Godrej Properties has bought a 27-acre plot in New Delhi’s Ashok Vihar area from the Rail Land Development Authority in a deal said to be valued at Rs 1,100 crore.
“The deal also involves a construction of flats for the railways free of cost and the sale of 50% of the flats for economically weaker sections at market value,” said people aware of the deal. The payment will be spread over eight years with interest at 12%. Godrej Properties declined to comment.
“As a matter of company policy, we do not comment on market speculation,” Godrej Properties said in an e-mail response. “The other bidders included the Adani Group and Eldeco,” said one person.
Godrej Properties has been acquiring land directly or through joint ventures to fuel its growth plans. The company entered into a joint venture with Hero Cycles last year to develop a four-acre plot on Golf Course Road in Gurgaon.
Last year, the real estate arm of the Godrej Group raised Rs 1,000 crore through an issue of shares to GIC-managed investment firm Gamnat Pte to fund its growth plans.
The Rail Land Development Authority, which is tasked with generating revenue from vacant land, has lined up six more such plots across the metros. It expects to earn about Rs 10,000 crore through land monetization. The plots include 16 hectares in posh Mumbai areas such as Bandra, Mahalaxmi and near Lokmanya Tilak Terminal. It also owns land in Chennai and Hyderabad.
The RLDA has identified about 45 sites that will be bid out in phases. The sites have a revenue potential of more than Rs 42,000 crore.
Godrej Properties has about 145 million square feet of the developable area across real estate assets classes in 11 cities in India.
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The deal also involves a construction of flats for the railways free of cost and the sale of 50% of the flats for economically weaker sections at market value.
Sobia Khan, Economic Times, Delhi/NCR