Monday, May 23, 2022

Table of Contents for Ticker Tape

Ticker Tape - Construction

L&T constructs 7-storey facility for DRDO in record 45 days

The Buildings Business of Larsen & Toubro has set a record by constructing the 7-storey, state-of-the-art Flight Control System (FCS) Integration Facility for the Defence Research and Development Organization (DRDO) in just 45 days using Integrated Hybrid Modular Construction Technology (IHMCT). The facility was inaugurated on March 17th, 2022, by the Hon’ble Minister of Defence, Government of India, Rajnath Singh in the august presence of Basavaraj Bommai, Hon’ble Chief Minister of Karnataka, Dr G. Satheesh Reddy, Secretary Department of Defence R&D & Chairman, DRDO and other dignitaries.

“This facility shows that India can build anything in a short time,” praised DRDO Chairman, Dr G Satheesh Reddy, adding that while the concept & technical design was developed by DRDO and detailed engineering & execution by L&T, teams from IIT-Madras & IIT-Roorkee conducted design checks and provided technical support.

A significant development to modernize and enhance the strategic capabilities of the Indian Defence, the facility is the result of L&T’s unique integrated offsite and onsite construction approach. “We adopted IHMCT, used for the first time in the Indian construction industry, to substantially reduce the cycle time with a dedicated team of engineers, architects and structural designers who have worked on it to make it a success,” remarked M V Satish, Whole Time Director & Senior Executive Vice President (Buildings), L&T. “We commenced the project on February 1st, 2022, and completed the superstructure including modular interiors, façade and MEP exactly on schedule on March 17th, 2022, taking just 45 days from design to delivery”, he added.

Constructed on a total built-up area of 130,000 sq. feet, the site team had to coordinate with 21 off-site locations to integrate design, structure, architecture, and MEP services. Going forward, this hybrid construction system developed by L&T will help increase productivity, optimize resource utilization, reduce losses due to wastage and speed up pace of construction.



DLF to invest Rs.550 cr to construct 1-mn-sqft office building in Chennai for StanChart GBS

Realty major DLF has invested  around Rs.550 crore to construct a one-million-square-feet office building for Standard Chartered Global Business Services’ largest campus globally. Tamil Nadu Chief Minister M K Stalin laid the foundation stone of the office campus in ‘DLF Downtown’ project at Taramani in Chennai.

In October 2020, DLF had pre-leased 7.7 lakh square feet office space to Standard Chartered Global Business Services (GBS) and the latter has an option to take the remaining area.

The DLF Downtown-Chennai project, spread over 27 acres and comprising 6.8 million square feet area, is being developed by DLF Cyber City Developers Ltd (DCCDL) with an investment of Rs.5,000 crore. DCCDL is a joint venture between DLF and Singapore sovereign wealth fund GIC.

In the first phase, DLF is constructing a total of 3.3 million square feet area, including one million square feet building for Standard Chartered. The construction of 2.3 million square feet is already undergoing and will be completed by the end of next fiscal, while the Standard Chartered campus will be completed by mid-2024.

The company has a presence in the state since 17 years and operates the largest IT SEZ ‘DLF Cybercity, Chennai’ at Manapakkam comprising 7.2 million square feet area.

This SEZ has contributed a cumulative export revenue of about Rs.84,000 crore since its inception and around 70,000 professionals are working. Once DLF Downtown is completed and operational, DLF will have a footprint of about 14 million square feet of commercial workspaces in the city, making it the second-largest market after Gurugram.

A development like DLF Downtown in a location like Taramani should generate the income of Rs.700-750 crore when fully functional and around 70,000 employees will work from DLF Downtown Chennai.

This project is designed with high-end specifications and has been awarded a Platinum LEED Certification by US Green Building Council.



Ramco Cements inaugurates Eco Park at the Company’s mines area in Pandalgudi, Tamil Nadu

In view of rehabilitating & reclaiming the mined-out land, Ramco Cements Limited has initiated an afforestation program at Pandalgudi to balance the ecology which was disturbed during mining of Limestone. Eco restoration has been planned for the entire mining area which covers around 800 acres, and is being implemented in a phased manner in areas where reserves are exhausted.

The total concept for rehabilitating the mined-out area has been designed by Botanical services, Auroville along with in-house department. The overall aim is to create natural self-sustaining eco system that supports local bio diversity of flora and fauna, as well as establishing an environmental education centre and recreation area that caters to the needs of the school students and visitors.

Phase 1 covers 72 acres of afforestation program at Eco-park started in the Year 2019 by landscaping the mined out area and terracing the dump. This area will be the hub for the whole project, and it is here the environment center is located surrounded by ornamental gardens based on native species and drought tolerant plants. As on date we have planted 1,00,000 no’s of saplings covering 250 nos. of species with 150 nos. of indigenous species like different types of ficus, neem, pupil tree, mahilam, pungam, babul tree, pulumeria, cactus, agave, aloe vera, medicinal plants, bushes & climbers and tropical dry evergreen species. The rockery garden has been created with the waste stones and boulders of the quarry.

Phase 2 covers 190 acres and was started in January 2021 and completed in 2022. The dump of 30 meters high on the Hangwall side has been terraced creating 18 km of walking and cycling trails, afforestation on dumps & Periphery, Miyawaki plantation, butterfly garden etc. have planted 1,50,000 no’s of saplings, the majority of the area has been planted with native species adapted to low rain regime of the local area. The butterfly garden has been created for species of butterflies to visit the garden. It provides a recreational activity to view butterflies interacting with the environment. Phase 3 covers an additional 100 acres and was started in December 2021 and will be completed by March 2023. As on date, we have covered an area of 350 acres out of the 800 acres project; and have planted around 2,50,000 saplings against the proposed 1 million saplings.

Ramco has raised indigenous nursery in houses for sustaining the green belt development, and also appointed well trained professional for this project.



Welspun One inks pact with Haryana govt to set up warehouses, to invest Rs.1,500 crore

Welspun One Logistics Parks (WOLP), an asset management and development platform has entered into a Memorandum of Understanding (MoU) with the government of Haryana to develop large-scale warehousing facilities across the state.

The integrated fund, part of the $2.7 billion Welspun Group, will bring in a total investment of Rs.1,500 crore in the state. It aims to explore the available government land parcels to build Grade A warehousing facilities across key warehousing micro-markets.

The development potential of the projects through this deal is around 5 million sq ft to be built over 3-4 years and will also help generate more than 4,500 jobs. With the collective investment generating substantial social and economic benefits, the state government has assured its complete support to Welspun One Logistics Parks facilitating overall ease of doing business. Haryana is an emerging warehousing hub in NCR and a key consumption market due to its strategic location intersecting with economic corridors. Further, the State’s Logistics Policy enables a conducive environment for the Logistics and Warehousing Sector.



Established residential realty developers set for 30-35% sales growth in FY22, says report

Established residential real estate developers are likely to witness 30-35% growth in revenue in the current financial year as against 14% growth a year ago. For the next financial year, these developers are expected to see revenue growth of 10-15%, said ratings agency CRISIL Ratings.

Top 11 listed realty developers sold nearly Rs.34,000 crore of inventory in the first nine months of this financial year 2021-22, equal to sales in the entire last fiscal, reflecting a significant recovery in the housing market.

Improved affordability and preference for larger homes owing to a surge in remote working driven by the Covid-19 pandemic have fuelled this boom.

The ratings agency has assessed top 11 listed realty developers including Brigade Enterprises, Godrej Properties, Kolte-Patil Developers, Macrotech Developers, Mahindra Lifespace Developers, Oberoi Realty, DLF, Prestige Estates Projects, Puravankara Ltd, Sobha, and Sunteck Realty for this analysis.

As a result, the market share of these 11 listed players in India’s top six cities has risen to 20-22% currently from 14-16% before Covid-19 struck. Besides strong residential sales, equity raising, and asset and land monetisation have helped these players navigate the pandemic and strengthen credit profiles.

“Increased affordability due to low interest rates and flattish capital values, rising demand for bigger homes, and government measures in the past two fiscals have provided a fillip to residential realty. After the setback in the first half of last fiscal due to the first wave, the sector has grown steadily through the second and third waves,” said Anand Kulkarni, Director, CRISIL Ratings. “Hence, established residential realtors are likely to see 30-35% growth this fiscal versus 14% last fiscal  For the next fiscal, we see growth at 10-15%.”

To be sure, the sector has seen lower impact and a shorter disruption period with each passing wave, with sales at 70-75% of the pre-pandemic level during the second wave compared with 50-55% during the first and recovery at one quarter as against two quarters during the preceding one, underlining the sector’s resilience. Meanwhile, selling prices of houses in the six cities are expected to increase marginally in the near future as realtors pass on the impact of higher labour and material costs, and as the demand-supply dynamics improves, the ratings agency said.

The inventory level in these cities has declined to nearly 2.5 years, compared with over 3.5 years as of March 2019. The ability of realtors to command price hikes will vary though, depending on brand strength and the resultant demand pull.

That said, the pandemic has amplified the difference in the performance of established and financially prudent developers versus their leveraged counterparts. Despite a downcycle in the past few fiscals, established realtors have delivered projects on time. They have also deleveraged in the five fiscals through 2022 by raising equity and monetising commercial assets and land worth nearly Rs.50,000 crore.

“The established realtors have strengthened their credit profiles. The debt to total assets ratio of these realtors is expected to improve to ~25% by March 2022 from ~45% five years ago. Significant opportunities through joint ventures and joint development will help these realtors log healthy growth without compromising on their credit risk profiles,” said Kshitij Jain, Associate Director, CRISIL Ratings.

Some mid-sized developers, which have historically maintained low leverage, are also well-placed in the current scenario. However, leveraged developers will continue to lose market share as they are crippled by high debt to total assets ratio of above 50%, weak liquidity, and limited ability to raise equity or monetise commercial assets. However, these realtors may choose to enter into partnerships with their established counterparts for project development.



Kalpataru to invest Rs.250 cr to develop 1-mln-sq-ft residential project in Pune’s Baner

Real estate major Kalpataru is planning to invest around Rs.250 crore to develop a premium residential project on a land parcel spread over 2.33 acres in Baner locality of Pune. The project, Kalpataru Aurum, has a total development potential of over 1 million sq ft.

Construction of the project will commence in March 2022 and the apartments will be ready for possession by December 2026. The project is adjacent to Kalpataru’s luxury project, Kalpataru Jade Residences and next to the Baner  Hills, a biodiversity hotspot.

Baner is witnessing a huge influx of knowledge and service industries spurring the development of world class homes, citizen amenities and a diverse culture. A key part of Pune Smart City Project, Baner is at the heart of Pune’s cosmopolitan transformation with its planned avenues, malls and lifestyle spaces. The about 500-acre Pashan-Baner Bio Diversity Park also makes it one of the greenest micro markets. The development will comprise 450 two-bedroom apartments with prices starting from Rs.1.10 crore.

Baner is a centrally located residential neighbourhood in Pune with established social and physical infrastructure and is also in proximity to the Mumbai – Benglauru Highway (NH-48). It has also grown as an IT employment hub with nearly 13 million sq ft of IT parks/office complexes including RMZ Icon and Panchshil Business Park.



Mumbai realtor Godrej Properties enters NCR with purchase of Sonipat land parcel

Godrej Properties has acquired around 50 acres of land in Sonipat, Haryana — foraying into a market outside its usual Mumbai playground. The nearly one million square feet of plotted residential development project is strategically located, with good connectivity to the Delhi border and national highways, and is in close proximity to the upcoming educational and industrial hub of Sonipat, as per a company filing with the exchanges.

Sonipat as a micro-market has seen a lot of infrastructure developments over the last couple of years and is going to play a vital role in the NCR growth story.

Godrej Properties has a 125-year legacy. In FY21, it was the largest developer in India by value and volume of residential sales.



Avigna Group’s arm to develop 50 million sq ft of warehouse space

Avigna Space, the industrial and warehousing arm of the diversified Avigna Group, plans to develop about 50 million sq ft of warehouse space over the next five years as it plans to expand its footprints in the western, eastern and northern parts of the country in the coming years. The warehouse expansion is part of its over Rs.2,500 crore investment plan.



Canada’s CPPIB to invest Rs.2,650 crore in JV with realty firm RMZ Corp

The Canada Pension Plan Investment Board (CPPIB) will invest Rs.2,650 crore in a joint venture with Bengaluru-based realty firm RMZ Corp to develop and acquire commercial projects across India.

RMZ Corp and CPPIB announced that they have entered into their second joint venture to develop and hold commercial office space in key cities across India.

“he total aggregate capital commitment by CPP Investments into the joint venture will be up to Rs.26.5 billion (C$ 449 million), to support the development and acquisition of projects across India.

The two joint ventures together have been established to develop assets worth in excess of $2.5 billion across cities. This partnership takes RMZ a step closer to our supercharge vision and growth strategy by 2032. The joint venture will be seeded with StarTech a 1.37 million square feet Grade A office building located in Koramangala, Bangalore, which is currently co-owned by RMZ and Prestige Estates. CPP Investments will acquire Prestige’s entire stake in StarTech. Spread across 8 acres, Star Tech is a LEED Platinum-rated green building and is a premium commercial campus with 100 per cent occupancy.

This is the second joint venture between RMZ and CPP Investments. The two entities formed their first joint venture in 2021 to develop and manage approximately 10 million square feet of Grade A commercial office spaces across Hyderabad and Chennai.

RMZ owns and operates a real asset portfolio of 67 million square feet, and are poised to grow to 350 million square feet of assets by 2032.



DLF to invest around Rs.100 crore to develop 85-acre housing project in Chennai

Realty major DLF will invest around Rs.100 crore to develop infrastructure in an 85-acre new housing project comprising plots located off the Old Mahabalipuram Road in Chennai.

The company launched the plotted development project Parc Estate on February 28. It will comprise 1,500 plots with plot sizes ranging from 600 sqft. to 4,000 sqft., with an approximate price of Rs.3,500 per square foot (psf).

The company will develop 1,500 plots, having 2.15 million square feet area, over the next 18 months. The company will sell 750 plots in the first phase in the price range of Rs.25 lakh to Rs.1.25 crore.

With a significant presence in the southern part of India over the last two decades, DLF has catalysed Chennai’s growth as an IT destination by offering a global ecosystem, future-ready workspaces, and safe and secure residential developments. Chennai has maintained steady growth in terms of infrastructure, connectivity and urban facilities and emerged as a major residential market where buyers can invest with confidence.

OMR is expected to see many infrastructure projects, adding to the future value of the investment. These include the Metro Rail Corridor Phase II, multiple flyovers to ease the traffic flow, a multi-deck elevated transport corridor along the Old Mahabalipuram Road and multiple road-widening initiatives.

DLF has developed 153 real estate projects and developed an area of approximately 330 million square feet. DLF Group has 215 msf (approx.) of development potential across residential and commercial segment.



SWAMIH fund approves last mile funding for Home & Soul project on Yamuna expressway

The Special Window for Affordable & Mid-Income Housing (SWAMIH) fund has approved over Rs.130 crore for completion of F Premiere 2, a real estate project on the Yamuna Expressway near the upcoming Jewar airport.

The last-mile funding will lead to time-bound delivery of houses to some 400 home buyers.

NCR-based Home & Soul, a subsidiary of brokerage firm Investors Clinic, was executing the project, but it got stuck due to a lack of funds.

While the project was announced in 2014, the construction got stuck in 2019. With the funding from SWAMIH, the construction has resumed and the project will be delivered soon.

SWAMIH Investment Fund has been formed to complete construction of stalled, brownfield, RERA registered residential developments that are in the affordable housing/mid-income category and are also net worth positive.

F-Premiere from Home & Soul is a residential hub overlooking the F1 motor racing track on the Yamuna Expressway.

Home & Soul has five projects and has already delivered over 600 homes.

While the impact of liquidity issues was felt across all asset classes, the residential real estate segment was the hardest hit.

To mitigate this impediment, in November 2019, the central government announced a Rs.25,000-crore special window to help complete over 1,500 stressed housing projects comprising around 458,000 housing units.

This move was directed towards stressed residential real estate assets under construction that are yet to be completed, including those that have been declared non-performing assets and have been admitted to insolvency proceedings.

Due to the impact of the pandemic on the economy, fault lines in the real estate sector have started to appear since last year.

With this, the fund has provided preliminary and final approval to a total of 213 projects across the country, committing Rs.17,000 crore in total. The fund is expecting 25 stressed projects to be completed, which will deliver 12,617 homes in the next 12 months.



GIFT City allots 70,000 sq ft development rights to Avenue Supermarts

The Gujarat International Finance Tec-City (GIFT City), has allotted over 70,000 sq ft development rights to Avenue Supermarts that owns and operates national supermarket chain D-Mart.

With this, D-Mart becomes the first retail chain to open a store in GIFT City. The City is already a host to the world’s leading names in the financial domain, banking, insurance, capital markets, technology, fintech, IT and ITeS sectors.

The addition of D-Mart will boost the integrated ecosystem offered by GIFT City where people enjoy a walk-to-work culture along with a good quality of life



Godrej Properties to develop a 9-acre project in Pune

Godrej Properties Ltd. (GPL), one of India’s leading real estate developers has acquired a 9 acres land parcel in the residential micro-market of Pimpri-Chinchwad in Pune. The development will primarily be for a group housing project.

Pimpri-Chinchwad is one of the established residential locations in Pune and has excellent connectivity to all major social and commercial hubs of Pune city.

Pimpri Chinchwad is an important micromarket in Pune and GPL is happy to add this land parcel to its portfolio. This will further expand the company’s presence in Pune and fits with its strategy of deepening its presence in key micro markets across India’s leading cities.



Construction costs up 10-12% in March, seen increasing further by December

Average construction costs for estate developers have bumped up 10-12 percent year over year in March, a report by Colliers India said.

Residential costs have gone from Rs 2060 per square foot in March 2021 to Rs 2300 per sq ft in the same period this year and industrial expenses from Rs 1900 to 2100 per sq ft.

The cost of key materials like cement and steel, which account for a large share of construction expenses, has risen over 20 percent.

Developers, who have been cautious about increasing prices as the market recovers from the virus, are now reviewing their pricing in the face of rising costs, the report noted.

With rising material costs, developers will be compelled to increase prices as construction materials account for about two-thirds of the cost of construction. Developers have already been operating on thin margins over the last few years. The rising cost will impact developers in the affordable and mid-market segments more as they are already operating on lower margins. With wholesale price inflation (WPI) and material cost seeing a double-digit rise, the cost of construction can rise by a further 8-9% by December 2022.



Lulu Group to invest Rs.3,500 cr in Tamil Nadu.

Lulu Group, the $7 billion Abu Dhabi headquartered retail conglomerate, will invest Rs.3,500 crore in Tamil Nadu to set up shopping malls, hypermarkets and food processing and logistics centre. An MoU for this was signed recently by Pooja Kulkarni, MD and CEO of Guidance Tamil Nadu and MA Ashraf Ali, Executive Director of Lulu Group in the presence of Chief Minister MK Stalin at the Abu Dhabi Chamber of Commerce HO in Abu Dhabi.

As per the MoU, the first shopping mall will come up in Chennai by 2024 while the first hypermarket is expected to open by this year-end itself in Coimbatore at Laxmi Mills compound.

The Lulu Group will also set up food processing and logistics centres for procuring and processing agri-produce for exports to Middle Eastern countries. A high-level delegation from Lulu will soon visit the state to finalise locations and related formalities.

In India, the group has three shopping malls in Kochi, Trivandrum and Bengaluru respectively. Its fourth mall is expected to be opened in Lucknow in the state of Uttar Pradesh by end of May this year.

Lulu currently operates more than 225 hypermarkets and shopping malls in the Middle East, Egypt, Indonesia, Malaysia and India. The group employs over 57,000 people globally. Lulu hypermarkets and department stores have a 32 per cent share of the retail market in Gulf Cooperation Council countries, the release said.

A State government release said that the LuLu group will generate employment of around 5,000 persons.


Delhi: NDMC to revamp three housing complexes.

New Delhi Municipal Council (NDMC) has decided to carry out major maintenance and revamp work at selected sites on priority, taking note of the deteriorating condition of municipal housing complexes in the area.

To begin with, NDMC has finalised a scheme for repairing houses and common areas in three societies for municipal sanitation staff - Balmiki Basti housing complex (Mandir Marg), costing Rs.7.5 crore; Palika Dham Housing Complex, Gole Market (Rs.4.5 crore); and housing Complex Bapu Dham, Chanakyapuri (Rs.1 crore).

On October 2, 2014, when the Swachh Bharat Mission was launched, the prime minister initiated a cleanliness drive in Balmiki Basti, Mandir Marg said NDMC vice-chairman Satish Upadhyay.

The improvement work will include strengthening of balconies; flooring of flats, scaffolding and painting work, repairing oftoilets and bathrooms, installation of rainwater pipes, etc. Presently, NDMC has 3,500 quarters of Type I to Type VI.



SWAMIH funds to invest Rs.24,151 crore across 252 stalled projects

The SWAMIH Fund, or Special Window for Completion of Construction of Affordable and Mid-Income Housing Projects Fund, will invest in 252 projects with sanctioned funds to the tune of Rs.24,151 crore. It will benefit 1,47,378 home buyers.

The Union Cabinet had, in November 2019, cleared a proposal to set up a ‘Special Window’ in the form of alternative investment fund (AIF) to provide priority debt financing for the completion of stalled housing projects. The SBICAP Ventures would be the Investment Manager to the first AIF set up under this special window.

SWAMIH Investment Fund was formed to complete construction of stalled, brownfield, RERA registered residential developments that are in the affordable housing/mid-income category, are net-worth positive and require last mile funding to complete construction. It has a target corpus of Rs.12,500 crore with a green-shoe option of Rs.12,500 crore.

Project approvals

According to a government statement, around 111 projects have been granted final approval. Investments (deal size) will be Rs.10,992 crore against which the project cost is Rs.30,503 crore. Beneficiaries or total units under the investment were 63,716.

On the other hand, preliminary approval has already been granted for 142 projects, entailing an investment of Rs.13,159 crore where the project cost was Rs.36,267 crore and number of dwelling units coming up stood at 83,662.

Recently, Ashwini Kumar Tewari, Managing Director, SBI, Intl Banking, Tech & Subsidiaries, and Suresh Kozhikote, MD, SBICAP Ventures, handed over the keys to home-buyers of Panchsheel Greens 2 located at Greater Noida in Uttar Pradesh. The project was completed within eight months of it receiving SWAMIH funds.

Although phase 2 of the project was launched in 2012 with 760 units being spread across four towers and villas; it was stressed due to paucity of cash flows.

Funding commitment by the GoI has resulted in its revival, thereby providing relief to over 750 plus homebuyers and provided direct employment to more than 600 labourers, the government statement said.

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