The Brihanmumbai Municipal Corporation (BMC) is dealing with a substantial shortfall in property tax collection for FY24, despite revising its target down to INR 4,500 crore from the initial INR 6,000 crore. To bridge this gap, Municipal Commissioner Bhushan Gagrani has devised a multifaceted strategy. This includes expediting the auctioning of assets seized from large defaulters, conducting comprehensive property inspections to reassess tax assessments, and imposing stricter penalties for late payments. The success of these measures is critical for maintaining essential civic services in Mumbai, underlining the urgency of addressing the shortfall in property tax revenue....
IDFC Capital gains INR 298 crore from Total Environment project in Bengaluru
HDFC Capital exited a Total Environment project in Bangalore, yielding nearly INR 300 crore. Initially, it invested INR 229 crore in a residential project in Whitefield, Bangalore, aiming to develop 1 million square feet under "Pursuit of a Radical Rhapsody." Founded in 1996, Total Environment has delivered 5.5 million square feet of residential and commercial space, with 14 million square feet currently under construction. The Bangalore-based developer generated INR 527 crore returns, providing an exit to HDFC Capital while also returning INR 250 crore against other investments in FY 2023-24. HDFC Capital manages four SEBI-registered Category II Alternative Investment Funds, forming a USD 3 billion platform....
Piramal Enterprises approves merger of subsidiary Piramal Capital & Housing Finance with parent company
The board of directors of Piramal Enterprises, a diversified non-bank finance company, has approved the merger of its wholly-owned subsidiary Piramal Capital & Housing Finance (PCHFL) with the parent company Piramal Enterprises (PEL). The new entity will be named Piramal Finance Limited (PFL) post-merger. The primary objectives of the consolidation are to simplify the group structure, create a more flexible entity and give shareholders direct access to the entire lending business. It is applying to RBI to convert its HFC license to an NBFC-ICC (non-banking financial company-investment and credit company) license. Piramal Enterprises reported a net profit of INR 137 crore for Q4 FY24....
Shifting Trends: The rise of luxury housing in India's real estate market
A recent ANAROCK report analysed housing trends across the top 7 cities in India from Q1 2019 to Q1 2024. A key finding was the rising prominence of luxury housing segments compared to affordable housing. In Q1 2024, luxury homes accounted for 21% of unit sales versus just 4% in Q1 2019. New luxury housing supply also increased from 9% of total launches in Q1 2019 to 25% in Q1 2024. Meanwhile, affordable housing sales declined from 37% to 20%. Non-luxury segments gained greater share in cities like Bengaluru, Chennai, Hyderabad and Pune. The data indicates developers are aligning new project launches more towards prevailing demand for higher-priced luxury properties....
Outstanding credit in the housing sector reaches record high of INR 27.23 lakh crore
Outstanding loans for housing have grown substantially over the past two years, according to RBI data. Housing credit increased nearly INR 10 lakh crore between FY22-FY24 to reach a record high of INR 27.23 lakh crore in March 2024. This growth can be attributed to pent-up demand during the pandemic and rising sales across segments. The government's push for affordable housing has increased accessibility. Reports show price appreciation of 50-100% in major cities over the past two years, leading to larger average loan sizes. Commercial real estate lending has also risen significantly from INR 2.97 lakh crore to INR 4.48 lakh crore between March 2022-2024....
Home First Finance posts 30.5% increase in net profit this quarter, reaching INR 83.5 crore
Home First Finance Company India Ltd reported a robust performance for the March quarter, with net profit surging 30.5% to INR 83.5 crore and quarterly interest income rising 38% to INR 283 crore. Assets under management grew by 35% to INR 9698 crore, with loan disbursement up 32% to INR 3963 crore. The company aims to expand its portfolio by 30% in FY 2025, with plans to open 20-25 branches. They recommended a 170% dividend and approved raising INR 700 crore through debentures....
Bajaj Group raises record INR 12,095 crore in bond issuances
Bajaj Housing Finance and Bajaj Finance, two entities within the Bajaj Group, collectively raised INR 12,095 crore through bond issuances, capitalizing on favorable debt market conditions driven by recent central bank actions. Bajaj Housing Finance secured INR 4,500 crore through two non-convertible debenture issuances, with ICICI Securities Primary Dealership facilitating the transactions. Bajaj Finance raised INR 7,595 crore through bonds maturing in 2034, with HDFC Bank as the sole arranger. The surge in borrowing activity coincides with a notable decline in government bond yields, spurred by the Reserve Bank of India's announcement of a sovereign bond buyback, injecting liquidity into the banking system....
Grihum Housing Finance reports 21% rise in net profit, AUM grows by 32% in FY24
Grihum Housing Finance reported a 21% rise in net profit to INR 140 crore for FY24, driven by a 32% increase in assets under management to INR 8,277 crore. Organic disbursements reached a record INR 2,914 crore, up 26% year-over-year. The company expanded sourcing channels and added 28 new branches, taking the total to 210. Revenue grew 46% to INR 1,046 crore with net interest margin of 8.3% and cost of borrowings at 8.1%. MD and CEO Manish Jaiswal credited the results to Grihum achieving a 30% CAGR and establishing itself as a national housing finance company serving over 77,000 customers....
ICRA forecasts 12-15% revenue growth for construction sector entities in FY25
In FY2025, India's construction industry anticipates robust growth, following a stellar FY2024. With the government's commitment to infrastructure evident in increased capital expenditure, ICRA maintains a stable outlook, projecting moderate margin expansion despite competition challenges. While profitability may remain below pre-Covid levels due to the expiration of certain schemes, the moderation in commodity prices, notably steel, offers relief. Stakeholders must navigate challenges with vigilance, leveraging opportunities as they arise. Monitoring market dynamics and policy shifts will be crucial for success in the upcoming fiscal year....
SEBI proposes measures to ease trading in privately placed InvITs and REITs
The Securities and Exchange Board of India (SEBI) has proposed lowering the minimum trading lot size for privately placed infrastructure investment trusts (InvITs) from the current INR 1-2 crore to INR 25 lakh. This aims to increase liquidity in the secondary market for InvIT units by allowing more individual and retail investors to participate. A smaller lot size would help diversify investment portfolios and better manage risks. In addition, SEBI has put forth several measures to reduce compliance burden for InvITs and real estate investment trusts (REITs), including setting a timeline of 5 days for profit distributions and giving flexibility to set record dates with 2 days' notice to exchanges....
HDFC Capital profitably exits Bengaluru project, gains INR 300 Crore in return
HDFC Capital, the real estate private equity arm of HDFC Group, has exited the "Pursuit of a Radical Rhapsody" project in Bengaluru, generating a remarkable return of close to INR 300 crore, surpassing their initial investment of INR 229 crore. Developed by Total Environment, the project comprises 4.4 million square feet of residential space and 500,000 square feet of commercial development. This successful exit underscores HDFC Capital's strategic investment approach and ability to create value. Partnering with esteemed developers like Total Environment, known for quality, reflects HDFC Capital's commitment to promoting affordable and mid-income housing in India. This achievement highlights the potential for strong returns in Bengaluru's real estate market and HDFC Capital's pivotal role in shaping India's housing landscape....
Aptus Value Housing Finance reports 21% rise in Q4FY24 PAT
Aptus Value Housing Finance saw continued growth in FY24 with a 22% rise in PAT to INR 612 crore. Total disbursements for the housing financier jumped 31% to INR 3,127 crore for the full year, reflecting robust demand for housing loans. In Q4FY24 alone, disbursements grew 45% to INR 968 crore. Aptus expanded its reach through the addition of 31 new branches, taking its total network to 262 branches across seven states. Commenting on the results, MD P Balaji expressed satisfaction with the company's performance and stated that significant accomplishments were made during the fiscal....
Commercial Real Estate lending surges as banks embrace regulatory reforms and REITs
Data from the Reserve Bank of India shows that scheduled commercial banks' commercial real estate portfolios grew nearly 23% year-on-year in March 2024, significantly higher than the 8.52% growth seen the previous year. This surge in commercial real estate lending by banks reflects positive changes in the sector in recent years, including regulatory reforms, growth of real estate investment trusts, and developers taking on less debt, which have boosted banks' confidence. Industry experts expect banks' commercial real estate lending to continue growing strongly due to healthy demand, a clearer regulatory framework, and avenues like REITs mitigating risks....
Blackstone in talks to acquire Adani Group's Inspire BKC commercial project
US private equity giant Blackstone is reportedly in advanced negotiations to acquire Inspire BKC, an 800,000 sqft office project in Mumbai developed by Adani Realty. As per reports, Blackstone may invest Rs 1,800-2,000 crore for the acquisition. Located in the Bandra Kurla Complex business district, Inspire BKC currently has tenants like Novartis, Reliance Nippon Life Insurance and MUFG Bank. Co-working operator Bhive recently leased over 62,000 sq ft in the building. Adani has been looking to sell the asset and previous discussions were held with Brookfield and Shapoorji Pallonji. Talks with Blackstone were halted in 2020 due to the pandemic but have now revived with strong demand and occupancy levels....
Nisus Finance launches second realty fund in Mauritius
The Indian real estate sector is experiencing an influx of foreign investment, notably in stressed assets. Nisus Finance, based in Mumbai, has launched the Nisus India Opportunity Fund in Mauritius, targeting distressed real estate projects. This initiative aims to attract foreign capital to revitalize stalled developments. Building on the success of their Singapore-based fund, Nisus Finance's new venture signals growing international interest in India's real estate market. By addressing stressed assets, the fund not only offers potential for high returns but also contributes to project revival, job creation, and overall market growth. This move reflects increased investor confidence in India's real estate sector and boosts liquidity while addressing critical market needs....
The evolution of Mumbai's Real Estate: Luxury condos redefine urban living
The real estate scene in Mumbai is witnessing a transformation, as luxury condos with contemporary amenities take centre stage. This shift is particularly evident in prime areas such as Carmichael Road and Walkeshwar Road, where soaring prices underscore the city's appetite for upscale living. As Mumbaiites increasingly seek modern comforts and convenience, developers are responding by crafting high-end residential offerings that cater to these evolving preferences. This trend signals a broader shift towards a more luxurious and sophisticated urban lifestyle in the bustling metropolis....
ADIA and KKR invest USD 1.5 billion in Reliance Retail's warehousing assets
Abu Dhabi Investment Authority (ADIA) and KKR invested USD 1.5 billion in Reliance Retail Ventures Ltd's warehousing assets, facilitated through Reliance Logistics and Warehouse Holdings (RLWH). This transaction, undisclosed officially, involved senior debt, NCDs, and equity infusion. Operations and maintenance will be managed by Reliance Projects & Property Management Services Ltd (RPPMSL). The deal aims to ensure cash flow stability for 20+ years, with potential future investment reaching USD 2 billion. Reliance's warehousing strategy aligns with its expansion plans for retail, emphasising an asset-light balance sheet. Previous successful capital solutions include telecom assets monetization with institutional investments....
Mindspace REIT announces record leasing performance and robust financial results for Q4 FY24
Mindspace REIT, a leading owner and developer of Grade A office portfolios across major Indian markets, reported strong quarterly and annual results for FY24. Key highlights included committed occupancy of 90.6% and gross leasing of 2 million sq ft in Q4 alone, taking total FY24 leasing to 3.6 million sq ft. Re-leasing spreads stood at 16.7% for Q4 and 14.3% for FY24. Net profit after tax for Q4 FY24 was INR 127.10 crore compared to a loss last year. Total income grew 9.05% to INR 624.10 crore for Q4. NOI and NAV also increased year-on-year, demonstrating Mindspace REIT's consistent growth. With a large Grade A portfolio across key cities, Mindspace REIT remains one of India's leading commercial real estate players....
The Executive Centre hits USD 315 million revenue milestone in 2023
TEC, a global provider of premium workspace solutions, reported record-breaking revenue of USD 315 million in 2023, with India contributing significantly to its adjusted EBITDA. TEC India saw a remarkable 31% revenue growth, reflecting its strategic expansion and commitment to high-quality service. With a focus on emerging markets like India, TEC aims for a 10-15% revenue growth in FY 2024-25. The flexible workspace sector in India is also booming, expected to reach 43 million sq. ft. by 2025. TEC's innovative approach positions it to capitalize on this trend and shape India's dynamic workspace landscape....
Shriram Housing Finance's Q4 FY24 PAT rises by 67%, AUM reaches INR 13,762 crore
Shriram Housing Finance has demonstrated remarkable financial performance in Q4 FY24, with a 67% increase in profit after tax (PAT), reaching INR 62.1 crore. Their total AUM surged to INR 13,762 crore, reflecting a growing demand for affordable housing finance. With a 3.5 times growth in AUM over three years and a substantial CAGR of 56%, the company raised an additional INR 400 crore, enhancing its loan disbursal capacity. Disbursements soared by 77% in Q4 FY24, totaling INR 7,591 crore for FY24. Despite robust growth, GNPA remained low at 1.03%, ensuring a healthy portfolio. Shriram Housing Finance's strong performance aligns with the soaring demand for affordable housing in India, positioning them as a key player in fulfilling homeownership aspirations....
In April 2024, Mumbai's property registrations hit a 12-year high of 11,621 units, marking the fourth consecutive month exceeding 10,000 units. Revenue from stamp duty also surged, reaching over INR 1,043 crore, a 16% increase from the previous year. Factors driving this growth include enduring buyer confidence, stable interest rates, and preferences for smaller, affordable apartments. Central and Western suburbs attracted 73% of registrations, offering modern amenities and connectivity. While the rise indicates a strong market, long-term sustainability requires responsible development to meet diverse needs and affordability concerns, especially for smaller living spaces....
SM-REITs changing real estate: INR 67,000-71,000 crore opportunity
ICRA's recent report highlights the emergence of Small and Medium REITs (SM-REITs), revolutionizing the commercial office space market. Unlike traditional REITs, SM-REITs allow listings for buildings valued between INR 50 crore and INR 500 crore, expanding opportunities for developers and investors. With an estimated 530 lakh sq. ft. of eligible office space, SM-REITs present a massive INR 67,000-71,000 crore monetization potential. Additionally, the formalization of Fractional Ownership Platforms (FOPs) further democratizes real estate investment, making it accessible to a broader range of individuals with lower minimum investments. While challenges persist, the introduction of SM-REITs signifies a positive transformation in India's real estate landscape....
ASK property fund makes profitable INR 354 crore exit from real estate investment
ASK Property Fund, the real estate private equity arm of ASK Asset & Wealth Management Group, has exited an INR 200 crore investment in three projects developed by QVC Realty Developers. Over four years, the fund generated a return of INR 354 crore, achieving a 1.8x multiple on their initial investment and an Internal Rate of Return (IRR) of approximately 20%. Amit Bhagat, CEO and MD of the fund, attributes their success to strategic project selection and timely market opportunities, emphasizing their commitment to identifying investments with a 3-5-year horizon. Sunil Rohokale, Managing Director and CEO of ASK Asset & Wealth Management Group highlights the positive real estate market dynamics and the importance of the residential sector within their investment portfolio, which includes logistics and data centers....
Rising construction costs pose challenges for developers in Indian real estate sector
The "Construction Cost Guide India: 2024" by JLL reveals a significant 6% average increase in construction costs across sectors for FY 23-24, posing challenges for developers. Mumbai remains the most expensive city for construction due to soaring prices of materials like cement and steel. Jipu Jose James of JLL stresses effective cost management for project viability. Developers like Goel Ganga Developments and 4S Developers have adopted strategies like price adjustments and cost-saving measures. MRG Group and Shriram Properties have adjusted pricing strategies while focusing on value for buyers. Navigating rising costs demands innovation and adaptation, emphasising efficient project management and informed decision-making for buyers....
Leptos Estates to market Mediterranean vacation homes in India
Leptos Estates, a 64-year old family-run real estate firm renowned for properties in Greece and Cyprus, is entering the Indian market. It aims to offer Indian buyers the opportunity to purchase homes in Greece and Cyprus while also obtaining permanent residency. Indian buyers of Cypriot homes qualifying for residency must invest a minimum of EUR 300,000 plus VAT. For Greek homes, the minimum investment is EUR 250,000 with 0% VAT until the end of 2024. With a focus on quality living and investment incentives, Leptos aims to cater to Indian families seeking Mediterranean homes. Their seamless process and commitment to customer satisfaction make them a compelling choice for Indian investors eyeing overseas real estate opportunities....
The Indian real estate is booming with INR 1.51 lakh crore investment and high sales
The Indian real estate sector is witnessing a strong recovery, supported by various positive factors. Following the HDFC-HDFC Bank merger, banks have injected INR 1.51 lakh crore into the sector, reflecting renewed confidence in its stability and growth potential. Residential property sales in the top eight cities reached a 10-year high in Q1 2024, exceeding 90,000 units. Tier 2 and 3 cities are also experiencing increased activity, driven by improving infrastructure and rising disposable incomes. Factors such as RERA, PMAY, and economic growth are further fueling demand. Analysts predict continued growth, with office space rentals and residential developer volumes expected to increase. However, sustainable growth practices and technology adoption are essential considerations....
CBDT circular provides relief to homebuyers receiving TDS notices due to inoperative seller PAN
On April 23, 2024, the Income Tax Department issued a circular providing relief to many homebuyers who had received tax deduction at source (TDS) notices due to the property sellers' Permanent Account Numbers (PAN) being inoperative. The circular stated that homebuyers would not be liable for any TDS shortfall notices received before March 31, 2024, if the seller's PAN is linked to Aadhaar by May 31. This gave relief to over 16,000 homebuyers who had received notices demanding an additional 19% TDS payment amounting to at least INR 9.5 lakh per property transaction. As per IT regulations, homebuyers must deduct TDS at 1% of the sale value if the property purchase exceeds INR 50 lakh....
Embassy REIT faces difficulty in INR 3,000 crore fundraising plan due to mutual fund's opposition
Embassy Office Parks REIT faces challenges in its plan to raise INR 3,000 crore for acquiring a business park in Chennai. Major unitholders, holding 17.29% stake, oppose the proposal due to concerns of dilution and decreased value of existing holdings. The discrepancy between the fund raise amount and acquisition cost raises questions about transparency. Embassy REIT clarifies that part of the funds will optimise their balance sheet and support ongoing projects. However, without addressing specific concerns, the proposal's success hinges on securing a special majority vote. This highlights the importance of transparency and communication between REITs and investors in navigating complex financial decisions....
Brookfield to invest USD 10 billion in Indian real estate over the next 3 to 5 years
Brookfield Asset Management plans to invest USD 10 billion in India's real estate sector over the next three to five years, doubling their existing assets under management (AUM). Managing Partner Ankur Gupta sees India's rapid economic growth as fertile ground for investment, with plans to double their investment in the future. While Brookfield already dominates the Indian office space, their new strategy involves diversifying into housing, industrial, and retail sectors. This move aligns with India's underdeveloped real estate market compared to its GDP, presenting ample investment opportunities. Brookfield's investment, alongside other global players like Blackstone and GIC, highlights growing confidence in India's real estate market amidst urbanisation and a growing middle class....
Aurum PropTech reported a net consolidated loss of INR 4.65 crore for Q4 FY24
Aurum PropTech, a real estate software solutions provider, reported a consolidated net loss of INR 4.65 crore for Q4 FY24, showing improvement from the previous year's loss of INR 9.83 crore. Despite the loss, their Q4 FY24 revenue grew by 28.07%, reaching INR 65.74 crore. For FY24, total income surged to INR 233.07 crore, a 68% increase from FY23. Onkar Shetye, Executive Director, noted a sustained EBIDTA margin improvement, indicating effective expense management. Aurum also underwent strategic restructuring, divesting subsidiaries to focus on core business areas. With India's PropTech market expected to boom, Aurum's revenue growth trajectory and ability to capitalize on this trend will determine future profitability....
The Kolkata Metropolitan Region (KMR) witnessed a 17% year-on-year increase in apartment registrations in March 2024, reaching 3,936 units
In March 2024, apartment registrations in the Kolkata Metropolitan Region (KMR) increased by 17% year-on-year, totaling 3,936 units, indicating a preference for budget-friendly homes. Notably, apartments under 500 square feet rose to 45%, reflecting a 21-point increase from the previous year. While units between 501 and 1,000 square feet still hold a significant share at 48%, affordability remains paramount. Abhijit Das of Knight Frank India emphasises the need for large, affordable projects with good connectivity. The real estate sector pushes for a permanent stamp duty rebate extension to sustain sales momentum, while infrastructure development enhances market appeal, especially in South and North zones known for affordable options....
Can Fin Homes report strong quarterly results and dividend for FY2024
Can Fin Homes Ltd (CFHL), a leading housing finance company sponsored by Canara Bank, reported a 26.08% rise in net profit for the quarter ending March 2024. Net profit increased to INR 209.02 crore compared to INR 165.79 crore in the same quarter last year. Total income grew 21.37% to INR 927.64 crore. The board recommended a final dividend of INR 4 per share for FY 2023-24. Vikram Saha was appointed additional director while Ajay Kumar Singh resigned as deputy managing director. With a stable outlook, prudent provisioning and a strong balance sheet, CFHL is well positioned to capitalize on growth opportunities in the housing finance sector....
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