Parsvnath Developers Buys 38 Acres NCR Railway Land For Rs 1,652 Cr

Delhi-based real estate firm Parsvnath Developers Ltd has brought 38 acres of land worth Rs.1,651.52 Cr from the railways in Delhi through competitive bidding. Railway Land Development Authority (RLDA) had fixed the base price at Rs.1,200 Cr.

The company will have to pay 20% of the money now and the remaining amount in the next 4-5 years.

Parsvnath Developers will invest additional Rs.1000 Cr in developing the plot.

Parsvnath Developers will develop luxury housing, commercial space and other civic amenities on the land and has partnered with private equity firm Red Fort Capital to develop the project. The entire project is expected to be completed over 10 years.

The land is located near the Sarai Rohilla railway station, just 4 km from the posh Connaught Place area in Delhi. This is the second-biggest land deal in Delhi after the 2007 purchase of 38 acres of DCM Group land in Motinagar by DLF for Rs1,675 crore.

According to Railway Land Development Authority (RLDA) sources, one-third of the land project will be used by the railways and the rest will be developed by Parsvanth.

Indiabulls, the only other bidder in the auction conducted by Indian Railways, offered Rs.1,257 Cr for the land.

Transaction Reference: ET

A total of 14 real estate developers had been pre- qualified for the auction. It included Godrej Properties, Indiabulls, Ackruti City, Emaar MGF, Peninsula Land, Ansal API, Omaxe and Parsvnath Developers.

However, leading developers like DLF and Unitech decided to stay away from the auction.

The site is with the RLDA , which has over1 lakh acre of surplus land across the country and its duty is to monetise this asset.

This will be the second land development deal for the railways. In August 2009, RLDA signed an agreement-cum-lease deed with SD Buildwell (an SPV of consortium of UTech Developers, Ansal Properties and Infrastructure and Cinflex Infotech) for development of commercial facilities over a land area of 13,216.64 sq.m in Gwalior, Madhya Pradesh.

Sitting over vast tracts of prime plots across India, the railways has been trying to cash in on its land assets. Among the various land locations that the railways is looking to lease out includes 4.5 hectares of prime land in the commercially strategic Bandra-Kurla Complex in Bandra East, Mumbai.

Parsvanath has a land bank of 194 Mn sq ft, of which it is undertaking construction of 80 million sq ft on fast track basis.

It is also planning to raise upto Rs 200 Cr by the end of this year thorugh PE route to cut down its debt, which is about Rs 1,500 Cr as on March 2010. The company has targetted to repay about Rs 520 Cr in the next two years.

Last year in Dec, Parsvnath raised $16 Mn from Sun Apollo by selling 50% stake in its Gurgaon Project - Parsvnath Exotica Part II.

Last month Parsvnath Developers sold 24.5% stake for Rs.120 Cr in its office complex project 'Red Fort Parsvnath Towers' at New Delhi’s Connaught Place to Red Fort Capital.

Indiabulls recently bagged National Textile Corporation’s (NTC) 8.3-acre land in Worli area of Mumbai for a whopping Rs 1,505 crore, while Lodha Developers had acquired 25,000 sq metre plot at Wadala here for Rs 4,050 crore.

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