Ansal sells properties worth Rs 1,714 cr in Apr-Dec 2010

NEW DELHI: Realty firm Ansal Properties and Infrastructure Ltd today said it sold properties worth about Rs 1,714 crore in the first nine months of this fiscal and its sales realisations improved by 24 per cent compared to the year-ago period.

“The total sales booked in the first nine months of the 2010-11 fiscal is 15.81 million sq ft aggregating sales value of Rs 1,713.79 crore,” the company said in a presentation, outlining the operational updates.

The average sales realisations have improved by 24 per cent to Rs 1,084/sq ft in the first nine months of this fiscal as against Rs 872.81/ sq ft in the year-ago period.

The company had set a target to book sales of 16 million sq ft in the current fiscal, out of which 15.81 million sq ft has already been booked, it added.

Out of the total sales booked, the hi-tech township ‘Sushant Golf City’ in Lucknow and ‘Esencia’ in Gurgaon contributed 8.63 million sq ft and 2.31 million sq ft, respectively.

In terms of location, Uttar Pradesh accounted for 60 per cent of the sales booking, followed by Haryana at 33 per cent. The sales was maximum in plots at Rs 623.54 crore, followed by villas at Rs 475.4 crore.

Ansal API has a 301.78 million sq ft of total saleable area in-hand, out of which 83 million sq ft valuing Rs 6,926 crore has been sold till the third quarter of this fiscal.

In the first six months of the current fiscal, Ansal has reported 54 per cent increase in its net profit to Rs 61.55 crore against Rs 39.89 crore in the corresponding period of this fiscal.

Realty companies’ financial woes to mount

MUMBAI: The woes of realty developers may not ease anytime soon as pressure to repay debt and redemption of quasi-equity instruments continue to be a major task for them.

Repayment of structured quasi-equity instruments totalling Rs 3,000 crore held by foreign investors is due in the next couple of months and this is expected to stress already cash-strapped developers.

Redemption of these instruments is likely to coincide with developers’ loans that were rescheduled by banks two years ago and are now expected to come up for repayment around March.

As external commercial borrowings are not allowed in the realty sector, some cash-strapped developers had placed non-convertible debentures with non-banking finance companies, listed these debentures and then offered these to foreign investors.

At least four developers, three from Mumbai and one from Bangalore, had raised over Rs 1,000 crore almost a year ago through this route. These funds raised by some realtors through quasi-equity instruments around three years ago went to supporting their ongoing projects and land acquisitions.

However, most of these foreign investors may not be interested in converting these instruments into equity and hold stake in these realty projects, given the weakening demand for residential units and possibility of a fall in prices, analysts said.

“Builders will find it difficult to repay overseas investors since few local banks are willing to take large exposures. With the stock market entering a bearish phase, the prospects of IPOs are also dim,” said a senior official of a realty fund.

In a few cases, the matter may boil into legal disputes. “However, many of the structured papers are not enforceable debt and foreign investors may be left with little recourse,” he said.

Consensus on a fall in realty prices hereon is getting stronger as almost all the market participants, including consultants who undertake sales of these projects on behalf of the developer for a fee, have also estimated at least 15% correction.

Mumbai, the country’s financial capital that led the appreciation in realty prices in the past 12 months, is now expected to lead the correction in property prices owing to buyers’ resistance to higher prices, rising interest rates, tightening of credit, and an excess supply scenario.

An indication of this has already come through falling numbers of registrations at stamp duty and registration offices across Mumbai. After gaining nearly 40% in the past one year, residential property prices in Mumbai have already surpassed their last peak witnessed in 2007 and scenarios are almost similar across major locations such as the National Capital Region , Bangalore and Hyderabad.

Interest rates that have started moving higher are impacting affordability and delaying decision making and all of this is not allowing the demand to get converted into sales since the past two quarters.

Parsvanath Aims Big-Plans to Generate Revenues Worth Rs 13000 Crore by 2013

Parsvnath Developers, New Delhi-based real estate company, is planning to generate revenues worth Rs13,000 crore in the next two years. The company, which currently has debt of Rs1,100 crore, also plans to become completely debt-free by March 2013. The revenues were Rs455 crore during first six months of the current fiscal.

“About 80 million square feet (msf) is on fast-track execution, which we plan to complete by March 2013. Out of this, 40 msf is pre-sold and will generate Rs4,000 crore for us. The remaining 40 msf will generate another Rs9,000 crore. So as of now, we are focusing to complete the 80 msf and generate large cash for the company. The moment we achieve this, our balance-sheet will be completely debt-free with large cash reserves,” said Pradeep Jain, chairman, Parsvnath. The company owns a total of 195 msf. The properties are mainly located in Delhi and the National Capital Region.

On debt reduction plans, Jain said, “Our debt position is very comfortable. From a peak of Rs2,200 crore, we are almost half at around Rs1,100 crore as of now. By the end of this calendar year, we hope to bring the debt at around Rs500-600 crore.” The current debt-equity ratio of the company stands at 0.43%.

“Debt servicing will be done completely through internal generations and no fundraising at the parent company level is on the cards as of now. Also, funds already raised on the special purpose vehicle level and through the forthcoming deals will not be utilised for the repayment of the debt. We may monetise non-core assets if required,” Jain said.

The company may monetise its properties in Cochin, Mysore, Chennai, Palghat, Nanded and Coimbatore if required depending on the valuations. There are no concrete plans as of now. The company last week also entered into a project level private equity deal worth Rs 100 crore with Sun Apollo. It has picked up a 49.9% stake in the Parsvnath Buildwell Pvt Ltd, the SPV developing Exotica in Ghaziabad spread over 31 acres. The deal proceeds will be used for project implementation as well as marketing.

US Based Developer Donald Trump Plans Luxury Residential Tower in Mumbai

US billionaire real estate developer Donald Trump is entering the Indian property market with a luxury residential tower in Mumbai, more than two years after announcing plans to expand in the south Asian nation. Trump, who has joined with Mumbai developer Rohan Lifescapes Pvt for his first venture in the country, expects to start marketing the project by March, quoted Donald Trump Jr., Trump’s son and executive vice president at the Trump Organization LLC in the report.

“We are doing a very luxury project with Rohan Lifescapes and we’ll be in India later this quarter to launch it officially,” he added. He declined to give further details on the project. The Trump development is being built on the site of a former hospital in south Mumbai, in a neighborhood dotted with jewelry stores, the only Porsche showroom in the city and next to a Mercedes showroom, said two people familiar with the matter, who declined to be identified before an official announcement.

Rohan Lifescapes focuses primarily on redevelopments. It has more than 60 projects spread across 54 sites, according to its website. It has developed more than 20 million square feet of homes and offices and is currently developing 3.45 million square feet of projects in Mumbai, according to its website. “Our entry has to be in Mumbai and that’s where everything is going on right now in terms of the high-end real estate,” the younger Trump had said earlier. The billionaire has branded buildings from skyscrapers in Manhattan to condominiums in Tijuana, Mexico, Trump World in the South Korean capital Seoul and the Trump Towers Istanbul

Arabian co, Simplex Infra get contract to build World One

MUMBAI: Lodha Developers has awarded civil construction contract of its proposed world’s tallest residential building, World One, to a joint venture of West Asia-based Arabian Construction Company and Simplex Infrastructures  The contract is worth 450 crore and is scheduled to be completed in 38 months.

The project at Lower Parel in central Mumbai has been in the news ever since it has been launched in June. There have questions over the status of approvals from the ministry of environment and the director general of civil aviation.

However, according to the company, the construction contract for the tower has been placed as it has received the approvals. “We have all the necessary approvals, including from the ministry of environment and the director general of civil aviation and the construction of World One will kick off from the first week of February,” said Abhisheck Lodha, managing director of Lodha Developers. The DGCA nod is needed because of the builiding’s height.

With a height of 450 metres, World One will surpass the current tallest residential building Q1 at Gold Coast in Australia that is 323 metres high.

Arabian Construction has constructed some of the tallest buildings in the world, including 100-storey Princess Tower and Pentominium in Dubai.

Parsvnath to cut net debt by nearly 60%

MUMBAI: Realtor Parsvnath Developers expects to cut net debt to 7 billion rupees by December as revenues from projects start to flow in, a top official said on Monday.

“We expect the net debt to reduce further in the current financial year, but this would not be substantial. By the end of this calendar year, we expect a substantial reduction to around 700 crore (7 billion rupees),” Chairman Pradeep Jain told Reuters in an interview.

As on Dec. 31, 2010, the company’s net debt was 11 billion rupees, he said, adding the reduction would be affected through internal accruals and revenues from ongoing projects.

The company would also look at increasing property prices in select projects by 5-10 percent across north India . These would be in Delhi, National Capital Region and nearby areas, he said without elaborating. “Earlier, during the slowdown time, prices declined… and now, after the revival, the prices are expected to go up.”

Parsvnath has a land bank of about 195 million square feet (18.12 million sq metres), of which 80 million square feet has been on fast track for completion, he said.

STAKE DILUTION

The New Delhi-based developer is not looking at diluting stake or roping in private equity firms in the company. However, it would continue to look at investments at project levels. “Going forward, if any good opportunity comes, or any good private equity proposals come (at project level), definitely we are happy to look at it. It is not that we are very aggressively looking, and there is nothing expected to be concluded in the short term.”

The company is also planning to develop 4.5 million square feet of residential properties and 0.5 million square feet of commercial ventures on the recently won Railway land. In Nov 2010, Parvsnath had won a bid for 38.3 acres (15.50 hectares). Jain declined to comment on the investments for the project stating it as “confidential”.

The company is waiting for approval for the special purpose vehicle set up for the rail land development in which it is looking at roping in foreign direct investment. The company, however, has already engaged architects and consultants and started work on the project. “I think it would take another two months’ time to work out the planning, which needs to be submitted for approvals.”

Declining to provide an outlook for its Oct-Dec quarter, Jain said “the quarter looks good.” At 3.19 p.m., shares of the company were trading lower by 3.33 percent at 52.20 rupees in a steady Mumbai market.

Over 27-Fold Rise in India Bulls Consolidated Net Profit

Indiabulls Real Estate Ltd today reported more than 27-fold jump in its consolidated net profit to Rs 76.61 crore for the quarter ended December 31, 2010, against Rs 2.76 crore in the year-ago period.

Net sales rose to Rs 399.66 crore in the third quarter of this fiscal from Rs 37.46 crore in the corresponding period of the previous year, Indiabulls Real Estate said in a filing to the Bombay Stock Exchange .

The total expenditure increased sharply to Rs 284.07 crore in the third quarter of 2010-11 fiscal against Rs 72.86 crore in the year-ago period, due to higher expenses on land, plots and constructed properties.