New Delhi, September 21, 2006: Goldman Sachs CEO Brooks Entwistle has said that the company plans to invest $1 billion in India over the next two years. A key focus area of the investment would be real estate and infrastructure amongst other sectors. Mr. Entwistle was in India for the India Leadership Initiative conference in New Delhi. Mr. Entwistle said, "That's putting our own capital to work in this market."
Goldman Sachs terminated its joint venture with Kotak Mahindra Bank earlier this year signaling its intent to go it alone in this "very important market". Goldman has over 1,000 people working in India in Mumbai and Bangalore.
The Reserve Bank of India (RBI), India's central bank, has asked banks to include the national building code of the Bureau of Indian Standards into their loan policies. The BIS building code seeks to guide construction activities within the country to desired standards.
HDFC has got approval for a property fund that is to raise $720 million from overseas investors. The money will be raised through India Offshore Real Estate Investments, a Mauritius based entity. In addition, $30 million is planned to be raised from the domestic market.
Jones Lang LaSalle is to strengthen its India leadership team to deliver quality advice and services to a growing list of global, regional and local clients. The company, a leading global real estate services firm, announced strategic India management initiatives aimed at consolidating and strengthening its India operations. The initiatives specifically relate to establishing new leadership in the firm’s high-growth business areas in the country: Facility Management, Transaction Services and Project & Development Services.
You can count on continued strong demand for housing in India according to the National Housing Bank. For one, the market is flooded with liquidity thanks to a healthy economic growth rate, tax concessions and relatively low interest rates. Secondly, not only have realty funds made an entry for the first time, they now have about $4.7 billion chasing property investments. In addition to this there is a housing shortage estimated at 31.1 million units, especially in rural India.
Economic Think-tank NCAER has in its just released Quarterly Review of the Economy said that increasing interest rates on housing loans is unlikley to dampen demand for housing. There is a shortage of homes in every segment and with an overall trend of rising incomes, housing demand continues to be strong and housing prices are bound to rise.
Retailing in India continues to be a booming industry. The Indian retail sector has seen strong interest from global players as well as Indian companies particularly since the government opened the doors for FDI in single-brand retail in Feb this year. According to this year’s Global Retail Development Index by A.T. Kearney, India is positioned globally as the leading destination for retail investment.
The government has approved 105 special economic zone (SEZ) proposals of 388 applications received according to Minister of State for Commerce, Jairam Ramesh. In terms of the number of proposals Maharashtra has the most at 63, followed by Haryana -54, Andhra Pradesh -53, Karnataka -51 and Tamil Nadu -42.
See other SEZ News on INRnews.com
Indiareit, the real estate venture capital fund promoted by Piramal Enterprises, is to launch a $160 million offshore fund with a $40 million commitment by European private equity firm 3i. The fund will partner with developers in residential and commercial projects as well as SEZs.
The Goa Assembly was informed by Industries Minister Luizinho Faleiro that the Goa Industrial Development Corporation (GIDC) has allotted more than 11.8 million square metres of land for the development of a pharma park/Special Economic Zone at Keri and other biotech parks in the State.
Minister of State for Shipping, Road Transport and Highways, K H Muniyappa told the Rajya Sabha that Phase V of the Highways project that envisages a total of 6,500 km to be widened to six lanes is progressing on track. The estimated cost of this project is Rs. 42,000 crore. The project is being developed on the Private-Public Partnership model.
The Government has approved Singapore-based AAPC Hotels Management Pvt Ltd proposal for building a hotel at an investment of Rs 150 crores. AAPC hotels has formed a joint venture "Express Call Pvt Ltd" for this project.
Separately, the proposal of ILM Trichy (Mauritius) Ltd to fund the Trichy Tollway road project in Hyderabad at an investment of Rs 94 crores was also cleared based on the recommendations of the Foreign Investment Promotion Board (FIPB).
Home loans are very likely to cost more following the RBI rate hike earlier this week. RBI has increased its short term lending and borrowing rates by 0.25% while keeping long term rates unchanged.
An increased thrust on infrastructure spending has intensified the pressure on municipal corporations to augment their revenues. CRISIL estimates that municipal corporations will be required to contribute more than Rs. 300 billion over a seven-year period as their share of funds towards projects executed under the Jawaharlal Nehru National Urban Renewal Mission (NURM), Government of India's flagship scheme launched in December 2005. Generating funds of this order will require municipalities to look seriously and creatively at their revenue sources.
The booming retail sector in India is expected to grow at 7 per cent to 280 billion dollars by 2010-11 from the present 200 billion dollars, a report by Assocham said. The report on the future of the retail industry in India estimates the size of organized retail to grow from the current $6 billion to $17 billion in the next 4-5 years.
The retail boom is likely to have a significant impact on the commercial real estate sector as the large metros will have sizeable retail construction projects underway. The development of shopping malls in cities like Mumbai, Delhi, Chennai, Kolkata, Bangalore and Kanpur would be based on build, operate, lease and sell basis, which would lead to a close link between real estate developers, state governments, financial institutions and retail industry, the report said.