Vornado, Uppal Group to Fund Rs. 5,000 crore SEZ

February 19, 2007	(1 votes, average: 5 out of 5)  Loading ...
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A leading operator of office building in US, Vornado Realty Trust and Indian real estate player, Uppal Group is coming up together with a joint venture to fund a 263 acre tax free enclave in the fast flourishing city of Gurgaon in a bid to make a substantial presence in Indian real estate.

The enclave will require a whopping investment of Rs. 5,000 crore and house information technology and other exclusive service businesses, says a source.

Vornado will acquire a 50% stake in the project. This New York based company could not be reached for comment.  However, the project will be paid for through a number of debt, internal accruals, and equity from both companies.

Seeing such a mature fund of US entering into Indian market seems to bring positive developments in the sector, says Jones Lang La Salle country head Vincent Lottefier. A number of SEZs are being developed in India. The project would only add to the boost going in the country. Development of SEZ will result in golden employment prospect across the country. Construction of a total of 237 SEZs proposals has already been formally approved and about 50 have been notified.

Such townships often incorporate both the residential and commercial premises thereby emerging as a fully functional community. Some prominent names in Indian real estate are coming up with their respective SEZ project. For that reason, they have been jostling hard to buy the best available land as soon as possible. Reliance Industries Ltd. took an exit route of buying land directly from the farmers.

Real estate in India has marked a growth of about 30% in a year and about 10 billion of foreign investment is likely to flow into the sector through private placement in the next two to three years.

Both the companies, UPPAL LTD. and Vornado have refused to release any further details about the project or its financial arrangement.

News Published Under:   Real Estate India, Real Estate Developers |