India's Real Estate: No Longer A Free For All?

India’s government wants to set up state-level regulators for real estate, a sector that has been among the country’s fastest growing in the past few months but is plagued by the lack of an adequate legal framework. “A quasi-judicial regulator is required in big cities as both consumers and builders may need protection,” Urban Development Minister S. Jaipal Reddy told reporters on the sidelines of an industry conference here Thursday. “We will set up a regulator in Delhi which would serve as a model for other states to emulate.” The body is likely to be set up in the next six months.

UBS lines up $1-b India-specific real estate fund for year-end launch

UBS Global Real Estate, the real estate arm of global financial services powerhouse UBS Global Asset Management, plans to launch a $1-billion India specific real estate fund by the end of this year. The company has tied up with Mumbai-based real estate developer K Raheja Corp to finance various real estate projects across the country.
UBS Global Asset Management is one of the three business groups of UBS, the other two being Global Wealth Management & Business Banking, and the Investment Bank. UBS Global Real Estate has invested nearly $50 billion in assets till March 2007 and has around 360 employees and 13 offices around the world.

Global asia real estate fund concludes landmark deal in india

Global Investment House “Global” announced today the conclusion of its latest investment in India, as part of its Asia Real Estate Fund investment strategy, making it the second investment for the fund. Last week, the fund finalized the purchase of a distressed shopping mall in Shangdong Province, China. The total value of the investment is USD8.8 million. Mr. Sameer A. Al-Gharaballi, Executive Vice President at Global, said that this investment provides the fund an excellent opportunity to invest in the financial capital of India, Mumbai. The fund has acquired a 10,377 sqm land site in a prime location within Navi Mumbai with the objective of developing the site into a first class international business hotel.

India is a potential market for timeshare models

Group RCI held its annual symposium in the city for the first time for its Asia Pacific region in India from August 23-24, 2007 at The Taj Palace, New Delhi focussing on identifying the various real estate products that would be viable hospitality projects in the future. The two-day event enlightened the participants about vacation ownership in its various forms as a profitable business model. On the occasion, Radhika Shastry, managing director (Indian subcontinent), RCI India said, "Looking at the future, vacation ownership is going to become a strong driving force for resort development, and Indian developers are eager to know about various products that could be lucrative real estate products.

High interest rates have hit real estate market

New Delhi, Sept 18: High lending rates triggered by the Reserve Bank of India's tight monetary policy have tranquilized the country's property market, but demand will surge once rates dip, real estate firm DLF Ltd's Chairman K P Singh said on Tuesday.
"Because of mortgage rate and monetary policy, there is no doubt that the market has got subdued at this moment temporarily," Singh told reporters when asked about an industry report that claimed residential property sale dropped by 70% in May-June this year. The DLF Chairman, who released industry chamber ASSOCHAM's report on real estate, said he did not have the statistics but his gut feeling was that the cooling happened because of high interest rates.

IndiaReit to offer $750 million property fund

MUMBAI: Indiareit Fund Advisors, a venture capital firm that counts 3i Group among its investors, plans to raise up to $750 million overseas for what may become the second-largest Indian real estate fund. The Mumbai-based company may begin seeking investors in the United States, Europe, Middle East and Japan by year-end, Ramesh Jogani, the managing director of Indiareit, said Monday. The fund will invest in companies that build apartments, malls and offices in India.

Strong fundamentals real estate sector

Mumbai, Sept 11 Rising interest rate, oversupply in development phases and project execution are temporary dampeners for the domestic real estate sector that is propelled by strong fundamentals. Long-term demand drivers such as a sustained GDP growth, rising affordability, population growth, favourable demographics, rapid urbanisation and increasing mortgage penetration, besides an improving regulatory framework are in place, according to equity broking house Prabhudas Lilladher.

Hindujas plan ventures in real estate

The Hinduja group's businesses in India cover banking and financial services, media and entertainment, healthcare, real estate, power and energy.
Raha said the group could add new verticals to its existing portfolio.Real estate is a huge opportunity, he said. The group has a land bank of around 1,000 acre spread across the metros. Similarly, healthcare, run by the Hinduja foundations could be leveraged into a profit-earning healthcare business. The first such initiative - a 350-bed hospital - is already under way, Raha said.

Pune`s closed factories become a real estate play

Rise in prices is tempting cos to convert factory land into realty projects. Pune’s factories may go the Mumbai mill-land way. The rise in real estate prices is tempting companies to convert their factory premises into real estate projects in the Pimpri-Chinchwad area, 20-odd km west of Pune, one of the country’s largest automobile hubs and a big centre for the IT industry. Driven by an eight- to ten-fold increase in land prices in the area in the last two to three years, companies like Raccold Appliances, Greaves Cotton, Elpro International, Garware Nylon and Formica India are converting their factory premises into commercial or residential projects.

Investment firm sees opportuinity if India slows

MUMBAI (Reuters) - Berggruen Holdings Inc expects the flow of foreign funds into India to slow down, creating big opportunities in real estate, private equity and potentially in the stock market, its founder said on Tuesday. India could not be immune to a global tightening of credit and rising risk aversion, despite its rapid growth and enormous potential, Nicolas Berggruen, the firm's founder and president, told Reuters. MUMBAI (Reuters) "India is being affected and will be affected as well. The question is how severe is the situation? It is impossible to know today, but it could carry for a while and it will certainly slow things down," he said.

Indian Realty: Subprime shock proof

In the last six months the default cases in the sub-prime borrowers’ category has gone up substantially. This has led to increase in the interest rates on sub-prime loan, making the repayment even tougher and further increasing the default rate. As the interest rate is going up, the value of sub-prime portfolio, which have bundled together in the form of security has gone down. Because of this, the buyer of sub-prime portfolio is likely to loose money. However, a senior global real estate fund manager said that the funds that have come to India are long-term resub-prime borrowers get at around 8.25%. As the interest rate is high, the chances of default by the sub-prime borrowers further increase.

HDFC closes intl real estate fund at $800mn

Housing Development Finance Corporation (HDFC) today announced the closing of its first sponsored international real estate fund, HIREF International LLC, at $800 million.
The nine-year, close-ended fund, open for subscription from only foreign investors, was subscribed to by 28 investors. With this international real estate fund, HDFC will be the largest player in the real estate private equity space in India, the release added.