Sky­line sells rights to pro­vide exit to RIL-backed Ur­ban In­fra Ven­ture Cap

The Economic Times - - Companies: Pursuit Of Profit - Kailash.Babar @times­group.com

Mum­bai: Realty de­vel­oper Kanakia Group has bought de­vel­op­ment rights for 0.5 mil­lion sq ft on a Powai land par­cel for .₹ 400 crore. Sky­line, the lo­cal de­vel­oper, which has sold th­ese rights, will be pro­vid­ing an exit route to Re­liance In­dus­tries-backed fund Ur­ban In­fras­truc­ture Ven­ture Cap­i­tal, said two per­sons fa­mil­iar with the de­vel­op­ment.

Ur­ban In­fras­truc­ture had in­vested in this spe­cial pur­pose ve­hi­cle in 2011 and will get .₹ 275 crore through this trans­ac­tion. “First part of this trans­ac­tion has been con­cluded with the agree­ment be­tween Kanakia Group and Sky­line be­ing inked a week ago. The sec­ond part of the trans­ac­tion, re­lat­ing to the Ur­ban In­fras­truc­ture’s pro­posed exit, is be­ing dis­cussed with pro­mot­ers,” said one of the per­sons men­tioned above.

The deal will be fi­nanced by Kanakia Group through its in­ter­nal ac­cru­als and the first tranche of the pay­ment has al­ready been made, he said. Kanakia Group and Sky­line Group de­clined to com­ment on the story, while an email query to Ur­ban In­fras­truc­ture Ven­ture Cap­i­tal re­mained unan­swered till press time. Sky­line Group had planned a to­tal de­vel­op­ment of 1.5 mil­lion sq ft on the land par­cel spread across 12 acres close to Hi­ranan­dani Hospi­tal in Powai. Kanakia will now un­der­take around one-third of this to­tal planned de­vel­op­ment, while the rest will be with Sky­line. The fund Ur­ban In­fras­truc­ture Ven­ture Cap­i­tal will exit the project com­pletely.

As per the agree­ment, both Kanakia and Sky­line will man­age their ap­provals separately apart from mar­ket­ing and ex­e­cu­tion of the project. Kanakia has al­ready started the process of get­ting de­vel­op­ment per­mis­sions and has sub­mit­ted its plans to the civic au­thor­ity. The de­vel­oper is look­ing to launch the project in the next six months. Cur­rently, Kanakia Group is de­vel­op­ing to­tal 3.5 mil­lion sq ft of area through seven projects spread across Mum­bai.

At present, res­i­den­tial prop­erty prices in the vicin­ity range be­tween .₹ 16,000 and .₹ 17,000 per sq ft. With Powai gain­ing im­por­tance as a startup hub, realty devel­op­ers are eye­ing this zone as a high-po­ten­tial res­i­den­tial mi­cro mar­ket.

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