Latest Property News on 'Mumbai'

Hoteliers Planning to Increase Room Tariff by 10-15%

In an attempt to cash in on the peak winter season and the improved economic scenario, “Hoteliers are planning to increase the average room rates (ARRs) by 10-15 per cent from September 2010 as they expect tourist traffic to improve,” says a report by domestic brokerage Angel Broking.

Although, the report didn’t talk about their plans for the upcoming Commonwealth Games, it is expected that tariffs will increase from October 3-14 on the back of strong demand. Last two years proved dull for the hotel companies as they were forced to slash average room rates by 25-30 per cent due to terrorist attacks in the country that led to lower occupancy levels as people were apprehensive to travel, the report said. Read More »

State Govt Prohibits Use of Petrol Pump Land for Real Estate Purpose in Mumbai

Fascinated by the lure of real estate, owners of fuel refilling centres in the city have long started dreaming of giving up their current business and jumping into the land development bandwagon. Some of them, in fact, have already got the civic body’s permission to change the usage of the land. However, the state government has recently issued a directive to Brihanmumbai Municipal Corporation (BMC) not to allow petrol pump owners to change the designated use of the land. Out of the 257 petrol pumps in the city, 40% are on lease land.

“Although the civic body had earlier decided not to extend the lease, with this government order it would now extend the lease on the condition that the owner would not change the land’s usage,” said a civic official from the Building Proposals department. To cash in on the rising property prices petrol pump owners have been submitting development proposals to the BMC. But what is worrying is the huge disparity in the ratio between petrol pumps and number of vehicles in the city limits. Read More »

Global Commercial Real Estate to Touch $300-bn Mark

Reflecting improved investor confidence, investment in commercial real estate globally is expected to witness a “healthy” growth of 40-50 per cent to $300 billion in the current year, says a report. According to the report by global real estate services firm Jones Lang LaSalle, the first half of 2010 saw investment worth $130 billion in the commercial real estate globally and is likely to touch $300 billion in the full year, representing an increase of 40-50 per cent from 2009.

“The first half of the year showed that confidence has improved and momentum has increased. While markets across the globe are strengthening, the last few weeks have shown that regional markets are moving with different dynamics,” the report noted. In the commercial real estate market, the quickest recovery was seen in the Asia Pacific. Europe lagged behind, where the investors still seem more hesitant, due to sovereign debt and austerity packages concerns, followed by the US, which had a slow start to 2010, but investment markets are picking up with the stabilised market fundamentals. Read More »

Investors Trust Real Estate Industry over MF’s

The rich rarely admit when they lose money. Often it’s too little to matter. More often, they are too proud to tell the world how wrong they were. A client, who asks a private wealth manager to handle Rs 50 lakh, may change her banker if the man fails. But she is unlikely to write a letter to the editor, or drop a mail to regulators — things that angry mutual fund investors often do. Better known as HNIs, these investor’s fish for ‘sophisticated’ products that appear smarter than stocks or bonds.

Over the last four years, more and more of them have been drawn to properties. They don’t get into cash deals, broker-dealings and paper work — the messy side of real estate transactions. Instead, they ask real estate fund managers to grow their money. Their message to fund managers is simple: “first, don’t buy listed stocks, go for unlisted builders; second, pick those property firms with projects in Mumbai and Delhi, the hottest markets.” Around 15 local real estate funds are today managing Rs 10,000-12,000 crore. That’s as big as the portfolio management business of stock brokers. Read More »

FDI in India’s Booming Real Estate Jumps 80 Folds

It’s not Indians alone who are monitoring the real estate market here. More and more money is being pumped into India’s housing sector from abroad. And this, despite the recent downturn. Foreign direct investment (FDI) in India’s booming real estate and housing market jumped 80 times between 2005 and 2010. Figures obtained by TOI show that in 2005, FDI in real estate was a mere Rs 171 crore. That soared to Rs 13,586 crore in 2009-10. In April and May this year, Rs 737 crore in FDI was pumped into the sector.

It is no surprise that the largest number of building projects where FDI is in play are in the country’s commercial capital, Mumbai. Of the total 1,614 projects in which foreign investors have put in money since 2005, 422 were cleared by the Reserve Bank of India’s Mumbai office, followed closely by 316 in Delhi. Other big cities like Bangalore (225 projects), Hyderabad (105 projects) and Chennai (68 projects) also enjoyed considerable attention of foreign real estate developers. Read More »

IFC in Discussion with Real Estate Developers to Create Large Affordable Housing Projects

The International Finance Corporation is in talks with several real estate developers to create large affordable housing projects in India. “IFC has been talking with everybody; there have been discussions with the Tatas and with other corporate groups on this,” said Mr Paolo Martelli, Director, South Asia, IFC. “Everybody” includes both real estate developers and housing finance companies, he said.

“We are working on this and we hope one of these projects will be developed in the next six months,” he said. If the estimated housing deficit in India is 25 million units, then such a large requirement cannot be tackled completely from a real estate point of view, according to Mr Martelli. IFC can help the Indian sector with advice on how affordable housing has been tackled in other countries such as Mexico where “literally, they are building cities at a time, 15,000 to 20,000 homes, costing between $7,000 to $15,000”. (The Corporation is also in talks with home builder Homex in Mexico for such projects here in India.) Read More »

Godrej all Set to Develop its 36 Acre Prime Land in Mumbai

The 36 acres of prime land that Godrej Industries owns in Mumbai are finally being developed and the master plan is almost ready. The first phase of the plan will be 6.5 lakh square feet of commercial space, of which half will house the group companies like Godrej Consumer Products Ltd (GCPL) and Godrej Properties and the other half will be leased out with expected revenues of over Rs. 350 crore annually.

The first part of the project will start in February or March of next year and will be completed within 30 months. The total amount to be developed over 36 acres is 3 million square feet over 3-4 years which will be a mix of residential, commercial, retail and hospitality development. Analysts have been waiting for the value unlocking of the Vikhroli land – a project being spearheaded by Adi Godrej’s son Pirojsha. Read More »

Lodha Raises 500cr by Selling 10% Stake of its Mumbai Residential Tower

Real estate firm Lodha Developers has raised Rs 500 crore by selling a 10 per cent stake in a project to develop a 117-storey residential tower in Mumbai to HDFC Venture Funds. “The deal shows the investor’s appetite for quality real estate projects in India,” said Abhisheck Lodha, the managing director of Lodha Developers.

HDFC Venture Funds is promoted by mortgage leader HDFC. Other investors include GIC, Temasek and Abu Dhabi Investment Authority.
The deal is the second-largest private equity investment in India’s realty space and puts the valuation of the project at Rs 5,000 crore, two-and-a-half times its estimated cost.
Hindustan Construction Company (HCC) sold a 74% stake in a commercial building in Mumbai’s eastern suburbs to the IL&FS Milestone Fund for Rs 575 crore two months ago, a valuation of Rs 775 crore.
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Zuri Group Looking at an Investment of Rs 1,200 crore to Expand its Presence in Hotel Industry

Zuri Group Global, the multinational conglomerate, has chalked out a multi-pronged expansion approach for its hotel chain, Zuri Hotels and Resorts, in India and abroad over the next five years. The company is looking at an investment of Rs 1,200 crore in the hospitality sector to set up its own brands and take up management contracts as part of its strategy to increase the number of wholly-owned properties.

The management contract model will allow Zuri to rapidly build a presence in more cities around the world, Priti Chand, assistant vice-president, PR and Corporate Communications, said. Chand said the company intends to set up at least 10-15 projects under the management contract models in cities, such as Hyderabad, Chennai, Mysore, Kochi, while the owned projects will be coming up at Bangalore, Nairobi and in West Asia in the next two years. The company is in advanced stage of discussions with various private owners for management of these hotels, she added. Read More »

Bombay Dyeing Focuses on Real Estate to Clear of Debt

Textile major Bombay Dyeing & Manufacturing Co may clear off its debt in the next few years with greater focus on real estate business, chairman Nusli Wadia has said. Bombay Dyeing’s debt stands at 1,775 crore. “Debt has been a major concern and we will be close to becoming a debt-free company in the next 2-3 years,” Wadia told shareholders at the company’s 130th annual general meeting.

“With new real estate projects coming up, we expect better earnings in future that would help the company to ease its debt burden,” he added. Real estate business income more than doubled to 562 crore last year. The company has a land bank of about 67 acres in Mumbai, where it plans to develop residential and commercial buildings.
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