Unitech sells hotel for Rs 200 crore

Third sale in two months, more to follow.

Unitech Ltd, the country’s second-largest real estate developer, has sold its under-construction hotel on National Highway-8, Gurgaon, for Rs 200 crore to an individual, according to a company executive.

“We have signed a memorandum of understanding with the buyer and will receive the payment in two-three weeks,” he said.

“The hotel property will have 190 rooms and would be completed by the end of this year,” he added.

The company is also in an advanced stage of selling a service apartment property in Gurgaon for Rs 200 crore. “ We will close the deal for our service apartments in the coming weeks,” the executive added.

Unitech is selling its non-core business assets, including hotels and office space, to generate cash for debt repayment.

This is the third such sale by the Sanjay Chandra-managed company in two months. Unitech raised Rs 231 crore in April from the sale of its 199-room Marriott Courtyard hotel in Gurgaon, while its office space in Saket was recently sold for Rs 500 crore to another individual.

Unitech has about Rs 7,800 crore of debt on its books and plans to cut this by at least Rs 1,000 crore by the end of this fiscal. Most of the repayment is expected to come from additional capital infusion into the company by promoters and by asset sales.

The company aims to raise Rs 1,600 crore in the fiscal, ending March 31, from the sale of non-core assets, including the Saket office complex and four additional hotel properties located in Noida, Kolkata and Gurgaon. The developer had earlier indicated plans to raise at least Rs 900 crore by June from such asset sales.

Unitech’s promoters raised Rs 1,625 crore in April from the sale of shares to qualified institutional investors. The company’s board has also approved a plan to allow the promoters to infuse an additional Rs 1,000 crore through issue of warrants that are convertible into shares at a later date.