Dubai’s Emaar plans to sell ho­tels and non-core as­sets in In­dia

HT Estates - - FRONT PAGE - Bidya Sa­pam bidya.s@htlive.com

MUM­BAI: Dubai’s Emaar Prop­er­ties PJSC, which built the emi­rate’s iconic Bur­jKhal­ifa tower, is plan­ning to sell sev­eral non-core as­sets in­In­di­ain­clud­ing­lan­dand aho­tel, said three­p­eo­pleawareof the de­vel­op­ment. The de­vel­oper now plans to fo­cus on its premium projects and ex­pand on its own­inIn­di­afol­lowin­gitssep­a­ra­tion from lo­cal part­ner MGF Devel­op­mentsLtd. The­com­pany hasal­readys­tart­edthe­p­ro­ces­sof sell­ing its 90-roomFor­tuneS­elect ho­tel in Jaipur, said the first of the three per­sons. It is also look­ing­tosell 10-15land­parcel­son­the out­skirts of cities in­clud­ing Mum­bai, Delhi and Chen­nai, which were ac­quired to build ho­tels and for other com­mer­cial de­vel­op­ment. Emaar has hired prop­erty con­sul­tant CBREIn­dia to sell the ho­tel and land as­sets, the peo­ple cited above said on con­di­tion of anonymity.“Emaar is ex­it­ing from­some­oftheirnon­core as­sets as it plans to go on its own­now. Mostofthe­mareat­land stage which they bought for de­vel­op­ment but it never hap- pened,” said the se­cond per­son, addingth­atthes­trat­e­gy­isaligned with its plan to fo­cus on lux­ury res­i­den­tial de­vel­op­ment in big cities. While the value of its land as­sets could not be as­cer­tained, the ho­tel is likely to fetch around Rs90-100 crore, said an of­fi­cial

EMAAR EN­TERED IN­DIA IN 2005 BY IN­VEST­ING RS8,500 CRORE IN A JOINT VEN­TURE WITH MGF DE­VEL­OP­MENTS

who­did­not­want­to­bei­den­ti­fied. Emaar Prop­er­ties and CBRE didn’t re­spond to email queries.

Emaar­enteredIn­di­ain2005by in­vest­ing Rs8,500 crore in a joint ven­ture with MGF De­vel­op­ments, mak­ing it one of the largest for­eign di­rect in­vest­ments in the coun­try’s real es­tate sec­tor.

In2016, the com­pa­nies­de­cided to part ways. In Jan­uary, the Na­tion­alCom­pa­nyLawTri­bunal ap­provedthe­p­ro­posed­de­merger scheme­ofE­maarMGFLandLtd, al­low­ing both­com­pa­niesto­op­er­ate sep­a­rately. A 2 April Press Trust of In­dia re­port said Emaar Prop­er­ties has ap­pointed its ex­ist­ing chief strat­egy of­fi­cer HadiBadri­as­man­ag­ingdi­rec­tor of its In­dia busi­ness. The com­pany has around 5,000 acres and has raised debt to fund hous­ing projects in Gu­ru­gram, Jaipur, Luc­know, Mo­hali and Chen­nai, saidthere­port. Manyotherde­vel­op­ers such as Su­pertech Ltd and Al­pha­Corp Pvt. Ltd are sell­ing as­sets suchasho­tel­sand­mall­sto raise funds to re­pay debt or fi­nance ex­ist­ing projects.

“Over­ape­ri­od­of­time, be­cause of the lack of liq­uid­ity and stressed bal­ance sheet, the ave- nue of fundraising has al­most dried up. One­ofthe­waystom­an­age liq­uid­ity by de­vel­op­ers is to sell some non-core as­sets like land parcels or com­pleted as­sets whichareyield­gen­er­at­ing,” said ShashankJain, part­ner(trans­ac­tion ser­vices) at PwC In­dia, a re­search and con­sul­tancy firm.

Emaar Prop­er­ties has been known for de­vel­op­ing premium res­i­den­tial projects an­dif it hasa land bank­out­side the city where pre­mi­umde­vel­op­men­tis­not­pos­si­ble, then it may fo­cus on core ar­eas which com­mand a premium, he added.

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