Global partners knock on trusted corporate developers’ doors

Trusted corporate developers are finding partners in international firms as they look to expand their real estate business.

While global entities look for trusted players to partner for expanding into the domestic market, Indian firms get both funding as well as technological know-hows when tying up with international firms.

According to Knight Frank Global House Price Index Q2 2017, prices in the residential real estate market in India appreciated 10.5 per cent in 12 months or 70 per cent (absolute) in five years ending June 2017.

Hines, the international real estate firm, has entered into a partnership with Tata Housing to invest $23 million towards the development of India’s first wellness homes project - Serein.

Players like Mahindra Lifespace Developers, the realty arm of Mahindra Group, is developing industrial cluster under the brand name Origins.

The first project is coming up in north Chennai with a phase-I development of 264 acres, a joint venture between Mahindra World City Developers Ltd and Sumitomo Corporation of Japan.

The second project is located near Ahmedabad, with a phase-I development of 268 acres, and is being developed along with International Finance Corporation (IFC) as a strategic partner.

Brotin Banerjee, CEO and MD, Tata Housing, said: “This partnership will help us bring in the global best practises from Hines internationally. We look forward to expanding our association with Hines for future projects.”

“This investment is in line with our thesis of providing equity capital to tier-I developers on residential projects, catering to the needs of the upper-middle and luxury segments. This also marks the entry for Hines in Mumbai, and is the first step towards a geographically-diversified India presence for Hines,” said Amit Diwan, Senior Director of Investments for Hines India.

Hines is a privately-owned global real estate investment firm with a presence in 201 cities in 21 countries. It has approximately $100 billion of assets under management.

In India, Hines has developed One Horizon Center and Skyview Corporate Park, and invested in an upcoming residential project on Golf Course Extension Road in Gurgaon with Conscient Group.

Mahindra said it will be investing ₹600 crore to develop the two clusters in Chennai and Ahmedabad.

“We are expecting around ₹3,000-4,000 crore from each of these projects. Global firms also help in planning and creating an infrastructure,” said Sangeeta Prasad, CEO, Integrated Cities and Industrial Clusters.

Last year, Trump Organization, the New York-based business venture of US President Donald Trump, had inked a deal with real estate firm Unimark Group in Kolkata for a residential project.

Real estate development has been going through consolidation post landmark reforms such as RERA and GST. Consumers have been going for trusted brands as they make their purchase decisions.

Last year, Dubai’s Emaar Properties PJSC terminated its 11-year-old joint venture with MGF Developments Ltd, Emaar MGF Land Ltd. Emaar MGF Land was the first partnership through a large foreign direct investment (FDI) in India’s real estate sector.

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