Land Acquisition Act is a fraud, ought to be scrapped: SC

Frowning at increasing incidents of government forcibly acquiring land for industrialization and residential schemes, the Supreme Court observed that the Land Acquisition Act ought to be scrapped as it is a “fraud” devised by some “sick people”. In a morale booster to the Narendra Modi government in Gujarat, the apex court complimented it for its land acquisition policy since there are “no complaints of any forcible acquisition” whereas issues of farmers and poor being uprooted are pouring in from all other states

A bench of justices G S Singhvi and H L Dattu cautioned that if remedial measures are not initiated then in another five years muscle men would take over the private land and utter chaos would prevails as the prices of land are shooting up everywhere. “The Act has become a fraud. It seems to have been devised by people with a sick mind who have scant regard for the welfare of the common man,” Justice Singhvi heading the bench observed.

The apex court made the scathing observations while dealing with a bunch of petitions filed by aggrieved farmers from Uttar Pradesh’s Hapur district on the forcible acquisition of 82 acres of land by the state for developing a leather industry.

Jaipur is Real Estate Hotspot Believes Global Research Agency ‘CRISIL’

If rising interest rates are compelling you to stall the idea of purchasing a house then think again. When it comes to buying property any time is a good time. While interest rates are cyclical, real estate prices progress in a linear fashion and always head north. The advice holds good especially for Jaipur, shows global research agency CRISIL.

Its report titled ‘Real(i)ty Next: Beyond the Top 10 Cities of India’ shows that property rates in Jaipur have increased by 11-12% during the period 2009 to April 2011. But, that is not the only reason why buying property in Jaipur right now makes a sense. Jaipur also offers the best growth prospects among the 10 smaller cities studied by CRISIL Research.

“Price appreciation is not the sole determinant of long-term attractiveness for investment. Potential for demand growth, price stability, quality of infrastructure,” said Prasad Koparkar, head of industry and customised research at Crisil Research. The number of units sold in Jaipur in 2010 was the highest among the 10 small cities and second largest in terms of value of houses sold.

The cities studied included Bhopal, Bhubaneswar, Coimbatore, Indore, Lucknow, Nagpur, Surat, Vadodara and Visakhapatnam. The report has forecast that of the 10 smaller cities, realty prices will rise in seven of them, while only four of the 10 big cities will register a rise in rates.

245 infrastructure projects awaiting green nod

Of the 245 projects seeking clearance from the Ministry of Environment and Forest, 136 are in the mining sector

New Delhi: About 245 infrastructure projects — a majority of them in the mining sector — are pending with the Environment Ministry, officials said.

Of the 245 projects seeking environment clearance, 136 are in the mining sector followed by 77 in building and construction sector, the statement issued by the Ministry said, reports IANS.

Besides, 22 thermal power projects and 10 hydro power projects are pending with the Ministry, it added.

Blackstone To Invest $200M In Embassy’s Bangalore SEZ

BY MADHAV A. CHANCHANI

Blackstone is picking up 37% stake in Manyata Embassy Business Park, valuing it at around $550 million.

In what will be the largest private equity deal in India’s real estate space during the past three years, private equity giant Blackstone is investing around $200 million (Rs 875 crore) in a special economic zone (SEZ), promoted by Bangalore-based real estate developer Embassy Property Developments Ltd. The private equity firm is picking up 37 per cent in the development, valuing it at nearly $550 million (Rs 2,400 crore), said a source familiar with the development.

Blackstone's real estate arm has picked up 37 per cent stake in Manyata Promoters Pvt Ltd, which has been jointly promoted by Embassy and the landowner Veeranna Reddy, for a SEZ located in Bangalore’s outer ring road. The transaction is a secondary share purchase from the Embassy group.

The deal is being seen as financing the buyback of HDFC Property Ventures' stake by the Embassy group. Embassy had bought back 22 per cent stake, held by HDFC Property Ventures, for $120 million (Rs 520 crore) in the development earlier this year. HDFC Property Ventures, through its Rs 1000 crore HIREF Domestic Fund, had invested in the SEZ in 2006. Amarchand Mangaldas was the legal advisor to Blackstone on the transaction.

"We cannot comment as we are bound by confidentiality," said an Embassy spokesperson when contacted by VCCircle, adding that Embassy chairman Jitendra Virwani was travelling. A Blackstone spokesperson said "no comments".

Located in north-east Bangalore, Manyata Embassy Business Park includes office buildings, commercial space, residential complexes and recreational areas, as well as a hotel. The SEZ features 13 million sq. ft. of saleable area, spread across 115 acres, with companies such as IBM, Fidelity, Philips, ANZ, Alcatel-Lucent, NVIDIA, Target and Cognizant as tenants.

Jitendra Virwani-led Embassy filed for Rs 2,400 crore ($520 million) IPO with the Securities Exchange Board of India (SEBI) in July last year and appointed investment banks UBS, Citigroup, Nomura and Edelweiss. The company was also looking at a pre-IPO placement of up to Rs 1,175 crore. But as the market situation worsened, the company temporarily shelved its IPO plans.

The last reported deal with over $200 million value took place in August, 2008, when Phoenix Mills raised $296 million from German-Swiss private equity firm MPC Synergy for its various special purpose vehicles (SPV), according to VCCEdge, the financial research platform of VCCircle. Also, in May, 2008, Symphony Capital Partners invested $450 million in DLF Assets.

Blackstone is one of the largest real estate investors in the world and globally, it had $26.5 billion assets under management, as of March 31, 2011. Blackstone Real Estate Partners, which has invested in properties like Waldorf-Astoria hotel, has till date made only one reported investment in Indian real estate space when it infused $18 million in Bangalore-based project and construction management firm Synergy Property Development Services in April, 2008. Last year, Blackstone also agreed to manage $2-billion-plus of Bank of America Merrill Lynch’s Asian real estate assets, which also included investments in Indian projects by developers like BPTP and DLF.

Although the private equity action in Indian real estate sector has been muted, there have been a couple of large deals this year in income-generating developments. In February, Ascendas India Trust entered a deal to acquire a portfolio of five buildings in Phoenix Infocity Pvt Ltd's SEZ for Rs 855 crore. Kotak Realty Fund also sold Peepul Tree Properties (IT park in Goregaon) to Tata Realty and Infrastructure Ltd and Tata Realty Initiatives Fund 1 for Rs 525 crore ($117 million).

Alpha G:Corp Announces Launch of Alpha International City, Amritsar

The foreign direct investment (FDI) funded real estate developer Alpha G:Corp on Friday announced launching of Alpha International City, Amritsar (AICA) the new integrated housing project at Amritsar. Spread over 500 acres, the project that envisages investment of Rs 600-700 crore, would be developed in phases. The company envisages sales realisation of Rs 1,000 crore through AICA, once the project is completed. The company on Friday announced launch of the first phase of the project which encompasses plotted and partly built houses, constructed over 100 acres of land.

AICA is a part of Alpha G:Corp’s Rs 5,000 crore expansion plan to develop commercial, residential and mixed-use development projects in North India over the next five years. SK Sayal, director and CEO, Alpha G:Corp maintained the AICA would be developed on real estate asset management model (REAM). Under this concept, the landowner retains complete ownership of the project, wherein Alpha G:Corp being the asset manager, executes the role of the developer without dilution of the land owner’s ownership.

Apart from integrated housing project in Amritsar, the company has 30 million square feet area under development. Sayal said in future the company has a string of project investments aggregating to about Rs 450 crore in various other cities across Punjab, including an industrial park in Amritsar and an integrated township in Ludhiana.