Latest Property News on 'Foreign Direct Investment in India'

$6 bn Real Estate Equity Deals for Indian Realty

One-fifth of the Real Estate Equity deals worth $30 billion planned for Asian markets will find its way to Indian real estate. However, the amount is believed to be less than what it has been earmarked for Japan and China.

An estimated $10 billion foreign investment is likely to enter the Indian real estate in the next 1-2 years. Taking a look back at 1990s, the inflow of foreign direct investment into the market was estimated to be at $2-3b billion a year. It was recorded to be $5.6 billion, and reached its peak in 2005-06 at $7.2 billion. Read More »

Govt. Efforts to Stifle FDI

In an effort to incorporate foreign direct investments (FDI) norms in Indian Real estate, the government is entangling itself in micro-regulation that runs the risk of curtailing the flow of such investments.

The restrictions including minimum project size concerning the area and a lock-in-period were imposed to keep out speculative foreign capital. However, they overlooked the fact that real estate companies could be listed. The government has now decided to bar construction companies from issuing depository receipts (ADRs or GDRs). Read More »

JP Morgan to Invest Rs 400 Cr in Indian Realty

JP Morgan Property Fund, which has already invested over USD 300 million to carve out a significant niche in Indian real estate, is soon to come up with a residential project in Chennai, with the investment of Rs 400 crore.

Arihant Foundations and Housing Ltd. (AFHL), Chennai’s leading developer of world class buildings, will develop the residential property over a large area of 45 acres of land. Read More »

Govt. May Review FDI Norms Soon

The government is considering modifying norms for foreign direct investment (FDI) in India. It would be done by bringing both direct and indirect overseas investment together to determine the total FDI within a company. It would help to check out whether a company is following the FDI limits in its area of operations. The decision has come after the Hutch – Vodafone issue.

The shift is likely to bring significant changes in foreign investment caps in investment sectors including telecom, retail, and aviation. Read More »

JM Financial to Invest in Real Estate

JM Financial is all set to foray into real estate market.  The group’s $400 million real estate fund, Infinite Investment Management, has invested a whopping $60 million in five projects in India. The fund is also looking at picking up equity stakes in mid sized real estate projects. However, the company is finding it difficult to raise capital through debt and equity markets.

JM Financial has parted the ways with Morgan Stanley thereby ending its seven years relationship with the firm. It is now planning to take up the development in new potential areas including real estate and mutual funds. Read More »

Pvt Equity Funds to “Invest” in Real Estate through SPV

The private equity funds have largely become skeptical on making direct investments in Indian real estate sector.

The funds are nowadays preferring to invest in a special purpose vehicle (SPV) created for implementing 5-6 projects, says Rashesh Shah, CEO & managing director of Edelweiss Capital, which manages real estate investments of about Rs 250 crore. The company is known to be one of the fastest growing full-service investment banks in India. It has invested a part of the kitty in SPV projects in Western India.

Experts also favor making investments through SPV route as it offers a clear earning flow and there was no hype concerning land banks. Read More »

Foreign Hotel Chains to Pursue Investment Plans in India

Starwood Hotels & Resorts, a leading hotel and leisure company, is looking forward to expand its operations in India. The move will bring significant changes in the hotel industry.

The group has been operating in the country for the last 36 years through its brands – Sheraton and Le-Meridien, for a fee.

Since 100% Foreign Direct Investment (FDI) is allowed in the hotel industry, the Starwood group can scout from a plethora of investment opportunities available in the country. Read More »

Malls Excluded from Realty for FDI purposes

As per the new guidelines, the government has excluded shopping arcades and multiplexes from the purview of foreign direct investments (FDI) for real estate. They will be included under the automatic route with foreign direct investment up to 100% in hospitality sector including development work and set up of cinemas.

FDI rules for construction projects pertaining to property market include accommodation units, commercial spaces, resorts, educational institutions, recreational facilities, and regional level infrastructure, etc. Read More »

Govt. stakes on FDI for Growth of Hotels

Hospitality sector is all set to hit the next milestone in the wake of fast flourishing real estate. The sector requires $1.5 billion to add three lakh hotel rooms over the next three years. This encouraged the government to bet on FDI to arrange for the same.

Handsome amount of foreign investments are required in this sector, says Ajay Dua, secretary, department of industrial policy and promotion. According to the data showcased by different surveys, the industry has attracted Foreign Direct Investment (FDI) worth $450 million. Read More »

Another Big Deal in Real Estate Sector

RREEF, the real-estate investment arm of Deutsche Asset Management, is planning to invest over $200 million in a joint venture with realty major Emaar-MGF.

If the discussions turn out to be fruitful, it would be the biggest deal in the real estate in India. With a whopping amount of $125million investment in Mumbai based Oberoi Constructions; Morgan Stanley Real Estate Fund is known to have made the largest private equity transaction in property market till date. However, the amount of stake to be diluted by Emaar-MGF is not yet known as the transaction is likely to be a quasi-equity deal. As far as RREF is concerned, it will hold convertible debentures in the company.

EMAAR–MGF, has not finalized anything. The company aims at raising equity in the company and is currently in advanced stages of discussions with several real estate players, including RREF. The next few weeks will decide for the final answer as officials are continuing their due research and analysis. Read More »