suruchi

Foreign investors continue to pour money in Indian properties, unruffled by RBI and government’s attempt to cool down the real estate sector. In the last one month, foreign companies and funds have invested over $1 billion in India’s IT parks, hotels and residential/commercial complexes.

Israel’s leading property developer Alony Hetz and the UK-based Plaza Centers NV have acquired majority stakes in real estate projects floated by textile manufacturing firm Wearology, Pune-based developers Panchshil group and Avinash Bhosale group respectively, to develop FDI complaint property projects in Mumbai and Pune. The foreign developers are investing approximately $400 million.

The expected volume of residential property investments in India is $40 billion, whereas the volume of investments in infrastructure is estimated at $65 billion. The annual demand for office space is projected at 2 million sq meters for the next five years. About 80% of the office space is leased to high-tech industries. The realty market in India was opened to foreign investors (FDI) in mid 2005.

Alony Hetz is participating in holiday home projects worth over $200 million in India with various developers. The company has raised NIS (New sheqel) 500 million through a bond issuance to institutions to invest in India. It plans to build a $160-200 million 450,000-sq m ‘second home holiday house’ project in a joint venture Wearoloy at Karjat near Mumbai.

To capitalise the Indian realty market, Scottish entrepreneur- Sir Tom Hunter, Icelandic investor Baugur and Britain’s HBOS have teamed up to finance a $100 million fund set up by pan-European property group Catalyst Capital. The fund will include $40 million of equity and the rest will be debt The investment will be used in the hotel development, house-building and land acquisition, initially around Mumbai and then other Indian cities.

Similarly, Yatra Capital, a Euronext listed property fund has picked up majority stake in FDI compliant projects in tire II and III cities in the Western India.

Priya

A UK-based property investment group,Red Ribbon UK Fund plans to invest 250 million pounds in India's booming real estate sector in the next five years.

Of the total amount,

• 50 million pounds would be invested in budget hotel chains all over India,
• 50 million pounds in developing resorts in Kerala,
• 50 million pounds in student accommodation and
• 100 million pounds in commercial properties.

The first budget hotel would be commissioned in Cochin by July 2007.
The company has identified land to build a 300-room resort in Kerala and the land acquisition would be completed in the next three months.

Regarding student accommodation, he said they would identify 50 top universities in India and build hostels and dormitories next to the campuses.

In addition, Red Ribbon UK Fund also have plans to set up a pre-fabrication building construction factory in Kerala.

The company's investment plans further include building of retail parks, keeping in view the requirements of leading bluechip companies in India.