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India Realty: A Trump Card

By: porperty, Sat Jun 3rd, 2006 06:23:28 AM

In the largest landmark deal in the recent history of Indian real estate, Unitech wrested 340-acres of Noida land outbidding DLF’s offer of Rs. 1,401-crore by quoting Rs. 1583-crore against the other, both offers far higher than the reserve price of Rs. 788-crore. Located on Noida – Greater Noida expressway and ear-marked for housing units, the prime piece of land is to be developed as an upmarket integrated township called ‘Express City’.

A record bid, Unitech only beat the largest real estate transaction in recent memory, when DLF purchased Bombay Mills land from NTC for a whopping Rs. 702-crore. Coming at a time when the capital market is in the throes of recovering from a major downslide that had caused apprehensions about an adverse impact on real estate prices, the trend-setting deal will propel low profile Unitech into the limelight for having outbid DLF, mover and shaker of the Indian real estate scene.

The winning bid, roughly translates to Rs. 11, 520-per sq. m. against Rs. 10,200-per sq. m. offered by DLF, and it has set a new benchmark for all future real estate transactions. Unitech, the out bidder, in the midst of putting together plans to build exclusive villas on the 340-acres of which 50% land has been set aside for a green belt, is fortunate to have won a prized piece of land, fortuitously located across Noida’s Sector-96, 97, 98 and adjoining Taj Expressway.

The largest land auction in the country, Sanjiv Saran, CEO of Noida Authority says the city master plan dictates only 50% of the area can be used for residential purposes, while the remaining area is to be devoted to open spaces, schools, colleges, hospitals and a shopping complex. With only a Rs. 181-crore difference between the two bids, it is a fair indication that the developers have assessed the value of the land at a realistic level.

And, this record deal comes at a time when US real estate tycoon, Donald Trump is getting excited about the Indian real estate and hospitality business. Recently, his son and daughter, both in charge of business development and acquisitions were seen scouting for business opportunities in India. It seems Trump, whose Trump Organisation is one of the world’s leading real estate developers, is interested in setting up his chain of luxury beach resorts on the Indian sub-continent. And, with that, you can say as with everything else Indian, Indian real estate has arrived, as well!

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