CITI REALTY ARM TO BUY 10% STAKE IN GOLDEN GATE FOR RS 400 CRORE

Citigroup's real estate arm is set to invest around Rs 400 crore ($100 million) in Bangalore-headquartered Golden Gate Properties for about 10% stake, sources said. The deal is expected to value the tier-II real estate firm at a little over $1 billion. This marks Citigroup's back-to-back deals in the domestic real estate space in the last fortnight. Early last week, the global financial giant unveiled $160 million play in Delhi-based BPTP.

Golden Gate is primarily into residential market with about 20,000 units under development totaling 23 million sq ft across southern cities such as Bangalore, Chennai and Hyderabad. The company also has substantial land holdings extending into emerging centres like Mysore and Mangalore. Besides, Golden Gate is believed to be foraying into SEZ and mixed use development.

In January this year, Deutche Bank investment unit RREEF closed $70 million transaction picking up under 10% stake in the company. The private equity juggernaut is now increasingly open to investing in tier-II or even in start-up realty firms, as the sectoral transparency issues are clearing up to an extent.

Citi's fresh investments are coming in when it was expected that the largest banking group in the US, reeling under $18 billion write-offs due to the subprime crisis, may go slow in ploughing more money into the realty sector in India. Several global banks have booked massive losses as the financial crisis that kicked in with the meltdown in the US housing market gained speed in the last two quarters. However, more realty firms are now opening up to private equity as their fund raising plans in the capital markets have run into trouble. For instance, several firms, including the biggest domestic player DLF, have been eyeing REIT listing on the Singapore Exchange, but are forced to delay the plan in the wake of market turbulence.

GROWTH OF INDUSTRIAL RENT HIGHEST IN MUMBAI

Mumbai has witnessed the world's highest (94.4%) increase in rentals of industrial space in 2007 from Rs 18 per sq ft per month to Rs 35 per sq ft per month ($10.88 per sq ft per annum). With this, the financial capital of the country leaped 11 positions to be 26th most expensive industrial locations in the world, said a global report on industrial space by real estate consultancy firm Cushman and Wakefield.

The rise in rentals of industrial space at Ranjangaon in Pune and IMT Manesar in the National Capital Region is fourth and sixth highest in the world. In Ranjangaon, the rentals went up from Rs 12 per sq ft per month in December 2006 to Rs 18 per sq ft per month in December 2007. In IMT Manesar, the rentals went up by 30% to Rs 13 per sq ft per month from Rs 10 per sq. per month. Rentals in prime area like Delhi's Okhala Industrial Area also went up by 28.57% to Rs 45 per sq ft per month from Rs 35 per sq ft per month ($14 per sq ft per annum).

Rentals in other areas in India have also gone up sharply. According to the report, rentals of industrial space in Hinjewadi in Pune has gone up by 18.75% to Rs 38 per sq ft per month, in Sriperumbudur in Chennai by 18.5% to Rs 32 per sq ft per month.

Within Asia-Pacific, Singapore came at third after Mumbai and IMT Manesar in annual rent growth and was followed by Pune and Chennai in the top five.

Bangalore-Bommasandra area came at sixth, while Bangalore-Jigani saw the ninth biggest rental rise in the region.

London retained its title as the world's most expensive industrial location in the world with total occupancy cost at $28.91 per sq ft per annum followed by Dublin, which jumped two places in the global ranking of occupancy costs to second place and Tokyo at third place. Occupancy cost in Dublin is $ 21.81 per sq ft per annum and in Tokyo $ 19.51 per sq ft per annum.

Okhala Industrial Area, with occupancy cost of $14.50 per sq ft per annum, is costlier than industrial space in Moscow, Frankfurt, Hong Kong and Beijing. The occupancy cost in Beijing is $ 7.31 pr sq. ft per annum

LODHA LAUNCHES LUXURY RESIDENCES

While there is talk of a demand crunch hitting the real estate industry developers still see prospects ahead, men for luxury Projects. Mumbai-based developer Lodha Group has launched luxury residences branded Lodha Marina at Mumbai's harbour zone of Sewri. With close proximity to Worli, Prabhadovi and Lower Parel, easy connectivity to 'Nariman Point, and Bandra-Kurla Complex business districts, Lodha Marina is positioned at the higher and of the market.

UNITY BAGS TWO ORDERS WORTH RS.221

Unity Infra-projects Limited has bugged Live orders worth Rs 221.85 Crore to build a mall-hotel-multiplex project at Pune for Vamona Developers Pvt. Ltd. at an estimated value of Rs 133.89 crure. In Hyderabad, Unity is building five towers with a basement and a podium at Kondapur for Kondapur Tower Pvt Ltd. The contract is worth about Rs 88.26 Crore.

HIRCO\'S CHENNAI PROJECT REPORTS ROBUST REVENUES

Hirco PLC, the investment vehicle of Mumbai-based Hiranandani Developers, has announced that sales of residential units in Phase 1 of its Hiranandoni Palace Gardens township development in Chennai continue to be robust both in terms of volume of units sold and the level of pricing achieved. As of March 31, sales revenues have been received on proximately 15.62.820 square feet at on overage price of RS 3,906 per square foot.

OMAXE INCREASES AD BUDGET TO RS 100 CRORE

Relieving its budget allocation for the financial year 2008-UH Delhi-based realty player Omaxe Ltd. has outlined its new budget amount for the New Year. The developer plans to push up its ad spend to Rs 100 crore from Rs 80 crore. Hath print and electronic media will be covered by the budget, which could be aimed at boosting demand amid a period of correction in the industry and inflationary pressures in the economy

CLERIDGS HOTELS

Cleridges will construct 1500 New Rooms at a cost of Rs.200 crore Group CONDERING TO OPEN HOTELS AT SEVEN PLACES with the entry into foreign markets and planning to expand in few cities of the country, cleridges Hotel Pvt. Ltd. will ad 1500 new rooms in its Hotel by investing Rs 1200 crore within next five years. Cleridges Hotel MD and CEO Peter J.Letgrb told the correspondent here "for investing in property we have a capital of 30 crore dollars. We are planning to open hotels at seven places so that the number of rooms may become from 1000 to 1500.

Letgeb said that for expansion of market, company is considering all types of alternatives. It includes organic and inorganic methods, shares, long term agreement for expansion etc. however, the company is not in favour of giving franchisee. He told that where the company is planning to open hotels in the country includes Hyderabad, Chennai, udaipur, Pune, and Keral. Letgeb said "we are in search of important areas in India and neighboring countries where hotels can be constructed." He said that company is at present talking to the parties of Chennai and udaipur respectively for opening the resort and business hotels. The company is going to open premium business hotel in Pune.

With regard to open hotels abroad, he said that company is planning to open hotels in Maldives and Middle East. In Maldives Company will construct a resort whereas a hotel consisting of 140 rooms will be constructed in Meddle East. On query about hotel place in Arabian countries Letgeb told that hotel can opened around Saudi Arabia and company is also talking to builders for it" cleridges is getting constructed hotels at three places in India which includes New Delhi, NCR and Mussoorie. This Delhi based company is constructing two hotels in Surajkund and Mumbai which will be opend by 2008 and 2010 respectively. The Cleridges Group told that company's income during 2007-2008 has reached Rs.90 crore with a profit of 40%