Hero group in real estate with township project
The Munjal family-controled Hero group, better known for its motorcycles, is entering the real estate business, with nearly Rs. 200 crore already invested.business Updated: Nov 04, 2009 21:21 IST
The Munjal family-controled Hero group, better known for its motorcycles, is entering the real estate business, with nearly Rs. 200 crore already invested.
The cash-rich Munjals are turning the current slump in real estate into an opportunity as they had no previous exposure in the business historically marked by aggressively priced land deals.
The Ludhiana-based group plans to launch over the next two weeks an integrated township in the pilgrim town of Haridwar.
The group plans more residential which are expected to be announced over the next couple of years, company officials said.
“The integrated township at Haridwar will be developed over an area of 50 acres and will have close to 2,000 residential units,” Sunil Kant Munjal, chairman, Hero Corporate Services Ltd told Hindustan Times.
“The company has invested close to a couple of hundred crore rupees for its real estate foray,” he said.
Hero Corporate Services also has interests in IT-enabled services and corporate training.
“The plan is to first consolidate our position in Uttarakhand before venturing out to other parts of the country,” Munjal said.
The Hero group expects real estate to be an important business vertical over the next few years. “The current downturn in the real estate sector has provided the company an opportune time to enter residential real estate development as valuations are just right,”
The company, however, does not wish to have an escrow account, which in effect means that the funds garnered from the pre-launch proceeds of a project is used only for the development of that particular project.
“The timely completion of Haridwar project with optimum standards will help us establish as a serious player in the sector. We are also banking upon our group’s credibility to showcase our prowess in real estate development,” Munjal explained.
The residential units in the integrated township at Haridwar would have apartments priced between Rs 18 and 20 lakh to Rs 70 lakh. The villas constructed in the project would be priced much higher.
The township will have hospitals, schools and shopping complexes, apart from residential apartments.
The company expects to start delivering the apartments within two years. “We would be targeting NRIs (non-resident Indians) and investors from north India who want to own a house at Haridwar, apart from local people,” said Munjal.