24-10-08
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Is this the realty bubble bursting at last? Reports say, many other Developers may default. Read this extract from IBN Live, Oct 23, 2008.
Quote:
Unitech defaults on Rs 150-cr payments
Unitech, the country’s second largest real estate company, has defaulted on two payments on a housing project in Greater Noida in Uttar Pradesh.
Sources told CNN-IBN Unitech has not paid two installments worth Rs 150 crore to the Greater Noida Authority for the 100 acres it had purchased for its ambitious Uniworld City project.
The company is trying to reschedule the payment, but risks harming the land deal if it doesn't pay up, the sources say. The company insists the payment was stopped due to farmer agitation.
CNN-IBN Correspondent Nayantara Rai reports officials of the Greater Noida Authority understand that real estate companies have been hit by liquidity crunch and will be “understanding” to Unitech’s request.
DLF group chairman K P Singh says the financial crisis has hurt the real estate business, particularly “fly-by-night operators”.
“Good clients will pay up, but there are millions of developers who are fly-by-night operators. My feeling is that they will be in trouble and if they are in trouble they won't be able to pay up and they are going to default,” said Singh.
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