[India Property, Real Estate India] Lemon Tree Planning Residential Apartment...

[Noida Property 7]

Delhi Property

The lucrative and fast growing affordable housing segment has attracted the attention of upscale Lemon Tree Hotels, which is looking to leverage its brand in the real estate segment. 

The company would spin a new entity for the realty venture to be called Lemon Tree Residences to focus on developing a million square feet of residential accommodation in Delhi-NCR, particularly Gurgaon. 

The promoters propose to offload up to 70 to 74 per cent equity in the realty venture to private equity players, according to a report published in Financial Chronicle. 

Lemon Tree Hotels, promoted by Patu Keswani, has Warburg Pincus, Kotak Realty Fund, and Shinesi Bank as its investors. Warburg has invested Rs 210 crore while Kotak Realty Fund and Shinsei Bank have jointly invested $30 million in the hotel chain. Warburg Pincus invested Rs 70 crore separately in the company’s budget hotel chain Red Fox hotels. 
“We have identified three possible sites in Gurgaon, where we will be looking to invest Rs 100-130 crore for acquiring an asset for developing apartments priced at Rs 30-80 lakh,” said chairman and managing director of Lemon Tree Hotels, Patu Keswani. The objective is to price their product at 20 per cent less than the prevailing market rate, he added. 

The total project cost is expected to be around Rs 250-300 crore for building 1,000 apartments and the project is expected to be launched next year. 

The company is in talks with a few private equity players for financing the project, said Keswani, declining to reveal their names. “We will remain limited to the NCR for two reasons ¬ one, that there is a lot of demand and potential for affordable housing in areas like Gurgaon and two, real estate is increasingly becoming a localised play where most developers tend to concentrate their area of operation to their region of influence,” he said. 

Keswani is looking to offload up to 70-74 per cent of equity in the realty venture that will offer two, three and four bedroom apartments. Lemon Tree Hotels is aiming for a 2,000-room inventory by the end of the present calendar year. It at present, has 1,300 rooms with two hotels, in Bangalore and Hyderabad, slated for opening in November and December respectively. “The focus of our expansion will be on the north, west and south India regions as most of the growth in India will initially be in these regions,” said Keswani who’s now pushing for the hotel chain’s public listing by 2012, depending on market conditions.


http://www.indianrealtynews.com/real-estate-india/lemon-tree-planning-residential-apartments-in-delhi-ncr.html

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Posted By Noida Property 7 to India Property, Real Estate India at 11/10/2010 11:24:00 AM