Shriram Properties to take over stressed TN real estate assets

The Shriram Properties Ltd -- part of the Shriram Group -- is in the process of concluding a deal to take over couple of stressed real estate projects in Tamil Nadu, a top company official said here on Saturday.

He said the company would soon be raising around Rs 1,600 crore ($250 million) from investors to be used in developing residential and commercial properties in Chennai, Bengaluru, Hyderabad, Visakhapatnam, Coimbatore and Kolkata.

"We expect lots of stressed assets in the real estate sector to come to the market. We are already in discussion for 12 projects. We may soon finalise deals to acquire couple projects in Tamil Nadu," Managing Director M. Murali told reporters here.

"Stressed assets may be of two kinds -- plain land mortgaged with a bank and land with partly built structure. We will look at the suitability of the stressed assets for our operation," Executive Director S.S. Asokan added.

The private equity (PE)-invested Shriram Properties will soon be concluding agreements to raise Rs 1,600 crore from investors.

"The fresh investment will be at project level. The investors will invest in different projects. We will also be investing in those projects," Murali said.

According to Murali, the company will invest around Rs 1,000 crore in development of residential projects for mid and affordable market segment, while around Rs 600 crore will be for developing commercial projects like special economic zones (SEZ), shopping malls and others in Bengaluru and Chennai.

"To date, we have delivered 18 million sq.ft of projects and close to 20 million sq.ft is under construction. Our land bank is around 60 million sq.ft," Murali said.

"Our focus is on southern states that contribute around 42 per cent of the nation's gross domestic product (GDP) and where new employment generation is higher," Murali said.

Asked about the market trend, the two officials said the demand for housing from the middle class segment (Rs 25 lakh to Rs 80 lakh) was there, whereas it had gone down in the luxury residential segment.

--IANS

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