Lodha snaps Canadian embassy building in London for $530M

Lodha has been one of the biggest acquirers of land in India, especially in Mumbai, for the last few years.

Mumbai-based private property developer Lodha Group has acquired the Canadian embassy building in London's Mayfair district for $530 million (Rs 3,300 crore) in its biggest move overseas. Lodha Group, which claims to be India’s largest real estate developer, has exchanged contracts to acquire the landmark MacDonald House in central London from.

Located on Grosvenor Square, this prominent building bears the address of 1 Grosvenor Square and is touted as one of the most prestigious addresses in the world, located close to Buckingham Palace.

In February this year, the Canadian government first announced the sale of the building to reposition Canada House on Trafalgar Square in the heart of London to consolidate the Canadian High Commission’s diplomatic activity in the UK in one central London location.

The property is believed to have a total saleable area of 1.6 lakh square feet and with this project, Lodha will be able to connect with global investors.

Abhinandan Lodha, deputy managing director of Lodha Group, said “London and the United Kingdom offer significant opportunities for a high quality developer focused on creating a large-scale housing development business there. We plan to focus on Mumbai and London as our two main markets.”

“The acquisition of this marquee asset overlooking London’s most renowned garden square, in the heart of Mayfair and in close proximity to Bond Street and Mount Street is a great opportunity for our company,” Abhishek Lodha, Managing Director of Lodha Group, said.

Located on the corner of Grosvenor Square, the property is in the heart of London’s West End and is one of Mayfair’s most prominent buildings. The building first served as the High Commission for the US and subsequently, as the High Commission for Canada.

Lodha was advised by the London office of Knight Frank on this acquisition.

Lodha has been active in buying land assets over the past few years and as highlighted by VCCircle has been the biggest real estate buyer in the country.

Last year, it bought the US Consulate’s Washington House in South Mumbai for Rs 341.82 crore. The group is currently developing over 35 million sq ft in prime areas such as Napean Sea Road, Prabhadevi and Walkeshwar.

Source: BY  Bhawna Gupta, VCCircle

Indian realty industry to almost double to $140B by FY17

BY  Pooja Sarkar, VCCircle

The industry, which had been growing at around 8 per cent annually during 2009-11, saws a 6.5 per cent deceleration in 2012-13.

The Indian real estate industry is expected to grow to approximately $140 billion by FY17, said a research report on real estate released by advisory firm Ernst $ Young and industry body FICCI. The report said, according to industry estimates, the size of the Indian real estate market was close to $78.5 billion in FY13.

Niranjan Hiranandani, chairman of FICCI’s real estate committee and managing director, Hiranandani Constructions Pvt. Ltd, said, “Mumbai urgently needs change of infrastructure with the support of government and also reforms in taxation, with 34 per cent of cost of an affordable house going out as taxes.”

The realty industry, which had been growing at around 8 per cent during 2009-11, saw a 6.5 per cent deceleration in 2012-13 primarily due to the sluggish domestic growth, rising input costs and negative global economic sentiments.

The sector’s major growth driver has been the pumping of capital through foreign direct investment (FDI) route. Between April 2011and July 2013, the sector attracted FDI of close to Rs 100,000 crore. The report, however, said the volume of FDI into the sector has been declining.

Even for private equity funding, the sector saw its peak in 2007 when $6.8 billion came in. In 2012, the industry attracted $1.7 billion from limited partners in realty projects across the country, as per the report.

For the first half of the current calendar year, the realty industry has seen investment of close to $1.4 billion and industry experts indicate that this year would be one of the better years compared to last four years.

With negligible sales and developers’ reluctance to bring down prices of properties, even banks’ credit exposure to the real estate and housing sector declined from 10 per cent as a percentage of gross bank credit in FY10 to 7.9 per cent in FY13. While bank construction finance continues to be the cheapest source of funding, another instrument which has caught attention of developers is raising money through non-convertible debentures (NCDs). Reflecting this trend, NCDs worth $4.2 billion were issued in 2012 compared with $3.8 billion in 2011.

The realty industry recently witnessed a few big-ticked buyout transactions in commercial office space by private equity funds. Over the last three years, it has attracted investment of $1.14 billion in commercial office space portfolio development.

(Edited by Joby Puthuparampil Johnson)

Real time property price index launched in Dubai

The first ever real time guide to property prices in Dubai has been launched for both sales and rentals with the data reflecting actual transactions.

The move is a joint venture between Arabian Business and Better Homes, the regions biggest estate agent which is providing the data for the live prices.

The index covers key locations including Downtown Dubai, Dubai Investment Park, Dubai Marina, Jumeirah Lake Towers, Jumeriah Village circle, The Greens and The Palm Jumeirah.

The latest prices are shown for all types of properties available in those areas, including the latest monthly changes.

‘This is the first time that anyone in Dubai, whether buying or renting, can get an accurate, up to the minute guide, or prices in the key areas of the emirate,’ said Ryan Mahoney, Better Homes chief executive officer.

‘Nothing else is as close to real time prices. Over the coming months, we will be hoping to roll this out across other areas of Dubai, and then eventually other cities,’ he added.

Shane McGinley, executive editor of Arabian Business, explained that until now anyone trying to find out true property prices  has had to make a judgment based on listed prices.

‘We all know that listed prices can be very different to the real prices. This data from Better Homes reflects what people are actually paying rather than what landlords and sellers are asking. Right now, we are confident there is no better guide to prices in the market,’ he added.

Meanwhile, the latest data from the Dubai Land Department shows that sales in the emirate have increased by 67% in a year with $6.26 billion of transactions made in the 12 months to the end of July.

 
The official data also shows a similar increase in mortgages over the same period of time and real estate agents have confirmed that people are increasingly looking to buy their own property as opposed to renting. Source: Property Wire