BANGALORE: Bangalore-based real estate developer Embassy Property Developments is in talks to raise Rs 800 crore in debt to fund its planned acquisition of an IT park in the city, a person with direct knowledge of the development said. "The builder is in talks with banks and financial services companies including HDFC LtdBSE -2.37 % and Indiabulls to raise the debt," this person said. "Earlier, Embassy and Blackstone were jointly expected to buy the 2.1-million sq ft Vrindavan Tech Park, but now the PE fund will enter when 100% stake in the park is bought by Embassy. "Chairman and MD of Embassy Group, Jitu Virwani , refused comment for this story. An HDFC Ltd spokesperson denied the development , while Indiabulls said it was not aware of any such development.
Embassy Property plans to fund the Rs 1,951 crore acquisition through . 900 debt and . 1,100 crore equity, the person quoted earlier said. "There is Rs 315 crore debt on the project from a public sector bank that has turned NPA. The IT Park is also involved in arbitration with Citigroup, which provided mezzanine financing to the project," he said. Post the acquisition, Embassy and Blackstone will not only get the 2.1 million sq ft of lease space but will also get hold of 75 acre of undeveloped land within the IT Park.
Some of the tenants in the IT SEZ include Cisco , Sony, Nokia and KPMG. "The builder may also decide to sell some space to Blackstone ," the person quoted earlier said. Blackstone bought 50% stake from Embassy Group in Embassy Office Parks, which comprises three commercial properties totaling 19 million sq ft, for Rs 1,015 crore last October.