Rs 872 Crore Is To Be Invested For Logistic Park In Mumbai

rajani — Wed, 20 Aug 2008 15:36:37 +0000

Mumbai has come into view as the most preferred destination for logistics and warehousing companies with proposed investments for setting up logistics parks in the city touching around Two hundred million dollar (Rs872 crore), a report said.
In spite of their lack of support infrastructure, smaller cities such as Nagpur in Maharashtra, Gurgaon in Haryana, Visakhapatnam in Andhra Pradesh, were recognized as promising locations, based on their proximity to manufacturing centres, geographic location and accessibility, according to the report released by real estate consultant Cushman and Wakefield Inc.
“Since almost one-third of the total realty development in the sector is expected to take place in emerging locations, many tier II and tier III cities and peripheral locations that offer good connectivity to multiple markets will witness increased activity from logistics players, providing a thrust to the real estate market,” said a statement from Cushman and Wakefield India’s joint managing director Sanjay Dutt.
The report estimates that 110 logistics parks, spread over 3,500 acres and costing $1 billion, will be operational by 2012 across the country. This is apart from some 45 million sq. ft of warehousing space costing $500 million that will come up during the period.
Bangalore, Indore Ambala, Ahmedabad, Jamshedpur and Alwar were classified as promising hubs in the report.
Kolkata, Chennai and Hyderabad were rated as “established logistics hubs”.
“Logistics people have started tapping (areas) closer to manufacturing locations because our arterial distribution networks such as the railways and the national highways are clogged,” said C.S. Verma, vice-chairman and managing director of logistics company ACV Logistics Pvt. Ltd.

Impact Of Rate Hike On Real Estate

rajani — Wed, 30 Jul 2008 12:43:08 +0000

Real estate companies observes their cost of borrowing rising by 1% age point as the central bank has increased the repo rate by 0.5 % and cash reserve ratio by 0.25 %.
The rate hike will push up the corporate lending rates. This, in turn, is anticipated to further strain the balance sheets of realty companies, already reeling under a fund crisis in the wake of slower property sales, higher lending rates, increase in input costs and the central bank’s measures to check conventional sources of funding.
“The borrowing rates will be 1% higher. The rate hikes will ultimately hurt the balance sheets of real estate companies. The cost of funds for our upcoming power projects will go up drastically,’’ said Ajith Mittal, president, corporate affairs, Indiabulls Group.
Indiabulls’ property arm Indiabulls Real Estate is into residential, commercial and retail realty development. It has ventured into power and is setting up power projects in Jharkhand and Maharashtra.
Hitesh Agrawal, head of research, Angel Broking, said, “We deduce the rate hike impact to be visible not only on the rate sensitive sectors like banking, realty and auto, but also on corporate profitability as a whole as most sectors and companies have embarked on huge capacity growth plans.
Property transactions in the major Indian cities such as Mumbai and Delhi have fallen 10 – 15 % because of higher lending rates in the previous 6 months, limiting the cash flows and execution skills of developers.
“Developers need to think in the hike in lending rates, which will lead to a dip in demand. Nevertheless, a rectification in real estate prices will make up for the dip in demand caused by increase in rates,’’ said Mittal.
The majority of real estate companies have been watchful in buying land and beginning new projects, given the tight monetary picture. Akruti City, another Mumbai-based developer, is concentrating on housing projects.

India Real Estate Monitor » Realty Development

Rs 872 Crore Is To Be Invested For Logistic Park In Mumbai

Impact Of Rate Hike On Real Estate