soon. Rebi has also started its overseas operations in Sri Lanka and is targeting countries like Dubai, UK, USA, Singapore, Malaysia and Australia in the next phase.

REBI is relying on the Franchisee model to give shape to its plans, within the next three years it is likely to set up 3000 franchisees all over India. In Andhra Pradesh alone, it is expected to set up 40 franchisee outlets. It has already pumped about Rs 5 crore in this model and expects to chip in another Rs 25 crore in next one year. REBI envisions to provide a single window services for a customer in real estate industry. The services offered by REBI include Brokerage Services, Financial Services, Database Services and Relocation Services. Read More »

RREEF Joins Hand with Golden Gate Properties

Since its entrance in the booming Indian Real Estate sector in 2007, Deutsche Bank investment unit RREEF has made its first investment of $70 million in Indian real estate firm Golden Gate Properties.

Speaking on the alliance MR Kishore Gotety, head of Deutsche’s Asset Management’s real estate and infrastructure investment advisory services in India said that the Golden Gate brand for construction is well-established in India in the middle and upper-middle class income segment which it targets Read More »

Emaar MGF Starts $1.8 Billion IPO

Emaar MGF Land Ltd., one of the biggest Real Estate Developer of the Middle East started its initial public offering in India today amid the biggest plunge in equities in almost four years.

Speaking on the same Shravan Gupta executive vice chairman and managing director at Emaar MGF said that the market may go up, or come down, but there are fundamentals of a company and the long-term investors will look at that. Read More »

Housing Sector Affected by Rising Home Loan Rates

The housing sector has been severely affected by rising home loan rates. The sector has witnessed a massive fall of 26.6 per cent in 2006-07 from 29.1 per cent in 2005-06 and is expected to slow down further to touch between 17 and 20 per cent in the current fiscal.

In a study named ‘Impact of rising home loan rates’, by ASSOCHAM revealed the fact. The study also points out that the real estate market has already seen a drop of 60 per cent in sales. Its impact could further worsen if reversal in rising interest rates for housing is not addressed urgently. Read More »