1.Indiabulls to Plan Restructuring of Wholesale Trading Business. 05/03/2010
Indiabulls Real Estate today said its board would meet on Thursday to discuss restructuring of its wholesale trading business through demerger. In a filing to the Bombay Stock Exchange the company said its board would meet on February 25 to consider a scheme of demerger of its wholesale trading business to Indiabulls Wholesale Services Ltd. The company had earlier said that the restructuring would unlock value and also streamline the operations and ownership structure of Indiabulls Real Estate. Last week Indiabulls Real Estate had said that its board has appointed advisers and authorised a committee to prepare and present the draft proposal and related documents for the said demerger. Shares of Indiabulls Real Estate were trading at Rs 153.85, up 0.36 per cent on the BSE. Read More

2.Online Trading Facilities Ease NRI Investments. 05/03/2010
For non-resident Indians, in particular, the online facility to trade in the Indian markets is a boon. With the markets currently on the lower side and more volatile than a few weeks back, there is the opportunity for the discreet NRI investor to pick on choice stocks to add to his portfolio. To assist him in doing this more easily and with greater control, we have an increasing number of brokerage houses adding new online trading facilities. In the past weeks, ICICIdirect and Geojit BNP Paribas, two leading retail stock brokers with a sizeable presence in the Gulf, have joined the fray. ICICIdirect launched its new online trading platform ‘TradeRacer followed by Geojit BNP Paribas which launched its enhanced online trading platform ‘FLIP’ (Financial Investment Platform). The platform is available free of cost for its existing customers while brokerage charges remain the same at 0.3 percent for a delivery. FLIP is already available in stock exchanges of Saudi Arabia and Oman. Developed by Geojit Technologies (P) Ltd, a subsidiary of Geojit BNP Paribas, ‘FLIP’ provides features similar to ICICIdirect’s TradeRacer like alerts, research reports, intra-day charts, technical analysis, third party news, customised interface and a mobile edition called FLIP-Me. Both mobile integration options are available through low bandwidth GPRS-enabled mobile phones. Read More

3.Gujaratis Shifting Base from Mumbai- Ahmedabad Being Preferred for Investment. 05/03/2010
The Maharashtra Navnirman Sena (MNS) and the Shiv Sena’s campaign against non-Marathis living in Mumbai is beginning to worry the Gujarati community in that metropolis. It is true that the campaign is directed mainly against North Indians in the city but it is sufficiently unpleasant to make many Gujarati Mumbaikars consider shifting to Gujarat for safety. Some Gujaratis from Mumbai have already purchased apartments in Ahmedabad and many others are on the lookout for properties that they can buy. Six Gujaratis from Mumbai, who happen to be cousins as well, recently struck a deal for seven apartments in a housing scheme in the South Bopal area of Ahmedabad. “We have booked seven apartments in South Bopal for our six families,” said Nita Shah. The 43-year-old Mumbaikar is in government service. Explaining why the cousins had bought so many flats together, Shah said that, apart from their love for Gujarat, they had also been driven by the anxiety caused by the campaign against non-Marathis in Mumbai. “We were born and brought up in Mumbai and we love the city, too,” she said. “But we feel more at home in Ahmedabad because our family originally came from this city. We plan to spend at least six months in Ahmedabad every year after retirement.” She said that following their decision to purchase property in Ahmedabad, many more Gujarati Mumbaikars had started thinking about buying property in their cities of origin in Gujarat. Read More

4.GTC Plot Sold for Rs 591 cr in Mumbai. 05/03/2010
In a city where open plots have all but disappeared, the last of the vast chunks of land are worth their weight in gold. In yet another big-ticket deal—considered to be the largest in over two years — Mumbai-based company Sheth Developers is learnt to have bought the GTC (Golden Tobacco Company) property in Vile Parle for Rs 591 crore. The deal overshadows last month’s agreement by the Wadhwa Group with Hindustan Composites Ltd (HCL) to buy an 18.18-acre Ghatkopar for Rs 571 crore.q According to people familiar with the deal, the Vile Parle land—spread over 57,000 square metres or approximately 14 acres—is located in a prime area next to Mithibai College and touching S V Road. On paper, the transaction is shown as a joint development between the builder and the Sanjay Dalmia-led GTC. Those in the know say that Sheth Developers will construct on 10% of the land and hand it over to GTC free of cost as part of the deal. The location is ideal for a high-end residential enclave on the lines of the builder’s Beau Monde towers at Prabhadevi. The property has been in the market for several years; one of the other contenders for it was reportedly D B Realty. Read More

5.No taxing time for real estate: Govt. 05/03/2010
The government today said the net impact of the service tax on real estate construction would be only 3.3 per cent, since construction attracts service tax only on 33 per cent of the value. The government had last week clarified through the Budget that transactions such as leasing vacant land and commercial spaces, payment made to developers before the grant of completion certificate and imposing preferred location charges, among others, would come under the service tax net. Developers said the proposal could push home prices up by 10 per cent in Tier-II and Tier-III towns and 0.5-4 per cent in big cities such as Mumbai and Delhi which have higher land prices. However, a senior finance ministry official here said the net impact of the service tax would be only 3.3 per cent, since there is an abatement of 67 per cent. “There is a false impression being created that prices will go up by 10 per cent but the fact is that 10 per cent service tax is levied only on 33 per cent of the value,” said the official. Read More

6.Ansal sees Rs 730 cr from two townships. 05/03/2010
Ansal API, the New Delhi-based real estate player, is looking at garnering sales of at least Rs 730 crore from two townships in the next two fiscals, even as it ramps up its plans for the affordable housing segment, a source familiar with the development said. The developer is currently working on 19 townships focusing on the residential sector, which includes two mega townships of 1,765 acre Sushant Golf City, Lucknow and 2,504 acre Megapolis Dadri, Greater Noida. The realtor has received Rs 410 crore as advances from sales in its Sushant City project and has bought land for the first phase in Megapolis. These two townships would provide sales of Rs 330 crore in fiscal 2011 and Rs 400 crore in fiscal 2012 as the developer increases its marketing and sales initiatives in these two townships. Ansal would now acquire 2,121 acres for the Dadri township and 530 acres for the Lucknow township to launch other phases. The Sushant Golf City Township is being developed in three phases with total of 60 million square feet of saleable area, comprising 23 million sq ft of residential and 27 million sq ft of non-residential development such as retail, commercial and industrial, etc. Ansal has already sold 10 million sq ft of residential units, including villas, plots and vertical apartments in the Lucknow township. The company is now looking to generate sales of Rs 330 crore from the sale of plots with an average price of Rs 1,333 per sq ft and additional Rs 489 crore from the sale of villas, group housing and apartments. Read More

7.Mumbai’s Fails to Lure Bidders in Govt Land Sale. 05/03/2010
Mumbai’s failure to lure any bidders in the first government land sale in at least 1 1/2 years may cause rates in that area to fall as India’s financial hub seeks to develop the reclaimed marshland into a key business district. “It’s a once-in-10 years kind of situation,” Vivek Dahiya, chief executive officer of New Delhi-based GenReal Property Advisors, said by phone from New Delhi. “The Mumbai real estate market is going through a rare situation, where several micro- markets are going to witness over-supply because lots of projects coming up in some areas and demand drying up in some.” The five likely bidders who attended a preliminary meeting last month for the sale of the site in the city’s Bandra-Kurla Complex didn’t submit offers yesterday, said Dilip Kawathkar, joint project director and spokesman for the Mumbai Metropolitan Region Development Authority. The land was valued at a minimum 4.35 billion rupees ($95 million) by the agency. Read More

8.Foreign funds sneak into property business. 05/03/2010
Foreign debt, banned in real estate, is finding its way into property firms, as bankers and lawyers help builders cobble together new deals to raise money. Even though foreign loans, better known as external commercial borrowings (ECBs), are not permitted in construction, property firms have spotted a mechanism where the debt can be provided by foreign institutional investors (FIIs) registered with Sebi. No rules are broken and the deals, involving a three-way transaction, come across as normal private placements in the corporate bond market. It begins with a real estate company placing non-convertible debentures (NCDs) with a local entity like a non-banking finance company (NBFC) to borrow. The next step involves listing the debt security, soon after which an FII steps in. Once the NCD is listed in the stock exchange, the NBFC offloads the paper to a foreign fund. Since FIIs cannot invest in unlisted debt, the NBFC warehouses the NCD till the paper is listed and then recovers the money by selling the debentures to a foreign fund. The two transactions are parts of a back-to-back deal struck among the NCD-issuing firm, the local NBFC and an FII. At least four developers, three from Mumbai and one from Bangalore, have raised over Rs 1,000 crore in the past few months through this route. Read More

9.Demand Boost may Pick up Realty prices. 20/02/2010
Home prices may remain firm or inch up slightly in metros such as Delhi and Mumbai and their suburbs despite an expected rise in interest rates as demand picks up once again on the back of renewed activity on the employment front, bankers and realty players that ET spoke to said. However, they felt that prices at extended suburbs — such as Greater Noida and Manesar near Delhi and Navi Mumbai, along with tier-II and tier-III townships — will remain under pressure due to over supply of housing, lack of connectivity and paucity of jobs in such locations. The residential demand is not just the function of the interest rate, said Keki Mistry, vice-chairman and managing director of HDFC, the largest home-loan player in the country. “The demand is primarily driven by job creation and job confidence. When any individual buys a home, he or she enters into a long-term payment obligation. Therefore, buyers need to have confidence of retaining their jobs,” he said. The late-2008 and early-2009 realty crash was largely thanks to the fear of impending job loss in light of the financial slowdown, Mr Mistry said. “Given the robust industrial growth rate, it is apparent that jobs will be created and there would not be any scepticism on protecting jobs. This in turn would continue to fuel demand for homes,” he said. Read More

10.Real Estate Players Plan To Raise $5.7 Billion over the Next 18 Months: JLLM. 20/02/2010
Real estate players plan to raise a whopping $5.7 billion over the next 18 months through public offer and private placement of shares to fund projects and repay debts, property consultant Jones Lang LaSalle Meghraj (JLLM) said. “At least $2.45 billion is expected to be raised through QIPs for which real estate players have shareholders’ approval and the remaining $3.31 billion is likely to come from IPOs,” Jones Lang LaSalle Meghraj Associate Director (Research) Abhishek Kiran Gupta told PTI here. Gupta, however, noted that some of the proposed QIPs may find it difficult to sail through due to market volatility and overpricing of the stocks. Still, he said that all the channels for financing realty sector would see enhanced activity in the coming quarters. “While sources of funding have become scarce in the aftermath of the 2008 global financial crisis, there are some emerging channels of real estate financing in India, which are likely to help the sector continue its high-growth story,” the report said. JLLM highlighted that the realty sector had attracted $2.8 billion FDI in 2008-09 fiscal, up 29 per cent from a year ago. During the FY2006 to FY2009 period, FDI in India’s real estate sector grew to $2.8 million from $38 million. Gross bank credit to the realty sector surged 45 per cent to $19.7 billion in FY09 from $13.6 billion in FY08, the report revealed. Read More