DLF gets 11.76-acre Gurgaon plot with record Rs 1,496 crore bid

dlf newsIn a closely contested auction, DLFBSE 1.19 % has emerged as the highest bidder for a land parcel put by Haryana State Industrial and Infrastructure Development Corporation (HSIIDC) spread over 11.76 acres in Gurgaon for a record Rs 1496 crore, said three persons familiar with the development.

The company is expected to pay an additional Rs 143 crore for Transit-Oriented-Development rights. DLF will also have to pay Rs 120 crore for registration of the land parcel, taking the total deal value to Rs 1,759 crore, against the reserve price for the land parcel that was set at around Rs 686 crore.

This is an unprecedented price for a land parcel in the National Capital Region. The deal concluded through an e-auction on Monday night, at a base price of over Rs 127 crore per acre, has surpassed all earlier benchmarks.

DLF and Bharti Realty had emerged as the contenders in the final round out of more than half a dozen developers, including Indiabulls Real Estate, Experion Developers, Emaar Group, Embassy Group and RMZ showing interest in this land parcel.

The second highest bid made by Bharti Realty stood at Rs 1,446 crore.

An HSIIDC official, who requested anonymity, confirmed that a subsidiary company of DLF has emerged as the highest bidder with Rs 1,496 crore. An email sent to DLF remained unanswered till the time of going to press on Tuesday.

As per the bid terms, the allotment letter for the said land parcel will be issued to Aadarshini Real Estate Developers, subsidiary of DLF Home Developers upon payment of 10% of the quoted amount. The balance amount can be paid in installments as per the terms of bid document, DLF said in a regulatory filing.

In November, global home furnishing company Ikea had bought a 10-acre land parcel in Gurgaon for Rs 842 crore through an e-auction conducted by HUDA, the Haryana government’s development agency. The land parcel is located on NH8 behind Oberoi Hotel in Guragaon, and has the potential to develop both commercial and retail spaces.

“This is an extension of the established DLF Cyber City micro market and the deal reconfirms DLF’s long–term commitment to retain control over this NH8 cyber city micro market in terms of pricing, supply and occupier profile,” said Ankur Srivastava, chairman, GenReal Property Advisors. “It allows DLF to revalue its undeveloped FSI in this micro market while using this auction as a benchmark.”

“This is an extension of the established DLF Cyber City micro market and the deal reconfirms DLF’s long–term commitment to retain control over this NH8 cyber city micro market in terms of pricing, supply and occupier profile,” said Ankur Srivastava, chairman, GenReal Property Advisors. “It allows DLF to revalue its undeveloped FSI in this micro market while using this auction as a benchmark.”

The said 11.76 acre land parcel has a leasable potential of around 2.3 million sq ft. The plot has base floor space index of 1.75 times, which would get double to 3.5 times after factoring the benefit of Transit Oriented Development (TOD) rights.

DLF is expected to push this development into DLF Cyber City Developers Ltd (DCCDL), its joint venture with Singapore sovereign fund GIC. Promoters of DLF have sold their 33.34% stake in its rental arm DLF Cyber City Developers Ltd (DCCDL) to GIC for Rs 8,956 crore. The transaction was concluded on December 26, and the company now holds the balance 66.66% in DCCDL.

Currently, the rental arm’s portfolio includes leased space of 27 million sq ft and nearly 4 million sq ft under construction. The joint entity also has access to land bank that has additional development potential of 19 million sq ft.

According to industry experts, the successful bidder will have to lease spaces in proposed development on this plot in the range of Rs 150 to Rs 160 per sq ft a month to achieve a breakeven, given the high amount of bid. Currently, office space lease rentals in this vicinity are around Rs 110 per sq ft and a right mix of retail and commercial development may help the company fetch the expected average lease rentals.

Source : http://bit.ly/2GP5QOr


Japan’s Sumitomo Enters Indian Realty Sector with $2 billion Gurgaon Projects

krisumi-corporation-660_022218052711Japanese conglomerate Sumitomo Corp today announced USD 2 billion township project in Gurgaon as it forayed into Indian real estate sector in collaboration with local partner Krishna Group.

The 50:50 joint venture, Krisumi Corporation Pvt Ltd will build 5,000 flats, shopping mall, office space and educational institution at 65-acre land in Sector 36-A, Gurgaon abutting the Delhi-Mumbai industrial corridor’s Global City.

The project, which will have a total built-up area of 18-18.5 million square feet, will be developed in phases, the two partners announced at a media round table today.

“I want to create a Japanese city here…The first phase will comprise 1.2 million square feet of built-up, consisting of 430-450 apartments and will be completed in 4-5 years,” said Ashok Kapur, Chairman, Krisumi Corp.

Krishna Group, a diversified business house with interests in auto components, media, travel, and entertainment seating, owns the 65-acre land parcel where the mini-township will be built, said Kapur, who is also the head of the Group.

“Idea is to create a niche which Indian market had not seen,” Kapur said adding the apartment that may cost Rs 1-2.5 crore will have quality and facilities equivalent to those costing Rs 15-20 crore at present.

Sumitomo Corp, which has done 300 real estate projects globally, will bring in the expertise and technology for Krisumi City.

“India’s real estate sector is going through an interesting phase. While consumer’s expectations have evolved manifold, most of the traditional developers are finding it difficult to effectively cater to all their requirements,” said Masahiro Narikiyo, Chairman and MD, Sumitomo Corp India.

Narikiyo said the Tokyo-based group has done projects in Japan, the US, China, Singapore, Indonesia and Vietnam.

The company was attracted to India because it “is politically very stable among emerging markets,” he said. “It is governed by democracy, the value we can share.”

Sumitomo Corp has sold over 50,000 (rpt) 50,000 condominiums in Kansai and in the Tokyo metropolitan area over the past 50 (rpt) 50 years. In the office building business, it operates about 3,30,000 square metres of office space in Tokyo and Osaka.

Kapur said the biggest challenge facing the Indian real estate industry today is quality, efficiency, and commitment to timelines, all of which is exactly what Japan is known for.

“Japan is already beyond RERA,” he said .. adding that Sumitomo may enter into more such alliances in India later on.

The project spread over 65 acres will be developed in 7-8 phases over 10 years. While the first phase with 1.2 million sq ft development will have over 450 apartments, the entire project will offer around 5,000 apartments.

“The biggest challenge facing the Indian real estate industry today is with regard to quality, efficiency and commitment to timelines, all of which are exactly what Japan is known for. We are certain that our partner, Sumitomo Corporation, part of the 400-year-old Sumitomo Group, with their extensive global experience in real estate development shall contribute tremendously in creating projects with endearing value for our clients as well as the local communities around it,” said Ashok Kapur, chairman, Krishna Group.

The joint venture company has got most of the approvals for the first phase, which will be launched later this year. The construction of the first phase of the project is also expected to commence this year.

Source : http://bit.ly/2EP74ZK

Investing in Real Estate? These Micro Markets can Give Good Returns

There is an uncanny similarity between the stock market and the real estate market today. Though the overall equity market is looking weak, there are several stocks worth investing right now. Similarly, though the broader real estate market is flat, action is happening at the micro level. There are several pockets across metros and large cities where property prices are reasonable and investors can expect Good Returns.


However, don’t expect prices to shoot up like they were between 2005 and 2008. “Rental yield can be a good yardstick for residential real estate. Investors should get in only when the rental yield is more than 3%,” says Pankaj Kapoor, MD, Liases Foras. The introduction of the Real Estate Regulation Act helps buyers but has removed the information asymmetry that helped generate High Returns from property. “Real estate, especially New Launches, used to double in value in 3-4 years; that phase is n ..

Second, the focus has shifted from premium properties to the affordable and mid-priced segments. Due diligence by home buyers has also improved. “Home buyers are taking time and doing indepth research like visiting property sites several times before buying,” says Jayashree Kurup, Head – Content & Research, MagicBricks. “Three main factors to check is the credible developer, right-sized house and good price. Unlike earlier, home buyers now insist that all three are in place,” says Sharad Mit ..

This week’s cover story looks at micro markets that are doing well and could offer value to buyers. We examine the factors that have worked for these pockets and tell you why you should consider buying property in these hotspots.

Improving connectivity and quality of space are plus points.

Gurugram Strong Showing

Improving connectivity and quality of space are plus points. 

Office-Space small

Availability of high quality office space at reasonable rates has helped Gurugram score over more expensive Delhi. “Gurugram remained the preferred office destination in NCR with about 57% share in overall leasing in 2017,” says Sachdev of Colliers International India. In addition to the cost advantage, proximity to the airport is another attraction. The price performance in Gurugram has been unlike other cities. A similar trend is expected in the coming year as well. “Premium office occupiers will continue to prefer Cyber City, Golf Course Road and NH 8 owing to their enhanced connectivity,” says Sachdev. Similarly, the state government’s efforts to decongest the Gurugram-Alwar highway should make commuting easier from Sector 48.

For more View Source : http://bit.ly/2sBJMol

Blackstone in Talks to Buy Commercial Property Portfolio from L&T for Rs 2.3k Crore

MUMBAI: US-based private equity player Blackstone Group is in advanced talks to acquire two commercial properties of L&T Realty, totalling 1.7 million sq ft, in a deal valued at Rs 2,300 crore, said two persons familiar with the development.

Blackstone Reuters

This portfolio of the real estate arm of engineering major Larsen & Toubro includes about 8 lakh sq ft of fully-leased commercial tower at the L&T premise in Powai suburb and another 9 lakh sq ft office block at the company’s commercial project at Seawoods, in Navi Mumbai.

The Seawoods office tower — yet to be completely leased — will be acquired in phases, the people cited earlier told ET.

“The deal is expected to be inked by late February as due diligence is currently in its final stages,” said one of the persons cited above, adding that L&T Realty will assist in further leasing at Seawoods commercial block.

Both L&T Realty and Blackstone Group declined to comment.

In 2016, Blackstone had bought a 1-million sq ft retail mall, adjacent to the office tower in Seawoods, from L&T Realty for over Rs 1,400 crore. L&T Realty’s office block in Navi Mumbai is part of India’s largest Transit Oriented Development Seawoods Grand Central, a mixed-use development area over 40 acres that includes the mall and other commercial spaces.

The persons cited earlier said Blackstone is acquiring these assets directly and not through existing joint ventures with Bengaluru-based Embassy Group and Pune’s Panchshil Realty. The New Yorkbased institutional investor has acquired assets and stake in portfolios independently earlier too.

The commercial tower in Powai is completely leased and has JP Morgan Chase, Colgate-Palmolive and L&T Infotech among its tenants. Being a fully-leased property with long-term contracts, the Powai asset is valued at Rs 1,500 crore and has a capitalisation rate of about 8.5%


Cap rate is ratio of net operating income of the property to its asset value.

Over the past few years, Blackstone has emerged as the most aggressive institutional investor in India’s real estate sector, picking up properties across major cities in deals that are turning out to be benchmarks in the sector. The company owns India’s biggest portfolio of incomeproducing office assets, totaling over 31 million sq ft across key property markets of Noida, Mumbai, Pune and Bengaluru.

The private equity player established its India office in August 2005, and since then has committed over $6 billion to companies in the country. In its real estate portfolio, Blackstone has over total 19 companies that own 31 million sq ft across 18 operating office parks, and it has invested $2.7 billion in these assets. It also has 11 million sq ft of commercial space under development across the country.

Large global institutional investors including Blackstone Group, Asset Management, GIC, Canada Pension Plan Investment Board, Goldman Sachs and Qatar Investment Authority have been investing aggressively in Indian real estate assets over the past few years.

Source : https://goo.gl/FjyPQA

Dwarka E-Way Connector to Get Extra Lanes

GURUGRAM: MCG will be converting the stretch connecting Daulatabad flyover and Dwarka expressway into a four-lane road to ease traffic congestion on the route. The move will bring relief to hundreds of residents living in sectors along the expressway and areas such as Rajinder Park and Daulatabad.

Dwarka Expressway Four lane road

dwarka expressway four-lane road

“This junction has always faced problems in terms of traffic congestion during peak hours. We have often received complaints regarding the traffic mess at this point and hence, we are making some changes in order to cut down on the snarls on the route,” a senior MCG official told TOI on Saturday.

According to officials, the tendering process for the work has started and an estimated Rs 4.5 crore has been sanctioned by Chandigarh for the project.

The work on the project is expected to be completed in the coming year. There is a one km stretch between Daulatabad flyover and Dwarka Expressway. The widening of this stretch will be a big relief to people living in the new sectors along the expressway, including sectors 109, 110, 103 and 106, since in the absence of another approach road, they take this route.dwarka xway latest news

“The area has a lot of societies and there are no proper roads and the approach from Daulatabad is almost always congested. The road widening project would bring some relief for the people living in the area,” said Sushil Kumar, a resident of Sector 109.
Additionally, the service lanes along the Daulatabad flyover will also be widened to streamline the traffic under the flyover.

A slip road will also be built near the entry point of the flyover that will take the traffic directly from Daulatabad to Rajinder Park residential area.

“The widening of the service lane and construction of the slip road will benefit residents in areas such as Rajinder Park, Vishnu Garden, Mahalakshmi Garden, Jai Vihar and Daulatabad Industrial Area,” said another MCG official.

Source : https://goo.gl/7yaADh