News: Realty boom helps business families land on gold mine
(TNN 03/04/2006) New Delhi - Old business families, some of which have accumulated real estate assets over generations, are unlocking the value of the land.
With assets prices shooting up to record highs, business houses are either selling estates and properties in multi-crore deals or re-developing them to tap new opportunities in retail and residential townships.
The trend is not restricted to the textile barons, who have got an exit route in Mumbai with the Supreme Court judgement allowing property sales. The list features families such as the Bajajs, Goenkas, Wadias, Bharat Rams and the Khaitans.
In some cases, groups are encashing the value of the land. In others, they are looking at developing them into malls and industrial parks.
In the North, DCM, the Vinay Bharat Ram group company, has joined hands with some Singapore-based NRI investors to set up a 3 million sq feet commercial-cum-residential complex in the heart of Delhi with a project outlay of Rs 1,800 crore. Plans are afoot to look at similar such projects in other cities where the group has land.
In the east, the RPG Group is among those sitting on large swathes of real estate. Says Sanjiv Goenka, vice-chairman of RPG Enterprises, "The idea is to convert the non-performing and under-performing assets for productive purposes.”
A few months back, the group sold some assets in its plantations business, which is under Harrisons Malayalam. This included the Rs 63-crore deal for Cheruvally Estate and the Rs 9.5-crore transaction for Nagamallay Estate.
The group is also believed to be looking at properties of other companies which have prime assets in Mumbai, Kolkata and other places either for redevelopment as malls or for a selloff.
The GP Goenka group is also is negotiating a deal for the Kalyan property of group company NRC —known as National Rayon Corporation earlier.
Another Kolkata based group, the Khaitans of Eveready, recently sold off their building complex at Guindy, near Chennai, for Rs 72 crore. The Bajajs sold their Kurla property, which housed a foundry unit of Mukand, for Rs 221 crore.
Then, there is the pack of Mumbai textile barons. This includes the Bombay Dyeing’s Wadias, who are planning to develop their properties scattered in and around the financial capital for commercial and residential projects. Ness Wadia is spearheading the initiative.
“Many old business groups are leveraging the value of their real estate assets. Some are unlocking their value to upgrade and expand their core businesses, while others are using it to enter sunrise sectors like retail, hospitality and real estate,” points out Anuj Puri, managing director of TrammellCrowMeghraj, a real estate consultant.
While old business houses are doing it with their family jewels, other companies with surplus assets are liquidating them to generate cash. These include many small and mid-sized companies in the country, including MNCs.
Stock market analysts say this is one of the other factors pushing valuations of scrips beyond limits justified by their core operations.
With assets prices shooting up to record highs, business houses are either selling estates and properties in multi-crore deals or re-developing them to tap new opportunities in retail and residential townships.
The trend is not restricted to the textile barons, who have got an exit route in Mumbai with the Supreme Court judgement allowing property sales. The list features families such as the Bajajs, Goenkas, Wadias, Bharat Rams and the Khaitans.
In some cases, groups are encashing the value of the land. In others, they are looking at developing them into malls and industrial parks.
In the North, DCM, the Vinay Bharat Ram group company, has joined hands with some Singapore-based NRI investors to set up a 3 million sq feet commercial-cum-residential complex in the heart of Delhi with a project outlay of Rs 1,800 crore. Plans are afoot to look at similar such projects in other cities where the group has land.
In the east, the RPG Group is among those sitting on large swathes of real estate. Says Sanjiv Goenka, vice-chairman of RPG Enterprises, "The idea is to convert the non-performing and under-performing assets for productive purposes.”
A few months back, the group sold some assets in its plantations business, which is under Harrisons Malayalam. This included the Rs 63-crore deal for Cheruvally Estate and the Rs 9.5-crore transaction for Nagamallay Estate.
The group is also believed to be looking at properties of other companies which have prime assets in Mumbai, Kolkata and other places either for redevelopment as malls or for a selloff.
The GP Goenka group is also is negotiating a deal for the Kalyan property of group company NRC —known as National Rayon Corporation earlier.
Another Kolkata based group, the Khaitans of Eveready, recently sold off their building complex at Guindy, near Chennai, for Rs 72 crore. The Bajajs sold their Kurla property, which housed a foundry unit of Mukand, for Rs 221 crore.
Then, there is the pack of Mumbai textile barons. This includes the Bombay Dyeing’s Wadias, who are planning to develop their properties scattered in and around the financial capital for commercial and residential projects. Ness Wadia is spearheading the initiative.
“Many old business groups are leveraging the value of their real estate assets. Some are unlocking their value to upgrade and expand their core businesses, while others are using it to enter sunrise sectors like retail, hospitality and real estate,” points out Anuj Puri, managing director of TrammellCrowMeghraj, a real estate consultant.
While old business houses are doing it with their family jewels, other companies with surplus assets are liquidating them to generate cash. These include many small and mid-sized companies in the country, including MNCs.
Stock market analysts say this is one of the other factors pushing valuations of scrips beyond limits justified by their core operations.
posted by InCar Group Press Room at 12:06
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