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Indian Real Estate News : Mumbai
DLF Plans to Sell 17.5 acre Prime Mumbai Land for Rs 4000 cr
Source: indianrealtynews.com Sep 13, 2011
DLF, India's largest real estate developer, has decided to sell its prized asset, the 17.5 acres NTC Mill land in central Mumbai, which bankers estimate would fetch between Rs 3,000 crore and Rs 4,000 crore that will make it one of the biggest land deals in the country. The company that bought the land for Rs 702.2 crore in 2005, has started the process of appointing investment bankers for the proposed transaction that is likely to complete in the current fiscal, said two persons familiar with the development.

More than four foreign investment bankers including UBS, Morgan Stanley and Deutsche Bank have already given presentations to the company. The appointment process is likely to complete by month end. Rajiv Talwar, group executive director, refused to comment. "We do not comment on market speculation." The proposed fund raising exercise through sale of assets is in-line with annual target to raise Rs 7,000 crore through this route, a company executive told ET on the condition of not to be named. The fund will be used to reduce its debt, which is slightly over Rs 21,000 crore.

"The consultants are giving a guidance between Rs 2,500 crore and Rs 3,000 crore for the land, while the company is aiming to fetch a much higher price of Rs 4,000 crore," the person said. Though, DLF has stated that it would sell only non-core assets and lands, where it has no immediate development plan, the Mumbai land is considered to be of great importance for the country's largest builder, as it would have helped it to venture into the Mumbai market. The company has a bigger project in Mumbai near Mahalaxmi Race Course, which it would develop in consortium with Shapoorji Pallonji and Ackruti, the official said.

Besides the prized Mumbai land, the company also aims to culminate two more transactions in the third quarter ending December 2011. These include the sale of iconic Aman Resorts barring Aman Hotel Delhi (formerly Lodhi Hotel) and will be able to bring in HCL group as strategic partner in its life insurance joint venture - DLF Pramerica in which the US-based Prudential International has 26% stake, another person familiar with development said. The company will raise another Rs 800 crore by end of this month through sale of two assets - a 25 acres land in Gurgaon to M3M for Rs 440 crore and its 71% stake in an IT Park in Noida to IDFC Private Equity, he added. It has already raised Rs 240 crore in the first quarter by selling small parcels of non-contiguous land.

Earlier this year, the company had planned to develop the NTC Mills land as Mumbai's 'largest luxury residential project', with a saleable area of 4.7 million square feet and one of the largest parking lots in the city with an area of 25 lakh square feet. The company has received in principal approval of higher floor space index (FSI, the amount of construction allowed on a plot of land) granted for parking lots to develop the project. In Mumbai, developers get an FSI of four if they build a parking lot and hand that over to the government for public use. Given the current market rate, the saleable value of fully built up project will be over Rs 15,000 crore.


Tag: Real estate in mumbai, property in mumbai, mumbai properties
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