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Æ Hyderabad Authority investing Big Money in Expressways

Æ Hyderabad to host HBS Real Estate Seminar

Æ New Airport to Add to Hyderabad’s Brand Image

Æ Malaysian co picks up 60% stake in MAK Group project

Æ Airport Project to Hit Castor Areas in AP

Æ Real Estate Prices Rise in Tier II and Tier III Cities

Æ GMR plans SEZ in Hyderabad

Hyderabad Authority investing Big Money in Expressways

May 19, 2008
The Hyderabad Urban Development Authority (Huda) is investing about Rs 6,000 crore for an eight-lane access-controlled expressway. Part of the Outer Ring Road (ORR) project, it would be taken up in three phases, said Huda vice-chairman KS Jawahar Reddy.

In the first phase, a 24-km road would be laid from Gachibowli to Shamshabad, which is scheduled to be completed by February next year. In the second phase, a road from Shamshabad to Pedda Amberpet in one stretch and from Narsingi to Patencheru in another, in all 60 km, would be laid at an estimated cost of over Rs 2,440 crore.

Five agencies are working on this project on a build, operate and transfer basis. This is likely to be ready by 2010. The third phase would see laying of a 70-km road connecting Patencheru and Pedda Amberpert. The government would take financial assistance from the Japan Bank for International Cooperation (JBIC) and would soon call for tenders for the project.

Speaking at a seminar on ‘Real estate sector: Opportunities and challenges in Andhra Pradesh’ organized by the Confederation of Indian Industry (CII)’s Andhra Pradesh chapter, he said 33 radial roads would also be laid at a cost of Rs 3,000-4,000 crore for better connectivity to the city. Work on four radial roads has already begun.

Huda has also identified land for setting up the digital entertainment city and will soon form a special purpose vehicle for the purpose. It is also planning a health city with participation from global players.

The government is also intent on developing townships along the Outer Ring Road. While one project has already begun at Tellapur, the other is being planned on about 800 acre at Srinagar near the international airport.

“We are trying to liberalize the norms for permission,” he said, adding the government was in favor of donning a facilitator’s role. Huda has also finalized an Ahemdabad-based consultant for preparing a growth plan for the next 20 years.

Ernst & Young partner Ajit Krishnan said increasing urbanization, rising household incomes and growth in the services sector would trigger growth in the real estate sector, particularly in the residential segment. However, real estate players are faced with challenges of higher interest rates, RBI regulatory measures, unclear titles and absence of real estate investment trusts.
 

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Malaysian co picks up 60% stake in MAK Group project

Sunway City Berhad, part of the USD 1-billion Malaysian Sunway Group, has picked a 60% equity in a joint venture with the Hyderabad-based MAK Group for a Rs 3.5-billion high-rise realty project.

The Malaysian company will bring USD 5 million as foreign direct investment (FDI) for its equity holding in the joint venture, which a special purpose vehicle (SPV) is called MAK Builders, at present. The venture will develop about two million sq. ft of residential space in the high rise, with sizes of 1,000 to 1,300 sq. ft and price up to Rs 5 million.
 

The booming real estate of Hyderabad has brought a bad time for the agriculture sector in the city. The new airport project at Shamshabad has hit the castor crop field in Mahboobnagar, which leads in castor area in Andhra Pradesh.

Out of the normal area of 1.42 lakh hectares, castor has been in 1.24 lakh ha during the Kharif season, which ended earlier this season.

Real Estate Prices Rise in Tier II and Tier III Cities

As property prices in metros see a shoot up, Tier I and Tier II cities have emerged as the most promising market for residential as well as retail developments. Now, these places experience a sharp increase in property prices which has gone along with increased demand. It has shot up by as much as 40% in the past two years which is believed to be the highest as compared to earlier hike descriptions.

The property boom in Tier II and Tier III cities is further fuelled by the factors like opening up of financial sector, rationalization of income tax and loan policies in addition with well-paid IT jobs. However, the rise in prices does not square with the earning capabilities and is being considered as an unhealthy sign in the long run

GMR plans SEZ in Hyderabad

The Hyderabad-based GMR group — which has won the contract to modernise Delhi airport — is joining the bandwagon of Indian enterprises setting up special economic zones (SEZ).

Unlike other corporates who are on a land acquisition spree to cash in on the boom in the tax free enclaves, GMR is planning to invest Rs 1,500 crore to set up a multi-product SEZ with special focus on aviation-related activities in the area adjoining Hyderabad’s greenfield airport.

Sources said the company had approached the board of approvals, which clears SEZ proposals, to move ahead with the project, which wil be spread over 250 acres.

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