VGN in joint venture with Pragnya for new home project

Chennai-based VGN Developers Pvt Ltd has entered into a joint venture with private equity firm Pragnya Fund to initiate a new residential project in the city.

The project is to come up in Paruthipattu on the Poonamalli Avadi High Road with a proposed investment of Rs 92 crore and would be developed by the joint venture firm, VGN Pragnya Pvt Ltd.

Pragnya would put 74 per cent of the investment while VGN would invest the remaining 26 per cent, said Pratish Devadoss, managing director, VGN Developers.

“We are planning to develop 550,000 to 600,000 sft over an area of 5.7 acres and the initial investment would be Rs 20 crore. Plans are in a nascent stage,” he added. The company expects to roll out the project by November, 2011.

The area is seeing rapid industry development and the company expects to achieve revenue of Rs 120 crore or above, depending upon the market trends at the time of implementation.

Earlier, VGN has raised Rs 110 crore through private equity funds from two firms, Pragnya and Paracor Capitals, for its future plans. The launch of joint venture comes as a part of this fund-raising efforts, said Pratish.

The company announced last week its plans to invest around Rs 1,600 crore in developing six to seven residential projects in and around Chennai over the next two years. It has plans to raise around Rs 700 crore from foreign investors for the proposed investment.

Pragnya is a Mauritius based private equity fund with target investments in Indian real estate. After completing deployment of its first fund, it is currently raising Pragnya Fund II, according reports.