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DLF offloads 49% in 8 housing projects

BS Reporter  |  New Delhi 

DLF, the country's largest real estate developer by market value, today said that it has sold 49 per cent stake in eight residential projects to private equity players for Rs 1,675 crore.
The development takes place five months after the company raised over Rs 9,000 crore from its initial public offering.
The realty firm has sold the stake in seven residential projects to a Merrill Lynch entity for Rs 1,480 crore, making this as one of the largest foreign direct investments in the Indian real estate sector.
These housing developments, classified as mid-income by the company at a price point of Rs 55 lakh an apartment, are located at Chennai, Bangalore, Kochi and Indore. All these projects are expected to be developed in about seven to eight years.
DLF has also sold 49 per cent stake for Rs 194 crore to Brahma Investments in another residential project at Panchkula, Haryana.
T C Goyal, managing director, DLF said, "As a part of its strategic objective, DLF continues to remain focussed on keeping its net economic interest in the residential property business to a ten-year development horizon.
Accordingly, these transactions shall help DLF in unlocking its investments in land for the eight projects."
Vice-Chairman Rajiv Singh had announced in July that the company would focus on housing for families that have a net income (post tax) of Rs 12 lakh. It wants to sell these "mass housing" projects of 1,500 sq ft apartments for around Rs 50-55 lakh.
Meanwhile, Merrill Lynch has invested almost $525 million, including the deal with DLF, in Indian real estate over the last year. Sources said Merrill Lynch is contemplating a Indian-specific real estate fund. "It is actually between that and an Asian fund for real estate," the source said.
DLF is also planning to raise a loan of $1.5 billion overseas. Of this, $750 million would be for foreign acquisitions and project development, while the rest for participation in the proposed IPO of DLF Office Trust on the Singapore Stock Exchange.
DLF Office Trust's portfolio comprises infotech and special economic zones, and will eventually become the parent company of DLF Assets, a KP Singh (promoter, DLF) held company.

First Published: Tue, November 20 2007. 00:00 IST