Yatra to invest e21.6 m in realty projects

Yatra Capital Limited, the first Euronext quoted Indian real estate company, has made its first investment in Indian real estate. Yatra has committed up to e21.6 million in equity for a 49% stake in a joint venture with Kolte Patil Developers Limited, to develop three residential sites in Pune, Maharashtra. Yatra Capital raised e100 million in December 2006 to invest in Indian real estate.

Yatra Capital Limited chairman Nigel Broomfield said, “We are very pleased to announce our first investment in India with a leading, experienced and internationally accredited real estate partner. This opens our investment account in India and is in alignment with our strategy of partnering experienced developers to create shareholder value for Yatra.”

All three localities are in key corridors of growth. This investment in Pune underlines Yatra’s stated strategy of investing in fast growing Indian cities. Kolte Patil Developers Limited chairman & managing director Rajesh Patil said, “Yatra Capital Limited through its advisor Saffron Capital Advisors is a very well informed and networked partner that creates value not only through equity investments but also through its extensive knowledge on quality real estate development.” Kolte has over 25 projects to its credit, including the GigaSpace IT Park project in Viman Nagar, Pune. Saffron Capital Advisors Limited, sourced, evaluated and advised on this joint venture. Yatra through its subsidiary K2 entered into an Investment Advisory Agreement with Saffron Capital Advisors in August 2006.
Source://indiatimes.com

India tries to cool real estate boom

India has tightened overseas borrowing rules, making it harder for less creditworthy and smaller local companies to raise funds, which analysts say will curb soaring capital flows and calm the hot real estate sector.

"It looks like the move is basically to control capital flows and cool the real estate sector," said D.K. Joshi, principal economist at credit rating agency Crisil.

The use of overseas borrowings for development of integrated townships would also be stopped. Rising mortgage rates and a doubling of property prices in major cities in the past two years have lifted home prices beyond the reach of middle-class Indians.

Source://nzherald.co.nz

Boomtown Faridabad

MARKETING executive Kamal Krishna is set to move into his new Faridabad flat in Green field Valley. “It’s green, it’s open, and it’s cheaper,” says the 27-year-old who started house-hunting two years back with his wife, a fashion designer.

After looking through the saturated real estate markets in Delhi and Gurgaon, they zeroed in on Faridabad. Why? “It’s just 30 minutes from my office at Nehru Place,” Krishna says. “I was looking for a house in Gurgaon, and the closest I could come to finding an affordable house was on Sohna Road which was nowhere near civilisation.

“Faridabad, closer to Delhi, offered the same in about half the price.”

Like Krishna, many are now heading towards Faridabad, which is now shedding its tag as a smoky industrial town that hosts the annual Surajkund crafts fair. It’s slowly graduating into a suburb offering a greener and economical housing option for those looking to stay around Delhi.

As property prices go through the roof at Noida and Gurgaon, Faridabad is on its way to make it big. And with builders eyeing the trans-canal land acquired from villages along the Yamuna and the proposed Taj Expressway corridor, Faridabad is expected to have 20,000 houses up for sale in the next two years.

Real estate dealer Harish Arora, who has seen a huge increase in number of property sales in the past two years, says: “People can buy a flat and a 1,000-square-foot bungalow plot for Rs 3,000-Rs 4,000 per square foot. In Noida and Gurgaon, the prices are at least double, if not more.”

Another factor that goes for Faridabad, he says, is its proximity to Delhi: Contrary to common perception barring traffic jams at Badarpur, it is closer to Delhi and Gurgaon compared to Greater Noida.”

Next change: chic
Two multiplexes and half-a-dozen multi-cuisine restaurants later, Faridabad is transforming. And with groups like Triveni, Omaxe, Achiever, SRS, Eldeco, Eros and Zion jumping into the real estate bandwagon, builder Sunit Sachar says the party has just begun. “We will have a dozen malls along NH-2 in the next couple of years, and Taj Expressway connecting Noida and Faridabad is on track,” he says.

“The suburb is gradually growing to be the next Gurgaon.”

But real estate agents warn that the bubble might just burst if developers and the government fail to build on infrastructure to support the growing population, 26 lakh at present.

“The expressway to Gurgaon is a mess and flats in Greater Noida are lying vacant due to lack of connectivity,” Arora says. “If the Badarpur flyover project takes off, people who are merely investing here and are slightly hesitant to move in will do so immediately.

“Otherwise, the 20,000 homes that may come up will have no takers.”

He admits that 70 per cent of the present market comprises investors, not people who want to live in these flats under construction.

Needed: infrastructure
Shubo Sengupta, an advertising executive, is wary of shifting into his Faridabad flat for these very reasons. “Faridabad is too downmarket, lacks infrastructure and has no value in Delhi’s snob market,” says the Greater Kailash resident.

But the reason why he wants to move base from GK — “too crowded and expensive” — is precisely what real estate developers say are Faridabad’s USP.

Krishna, who lives in a rented accommodation at Faridabad’s Ashoka Enclave in Sector-37, says, “Infrastructure is important but it will come up only if people start living here. It is a consumer-driven market. And Faridabad has the potential of being an alternative to Delhi.”

Source://expressindia.com

Roller coaster ride for realty stocks

It was an extremely volatile day’s trading for real estate stocks, a day after Delhi-based DLF announced that it had received approval for its mega initial public offering.

Most real estate india stocks including Unitech, Indiabulls Real Estate, Sobha Developers, Ansal Properties, Parsvnath Developers, Akruti Nirman, among others, shot up in morning trade, but profit booking during the latter half of the day brought down the stock prices below Monday’s level at close.

Unitech, which ended higher by 4.74 per cent or Rs 20.05 to Rs 443.45, was the only notable gainer on Tuesday, while Indiabulls Real Estate (down 3.84 per cent to Rs 351.40), Sobha Developers (down 1.12 per cent to Rs 854.85), Parsvnath Developers (down 1.19 per cent to Rs 308), Ansal Properties (down 3.54 per cent to Rs 273.75), Orbit Corp (down 3.92 per cent to Rs 196) and Akruti Nirman (down 4.22 per cent to Rs 382.40) slipped on heavy profit booking in closing hours.

Analysts, however, feel that the recent fall in prices, make some of the real estate stocks an attractive investment opportunity for investors.

Suman Memani of Emkay Securities anticipates a bright future for the real estate sector, considering the investments that are being made in commercial real estate. “Residential sector will still take some time to normalise. It may see a bit of a slow down,” he said.

The fact that the Reserve Bank of India has reduced risk weight on home loans of less than Rs 20 lakh from 75 per cent to 50 per cent is also another positive factor.

All the real-estate stocks were on fire in morning trade on heavy buying from investors. Indiabulls Real Estate hit a high of Rs 384.80, up 5.29 per cent from previous close, earlier in the day, before profit booking pulled the prices down by close. Similar situation was witnessed in other counters as well.

For instance, Sobha Developers was trading at about 3 per cent high from Monday at Rs 889, while Ansal Properties was trading at Rs 294.35, up by 3.71 per cent from previous close, in early trading on Tuesday. Source://business-standard.com