Puravankara in JV to develop Pune land

Will develop 30 acres of land in Mundhwa in east Pune

Puravankara Projects today announced that it has entered into a joint venture deal to develop approximately 30 acres of residential land in Mundhwa, east Pune. The JV partners are Pune-based Oxford Group and Mumbai-based Ekta Group.

This project is the first one for the group out of southern India, where it has a stronghold. The project size is around Rs 1,600 crore with average realisation being Rs 6,500 to 7,000 per square feet.  

“We are excited about this Joint venture in Pune, as this would mark our foray into the West Indian market. Pune offers great potential with its changing demographics and significant demand in Real Estate, across segments,” said Ashish Puravankara, Joint Managing Director, Puravankara Projects.

Purvankara further added that since this was the maiden project in Western India the JV model quite suited them. “As we were entering new market we didn’t want to lock in capital. And this JV route is ideal for both the landowners and us,” he added.

The JV is based on a revenue sharing model. “All the money that will be collected first goes to fund the construction and other operational functions, balance money will be used to reimburse the land owners. Post that profits will be shared on 50:50 basis. Based on the revenue share model our share will be 32 per cent,” said Puravankara.

Other than Pune, the company is also in talks for joint development projects in Mumbai. “We are as of now focused on Pune and we have some plans for consideration in Mumbai,” he added.

From a residential real estate viewpoint, Puravankara feels that Pune is similar to Bangalore with IT and manufacturing hubs. “I think Pune is similar to where Bangalore was five to seven years back. As for demand-supply mix, you have to look at the micro markets in a given region. You will always have areas that have over supply. Pune also has such pockets,” he added.

The project will be developed in two phases. The first phase will be developed over 10 acres and the 20 acres after that. Construction will begin from March 2015 onwards.