maverick
30-11-2007, 10:41 PM
As prices surge in India’s real estate market, Goldman Sachs, Wachovia Bank and Baer Capital have stepped in, pumping $250 million into the realty and hospitality player Vatika Group.
The disbursement of funds has already started and will be completed by the end of the first quarter of 2008, according to a release from the company, based in Gurgaon, on the outskirts of New Delhi.
“About half of the latest infusion of funds will be used to add value to existing projects and to consolidate our land banks, while the rest will be used for new projects, in cities like Pune and Nagpur [in western India] and in the south,” said Gaurav Bhalla, executive director at Vatika Group, which has projects worth more than $2.01 billion and land of around 2,500 acres under development.
In the past two years, the company has seen growth rates of about 100% in an Indian real estate market that is expanding faster than 30% as demand outruns supply.
The company is planning an initial public offering in mid-2009, after its projects, including those that are being conducted in partnership with Starwood Hotels and Resorts Worldwide (nyse: HOT - news - people ), are complete.
Vatika is pairing with Starwood to build under the aegis of its luxury brand Westin. It expects valuations will more than double by 2009 to around $5 billion, Bhalla said.
A surge in property prices has prompted several real estate companies to approach the stock markets in recent months. DLF, India’s largest land developer by market value, raised a record $2.3 billion in an IPO in June. Its stock has risen around 70% since then.
About 18 Indian real estate and construction companies opted for exchange listings at home and in overseas markets from August 2006 to this September, raising about $4.4 billion. For 16 companies with IPOs, average listing gains were 71.5%, according to a study by Ernst and Young.
Foreign investors have pumped billions of dollars into the real estate sector over the past two years, as property prices approach the highest in the world. A recent survey by CB Richard Ellis put Mumbai and New Delhi among the world’s most expensive cities for commercial properties.
Earlier this month, the finance ministry said it had cleared a $1.7 billion investment by Goldman Sachs (nyse: GS - news - people ) and Macquarie Bank (other-otc: MQBKY - news - people ) into PTC India Financial Services, a subsidiary of power company PTC.
The disbursement of funds has already started and will be completed by the end of the first quarter of 2008, according to a release from the company, based in Gurgaon, on the outskirts of New Delhi.
“About half of the latest infusion of funds will be used to add value to existing projects and to consolidate our land banks, while the rest will be used for new projects, in cities like Pune and Nagpur [in western India] and in the south,” said Gaurav Bhalla, executive director at Vatika Group, which has projects worth more than $2.01 billion and land of around 2,500 acres under development.
In the past two years, the company has seen growth rates of about 100% in an Indian real estate market that is expanding faster than 30% as demand outruns supply.
The company is planning an initial public offering in mid-2009, after its projects, including those that are being conducted in partnership with Starwood Hotels and Resorts Worldwide (nyse: HOT - news - people ), are complete.
Vatika is pairing with Starwood to build under the aegis of its luxury brand Westin. It expects valuations will more than double by 2009 to around $5 billion, Bhalla said.
A surge in property prices has prompted several real estate companies to approach the stock markets in recent months. DLF, India’s largest land developer by market value, raised a record $2.3 billion in an IPO in June. Its stock has risen around 70% since then.
About 18 Indian real estate and construction companies opted for exchange listings at home and in overseas markets from August 2006 to this September, raising about $4.4 billion. For 16 companies with IPOs, average listing gains were 71.5%, according to a study by Ernst and Young.
Foreign investors have pumped billions of dollars into the real estate sector over the past two years, as property prices approach the highest in the world. A recent survey by CB Richard Ellis put Mumbai and New Delhi among the world’s most expensive cities for commercial properties.
Earlier this month, the finance ministry said it had cleared a $1.7 billion investment by Goldman Sachs (nyse: GS - news - people ) and Macquarie Bank (other-otc: MQBKY - news - people ) into PTC India Financial Services, a subsidiary of power company PTC.