PE exits in real estate rose by 33% in 2013
Investments were down by 8.2% in the year
Jan 09, 2014
Source : Business Standard


CHENNAI: Private equity (PE) firms focused on the real estate sector made 24 exits during 2013 compared to a total of 18 exits announced during 2012. Ten of these exits with disclosed values harvested $421 million for the investors.

As far as investment is concerned, private equity-real estate firms made 45 investments during 2013. Of these, 37 transactions had an announced value of $1,423 million. The activity level was 8.2% lower compared to the 49 investments ($1,202 million across 39 announced deals) in 2012.

The buyback route – acquisition of the PE firm’s interest by the developer - accounted for 23 of the exits, according to Chennai-based Venture Intelligence, a research service focused on private company financials, transactions and valuations.

Among the larger exits, Farallon Capital sold its stake in seven joint ventures with the Indiabulls Group for nearly Rs 1,172 crore, making a profit of 42% on its six year old investment. The SPVs, in which Farallon had invested Rs 847 crore in 2007, are at present executing residential projects in the NCR region and Chennai.

Landmark Holdings exited Wave Hi-Tech City, a township in Ghaziabad run by the Wave Group, with Rs 350 crore, at an internal rate of return (IRR) of 20%. In the only exit outside of buybacks, Shriram Properties purchased a 12.5-acre land parcel valued at over Rs 110 crore along Bangalore's IT corridor of Sarjapur Road from Golden Gate Properties.

Investments down by 8.2%

Private equity-real estate firms made 45 investments in the segment during 2013. Of these, 37 transactions had an announced value of $1,423 million. The activity level was 8.2% lower compared to the 49 investments ($1,202 million across 39 announced deals) in 2012.

The largest investment announced during

2013 was Blackstone and HDFC Venture’s $367 million acquisition of Vrindavan Tech Village, along with Embassy Group, from Singapore-based Assetz Property Group. This was followed by Canada Pension Plan Investment Board’s (CPPIB) commitment of $200 million for an 80-20 joint venture with Shapoorji Pallonji Group that will target office assets in Indian metros; Ascendas Trust's Rs 600 crore (about $110 million) acquisition of 2 million sq ft of office space in Hyderabad from Phoenix Group; and StanChart’s joint venture with publicly listed Mahindra Lifespaces to together invest Rs 1,000 crore across various projects.

Residential projects accounted for 46.7% of the investments by volume (and 66.7% including townships) during 2013, followed by commercial projects with a 16% share of the pie, the Venture Intelligence research added.

Latest Realty News

Indian Bank, Indian Overseas Bank launch special drive for home loans
Jan 08, 2014
CHENNAI: In an attempt to target prospective home buyers, public sector lenders -- Indian Bank and Indian Overseas Bank -- are offering home loans at interest rates of 10.20 and 10.25 per cent, respectively.
Realty: Then and now
Jan 04, 2014
CHANNAI: The economic downturn in the year 2013 has had an adverse impact on various sectors and the realty sector has not been insulated by these changes. The year has been one of guarded optimism and the sentiments were rather cautious from both investors and builders.
Owners rent out buildings to commercial units, cheat on tax
Jan 03, 2014
CHENNAI: A growing number of residential properties in the city are being used for commercial purposes to evade high property tax resulting in a huge loss to the city corporation. Any shortfall in collection of property tax, the biggest source of revenue for the corporation, impacts infrastructure schemes directly.
Real Estate Promoters in Chennai,Chennai Real Estate,Real Estate Developers in Chennai
Dec 31, 2013
CHENNAI: The Consumer Disputes Redressal Forum, Chennai (South) has ordered a real estate promoter to refund the amount deducted as cancellation charges from the installment paid by a woman who had booked an apartment in a project mooted by the firm in 2008.
Air India property in Chennai on the block
Dec 31, 2013
CHENNAI: Air India has put on the block a 1.33-acre property in Chennai.It will sell the property located at Teynampet on the arterial Anna Salai through an e-auction on January 21.
Chennai, the hot spot for new retail ventures in 2013
Dec 30, 2013
CHENNAI: Establishing its position as one of India’s fastest growing markets for organised retail, Chennai accounted for over half of the new property rentals and purchases that took place in the space in January-September, 2013.
Another project on OMR
Dec 28, 2013
CHENNAI: Adroit Urban Developers is set to formally announce the launch of Artistica, a two-acre residential development on the OMR. The multi-storeyed apartments are coming up at Sholinganallur junction to the south of Chennai. Over 145 apartments and coming up on three towers of stilt plus 10, 13 and 16 floors, according to the developer.
Bleu villas at Kovalam
Dec 28, 2013
CHENNAI: The Chennai-based Vijay Shanthi Builders will soon launch a 19-villa project, Bleu at Kovalam on the East Coast Road to the south of the city.
Green revolution of a concrete kind
Dec 28, 2013
CHENNAI: Chennai is seeing a spurt in development of green building spaces – commercial and residential space – earning it the qualification to be called a green city. Increasingly homes and offices are seeing the benefit of sustainable construction techniques and operation and maintenance of built-up space.
What affects your realty investment in Chennai
Dec 27, 2013
CHENNAI: Various macro and micro factors impact real estate investment in a city. Here the author talks about factors that impact property investment in Chennai. However, before that let us understand what these macro and micro factors are

Latest Realty News Of State

Realty Talk's