Latest Property News on 'Chennai'

Paramount Group Signs MOU with Germany Based Aluplast Group

Real estate developers Paramount Group today signed a memorandum of understanding (MOU) with Germany-based Aluplast Group for the supply of windows specially designed for the Indian firm. As per the agreement, Aluplast will supply 25 lakh square feet of U-PVC windows to Paramount at the cost of Rs 300 square feet. “To start with, the initial module is of Rs 75 crore. It is a ongoing process. We will be continuing these windows in all our projects,” Paramount Group of Companies Executive Director Ashwani Prakash told reporters here.

This is in line with the our investments in superior technology and quality products, he added. “We have always provided our customers best luxury in affordable range. I am delighted that we have once again maintained our promise by signing this MOU,” Paramount Group of Companies MD Mukesh Aggarwal said in statement. The windows to be supplied by the company will have the same technology that is being used in Germany and will be hundred per cent lead free and energy efficient, Aluplast said.

Aluplast Group Chairman Manfred Seitz said: “Aluplast windows are patented windows. The company is the technology leader in the market offering a wide range of different products that suit every geographical situation and individual market necessities.” Aluplast has 23 production plants and produces nearly 10 million windows annually.

Emami Group buys 850 Acres of Prime Land in Countrywide Property Expansion Binge

Emami Group, a Rs 3,700-crore diversified conglomerate, has bought about 850 acres of prime real estate in a countrywide property expansion binge. The company has spent more than Rs 200 crore to buy land in Hyderabad, Chennai, Coimbatore, Jhansi and Kolkata for developing up-market large scale residential and commercial complexes.. Top officials from Emami are negotiating more land deals and expect to clinch them in 2011-12, RS Agarwal, group joint chairman, Emami, was quoted as saying. “We are indeed in a hurry to lap up huge tracts, but will not close the land deals in haste. All pros and cons will be weighed before we clinch the property,” he said.

Agarwal, however, refused to reveal the break-up of these deals citing corporate governance issues. He said the company has been supported by commercial banks and lending institutions. “We are looking to build premium residential complexes. We also plan to develop large as well as mid-sized mixeduse housing projects comprising residential, hospitality, retails and commercial properties depending on prevailing market conditions,” said Girija Choudhary, director, Emami Realty.

“Our real estate ventures, like all other projects being undertaken by us, will be financed by unsecured and secured loans, advances from customers and promoter’s own funds,” Choudhary said. The Emami Group, which has taken big strides in FMCG and personal care space over the years, has been actively involved in the city’s realty market. It has acquired majority stakes in some of Kolkata’s landmark real estate projects being developed by a city-based realtor or a group of realtors. On its own, the group has been building residential complexes under the Orbit brand.

“Although a firm decision has not been taken, as a group we intend to grow our real estate business independently. Joint venture developments will be taken up selectively and only if the deal is lucrative. Going forward, the focus will be more on promoting the umbrella brand ‘Emami’,” Agarwal said, outlining the group’s future plans.

Bangalore Based Sobha Developer Looking to Raise 150cr via Sale of Land Bank

Sobha Developers, the Bangalore-based publicly-held realtor, is understood to be looking to offload a part of its 2,550 acres of land bank spread across the country to reduce its gearing (comparison of long term debt to its equity capital) by the end of FY11. The company, which has a debt of Rs 1,362 crore with a gearing of 0.71 times, is looking to bring this level to 0.5 by end of the ongoing fiscal, reports Business Standard. “We are targeting to raise Rs 150 crore through sale of land bank shortly. In addition to this, with steady sales being registered we should be able to able to bring down the leverage to more comfortable levels,” a senior official of Sobha Developers was quoted as saying.

The company over the past 18 months has been offloading land bank parcels after touching a uncomfortable leverage of just under two times as it amassed debt to expand its land bank when the global financial meltdown of 2008 hit the realty sector in India.
According to the company, its net debt level recently increased as it invested to acquire a majority stake in one its subsidiaries which is expected to realise sales of Rs 808 crore over the next few years as and when it is developed. Sobha Developers has 45 ongoing projects aggregating to 16.16 million square feet in real estate and with 22.30 million square feet of total area under development.

It is also lining up 17 projects aggregating 8.97 million square feet in real estate. According to the senior official of Sobha Developers, eight projects aggregating to 2.25 million square feet of projects are targeted for completion in FY12 in the real estate segment, while 23 projects aggregating to 2.80 million square feet of projects are planned to be completed by the end of this fiscal. “Overall, 31 projects, aggregating to 5.05 million square feet are targeted to be completed and handed over by FY12,” he added.

Despite gloomy macroeconomic conditions, the company has managed to grow its average sales realisation to Rs 5,196 per square feet as against Rs 4,547 per square feet during the corresponding previous second quarter of last fiscal. “The present trend reflects further improvement in the realisation in the coming quarters and we are confident of maintaining current operating margins despite cost pressures,” the official noted adding that they are poised for Rs 1,500 crore new sales in real estate. The company has cash and cash equivalent of Rs 438.54 crore by end of Q2 of FY12.

SMR’s Flagship Gated Community Project Getting Ready in Hyderabad

SMR Vinay Fountain Head, the flagship gated community of real estate developers SMR Group, would be ready by February next year. SMR would give possession of the dwelling units then. In all, it has about 975 units in 10-acre project coming up at Hydernagar, near the Miyapur to Ga-chibowli road in Hyderabad. The project is situated near the IT hub of Hyderabad. According to SMR chairman and managing director, S Ram Reddy, who is also the chief architect of the project, the Fountain Head focused on the layout to ensure that it would not be ‘crowded’. It would have four towers, each 19 floors and a lot of landscaping.

The project is a combination of two BHK averaging 1,200 sq ft and three BHK measuring around 1,800 sq ft. The company claimed it has sold about 50 per cent of the units at an average price of Rs 2,900 per sq ft. The project cost is estimated to be Rs 350 crore, of which Rs 75 crore came from promoters, Rs 70 crore as loans from financial institutions and about Rs 150 crore from the owners- to-be.

“The total area of construction is about 20 per cent. We have left the remaining open. The structure is designed to withstand seismic loads,” he said. Based on customer feedback, it designed the living room for multiple uses. The units would have sit-outs offering a view of the surroundings, said Reddy, adding that the project has a 50 ft setback including 30 ft road and 20 ft greenery. About 75,000 sq ft has been earmarked for various amenities. For health freaks, Fountain Head would have a jogging track and separate gyms for men and women.

The terrace garden turns into a venue for get-togethers and celebrations with music. And for the pumped up ones, there is a dance floor, too. For leisure, swimming pool, reading room, coffee shop and tennis court are lined up. The gated community, where the apartments would not have common walls, would also provide wi-fi connectivity, a three-level parking including for guests, children play area, an amphitheatre and multiple banquet halls.
SMR has other residential projects — such as Sky City with 120 apartments in 13 floors at Uppal and Symphony with 190 units at Gachibowli — which are already partly occupied.

Puravankara Targets Overseas Market; Plans Project in Sri Lanka

Real estate developer Puravankara is eyeing the overseas market for expansion. The company’s maiden project in a foreign soil is coming up in Sri Lanka. The company had invested on the land some years back, but postponed development as the situation was not congenial for promoting mega projects. “We were waiting for the right time to develop it,” a senior official of the company told Business Line.

Stating that Purvankara would make an announcement about this upcoming project before the end of the current calendar year, the official said “the site is located en route to the airport from Colombo city. It is a 25-acre plot and we have the necessary approvals in place from the respective authorities.” The real estate development major also owns another piece of land within the city limits, but would look at developing the same at a later date he said, referring to the land holding in Colombo.

“The project would comprise apartments and mid-segment dwelling units,” he said without disclosing more details about the company’s overseas venture. In India, Puravankara is planning to reach out to 22 cities over the next five years. The company is planning to moot projects in Tiruchi, Salem, Madurai and so on among other locations.
The company, meanwhile, has expressed its intent to hike the price of ‘Purva Bluemount’ – a project under construction at Singanallur in Coimbatore, from November 21. The project is sitting on 16.86 acre, with a planned layout of 1,116 units, comprising two and three bedroom apartments ranging from 1,352 sq feet to 1,872 sq feet. Construction is under way, work commenced around May 2011.

Decision on FDI in Multi Brand Retail Next Week

The Government’s long awaited ‘big ticket’ reform — of allowing foreign direct investment (FDI) in multi brand retail — is likely to see the light of day soon, with the Union Cabinet likely to take up the issue next week. The case for increasing the current 51 per cent cap on FDI in single-brand retail is also likely to be considered at the same time, Business Line reported, citing sources. Allowing FDI in multi-brand retail would open the door for giant multinational retail chains such as Walmart to enter the Indian retail sector. Currently, Walmart has a joint venture with Bharti for wholesale ‘cash-and-carry’ stores.

The move had been delayed by strong political opposition from some quarters, which feared that the entry of foreign retail chains would kill the small Indian retailer. According to sources, the plan is to issue the necessary orders within a month of the approval by the Cabinet. “So now you can expect a New Year gift for the foreign investors”, a person familiar with the development said. But the “gift” is likely to come with several strings attached. Sources confirmed that the Cabinet nod was likely to come with several modifications to the recommendations made by the Committee of Secretaries (CoS) on the subject.

For example, the final guidelines for the FDI may ask for 30 per cent mandatory sourcing from small and medium enterprises (SMEs). The definition of the SMEs may include domestic and global firms. It may be recalled that the CoS, in its meeting on July 22, said, “The condition that 30 per cent of value of manufactured items may be procured from the domestic SME sector, was not agreed to.” The Government is also likely to stipulate that in the case of agricultural produce, 60 per cent of the sourcing should be from low-income, resource-poor farmers.

Such farmers will be defined as those who are having less than 10 hectares of land. The final guidelines may retain the recommendation of the COS regarding self-certification by the company in regard to 50 per cent of the total FDI proposed by an investor in back-end infrastructure, but with a condition that the Government may go for surprise checks.
The final proposal is also likely to give some detail about the definition of ‘back-end infrastructure.’ It may say that cost of land and the building for a retail store will not be taken as investment in the back end infrastructure. Earlier, it was not clear what could be considered as back-end infrastructure.

To soothe the concerns of the electronics sector, the final guidelines may impose a condition such as, “for the purpose of investment in the back end infrastructure, any investment made in the processing, manufacturing or distribution would be counted.”
A senior Government official said that an increased FDI limit in single-brand retail may come with some riders. One of these could be mandatory 30 per cent sourcing from small and medium enterprises, as soon as the FDI limit exceeds 51 per cent. The Government allowed FDI in single-brand retail in February 2006. Till May this year, a total of $92.1 million was approved, but actual inflow has been just $69.26 million.

Ozonegroup Announces Rs 3,000 cr Integrated Township Project in Bangalore

Real estate developer Ozonegroup has announced a Rs 3,000-crore integrated township project in Bangalore, near the Bangalore International Airport. The project, Ozone Urbana, would be spread across 150 acres, and “there is a potential to grow this to 167 acres,” said K S Sudarshan, chief operations officer, Ozonegroup, at the launch. The overall project cost would be around Rs 3,000 crore, said S Vasudevan, chairman and managing director, Ozonegroup, which includes land acquisition and infrastructure development costs of Rs 1,000 crore.

“We acquired the land over 3-4 years,” he added. The project would be funded through equity and investor funds. “We have also tied up with banks for project funding,” he said.
Urban Infrastructure Opportunities Fund, promoted by Anand Jain, in which Reliance Industries is the largest shareholder, has invested over Rs 1,000 crore in the Ozonegroup both at SPV level and entity level. At the entity level, the fund has 50 per cent stake in the company. The company also partners with HDFC Venture Fund.

Govt to Make Draft Real Estate Regulation Bill Public

The government will make public the draft Real Estate Regulation and Development Bill, 2011 for comments from stakeholders this week and may subsequently introduce it in the forthcoming winter session of Parliament. Aimed at protecting customers from fly-by-night developers, the draft Bill will seek to bring more transparency in the realty sector.

“We will upload the draft Bill on the Ministry’s website on November 11 for suggestions by public. After considering those suggestions, we are hopeful of introducing the bill during the winter session of Parliament,” Union Housing and Urban Poverty Alleviation Minister Kumari Selja said. While unveiling the new logo and brand identity of Confederation of Real Estate Developers’ Associations of India (CREDAI), she said the draft Bill has taken into account of the concerns raised by the builder community.

“The bill will be under the public domain for few days… We are also prepared to look into the suggestion of single window clearance system for realty projects wherever we can,” Selja said. Last week, she had said the Bill would protect the interest of consumers without hurting the real estate sector. “It will be a balanced kind of Bill, as on one hand we do not want consumers should be put into any difficulty (in real estate buying) and on the other hand, we definitely do not want to throttle the real estate industry. So it will be a balanced (one),” the minister had said.

Real estate developers led by CREDAI has been opposing the constitution of a regulatory body to supervise sector and said that it would become a “breeding ground for corruption” when implemented. They apprehended that the objective of the draft Bill was limited to just consumer protection, leaving other important issues such as long delay in approval and rising cost of material.
According to the draft, developers will need to make public disclosures related to land title, project completion date and other relevant scheme details on the website of the proposed regulatory authority. The disclosures must be made before launching a project, so that consumers are not taken for a ride at a later stage and the promoters will also have to register themselves with the regulatory authority.

NCC Urban Plans Residential & Commercial Projects in South India

NCC Urban Infrastructure Limited, a subsidiary of Hyderabad-based construction major NCC Ltd, is lining up over 10 residential and commercial projects, together with a built-up area of 2.5 million square feet, in Bangalore, Chennai, Hyderabad and Kochi. “While we recently launched six projects in Bangalore, both apartments and villas, which are expected to generate a turnover of Rs 250 crore per year, ventures in Hyderabad, Kochi and Chennai are to be launched in the next two to three months,” said Narayana Raju Alluri, managing director of NCC Urban.

The company had received Rs 150 crore as equity and the remaining as loan from the parent, NCC Limited, to fund acquisition of land for these projects, he added. NCC Urban, which has so far developed over 2 million sq ft of residential and commercial space, currently has a land bank of over 400 acre. The company is in the process of launching a 100-acre integrated township, enveloped with commercial space, in Visakhapatnam, besides a 150-unit apartment venture in Guntur city shortly.

On the company’s maiden overseas project, NCC Harmony, a twin-tower project of 2.3-million sq ft coming up at the Dubai Biotechnology and Research Park, Alluri said the project was going slow because of the Dubai financial crisis. The company had invested around Rs 150 crore in the project and raised the rest through sales. “With the Dubai market collapsing, the high-rise (35-floor) apartment project has not sold much. Construction work is still going on and it will take another two years to be completed,” Alluri said, adding the company garnered revenues of Rs 175 crore last year and was expecting it to touch Rs 200 crore this year.

AR Group launches high-end villa project in Chennai

The Chennai-based AR Group, which had earlier promoted the premium IT park, Acropolis in Chennai’s upmarket Dr Radhakrishnan Road, has announced the launch of premium high-end villas on the scenic East Coast Road (ECR). The project, Amara Ananta, coming up at Palavakkam on ECR and located close to the city, will offer a total of 25 high-end premium villas. Each villa will come up on a two and half ground land (one ground = 2,400 square feet) and around 5,500 square feet built-up area. Each villa will have a private swimming pool and facility to park two to three cars. Being developed as a gated community, the common facilities will include a large club house with a swimming pool, a 1,500 sq ft multi-purpose party hall and a 1,000 sq ft gym, besides service areas and terrace BBQ facility.

“Amara Ananta will be one of the best gated communities in the city. It will be a contemprory design executed with the best quality materials available in the market,” says Amarnath Reddy, managing director of AR Group. “The construction, which has already started, is in full swing and the villas will be handed over in about 18 months from now,” Reddy added. The gated community will also have four boutique showrooms to match the lifestyle of the villa owners and six different elevations, besides being centrally air-conditioned and furnished (except for furniture). Located just a few minutes’ away from the beach, the villas are modern, idyllic homes with the finest amenities, coupled with expansive estate, with spectacular green landscapes, Reddy observed.

Given the amenities and the large land area that comes to be owned by the buyers, the price per villa ranges between Rs 5.5 crore and Rs 7 crore, depending on amenities and fixtures chosen by the buyers. AR Group is targeting business people, HNIs and top-level executives for the villas in Amara Ananta, since it is not only coming up on ECR, but also located close to the city as well as easily accessible to OMR, the city’s IT Corridor.