Walton says top line from Hindustan Motors land project is seen at Rs 7,000-7,500 crore. Hindustan Motor Land development project is going to be completed in 6 years says Shriram Properties.
US-based private equity companies Starwood Capital and Walton Street Capital and property developer Shriram Properties will pick up a 33% stake each in Bengal Shriram Hi-Tech City Private, the special purpose vehicle to develop the Rs 5,500 crore integrated IT township and auto park in Hindustan Motor’s Uttarpara plant in West Bengal, reports the Business Standard. An official announcement is likely tomorrow.
Hindustan Motors will retain about 1% stake in the project, which covers 314 acres. Initially, all three players will contribute Rs 100 crore each and increase that contribution according to the requirements of the project. Hindustan Motors, the C K Birla Group automobile company, recently entered into an agreement with Bangalore-based Shriram Properties to jointly develop the land.
The company would receive about Rs 295 crore in five tranches spread over the next ten quarters as well as a non-compete fee of four per cent of the sale proceeds of the project. Hindustan Motors had engaged housing major HDFC to advise on identifying prospective developers, evaluation of bids and to conclude the commercial terms.
Starwood Capital Group Global, LLC is a privately held global investment management firm based in Greenwich, which specialises in real estate-related investments on behalf of select private and institutional investor partners. The group is the promoter of Starwood Hotels and Resorts.
Walton Street Capital, LLC, which sponsors a series of private equity real estate investment funds, has invested or committed to invest nearly $ 3.5 billion (Rs 14350 crore) of equity in 150 transactions in the US. According to sources, HOK, a US-based architecture company, has been appointed to prepare a master plan for the project.
Construction of the project is expected to commence in nine months and will be completed in six years.
The IT and ITeS sector contributes 80% absorption of the commercial space in Kolkata and commercial space measuring 7,00,000 sq ft is expected to come up by the end of 2007, according to a recent report by property consultancy DTZ.
The city has seen vacancy levels of four per cent in the central business district and areas outside the central business district have seen vacancy levels of five per cent. The peripheral areas have seen vacancy of 12-15 per cent due to the new supply coming in. The vacancies have remained stable quarter on quarter but have decreased year-on-year, according to the report.
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