Real estate in india

Falcon Realty Services Private Limited (FRSPL) opened bookings for Gulmohar Woods, its

affordable housing project with apartments available for as little as Rs 5.5 lakh.

Gulmohar Woods is the first project to be developed s a part of
href="http://www.zameen-zaidad.com/"> Global EcoCity on the NH-8 in Delhi – NCR.

The company has announced a flexible and convenient payment scheme that allows buyers

to pay only Rs 51, 000 at the time of booking.

Spread over 35 acres, Global Eco City has
executive homes, weekend homes, home for

all and premium villas.

Courtesy:- HT dt:-- 04-04-09

With falling property prices,
home financing offers have increased. But, there is a word of caution: One must keep the borrowing component low to avoid high leverage

Home buyers have their plate full, at least in terms of financing options. A recent addition to the offer list is Canara Bank’s new home loan scheme. ET Intelligence Group takes a look at some of the public sector bank schemes to check which of these involve the minimum outflow. After the stimulus package’s blanket offer (five-year fixed 9.25% interest rate for loans up to Rs 20 lakh taken till 30 June 2009), there are other equally luring offers. Be it the largest public sector bank SBI, or the likes of LIC Housing Finance, Bank of Baroda or Union Bank, every bank is vying for the same customer. However, there is a word of caution; one must keep the borrowing component low to avoid high leverage.

CANARA BANK’S NEW HOME LOAN

This scheme is applicable for home loans up to Rs 30 lakh. The interest rate will be 8.25% in the first year and 9.25% for the next four years. Thereafter, the benchmark prime lending rate (BPLR) will be applicable, less 2.5%, subject to a minimum of 10%.

For loans above Rs 30 lakh and up to Rs 1 crore, the rate of interest will be 9% for the first year, 9.75% for the next four years and BPLR less 2% subject to a minimum of 10.50%. These rates are only available for the new borrowers and up to December 31, 2009. The maximum loan tenure that can be allowed under this scheme is 25 years. The loan to value ratio would be 80%.

SBI had earlier unveiled its Happy Home offer. This scheme specified an interest rate of 8% for the first year, a discount of almost 200-250 basis points to the prevailing market rate. However, after the first year, it would be marked to-market.

OUTFLOW

The EMI for Rs 30 lakh loan would be Rs 29,104 in the first year, at an interest rate of 8.25%. For the next four years, the EMI would be Rs 30,783, calculated at 9.25%, resulting in increased outflow of Rs 1,679. But assuming that the minimum rate applicable after the fifth year would be 10% as per rules, the EMI payable would be Rs 31,774. This would be a marginal increase of 3.2%, which would not be heavy on the pocket.

A borrower would be protected against the rising interest rate regime, at least for the first five years. However, on the flip side, one would end up paying a higher EMI amount in case the interest rates decline during the first five years.

THE BEST OPTION

A cursory glance at the scheduled interest rates gives the impression that this is the cheapest home loan scheme, but it is not the case. A comparative analysis shows that the interest outgo of other public sector bank schemes is higher than LIC Housing or Bank of Baroda. However, the interest outflow is lesser compared to SBI’s offer. Nonetheless, each bank has its own payment schedule (whether the repayment will first be towards interest or principal). A customer must, therefore, undertake thorough analysis on his own before opting for a scheme. Happy home buying.

Courtesy:- ET dt:- 13-04-09

For the first time in last five years,
Mumbai’s commercial real estate market

is headed for an oversupply with a total of 16.02 million sq ft of new commercial

office space expected to enter the market in 2009. Demand though has been dipping

steadily. According to property consultancy Jones Lang LaSalle Meghraj (JLLM), the

demand for office space has dropped 60-80% compared to the peak period from late 2005

to early 2008. Some parts of the city had seen rental appreciation of over 100% in the

period on the back of big demand from the Banking, Financial Services and Insurance

(BFSI) and IT/ITeS sectors. “Rentals are set to go down a further 20-25% in Mumbai

owing to the mismatch in supply and demand. BFSI which generated the most demand for

the Mumbai market has been hit the most in the recent times,” says Vivek Dahiya, CEO

of property consultancy GenReal.

A JLL-M report ‘The Slope of Descent’ says: “The BFSI and IT/ITES sectors - the two

most prominent office space occupiers in the country, have been adversely affected in

the economic downturn. The BFSI sector suffered globally with the collapse of major US

and UK banks resulting in many financial corporates putting their expansion plans on

hold. BFSI demand for office space in India’s business districts fell in 2008, and it

is projected to remain sluggish in the short term.”

The mismatch for many years has been on the supply side, which has been reversed now.

Throughout 2006-08, Mumbai trived on new companies coming in. A number of
investment banks, management

consultancies, private equity firms and others who entered the Indian market

wanted to take up space in Mumbai, mostly south Mumbai. “The only demand that is there

in the market today is from the non-BSFI corporate segment,” says Kaustuv Roy,

executive director at Cushman & Wakefield.

The first quarter of 2009 saw a total supply of 2.47 million sq ft of new space in

Mumbai of which the total absorption of space is only 35%. The total absorption was

only 896,454 sq ft. Rentals have been steadily falling in most major micro-markets of

Mumbai.

Rentals in Nariman Point are down 13% compared to last quarter and about 30% down

compared to a year ago. Worli, Lower Parel, Bandra Kurla Comlex and Andheri-Kurla are

the worst hit with rentals coming down by 38%, 39%, 27% and 33%, respectively, over

the last one year.

This is the best time for businesses to relocate to locations that offer lower rentals

and bring down their operating cost. “There is some leasing activity going on but only

for the price conscious which is mainly for relocation. The business expansion demand

has completely dried out in the city,” says Aniruddh Wahal, national head, strategic

occupier services at JLL-M.

Courtesy:- ET dt:- 17-04-09

For details visit www.zameen-zaidad.com

Unitech Ltd, the country second-biggest real estate developer, plans to raise as much as $250 million (Rs 1,250 cr) through private placement of shares to qualified institutions, company officials said, to repay part of its debt of over Rs 8,000 cr

The New Delhi-based developer plans to raise the funds by the end of this month, a company official, said declining to be identified. The company is planning to reduce Rs 1,000 cr of debt on its books by June this year.

Unitech Managing Director Sanjay Chandra and key officials of the company have been in Mumbai over the past couple of days to gauge investor sentiment. The
real estate company has hired UBS and IDFC as arrangers for issue. A Unitech spokesperson declined to comment.

Unitech’s move comes after the developer withdrew its application with the Foreign Investment Promotion Board (FIPB) in February to raise Rs 5,000 cr fro the sale of securities. A year earlier, the company planned to raise Rs 7,500 cr through a qualified institutional placement or QIP.

The recent rally in the stock market seems to have encouraged Unitech to revive its QIP plan. The company’s stock has climbed 70 per cent since March 9, while the benchmark Sensitive Index has risen 32 per cent. The company’s stock rose more than 14 per cent in the past two trading sessions and closed at Rs 42.05 on Thursday.

"With markets recovering from its lows,
Unitech has started working on the issue,’’ said an investment banker who declined to be identified. “The dilution cold be as much as 1/6th of the market cap.’’

If this QIP goes through, it will be the first such placement in as many as eight months after the Securities and Exchange Board of India changed QIP norms. Last August, the Sebi had amended pricing norms for QIPs by allowing companies to fix the price based on the average price of two weeks. Earlier, companies had to fix the price based on six-month average prices. Not a single QIP issue, however, has hit the market since then.

QIP deals, which were struck during the bill run at hefty premiums, have now turned sour because of the sharp fall in the valuations of listed companies.

The mark-to-market (MTM) value of QIP deals raised between March 2006 and March 2009 has fallen 73.47 per cent to $1.75 billion (about Rs 8,841 cr) from $6.58 billion (about Rs 33,245 cr), according to data from SMC Capital.

Courtesy:- BS dt:- 10-04-09

Redevco, one of Europe's largest real estate investment and development firms, with a

$10 billion portfolio, is understood to be looking at investing around Rs 300 crore in

various projects of Bangalore-based
Sobha Developers .

Redevco, part of the diversified Cafro Holdings, which is into private equity, retail,

financial services and renewable energy, in addition to
Indian real estate

have been slowing over the past three quarters and this deal is expected to be a major

one. While Redevco said it had nothing to comment, Sobha has been maintaining that it

is in talks with various funds and nothing has been finalised.

Over the past two quarters, Sobha has been aggressively looking at three options to

reduce its debt burden of close to Rs 1,900 crore, a leverage of 1.6 times.

The company, which has Infosys as one of its major clients, is looking to raise around

Rs 850 cr by selling around 200 acres of its 3,000 acre land bank, offloading up to 49

per cent stake through special purpose vehicles and to offload up to 25 per cent stake

at the enterprise level.

Sobha is understood to have identified around 150 acres of land on which projects can

be implemented through special purpose vehicles by divesting stakes.

The company is also engaged with around 12 banks and financial institutions to

restructure around Rs 850 cr of debt that will be due for payment during the next 18

months.

Banking sources indicate Sobha has been able to get a nod for a part of that sum and

talks are also on with mutual funds to roll over Rs 350 cr of debt

Courtesy:- BS dt:- 17-04-09