Piramal Realty ties up with Omkar Realtors for 12-acre project in Mumbai
BENGALURU: Piramal Realty, the real estate development arm of Piramal Group, has entered into a development agreement with Omkar Realtors and Developers Pvt. Ltd for a 12-acre project in Mahalaxmi, a prime location in Mumbai.
Piramal Realty intends to invest Rs2,600 crore in this development. It will pay a deposit of Rs400 crore and will have a 60% revenue share in the project.
According to the agreement, Piramal Realty will lead design, development, construction, sales and marketing of the project. Withover2millionsq. ft of development, this will be one of the largest premiumresidentialprojects in south Mumbai.
The developer plans to build high-rise residential towers on the plot.
“ReformssuchasRERA, GST, demonetization are driving consolidation intherealestateindustry. Thisisagreattimeforinstitutionalized players with a strong track record and robust balance sheet to grow and expand their footprint,” said Anand Piramal, founder, Piramal Realty.
Launched in 2012, Piramal Realty is led by Ajay Piramal’s son Anand.
The firm is backed by private equity firm WarburgPincusand investmentbankGoldmanSachs Group Inc., which invested Rs1,800 crore and Rs900 crore, respectively, in 2015.
Joint development agreements have been a lifeline for mid-sized developers, who are unable to develop certain projects ontheir ownduetoaliquidity crunch, owing to a prolonged slowdown in the sector. Such pacts with larger realty firms allowthemtomonetizetheirland holdings and pare debt.
Last year, Piramal Realty boughta3.2-acrelandfromMumbai-based developer Nirmal Lifestyle Ltd for Rs153 crore. Developers such as Nirmal, whichhavethelandbutareunable to develop themontheirown, havebeenlookingforpartnersto monetise such assets.
Nirmalformedajointventure with Godrej Properties Ltd to develop a residential project in suburban Thane, near Mumbai, in 2017, and also signed a joint development agreement with L& T Realty Ltd for another project in suburban Mumbai’s Mulund.
Gaurav Gupta, director, Omkar, said, “Our association withPiramalGroupdatesbackto 2010 with the Group funding many of our projects.
The current transaction with Piramal Realty will strengthen our relationship and we are excited to partner with them to deliver anexcellent value proposition for all our stakeholders.”
Primarily a developer of premium residential projects in Mumbai, last year Piramal Realty said it would invest Rs2,400 crore in its first commercial project, a 16-acre corporate parkcomingupatKurlainMumbai. The firm has also been looking to buy land in the Mumbai Metropolitan Region to expand its commercial real estate business.
Highrise homes are likely to be built on the plot