APIIC Scouting Co-Promoter for FAB City

May 7, 2007	(Be the first to rate this story!)  Loading ...
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The Andhra Pradesh Industrial Infrastructure Corporation (APIIC) has set itself on course to search for a prospective co-developer for the nation’s first Fab city which is to be constructed at a cost of $3 billion.

Earlier SemIndia was chosen to play the role of an anchor industry on the 100 acres and the remaining 1,100 acres was allotted to other developers. Since the government has cut the SemIndia’s role, the APIIC has taken the driver’s seat. It has asked local developers of IT and infrastructure projects to study the feasibility of becoming a co-developer in the Fab City Special Purpose Vehicle (SPV).

The corporation has listed some of the prominent real estate players including Emaar, Rahejas, DLF, L&T, and promoters of Satyaveedu Special Economic Zone (SEZ) on becoming co-promoters.

APIIC wants these developers to see the things as per their convenience to become a co-promoter. The corporation also wants them to study the market and other allied aspects. However, it does not imply that any developer will be chosen on a nomination basis, says an executive from one of the developers. High cost involved in infrastructure development is putting off them from stepping ahead.  The Fab City SPV will be primarily engaged in infrastructure development which is likely to cost more than Rs. 4,000 crore.

Most developers have only been engaged in IT projects and none of them possess the right knowledge about developing the Fab industry. Another reason is the return on investment which largely depends on the condition of Fab investors.

Any divergence from the process could lead to criticism that the government is turning Fab into a real estate venture.

News Published Under:   Real Estate India |

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