Daily Real Estate brief from PNT
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Netflix India renews BKC office lease for Rs 284 crore in 5 years
Netflix's Indian subsidiary has extended its lease for a 137,000-square-foot office space in Mumbai's Bandra-Kurla Complex for five years, with a total value exceeding Rs 280 crore. The lease covers the 11th and 12th floors of Godrej BKC's commercial tower. Rental fees will be nearly Rs 4.30 crore per month, with a provision for annual rental increases of 5 percent. Netflix had originally leased the space in 2019 from D Decor Properties LLP. India has become a vital content hub for Netflix, with substantial investments in the Indian market. In Q3 2022, India's office space leasing market reached a six-quarter high, absorbing 10.37 million sq. ft.
Deals of the Day: Deals in Colaba, Vashi, Juhu, Grant Road and Sion
• A residential flat spanning 710 square feet on the 3rd floor sold in Jamuna Sagar in Colaba for INR 2.6cr
• A residential flat spanning 472 square feet sold in Shree Ganesh Krupa in Vashi for INR 49.85 lacs
Ajmera Realty & Infra’s Q2 profit falls 34% to Rs 22.53 crore
Ajmera Realty & Infra India Ltd (ARIIL) reported a 34.08% decline in its net consolidated profit for Q2 FY24, with a profit after tax of Rs 22.53 crore, down from Rs 34.18 crore in the same quarter the previous year. Their net consolidated total income also decreased by 21.13%, reaching Rs 147.59 crore in Q2 FY24. Despite ongoing business activities, the company maintained a stable debt-to-equity ratio of 0.97x. The board approved the re-appointment of K. G. Krishnamurthy as an independent director. ARIIL highlighted an expansive launch pipeline and substantial sales growth, with a net worth of Rs 807.40 crore as of September 30, 2023.
Sunteck Crescent Park: A landmark of luxury and sustainability in Kalyan
Sunteck Crescent Park (Phase 1) is a luxurious residential project spanning 7 acres in Kalyan, Mumbai. It boasts stunning towers with a 360-degree panoramic view of 80% open spaces, a 1.4-acre open podium, and an elevated infinity pool. This development redefines high-end living, seamlessly blending luxury residences, amenities, retail, and fine dining. Sustainability is a core focus, with green building features, solar energy, and waste recycling. Sunteck Realty aims to transform Kalyan into a premier residential destination, with potential top-line revenue of Rs 9,000 crore over 7-8 years. Kalyan's real estate market is growing due to infrastructure development, making it a promising investment destination. Sunteck Crescent Park is a testament to luxury and sustainability, reshaping Kalyan's real estate landscape.
DLF reports a consolidated profit of 30% in Q2 FY24
DLF, a major real estate company, reported a strong financial performance in Q2 FY24. Their net consolidated total income rose to Rs 1,476.42 crore, an 8.52% increase from the previous year. Notably, the net consolidated profit surged by 30.32% to Rs 621.89 crore. DLF declared a dividend of Rs 4 per share, totaling Rs 990.12 crore. The company underwent corporate changes, with a subsidiary, Pegeen Builders & Developers, forming a joint venture by ceding a 49% stake to Trident Buildtech. New sales bookings for the quarter were Rs 2,228 crore, and DLF Cyber City Developers showed a 7% YoY revenue increase, reaching Rs 1,463 crore. The consolidated profit for the quarter notably climbed by 17% to Rs 416 crore.
Raymond's subsidiary unveils Rs 1,700 crore redevelopment plan for Navjivan Society
Raymond Limited's subsidiary, Ten X Realty, recently unveiled plans to redevelop the Navjivan Society in Mumbai's Mahim area, projecting a revenue potential of Rs 1,700 crore. This move aligns with Raymond's real estate expansion strategy within the Mumbai Metropolitan Region. The company emphasized leveraging its vast land assets, aiming for substantial growth through joint ventures and development projects. This strategic step reflects Raymond's commitment to advancing real estate initiatives, diversifying its portfolio, and solidifying its position in Mumbai's real estate market.
Consumer Forum directs Holy Faith Builders to compensate buyers for coastal zone violations
In a recent verdict, the Ernakulam District Consumer Disputes Redressal Commission has ordered Holy Faith Builders and Developers to reimburse a couple over Rs 20 lakh. The couple had purchased a flat in Maradu, later demolished on Supreme Court orders due to violations of coastal zone regulations. The reimbursement includes over Rs 17 lakh for the flat's balance consideration and Rs five lakh as compensation for the deficient service and unfair trade practice. The builder must also pay Rs 25,000 for litigation costs.
Ahmedabad offers compensation in TDR to landowners affected by Town Planning Scheme
The Ahmedabad Municipal Corporation (AMC) is set to provide relief to plot owners who lost portions of their land due to errors in town planning schemes. Landowners will receive TDR certificates, which can be sold to developers in their designated areas. This initiative is pending approval and will initially benefit plot owners within Naranpura Town Planning Scheme 29, who have been in a 25-year dispute with the AMC over the error that occurred in 1973 when a smaller area was allocated than expected. The compensation is valued at Rs 3.35 crore, aiming to rectify the long-standing issue.
Contractor arrested for alleged Rs 10 crore fraud against NPCC in Nashik
The recent arrest of contractor Nitin Subhash Sharma in a case involving alleged fraudulent activities against the National Project Construction Co-operative Limited (NPCC) has raised significant concerns in the industry. Sharma is accused of engaging in fraudulent practices related to a contractual agreement with NPCC, amounting to over Rs 10 crore. The investigation revealed that Sharma had provided counterfeit Performance Bank Guarantees as part of the contract. This case underscores the importance of strong oversight and regulatory measures to prevent fraud in the construction industry. It also highlights the need for organizations to enhance due diligence processes and scrutiny of contractor guarantees to maintain transparency and integrity in the sector.
Bombay HC blocks Solapur land allotment cancellation over rider issue
In 1976, a 2,500-square-foot plot of land was granted to a Project-Affected Person (PAP). After nearly four decades, a complaint emerged, alleging a violation of the allocation's terms, which mandated the construction of a dwelling on the land within a year. As a result of this alleged non-compliance with the stipulated condition, the state authorities took the decision to cancel the land allotment. This move has ignited a debate surrounding the legality and fairness of revoking an allocation made many years ago, raising questions about the rights and responsibilities of land beneficiaries in long-standing cases of land distribution.
Mumbai's property market sees resilience despite repo rate increase
In Mumbai, over 56% of properties sold between January and October 2023 were priced above Rs 1 crore. Rising property prices and a 250 basis point increase in the policy repo rate over the past two years have affected registrations for properties below Rs 1 crore. However, higher-value properties have seen minimal impact with a consistent increase in their share. Mumbai achieved a total registration count of 104,832 units in this period, with 58,706 priced above Rs 1 crore. The Central and Western Suburbs have seen a surge in launches and strong demand, driven by factors like metro connectivity. This trend reflects the shifting preference towards more upscale accommodations, signifying buyers' capability and willingness for long-term commitments in the Mumbai residential real estate market.
Provident Housing negotiates Rs 1,000+ crore with HDFC Capital
Provident Housing Ltd., a subsidiary of Puravankara Ltd., is in discussions with HDFC Capital Advisors for a substantial equity investment exceeding Rs 1,000 crore. The aim is to finance the construction of mid-income residential properties in Bangalore, Chennai, and Hyderabad and to expand into new markets. These discussions are anticipated to result in the creation of a dedicated platform for the acquisition and development of residential assets. Provident plans to double its residential portfolio to over 20 million square feet by entering cities like Mumbai and Pune. The company is actively involved in over 11.32 million square feet of ongoing projects in multiple locations.
CapitaLand Investment launches Tech Park in Chennai with an invest plan of INR 1600 crore
CapitaLand Investment has inaugurated the first phase of its International Tech Park in Chennai, covering 1.3 million square feet and marking a significant economic boost for the region. The entire project, valued at Rs 1600 crore, is set to accommodate 50,000 IT engineers, aligning with the government's vision for Chennai as a tech hub. Securing international investments, including $262.5 million from Mitsubishi Estate Co. Ltd, demonstrates the project's appeal. CapitaLand Investment's substantial commitment underscores its dedication to Chennai's infrastructure development, supporting the city's progress and growth.
The Chennai civic authority raises taxes twofold to boost revenue
In response to increased property taxes, revised electricity rates, and heightened water charges, the Greater Chennai Corporation has doubled company taxes and building permit fees, imposing these changes through a recently approved resolution. While residential buildings under 100 square meters remain unaffected, larger structures will see increased fees, with commercial buildings and industrial properties also subject to higher charges. Simultaneously, company taxes have tripled, with varying rates based on annual investments. Additionally, the cost of demolition permits has doubled. These changes aim to enhance revenue collection and transparency while ensuring fairness in property and company taxation in Chennai.
Chandigarh's municipality is set to initiate attachment against the top 2,000 tax defaulters
The Chandigarh Municipal Corporation (MC) is set to initiate attachment proceedings against the top 2,000 property tax defaulters, including both commercial and residential entities. Many have failed to settle their dues within the stipulated timeframe. Section 138 of the Municipal Act empowers the MC to recover overdue taxes and associated recovery costs by attaching and selling the immovable properties of defaulters. A considerable sum, approximately Rs 150 crore, is pending in property tax dues, with Rs 8 crore attributed to residential properties. Despite offering incentives, the MC now faces no alternative but to resort to attachment proceedings due to persistent non-compliance.
Olive's hybrid revolution redefines hospitality for modern travelers
Olive by Embassy, a leading multi-brand hospitality management firm, is excited to announce its entry into the realm of hybrid hospitality and leisure, driven by the changing landscape of hospitality. Olive introduces four distinct brands aimed at meeting the diverse requirements of today's travelers. This approach is built on a "hospitality first" ethos and integrates various elements like hotels, co-living, coworking spaces, members' clubs, wellness amenities, and dining options within one location. Olive aims to expand its presence across India, with plans for premium resorts and luxury stays in key leisure destinations, along with an employment boost for various cities.
Trichy City Council approves 14.1 acres of land for Tidel Park development
In Trichy, a resolution was passed to allocate 14.1 acres of land in Panjapur near the Trichy-Madurai national highway for the construction of Tidel Park. The previous allotment of 8.9 acres was cancelled to accommodate the Tidel management's request for a larger land parcel to build a mega office space for IT and ITES companies near the upcoming integrated bus terminus (IBT). The Trichy corporation has agreed to transfer ownership of the land to Tidel Park Limited at a cost of Rs. 282 per sqft. The construction is expected to begin in March 2024. Additionally, the council approved road improvements at the Central bus stand.
Q3 sees dramatic 71% slump in global real estate fundraising, reports Preqin
Global real estate fundraising significantly declined in the third quarter of the year, dropping by 71% compared to the previous quarter. A total of $18.2 billion was raised by 61 funds. Property markets worldwide have been affected by central banks' interest rate hikes, resulting in increased borrowing costs and reduced property valuations, particularly for offices due to the growth of remote work. This reduced investor risk appetite. North America-focused funds remained dominant but saw a decline in their proportion, while Asia-Pacific funds increased their share. Funds focused on Europe and the rest of the world raised just 6% of the total capital. Uncertainty surrounding interest rates is expected to continue impacting real estate fundraising and transactions, keeping investment sentiment subdued.
Hong Kong High Court delays Evergrande liquidation decision to December 4
The Hong Kong High Court has postponed the hearing to wind up Evergrande, the troubled Chinese real estate giant, to December 4. This hearing is pivotal, as it's the final opportunity for Evergrande to present a concrete restructuring proposal before the court considers liquidation. Evergrande, struggling with massive debt, defaulted on its offshore debt in 2021 and had been working on a restructuring plan. However, the recent investigation of its founder and regulatory restrictions on issuing new bonds have complicated the process. The court's decision has added immense pressure on the company, emphasizing the need for a viable restructuring plan. A liquidation could have broader implications on China's real estate sector, and its ongoing projects would continue without immediate impact.
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