Hyderabad has yet another first to its credit. The city has become the first and favourite destination for several international players interested in real estate business to foray into Indian real estate market.
Over the last 12 to 18 months, the city has attracted biggies like Sunway Berhad, Malaysia, ACI Real Estate – an affiliate of German investment company Alternative Capital Invest GmbH, Property and Building Corporation (PBC), Electra Real Estate from Israel and the list goes on. The internationally acclaimed players have chosen Hyderabad as their gateway to explore the real estate business in the country. They either forged alliance with a local partner, or appointed franchisees to make a beginning.
Murali Krishna Reddy, chairman of the Hyderabad-based MAK group said, international players see lot of opportunities in India. They chose Hyderabad over other cities for their entry as the city is the most happening place with multi lingual, cultural population. The city is also receptive to new ideas. Foreign players look at Hyderabad as a good testing ground. They feel that whatever succeeds here will succeed in other metros as well. Also the government is very proactive, he added.
His group recently saw investment coming from Sunway Berhad, Malaysia. The foreign company has formed a SPV with MAK Builders, part of the MAK group to develop a Rs 350 crore integrated township project in Hyderabad. It holds about 60% equity in the SPV and would be pumping in $5 million into the project as FDI. The project would have 2 million sq ft of residential space besides some retail and commercial space and a hotel.
Tishman Speyer, a New York-based closely held real-estate developer and operator also joined hands with ICICI Venture, a private-equity firm of ICICI Bank of India to float TSI Ventures- India?s first fully integrated real estate investment, management and operating company. The mission of the joint venture is to redefine the Indian real estate portfolio and development industry landscape. The first two projects of the JV is coming up in Hyderabad. The first one is a 400-acre integrated township at Tellapur with an outlay of $2 billion. The township would encompass 30 million sq ft of mixed-use development including residential, commercial, retail as well as civic amenities. And the next project is a world class office facility at Gachibowli in the city where Nagarjuna Construction Company is also participating with a minority stake.
The office facility would have 2.2 million sq ft of class A office space in a special economic zone being promoted by Andhra Pradesh Industrial Infrastructure Corporation.
According to Yogesh Maurya, deputy head-Hyderabad, TSI Ventures, “the city scores over the other cities for three reasons – progressive government, very good infrastructure with roads and international airport and highly vibrant economy. The government here is very progressive. It understands the needs of a private investor and creates a win-win situation. Hyderabad is a growing city and that’s precisely why it is fast becoming a hot spot for global players.”
ACI Real Estate, affiliate of German investment company Alternative Capital Invest GmbH, is yet another international player which entered the Indian real estate market through franchisee route. It began its franchisee network with Hyderabad by appointing Global Properties Ltd for the city. It is looking at similar arrangements in Mumbai, New Delhi, Bangalore, Pune and Kolkata. The franchisees would look for customers who are willing to invest in ACI’s properties in UAE. The company has a huge real estate portfolio including residential, commercial, leisure and other retail developments in prime locations across Dubai, Abu Dhabi, Ajman and other emerging cities across the UAE. Sanjay Chimnani, joint managing director of the company, had said earlier “ACI has plans to develop projects in India in 2009. And setting up a franchisee network is the first step towards the company’s goal of developing projects in India. Our franchisees will help us understand the Indian market better through feedback from customers.”
Israel-based Property and Building Corporation (PBC) and Electra Real Estate also recently joined hands with Hyderabad-based Incor Infrastructure to develop Rs 4,000-crore real estate projects in Hyderabad, Chennai and Mysore through a joint venture company-PBEL Property Development (India). The JV company has made a beginning by acquiring 58 acres of land in Hyderabad for a mixed township project. It has also acquired 42 acres in Chennai and about 10 acres in Mysore for development.
